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4 sustainability strategy questions food companies should be asking

Berries in hands

How can food companies help with the transition to a greener planet?

As the world nears its tipping points for climate change, biodiversity loss and natural resources depletion, sustainability takes on double the significance for food companies.

The agri-food sector relies on increasingly scarce land, water and temperate climates, meaning the margins for becoming sustainable are narrowing, and this threatens the very bottom line of industry.

But the sustainability of food producers, distributors and retailers also determines their social license to operate. Food companies may exist firstly for profit, but they are also responsible for nourishing an ever-growing population, more than half of which is overweight or obese.

A recent analysis of sustainability strategies, Fixing the Business of Food, disclosed by the world’s 100 largest food companies, lifts the lid on the existential threats that agri-food businesses are proactively countering, as well as those which industry has not yet internalized as sustainability risks and opportunities.

With governments set to announce national strategies to radically change food systems at this month’s UN Food Systems Summit, food companies must recognize and assume their role and responsibility as a key driver of this transformation.

To ensure company sustainability strategies have maximum impact for both people and profit, food businesses should be asking four critical questions.

1.Do our product portfolios and strategies contribute to healthy and sustainable diets?

At present, only one in 10 of the largest food companies has set a comprehensive strategic objective in terms of contributing to healthy and sustainable diets. (The report did not specify which company.) As shown by the most authoritative nutrition literature, healthy and sustainable diets can reduce the risk of non-communicable diseases such as diabetes and obesity, and help extend the longevity and health span of their consumers.

Food companies must recognize and assume their role and responsibility as a key driver of the food transformation.

2. Are our production processes environmentally sustainable, or are they implicated in environmental harms such as greenhouse gas emissions, freshwater depletion and deforestation?

By definition, over-exploiting the very resources necessary to your business is unsustainable, yet responsibility for environmental sustainability across food companies is patchy and inconsistent.

Although more than 90 percent of companies monitor their greenhouse gas emissions, only around a fifth make it a specific objective to bring them down as part of their sustainability strategies.

And despite recent high-profile campaigns around the environmental cost of palm oil, only six of the world’s 100 largest companies make a point of recording sustainable sourcing.

3. Do our upstream and downstream chains reflect our values by rejecting child and slave labor, and protecting the rights of workers, their families and communities?

For food systems to become more inclusive and sustainable, companies must reduce not only their environmental impact but also the inequalities that mean millions working in agriculture globally are also among the poorest in the world.

The sustainability of the agri-food sector relies as much on providing decent livelihoods and rights for everyone along the value chain as it does on protecting natural resources, and this includes indigenous and rural communities.

Only 5 percent of the companies reviewed by the initiative published targets for sustainable supply chain management while none of them disclosed information regarding the protection of land and water rights.

4. Do we fulfill our "social license to produce" by being honest, eschewing fraudulent practices, respecting all stakeholders and obeying the law?

Strategic objectives and targets on meeting corporate tax obligations and protecting resource rights are typically missing from sustainability strategies, and this can undermine legitimate democratic institutions and public confidence.

The greatest risk associated with a lack of accountability on issues such as corruption and legality is that this restricts governments’ ability to finance and achieve the UN’s Sustainable Development Goals to end hunger, poverty and climate change.

Food companies alone cannot solve the world’s challenges. And the UN Food Systems Summit is just the starting gun for an urgently needed transition by all sectors and elements of society.

But it is in everyone’s interests, including food businesses themselves, to play their role as fully as possible to contribute to the sustainability of people and planet, as well as profit.

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