The Industrial-Scale Fisheries strategies focus on two countries: Chile and Brazil
The term “industrial-scale fishery” refers to severely distressed, large-scale fisheries where stock biomass has been reduced to as low as 10% of estimated maximum sustainable yields (MSY) and existing management efforts have proven ineffective. While this degree of distress poses clear management challenges and potential risks to impact investors, it also offers potential outsized investment returns in the event that the strategy succeeds in restoring the targeted stock.
The industrial-scale fishery Investment Blueprints propose investing in comprehensive fishery management improvements, acquiring fishery assets (such as fishing quotas or vessels) that increase in value as stocks recover, and investing in seafood companies to increase and maximize the value of increasing catch volumes over time. At the heart of each strategy lies a proposed set of fishery management improvements that seek to protect and restore fish stocks, reduce bycatch of unwanted species, and protect and restore marine habitat. Therefore, the industrial-scale blueprints target a robust set of interventions and multiple channels for ensuring fisher compliance. Similarly, the asset acquisition component of the strategy aims to allow investors to realize potential outsized returns to justify the upfront risks undertaken.
Investment Strategy
Because there is large impact and financial upside potential tied to the restoration of depleted stocks, each strategy seeks first to implement comprehensive fishery management reforms that affect the entirety of the fishery, and then to acquire assets that appreciate in value as the stock size and landings increase. Similar to the small-scale fishery strategies, value is also generated through increased supply chain efficiencies and value addition to the products. This market connectivity increases each strategy’s capacity to implement broad-scale improvements that might otherwise be undermined by the existing supply chain. By bundling investments into comprehensive fishery management improvements with investments into fishing assets and seafood companies, investors can support sustainability, generate cash flow, and own assets with value that is tightly correlated to fishery health, a value that rises over time as stocks recover. The economic benefits generated through the investments can, in turn, be offered to fishers as rewards for compliance with sustainable fishing practices, creating a strong financial incentive for stewardship that counters the existing incentives that drive short-term depletion.
