Acquiring Environmental Allies: Increasing the Adoption of Environmental Stewardship Practices by Ontario Landowners

As societal pressures around environmental stewardship increase and Canada has set ambitious targets for achieving its environmental outcomes, the agricultural sector will continue to come under the spotlight for its role in environmental sustainability. While environmental stewardship is practiced by many primary producers and recognized as a necessity for the sustainability of the sector’s natural capital, participation in environmental programs remains relatively low, especially in Ontario. Industry associations in various production sectors have created sustainability assessment frameworks for their members to measure and work towards desired environmental and social goals. Now more than ever, environmental practices are inherently linked to more than just environmental outcomes.

Management experts and scholars view sustainability through the triple-bottom-line, recognizing there is a balance between achieving environmental, economic and societal goals. Government and Industry will benefit from recognizing and promoting the triple-bottom-line to primary producers to help increase the adoption of agri-environmental programming.

This research synthesis and literature review sought to improve the understanding of how landowners in Ontario who do not participate in environmental stewardship programs could be engaged to participate and improve the environmental stewardship of their lands by studying the adoption of environmental stewardship practices in other jurisdictions and farm business management best practices.

The research reveals a number of opportunities for Ontario to increase the participation of landowners in agri-environmental programming. The recommendations derived from this research are presented in three (3) distinct categories: Policy and Programming, Communication Tactics and Strategies, and Future Research.

For more information, contact:
Heather Oakley
Project Manager
Heather.Oakley(at)fmc-gac.com

This research synthesis project was funded by the Ontario Ministry of Agriculture, Food and Rural Affairs’ Ontario Agri-food Research Initiative (OAFRI) under the Canadian Agricultural Partnership.
Project no. OAF-2020-101771

Building Farm Financial Resilience Summary Report

Results of targeted discussions held during the 2023 National Agriculture Risk Management Forum

A National Agriculture Risk Management Forum was hosted by Farm Management Canada in Ottawa February 16–17, 2023 to bring together key representatives from the agriculture sector in order to engage in a meaningful dialogue for the exchange and confluence of insights and ideas on how to improve risk management efforts across the sector.

The objective of the 2023 Forum was to reflect on the current domestic and global context in order to identify the impacts of actual, emergent, or potential risks for agriculture given the consequential changes which have taken place, and create a series of recommendations, identifying roles and responsibilities for key players to establish a path forward and make meaningful progress in building on-farm resilience and the capacity to seize new opportunities. The focus of the Forum was managing farm risk by building financial resilience at the farm level.

For more information, contact:
Mathieu Lipari, Program Manager
Farm Management Canada
mathieu(at)FMC-GAC.com

Seeds of Change

Shifting Diets and Soil Carbon Sequestration Markets: How Climate Change is Driving New Opportunities and Risks in Agriculture

Farm Management Canada is pleased to announce the release of “Seeds of Change – Shifting Diets & Soil Carbon Sequestration Markets: How Climate Change is Driving New Opportunities and Risks in Agriculture”.

Climate Change is driving shifts in Canadian agriculture and food consumption at an increasingly rapid pace, introducing new opportunities and risks that were unanticipated just a few years ago. Traditional forecasting methods fail when the future looks nothing like the past. How best then, to manage risk when faced with this kind of uncertainty? Farm Management Canada’s Roots to Success project responded to this challenge by undertaking a foresight exercise focused on farms and ranches.

Weak signals or seeds of change are defined in foresight analysis as the first indicators of change that may become significant in the future.  Members of Farm Management Canada’s National Risk Management Roundtable participated in a horizon scan exercise that identified 8 weak signals driven by climate change. Two of these signals were identified as priorities by Roundtable members:

• Canadians are shifting their diet to include more fruit, vegetables and non-animal protein alternatives (for both health and environmental reasons); and
• Soil carbon sequestration markets will become an opportunity for the agriculture sector.

In the report, both priority signals were then used to build future scenarios that indicate potential outcomes should the signal become the norm. Resulting opportunities and risks to farmers and ranchers were then identified, along with recommendations for support strategies that Farm Management Canada, other similar organisations, and governments can provide.

For more information, contact:
Mathieu Lipari, Program Manager
Farm Management Canada
mathieu(at)FMC-GAC.com

The Path Forward: Supporting the Farm Business Management Needs of Indigenous Farmers

Following the success of “Dollars and Sense: Measuring the Tangible Impacts of Beneficial Business Practices on Canadian Farms” and “Healthy Minds, Healthy Farms: Exploring the Connection Between Mental Health and Farm Business Management”, Farm Management Canada, with the support of Bayer and Canadian Canola Growers’ Association is pleased to release a new research report that will increase awareness of the needs of indigenous agricultural producers and how to support their farm business management needs.

