Sustainability claims for international markets

Supplementary submission in response to Assuring agricultural sustainability claim: discussion paper
This paper is intended to supplement the earlier submission from
by providing additional information addressing aspect 3 in the discussion paper: Assuring agricultural sustainability claims.
Aspect 3: Support verification for market access purposes

• Advise on using existing and emerging data which may support verification of
sustainability claims to maintain market access in response to emerging,
complex regulatory requirements.
response is given by explaining a ‘nature positive farming’ framework is developing on behalf of the Australian wool industry to enable credible reporting of environmental sustainability outcomes to the supply chain.
How the Australian wool industry is currently addressing verification of sustainability claims to maintain market access
The Australian wool industry is receiving strong market signals to demonstrate the adoption of environmentally sustainable practices on farm, achieving outcomes that support natural capital (including biodiversity) and that sequester carbon in soil and vegetation. These signals are driven by increasing pressure from international customers and regulators to address climate change, meet sustainability goals and net- zero commitments, and comply with emerging international reporting requirements.
The wool industry’s carbon footprint pre-farm gate is attributed to Scope 3 emissions.
For many fashions brands Scope 3 emissions can constitute up to 90% of their total emissions. However, nature is also emerging as a material issue for many brands, with companies looking to address their environmental impacts across biodiversity, land, freshwater, and oceans, in addition to their Scope 3 emissions. Thus, Australian agriculture, including the wool industry, is exposed to the global shift toward reporting nature-related performance as well as climate-related impacts. Market access for
Australian agricultural products like wool may be reduced by the absence of natural capital and environmental performance data.
Natural capital accounting
Natural capital accounting is emerging as an important tool for reporting environmental performance to the supply chain. Companies are increasingly setting climate-related targets aligned to the Paris Agreement - many of which are registered through the
Science Based Targets initiative (SBTi) – and nature related goals, aligned to frameworks
like the Kunming-Montreal Global Biodiversity Framework. Improved transparency of supply chain reporting is therefore emerging as a market access issue.
has invested in natural capital accounting over the past 5 years to:
Firstly, understand the business case for improving natural capital on farm, that is, whether building natural capital can simultaneously improve farm productivity, profitability and environment outcomes.
Secondly, develop science-based methods and metrics to cost-effectively measure natural capital to inform on-farm decision making, and for reporting environmental performance to the supply chain.
In addition to developing science-based methods and metrics for measuring natural capital, the Australian Wool Traceability Hub (AWTH) can serve as a critical infrastructure for collecting and verifying sustainability performance data across the supply chain. By integrating traceability data with natural capital accounting metrics,
AWTH can enhance transparency and provide brands with robust, verifiable evidence of environmental stewardship at the farm level.
Nature positive farming framework
Capitalising on prior investment in natural capital accounting, as well as the growing demand for environmental performance data from the textile supply chain, is developing a scientific, outcomes-focused ‘nature positive farming’ framework on behalf of the wool industry. This will enable existing certification organisations to assess farms for ‘nature positive farming’, alongside their existing environmental and animal welfare parameters in response to growing market demand for sustainable wool.
The ‘nature positive farming’ framework is targeted at firstly enabling woolgrowers to cost-effectively measure their environment performance, and also address the supply chain’s demand for increased transparency on the environmental impact of their raw material procurement. It will enable brands to make verified claims such as ‘nature positive’ and ‘regenerative’ in an increasingly complex regulatory environment.
Additionally, the framework will assist brands to comply with reporting frameworks such as the Taskforce for Climate-related Financial Disclosures (TCFD) and Taskforce for
Nature-related Financial Disclosures (TNFD).
Engagement with the broader wool industry thus far has facilitated the development of
10 metrics deemed most relevant to measuring environmental performance outcomes on farm (Figure 1). These metrics are consistent for measuring the outcomes of both
‘nature positive’ and ‘regenerative’ farming practices as requested by the market, and useful for guiding on farm decision making for woolgrowers. The framework is intended to align with (and fill capability gaps) for existing environmental certification schemes to assess environmental performance outcomes, and to mitigate market scrutiny around product claims, for example, EU greenwashing laws, and SBTi reporting. Consultation with the wool industry highlights that the measurement of environment performance needs to be as low cost and practical as possible, whilst retaining robustness and
credibility. Remote-sensed metrics are prioritised where possible to achieve reductions in cost.

Figure 1: Proposed metrics for measuring ‘nature positive farming’ outcomes on farms
Further consultation with woolgrowers and environmental certification organisations is currently underway to improve and operationalise the framework, including:
1. Developing a fair and robust process for translating the metrics into an overall
score (or statement) for nature positive farming.
2. Exploring the data collection capability of industry stakeholders and develop
processes to improve data collection.
3. Preparing certification organisations for road-testing the nature positive farming
metrics.
To further strengthen the credibility and adoption of the ‘nature positive farming’ framework, AWTH can provide a traceability-backed system that links environmental performance outcomes directly to wool supply chains. By leveraging
AWTH, certification schemes can incorporate an additional layer of validation, ensuring that claims related to ‘nature positive’ and ‘regenerative’ wool are fully substantiated with traceable, auditable data. This would support brands in making verifiable sustainability claims using Australian wool.