Federal Reserve Bank of Chicago

• Nationwide value of farm real estate and cropland also increased sharply from 2021 to 2022, by 12.4% and 14.3% respectively, according to the USDA’s previous annual survey.
• “The value of nonirrigated cropland increased from a year ago by an average of about 7% in all participating regions.”
  Luca Fabbri, President and CEO of Farmland Partners Inc. (NYSE: FPI) (the “Company” or “FPI”), released the following statement about the new data:
  “These studies and similar reports coming from farm country show that the farmland market is still strong and adding value.
• Because farmland is finite in supply and its value is founded on worldwide population growth, growing food demand, and yield-boosting innovation.
• “Smooth out the peaks and plateaus, and you see that farmland grows in value by roughly 6% a year.

• The FedNow Service is the Federal Reserve's new instant payment platform, which will provide financial institutions of every size, and in any location across the nation, access to safe and efficient instant payment services in real time, 24 hours a day.
• "Completing certification is a key milestone for participating organizations to validate their ability to deliver instant payment services."
• To achieve certification, Form3 met the requirements of the FedNow Service testing program and attested that it is prepared to meet the requirements to successfully operate in a 24x7x365 instant payments environment.
• Form3's innovative and industry-leading approach to backend payment technology is built on the company's deep experience of the instant payment industry in Europe.

• SAN FRANCISCO, July 13, 2023 /PRNewswire/ -- 3Degrees, a leading global climate solutions provider and Certified B Corporation, has added investment and risk professional Amy Wierenga to its Board of Directors.
• Wierenga brings global investment and risk expertise to 3Degrees' growing climate solutions business.
• "We are pleased to welcome Amy to our Board of Directors," said Dan Kalafatas, 3Degrees Board Chair.
• "3Degrees is entering a new phase of growth as we continue to expand our decarbonization services and products globally to combat the existential threat of climate change.

• These rate hikes have been reverberating through the economy, raising prospects of a recession amid heightened concerns about the fragile state of banks.
• The rate hikes are also rattling sustainability-focused investing, better known as ESG investing.
• However, the high uncertainty around interest rates today, along with the prospects of a looming recession and a political backlash, has put the future of ESG investors at a crossroads.

Interest rate uncertainty

• However, heightened uncertainty about interest rates poses a challenge today.
• That means that future cash generated by long-term investments is considered to be worth considerably less at today’s higher interest rates.
• So, long-duration investments – like most ESG investments – are especially sensitive to changes in interest rates.

Looming recession

• As research shows, investors do not necessarily make ESG investments for greater long-term returns, but often for altruistic reasons or due to personal preferences to hold greener assets.
• For these ESG investors, a looming recession could change their perspective on these “luxuries.” In an early warning about this possibility, a recent study I conducted with an economist at the Rotterdam School of Management found that retail investors showed signs of shying away from investing in sustainable mutual funds during the early months of the COVID-19 shock in 2020.
• Prominent economists, such as former Treasury Secretary Larry Summers, have warned of a likely recession as inflation and the Fed’s battle against it persist.

Political backlash

• Finally, recent political friction and anti-ESG policies across states have started to create headwinds for pension funds and large institutions that serve them.
• While concerns about greenwashing and high fees in ESG investing are not totally unwarranted, these political interventions can also have unintended consequences.

Navigating the crossroads

• As companies hold their 2023 annual meetings, the discussions among corporate officials, investors and stakeholders will serve as an important barometer for the current state and future of ESG investing.
• Due to high interest rate uncertainty, prospects of a recession and political upheaval, ESG is under pressure.