The coalition of 40 investors, brought together by the Farm Animal Investment Risk & Return (FAIRR) Initiative, wrote to 16 leading companies, including Walmart, Tesco and Unilever. The investors want the companies to outline if they have a strategy to profit from plant-based protein as fear mounts over the overreliance on factory-farmed meat.
“The world’s overreliance on factory farmed livestock to feed the growing global demand for protein is a recipe for a financial, social and environmental crisis,” said Jeremy Coller, founder of the FAIRR Initiative and chief information officer of Coller Capital, one of the 40 investment firms behind the letter.
“Intensive livestock production already has levels of emissions and pollution that are too high, and standards of safety and welfare that are too low. It simply can’t cope with the projected increase in global protein demand. Investors want to know if major food companies have a strategy to avoid this protein bubble and to profit from a plant-based protein market set to grow by 8.4% annually over the next five years.”
China’s meat cut
The call from investors follows Oxford University research that estimates $1.5trn in healthcare and climate change costs could be saved by 2050 if the world reduced its reliance on meat.
China has already implemented plans to reduce national meat consumption by 50%, over concern its growing obesity problem will cripple health services. Denmark’s influential think-tank, the Danish Council of Ethics, has also suggested red meat taxation may be needed to tackle the environmental impact of beef production.
General Mills, one of the companies targeted by investors, has been praised for supporting start-up Beyond Meat , which is developing ways to manufacture plant-based meat burgers.
General Mills, Kraft Heinz, Mondelez International, Nestlé SA, Unilever, Ahold-Delhaize, The Co-operative Group, Costco Wholesale Corporation, Kroger Company, Marks & Spencer, Wm Morrison Supermarkets, Ocado, Sainsbury’s, Tesco, Walmart, Whole Foods Market.
Diversify global protein
There are a host of other companies like Beyond Meats researching how to produce lab-grown meat in industrial quantities. The technology is still in its infancy but some companies, like SuperMeat, expect to have lab-grown chicken breasts ready by 2018.
Peter van der Werf, engagement specialist at Robeco, a Dutch asset management firm, said the need to diversify global protein sources is paramount.
“The growing demand for meat will put large pressure on natural resources in the coming decades. Robeco identified this as a financial material topic and engages to improve sustainability in the meat supply chain,” said der Werf.
“Protein diversification is an important instrument to that end. Companies at the end of the meat supply chain have an important role to play towards customers and we will encourage them to make protein diversification an integral part of their strategy.”