Food companies’ product-level greenhouse gas accounting efforts are most likely irrelevant, states a recent World Wildlife Fund (WWF) analysis. It found that emissions attributed to a specific product can vary tenfold to a hundredfold, meaning that "even the most conscientious companies will have difficulty in tracking their emissions reduction progress, and ill-intentioned companies will be able to find systems and data sets that allow them to report the lowest possible emissions."
Why? Because the data, methodologies and interpretations used across the industry are a mess, and the impacts of different production processes for the same ingredient vary astronomically. WWF concluded that these immense discrepancies render the results of product-level greenhouse gas accounting useless "both within a company’s own scope and when comparing across industries."
That sounds like a ticking bomb to me. After all, many companies have started adding greenhouse gas labels to their product packaging and restaurant menus. And internally, companies have been incorporating emissions information from their suppliers into sourcing decisions. Consumers, investors, activists and governments have been demanding, noting and pushing back on those claims — the first lawsuits are already in process.
There are several reasons why carbon accounting for food products has been difficult:
- Food production is much more decentralized than other manufacturing processes. WWF told me there are over 500 million farms and thousands of packing and manufacturing facilities worldwide, all using different methods with varying emissions.
- The methodologies and datasets used by greenhouse gas accounting standards aren’t uniform. They employ disparate criteria for which emissions to include — for example, whether land-use change is accounted for or if offsets and sequestration can be factored in. Some datasets are more granular than others, using local or regional emissions factors. Others work with global averages, which can lead to very different results, such as when products come from regions with high deforestation rates.
- A single plant or livestock animal typically feeds into multiple, very different types of products, making it difficult to attribute the emissions. For example, a cow will be divided into whole-cut meats, sausages, bone broth, leather, etc. Some standards distribute emissions by economic value among co-products, while others use mass as a metric. Depending on that choice, a larger emissions share would go towards the most expensive or heaviest product. Companies have an incentive to pick the most favorable standard for their part of the product, meaning that emissions end up systematically underreported.
Despite these inconsistencies, companies and investors are using information from product-level accounting to underpin investments, sustainability strategies, global and regional benchmarks as well as product rankings. A faulty and risky choice, in my opinion.
Technology enables companies to identify hotspots and hone in on specific ingredients or suppliers as their most significant areas for impact.
Still, it doesn’t mean we should abandon efforts to equip food products with emission footprints. Done correctly, it can render valuable insights. So how must the system change for this tool to be used correctly?
WWF calls for three improvements that would facilitate more meaningful comparisons and targets:
- Agreeing on globally standardized methodologies and reporting requirements designed for comparability and shared learning.
- Collecting information more efficiently from suppliers via shared data collection requests that reduce their reporting burden and enhance data quality. This could be done in pre-competitive, industry-wide collaboration efforts.
- Reporting the detailed methodological information that was used to calculate footprints, allowing companies to compare the information they received from different suppliers more accurately.
These action items sum up to an extensive to-do list that might initially seem overwhelming. But projects going in this direction are already underway — for example, the Sustainable Markets Initiative, World Business Council for Sustainable Development and One Planet Business for Biodiversity run various pre-competitive workstreams aiming to streamline supplier data collection efforts. Still, building a somewhat globally aligned system will take time, and it will never be bulletproof.
In the meantime, don’t take these challenges as an excuse for inaction. "You can start making good decisions with the data that’s available now," said Ethan Soloviev, chief innovation officer at HowGood, a company assessing product footprints.
Sophisticated data platforms such as the ones used by HowGood and PlanetFWD have evolved over the past decades by leveraging machine learning to pull together thousands of data points on hundreds of ingredients from existing life cycle assessments. HowGood’s data on each ingredient includes emissions counts, among other factors such as biodiversity, water use and human rights, accounting for regional and practice-based differences with more granularity. "Today’s technology gives us the ability to triangulate and spot figures that are way off in an automated and scalable way," Soloviev said.
Technologies such as these enable even companies that are just starting on product footprinting to rapidly get a big-picture look across their portfolio, identify hotspots and hone in on specific ingredients or suppliers as their most significant areas for impact. And as more companies use such shared platforms, many of which contribute additional data from their suppliers, the insights continuously become more accurate.
Given the urgency of this work, tapping into these collaborative approaches, rather than spending years building up proprietary insight platforms, seems the smartest and most impactful way forward.