Recent data analysis conducted by a human rights advocacy organization found that nearly a dozen international finance institutions directed over $3 billion to animal agriculture in 2023. The majority of those funds — upwards of $2.27 billion — came from development banks and went towards projects that support factory farming, a practice that contributes to greenhouse gas emissions as well as biodiversity loss.
The researchers behind the analysis are calling on the development banks — which include the International Finance Corporation, or IFC, part of the World Bank — to scrutinize the climate and environmental impacts of the projects they fund, especially in light of the World Bank’s climate pledges.
The analysis comes from the International Accountability Project, which reviewed disclosure documents from 15 development banks and the Green Climate Fund, established in 2010 at COP16 to support climate action in developing countries. Researchers found that 10 of those development banks, as well as the Green Climate Fund, financed projects directly supporting animal agriculture. The data serves as the basis for a new white paper from Stop Financing Factory Farming, or S3F, a coalition of advocacy groups that seeks to block development banks from funding agribusiness, released last month.
The International Accountability Project, which advocates for human and environmental rights, hopes that its findings will pressure international financial institutions like the World Bank to see the contradiction in financing industrial animal agriculture projects while also promising to help reduce harmful greenhouse gas emissions.
Agriculture accounts for a significant portion of global greenhouse gas emissions, so much so that research has suggested limiting global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) is not possible without changing how we grow food and what we eat. Within the agricultural sector, livestock production is the main source of greenhouse emissions — as ruminants like cows and sheep release methane into the atmosphere whenever they burp.
Factory farms, which aim to produce large amounts of meat and dairy as quickly and cheaply as possible, present a problem for the climate and the environment. They can hold anywhere from hundreds to hundreds of thousands of animals (fewer if the animals are bigger in size, like cattle, and more if they’re smaller, like chickens). These operations result in tremendous amounts of manure, which, depending on how it’s stored, can pollute waterways or release ammonia into the air. They also contribute to global warming: A nonprofit research organization once looked at the 20 meat and dairy companies responsible for the greatest amount of greenhouse gas emissions and found that, put together, their emissions surpassed those of countries like Australia, Germany, and the U.K.
The primary goal of development banks is to provide funding for projects in developing countries that help achieve some social or economic good. In recent years, these banks have included climate among their considerations when selecting initiatives to support. In its Climate Change Action Plan for 2021 to 2025, the World Bank stated its commitment to funding “climate-smart agriculture,” with the goal of nudging the agricultural sector towards lower emissions without sacrificing productivity. The plan says the IFC, a member of the World Bank Group that funds private-sector projects in developing countries, will seek to finance “precision farming and regenerative” agriculture, but also “make livestock production more sustainable.”
But this framework has not precluded development banks from supporting industrial animal agriculture — despite the abundance of information about how factory farming harms people, the planet, and animals themselves. “I think it’s just business as usual,” said Alessandro Ramazzotti, the International Accountability Project researcher who spearheaded the data analysis.
In order to determine how much money development banks are sending to industrial animal agriculture projects in the form of loans, investments, and technical and advisory services, Ramazzotti utilized a tool that scrapes bank websites for public disclosures. From there, he and a team of researchers analyzed the information collected, identifying 62 animal agriculture projects and reading the disclosures closely for detail on each one. They found that, of the $3.3 billion spent on animal agriculture, $2.27 billion — or 68 percent — was put towards projects that support industrial animal agriculture, or factory farming.
Only $77 million — or 2 percent — went towards non-industrial operations or small-scale animal agriculture. The remaining project disclosures did not contain sufficient information for the researchers to determine one way or another what sort of initiative it was being funded.
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Ramazzotti noted that the analysis was subjective based on interpreting the language of bank disclosures — which, he pointed out, can largely be considered marketing material for the banks. As a result, sometimes projects that sound small in scale may still feed into industrial animal operations.
He gave the example of the World Bank, which over the years has sought to connect smallholder farmers in Latin America to greater market opportunities. Depending on the exact context of such investments, that can be “quite concerning,” he said. Supporting small-scale cattle ranchers in Brazil could, for example, end up increasing beef supply for the Brazilian-based meat processing giant JBS S.A., which works with suppliers in the region. Such a development would be concerning to environmentalists, as cattle ranching is considered a major driver of deforestation in the Amazon. JBS, along with three smaller slaughterhouses, was sued last year by Brazilian authorities for allegedly purchasing cattle raised illegally on protected lands in the Amazon. JBS declined to comment for this article but has previously said it is “committed to a sustainable beef supply chain.”
The IFC, the World Bank Group member that funds private-sector projects in the developing world, told Grist that its goals concern “food security, livelihoods, and climate change.”
“There are 1.3 billion people whose livelihoods are tied to livestock and we also know this sector is responsible for over 30 percent of the global GHG emissions,” a spokesperson for the member bank said, using an abbreviation for greenhouse gas.
The spokesperson added that the bank seeks to fund projects that increase both livestock production and efficiency while reducing greenhouse gas emissions. The IFC also noted that as of July 1, 2025, all its investments will be required to align with the Paris Agreement target of limiting global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit), and that it asks recipients of livestock financing to adhere to their countries’ commitments under the Paris Agreement.
Lara Fornabaio, a senior legal researcher at Columbia University’s Center for Sustainable Investment, said she was “not surprised at all,” by the S3F report’s findings. She argued that development banks, rather than being profit-motivated, should consider the big picture when choosing the kinds of projects they fund. But she also emphasized that banks need to be rigorous when discerning whether an initiative fits into their stated climate goals.
Even the rubric of “reducing emissions” is likely not rigorous enough to ensure banks are not inadvertently supporting industrial agriculture, Fornabaio said. In some factory farming settings, because growers are so efficient at producing livestock, “the emissions per animal are probably lower than the emissions of a cow [grazing] on a field,” she said. That’s partly because, in industrial agriculture operations, farmers can control every aspect of an animal’s feed — and certain feed choices can help reduce ruminants’ methane emissions. But because large animal agriculture operations grow so many animals, their cumulative emission footprints can be enormous. This big picture lines up with research that says shifting diets away from meat is crucial to curtain global warming.
Ramazzotti says his team will continue to monitor bank disclosures for new financing of animal agriculture and hopes to release updated findings on a regular basis going forward. He mentioned that the S3F coalition would consider supporting animal agriculture in the developing world if done on a local, small scale — such as by family farms or pastoral or Indigenous communities. However, he said, the coalition would prefer to see development banks putting money towards vegetable farming and plant-based diets.
Ramazzotti is hopeful about the possibility of pressuring financial institutions to stop supporting factory farming. Recently, the team found that the IFC was considering a loan of up to $60 million to expand a company’s meat-processing operations in Mongolia. “It’s a direct investment in the expansion of factory farming,” he said. “And that’s exactly the [type of] investments we don’t want to see anymore because we believe that the impacts on the local level, but also on the global climate, are very deep.”
The coalition reached out to the IFC team considering this project with concerns, and the team has since postponed a discussion of the project with their board of directors twice, according to Ramazzotti. Following up, Ramazzotti said, is “not always” proven to be effective, but he’s optimistic that engaging with financial institutions can still lead to change.
Fornabaio agreed. “If I didn’t believe in change, I wouldn’t do this work, probably. … There’s always a way to put pressure,” she said. “I think this type of work is key.”
Correction: A previous version of this article misspelled Lara Fornabaio’s last name.
