The QTR project conducted jointly by the Overseas Development Institute (ODI), a UK based international development think tank and TMP Systems, a consultancy network that helps the private sector solve complex environmental and social problems, have sought to develop a methodology to assess and demonstrate the levels of land related risks to business that investors and companies face in land-based investments in agriculture. The QTR also assesses the impact these risks can have on the balance sheet. Land risks result from uncertain tenure conditions, and the presence of legitimate land owners and users who may be invisible to companies because of a lack of data. Land risks are frequently underestimated and can impose long delays and high costs on companies and must be taken into account if an investment project is to treat local communities, partners, employees company shareholders and others responsibly. The immediate outcome of the project is a summary report of an in depth study on tenure risk but the project also resulted in refinement and launch of Landscope, a tool for measuring tenure ris developed by TMP Systems. Landscope utilises large quantities of geospatial data on social, environmental and political conditions, and delivers an automated analysis of tenure risk at a subnational, highly localised level of granularity. It helps companies to identify the best locations for new assets; reduce the burden of environmental, social and governance risk identification in project and supplier screening; plan due diligence and impact monitoring; and improve the quality of valuations and cash flow modelling.
The acquisition of agricultural land is growing at an unprecedented rate in Africa, as global demand for food and resources grows. Research shows that land disputes are also on the rise, exposing businesses to severe risks at the project level. The problem is endemic and growing – companies want evidence-based approaches to address this new reality and understand their exposure to risk.