“Indigenous Agriculture and Agri-Food: The Path Forward – Supporting the Business Management Needs of Indigenous Producers” The number of Indigenous agricultural producers in Canada is growing rapidly. To better serve these producers, we worked with the Canadian Agricultural Human Resources Council to engage with indigenous producers operating farm businesses across the country to learn more about their management needs. The final report provides 5 broad areas and 15 recommendations for all producers, as well as farm business management professionals at all levels to improve the agri-business sector for all, including increased access to capital, new and improved educational opportunities, and increasing market access.

“The Path Forward” was made possible by the generous participation of indigenous agricultural business owners from coast-to-coast who participated in surveys, focus groups, and interviews creating a rich picture of the current state of their farm businesses and what they need to create a robust business management plan or enhance their business management strategy.
This investigation highlights two notable pieces of information. The first being there is desire from indigenous producers for more business management training. Secondly, this study confirms the findings of other reports showing the growing number of indigenous people in agriculture working to build community, economic opportunity, and food self-determination.

The report identified five high-level recommendations with specific recommendations under each. The five recommendations are:

1. Build Lasting Relationships with Indigenous Communities
2. Increase Awareness of and Access to Indigenous Agricultural Opportunities and Support Programs
3. Enhance Indigenous Educational Opportunities
4. Expand Indigenous Support Services
5. Enhance Indigenous Research and Analysis

Recognizing the growth of First Nations and Metis people in agriculture in the last decade, Farm Management Canada contracted the Canadian Agricultural Human Resources Council with the guidance of their Indigenous Advisory Council and was generously supported by Bayer, Farm Credit Canada, and the Canadian Canola Growers Association.

For more information, contact:
Heather Watson, Executive Director
Farm Management Canada
Heather.Watson(at)FMC-GAC.com

Healthy Minds, Healthy Farms

Exploring the Connection Between Mental Health and Farm Business Management

The conversation around improving the mental health of all Canadians has been elevated in recent years. In recognition of the contribution of farmers to the Canadian economy, support for farm businesses continues to be delivered across the country through federal, provincial and territorial governments; not-for-profit organizations; and community groups.

The mental health of Canada’s farmers as it relates to farm business management is of critical economic, and public health importance. That is why Farm Management Canada, along with its partners, has been working to improve our understanding of the relationship between mental health and farm business management. More specifically, to highlight how mental health can be supported through farm business management, and how farm business management can contribute to positive mental health.

 

The Relationship Between Strategic Management and Farm Success

In today’s dynamic landscape, where conventional industries evolve at a relentless pace, most professionals, across sectors, mandate business degrees as a prerequisite for managerial roles. Yet, within agriculture, a stark contrast emerges. Many dedicated farm operators initially embark on this journey driven by a passion for agriculture, not the intricacies of business management. Consequently, a wide spectrum of attitudes and varying levels of knowledge pertaining to the benefits of strategic management has emerged, painting a diverse canvas across the agricultural landscape.

This comprehensive study delves deep into the pivotal connection between business management practices and farm success to foster a transformative shift in the industry by catalyzing the widespread adoption of strategic management techniques among farmers.

Larry Martin, Principal of Agri-Food Management Excellence Inc. authored the report, commissioned by Farm Management Canada. Martin conducted an extensive literature review and interviewed business management experts.

Results reveal three key findings:

1. improving strategic management can lead to a 100% return on investment
2. strategic managers tend to be consistently more successful regardless of size, location or type of enterprise
3. definitions of farm success go beyond profitability.

This research further validates our belief that in an increasingly competitive and volatile business environment, farmers must think and act strategically to remain resilient and competitive.

For more information, contact:
Heather Watson
Executive Director
Heather.Watson(at)fmc-gac.com

Dollars and Sense Study

How can we increase the adoption of business management practices on Canada’s farms?

While we realize most farmers didn’t get into farming to be business managers, we know farm business management matters.

A ground-breaking 2015 study titled Dollars and Sense revealed the success of any farm enterprise, regardless of size, production sector, or location is directly related to the business management practices of the farm manager. According to this research, top farm managers are dedicated to continual learning, carefully monitor and use their financial data to make business decisions and are 30% more likely to consult with business advisors. They are 50% more likely to have and follow a formal business plan, monitor and use their costs of production to inform decisions, assess and manage their risks, and have a sound financial plan that includes budget goals. Farmers who adopt business management practices were proven to increase their profitability by up to 525%.

2020 Dollars and Sense Study Update

It has been 5 years since the first Dollars and Sense study. In 2020, we wanted to take a deeper dive into understanding the barriers and drivers of adopting farm business management practices on Canada’s farms, and how we can help.

The Dollars and Sense Study Update surveyed over 700 farmers from across Canada, farm types and farm size.

