The International Land Coalition (ILC) said cross-border institutional land ownership, especially in less developed countries, has been accelerated through the use of various corporate instruments to duck accountability.
“This lack of transparency around land investments is consistent with the increase in the use of complex corporate structures, cross-shareholdings, and financial market interests in land,” ILC said.
It said this phenomenon had exacerbated the problem of global land inequality to a level “that was much worse than previously thought”.
Citing an example, the Europe-based NGO said an overwhelming number of the 608 million farms worldwide – most of them family owned – were now operated by just a few farming entities.
“The largest 1% of farms operate more than 70% of the world’s farmland while over 80% are smallholdings of less than two hectares that are generally excluded from global food chains,” the report said.
The ILC findings are contained in a special report titled “Uneven Ground – Land Inequality at the Heart of Unequal Societies“ released today.
It described the findings as “worrying,” especially the absence of details about the stake corporate entities and foreign investment funds’ have in land parcels across different countries.
The NGO said the lack of transparency and accountability showed up in a recent assessment of large-scale international land investments in the agricultural sector by G20 countries in smaller economies.
The study found only 20% of the land deals had revealed the identity of the company or country involved, while just 15% of investments divulged the exact location of the land owned.
“And only in fewer than 10% of purchases did investors publish the purchase price or leasing fee. It is striking that for 90% of the deals there was no information on consultation with the local communities.”
The report said complex corporate and financial structures and cross-shareholdings meant that clear lines of responsibility for land use and management were becoming harder to discern.
“It is also difficult to hold investors to account for their economic, social, and environmental impacts when primary investors are unknown or geographically and institutionally remote from the land in question,” said ILC.
It said governments should ensure the public have the right to access to information on all transfers of rights to use land, whether through purchase, rental, usage, or shareholding.
At the same time, countries should restructure their land registries to include information regarding institutional ownership and control of land through sophisticated financial instruments, including listed and unlisted funds.
It warned that transparent reporting by investors and accountability are unlikely to happen without effective enforcement by authorities in the host countries.
“Little will change without compulsory compliance and reporting requirements and national governments (especially of investor countries) holding companies registered in their jurisdictions to account,” the report said.
Vitally important, said the coalition, is to respect the free, prior, and informed consent as a right recognised under international law for indigenous peoples, giving communities the choice to give or withhold consent to a project planned on their land.
The ILC urged civil society organisations (CSOs) in developing countries to stand up and demand for accountability from their governments before land inequality worsened.
It said they must demand that the authorities restructure their land registries to include information regarding institutional ownership and control of land through sophisticated financial instruments, including listed and unlisted funds.
“It is likely that in most countries CSOs and local institutions will have to lead the way in demanding change, particularly in the power relations between citizens, corporate and financial interests, and the state,” it said.
Public support, including development finance for investments or projects, should be contingent on the release of all relevant information, the NGO emphasised.
“It should be mandatory for companies and investors to publicise their shareholdings in other companies and initiatives owning, accessing, and controlling land and land-related activities,” it added.