Intermediary organisations have increasingly played a role in payments for agri-environment services across Europe over the last two decades. However, the economics literature has so far not examined the impact of this new governance mechanism on environmental protection and on individuals’ behaviour. We develop a new theoretical economic framework to compare an incentive mechanism using intermediaries, such as environmental knowledge brokers and information providers, with a standard central governance mechanism, in terms of environmental impact. We show that the emergence of knowledge intermediaries is particularly effective where farmers initially have low environmental awareness, or when the public institution organizing the scheme is insufficiently aware of individuals’ characteristics. Our findings provide theoretical support for previous empirical results on payment schemes for agri-environment measures.