Waipa Catchment, Waikato, New Zealand

Contributed by Nigel Bradley of Envirostrat Consulting Ltd

What is it?

A study has recently been undertaken in the Upper Waipā Catchment to investigate the feasibility of impact investment approaches and the opportunities to address significant environmental challenges in the catchment whilst delivering a positive financial return on investment. The work was initiated and funded through a grant from the Waikato River Authority and Waikato Regional Council.

The work has been focused on a target area of ~130,000 hectares of mostly agricultural land that suffers particularly from sediment loss and nutrient-related water quality problems. The approach to impact investment seeks to transform land use in a way that provides environmental change whilst delivering a financial return on investment. Sediment and nutrient reduction, biodiversity improvement and climate adaptation are core impacts under consideration.

What it entailed

Geospatial analysis of the watershed and its key economic drivers was followed by identification of environmental ‘hotspots’ to target priority areas for future investment. These hotspots were assessed against the current land use and a range of potential land use changes and mitigation interventions were considered and costed, including conversion of conventional intensive dairying to low input organics, afforestation of sheep and beef farms. Revenue streams from carbon sequestration and Manuka honey were factored in as well. Economic analysis was carried out to understand the impact on farm profitability of the change in land use and environmental mitigations measures.

This work has attracted significant interest and the project is currently building a detailed investment blueprint and the related due diligence to facility landscape level transformation to ensure future land use has a reduced environmental footprint, is able to adapt to climate impacts and delivers a positive return on investment.


The feasibility study shows that by investing in land use change in only 5% of the target area (3,484 ha of beef and sheep and 3,055 of dairy land), a reduction in sediment output of up to 17,000 tonnes per year could be achieved. In both cases, the net present value is positive and internal rate of return is within normal parameters for global conservation impact investment.

The investment will lead to new revenue streams in the honey, forestry and organic dairy sectors and provide new employment opportunities in rural communities.

A full investment prospectus is expected to be developed by mid-2018.