Findings reveal the rate of adoption for the vast majority of business management practices has dropped over the past 5 years, including those practices that were found to have the greatest impact on farm financial performance in 2015.

While the ability to read and use Financial Statements continues to have the highest rate of adoption at 63%, this has declined significantly since 2015 (73%), and having a formal plan for human resource management continues to have the lowest adoption, now at 12% (compared to 20% in 2015).

The following table demonstrates how the adoption of farm business management practices has changed over the past 5 years:

 

	2015	2020
Having a clear vision and goals for the farm*	43%	31%
Communicating plans and the direction of the farm with key stakeholders	39%	39%
Having a written business plan that is reviewed and updated at least once per year*	26%	22%
Having a budget and plan for each enterprise within the farm that is reviewed regularly*	73%	63%
Calculating, reviewing, monitoring cost of production for benchmarking and decision-making	33%	33%
Having an in-depth understanding of financial statements to monitor progress*	50%	48%
Having a structured approach to financial planning to ensure sufficient capital to withstand changes to the business environment	51%	43%
Following markets closely and having a marketing plan to track pricing goals and targets	36%	35%
Having a formal risk management plan and procedures in place to assess and manage risk*	51%	42%
Having a collaborative relationship with suppliers and customers	32%	29%
Having a well-developed human resource management plan outlining responsibilities and compensation that is reviewed regularly to meet changing business needs	20%	12%
Having a form farm transition or succession plan that has been communicated to those involved in the farm business and is reviewed regularly when major changes occur	27%	26%
Using farm business advisors to help meet business objectives*	32%	23%
Actively seeking learning and skills development opportunities to meet the changing needs of the business*	49%	41%

*Indicates the 7 practices of Canada’s top performing farms in 2015.

Study findings reveal the greatest barriers to implementing farm business practices are:

1. Farmers feel the farm is succeeding without them
2. Aging/retiring farmers feel it’s too late to benefit
3. Farmers don’t have the time
4. Farmers don’t know where to start
5. Getting others on board with adopting more formal business practices

Lack of communication skills is the greatest barrier to engaging others in farm business management activities.

The greatest motivators to implementing farm business practices are:

1. To increase profitability
2. To manage risk
3. To prepare for farm transfer/retirement
4. To reduce stress and anxiety and improve quality of life
5. To improve our family/farm team harmony

Farmers who regularly work with farm advisors, young farmers, female farm operators, farmers in Quebec, horticultural operations and larger farms are more likely to implement farm business management practices. With the exception of larger farms, these farmers are also most likely to access support programs and services offered by the Ministries of Agriculture.

This research reinforces the need for Farm Management Canada to continue to champion a better understanding and use of business management practices on Canada’s farms.

Following are the recommendations derived from our findings:

• Redefine the value of farm business management by redefining what success looks like. Success can be both business-focused and/or personal
• Create messages targeted to different segments – by age, gender and farm type that would better resonate with a specific group regarding the value and importance of each business management practice
• Investigate reasons behind Quebec’s higher adoption rates of these business management practices and how these lessons can be disseminated across other provinces
• Increase accessibility and availability of risk management and scenario planning tools that can help farmers prepare for the uncertainty they will face in the future or to manage the long-term impact the pandemic could have on farms.
• Champion the use of Farm Business Advisors
  • Develop communication guides for understanding what farm business advisors can offer farmers
• Develop new resources for farmers including communication guides for various business management topics that farmers could reference to improve confidence in communicating about business management practices with family, employees and farm business advisors.

These research findings are critical for informing government policy, resource allocation, and how we can continue to support and promote the benefits of farm business management while addressing the barriers to adoption and implementation.

For more information contact:
Heather Watson, Executive Director
Farm Management Canada
Heather.Watson(at)fmc-gac.com

2016 Farm Business Management Planning: Baseline Update

How does awareness translate into action, and what role do attitudes play in increasing the adoption of planning and other practices on Ontario’s farms?

This study helps us understand planning attitudes and activities on Ontario farms, including the drivers and barriers to implementing planning and other business activities, factors influencing farm success, and learning preferences.

The study also provides tracking of key measures captured in 2011 to see if progress has been made.

Results show that overall planning awareness and implementation declined significantly between 2011 and 2016, with the exception of business planning. In general, individual management activities including benchmarking financials and production had more penetration than planning activities. And only 1/3 of farmers feel planning has an impact on the success of their business.

The research concludes with a segmentation analysis of respondents based on farmographics, planning attitudes and planning behaviors resulting in 5 different segments:

• Skeptics 18%
• Strugglers 29%
• Developers 19%
• Planners 18%
• Sunsetters 24%

Understanding the differences between these segments allows practitioners to target their efforts in direct response to farmographics, attitudes and behaviors that are helping or hindering adoption of farm business planning practices.