Press Release

COP15 ‘Paris Agreement for Nature’ Will Increase Pressure on Global Meat and Dairy Producers

$70 trillion-backed FAIRR investor network finds meat and dairy industry failing to manage its biodiversity impacts, undermining targets of a new global deal for nature and exposing companies to increased regulatory, legal and reputational risks 

  • New research today shows global meat and dairy sector performs very poorly on three biodiversity metrics expected to be part of a legally binding “Paris Agreement for nature” at COP15: Deforestation, nutrient pollution and freshwater conservation 
  • At least 60% of companies source soy for feed from areas at high risk of deforestation and have still not set deforestation targets. Less than one in five meat, egg and dairy firms are adequately managing the pollution of waterways from manure 
  • “Investors are focused on material financial risks for companies, and a global agreement on nature at COP15 would see the intensive animal agriculture industry face increased regulatory, legal, tax and reputational risks” saysJeremy Coller, Chair of $70 trillion FAIRR investor network

The world will gather in Montreal tomorrow to discuss a ‘Paris Agreement for Nature’ (COP15) including a set of proposed targets to halt and reverse global biodiversity loss. However, new data from FAIRR today shows the world’s biggest meat and dairy producers are currently unprepared  to meet targets expected in such a deal. 

The data comes from the release of the fifth annual Coller FAIRR Protein Producer Index (the Index) which assesses 60 publicly-listed animal protein producers worth a combined $360 billion (49 primarily produce meat, eggs and dairy, 11 are aquaculture companies), against ten environmental, social and governance (ESG)-related factors. 

Jeremy Coller, Chair of FAIRR initiative and CIO of Coller Capital, said 

“From rainforests to rivers, meat & dairy producers are failing to manage their biodiversity impacts. Industrial animal agriculture is the number one cause of deforestation and the number one user of fresh water globally. Investors are focused on material financial risks for companies, and a global agreement on nature at COP15 would see the intensive animal agriculture industry face increased regulatory, legal, tax and reputational risks.  

“Change is possible. The industry appears to be open to it. And with the Food and Agriculture Organization of the United Nations making a significant announcement at COP27, committing to develop an agricultural roadmap to 1.5C by COP28, we can be confident this trend will continue to gain momentum as companies adapt to the inevitable transition to a more sustainable food system. 

Rachel Crossley, Head of Stewardship, Europe, BNP Paribas Asset Management, said:  

“As the reality hits home that the loss of biodiversity poses as great a risk to global economic stability as climate change, we expect regional and national governments, as well as capital markets, to take increasingly robust action to drive fundamental changes in those sectors that threaten the water, soils, and forests we all depend on. The evidence in the Coller FAIRR index published today should remove any doubt that the meat and dairy sector must urgently improve its practices to eliminate deforestation and vastly improve its management of waste and fertiliser.” 

Jennifer Anderson, Co-Head of Sustainable Investment and ESG, Lazard, said: 

“Making up ~1/3 of total global GHG emissions, the current food system presents interesting investment opportunities to drive efficiency. It is increasingly important for us as investors to better understand the material risks that climate change and biodiversity pose to the sustainability of a company’s financial performance. The Coller FAIRR Index provides a useful benchmark for investors to reliably assess and compare companies across the protein supply chain.” 

Diane Roissard, Biodiversity Lead, La Banque Postale Asset Management, commented:  

“Financial institutions in France are already required to disclose biodiversity-related risks and strategies for reducing negative impacts. An agreement on a global biodiversity framework at COP15 will add further urgency and importance to companies’ disclosure and performance on biodiversity. 

“With the likelihood of significant new regulation on the horizon, it is worrying to see FAIRR’s data reveal such large gaps in reporting from meat and dairy firms on risks from deforestation to nutrient pollution. These livestock companies must take urgent action to reassure investors that these material risks are being properly managed, and to ensure that future disclosures will satisfy investors’ own reporting requirements.” 

FAIRR’s findings are key to at least three of the proposed targets in the ‘Post-2020 Global Biodiversity Framework’ being discussed at COP15. The table below highlights the proposed targets alongside relevant findings from FAIRR’s Index report: 

COP15 was originally to be held in China but postponed and moved due to COVID-19. It is notable that there are 12 Chinese companies in the Index, making up 40% of its total market capitalisation, and all but one of the firms are in the bottom half of the Index due to poor levels of disclosure and performance, though there has been year-on-year improvement. Despite poor performance overall, 5 out of 12 Chinese companies analysed now disclose practices on slurry1 management – showing the effectiveness of Chinese regulation and the potential for improved practices driven by regulation that would follow a global deal on nature. Just one other company, Vinamilk in Vietnam, discloses on slurry management.

Index Results 2022

The full results of the Coller FAIRR Protein Producer Index 2022 are available free to investor members to help them integrate ESG data and assess company performance – covering all 60 of the largest publicly-listed protein producers assessed by FAIRR. Rankings of how each company performed based on its total ESG score for 2022 are included in the notes to editor below.

Aquaculture firms make up seven of the top ten places, with Marfrig (Brazil) the highest place meat & dairy firm. US firm Tyson Foods dropped 4 places, while China Modern Dairy was the most improved performer, going up from 48th place to 24th, in the top half of the Index companies. 

Notes to Editor

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1A previous iteration of this process release listed Maple Leaf as an example of a company that does not assess if their farms are located in water-stressed areas. This is incorrect and has been removed.

2Animal waste is commonly considered to be the excreted materials from live animals. In other words, it is manure. It may also include straw, hay, wood shavings and other sources of organic debris under certain production conditions, but in this report the terms “animal waste” and “manure” are treated as interchangeable; a third term, “slurry”, which refers to manure with a high liquid content.

Overall Ranking

60 companies of the Coller FAIRR Protein Producer Index 2022, ranked by overall ESG performance:

Rank 2022 Company Market Cap ( $bn) Country Risk Category 
1 Mowi ASA 12.3 Norway Low Risk 
2 Grieg Seafood ASA 1.1 Norway Low Risk 
3 Marfrig Global Foods SA 2.6 Brazil Low Risk 
3 Lerøy Seafood Group ASA 4.7 Norway Low Risk 
5 Cranswick PLC 2.5 Britain Medium Risk 
6 Salmones Camanchaca SA 0.2 Chile Medium Risk 
7 Fonterra Co-operative Group Ltd 4.2 New Zealand Medium Risk 
8 Bakkafrost P/F 3.9 Faroe Islands Medium Risk 
9 Multi X 0.4 Chile Medium Risk 
10 SalMar ASA 8.1 Norway Medium Risk 
11 Maple Leaf Foods Inc 2.9 Canada Medium Risk 
12 BRF SA 3.3 Brazil Medium Risk 
13 Tassal Group Ltd 0.7 Australia Medium Risk 
14 Charoen Pokphand Foods PCL 6.0 Thailand Medium Risk 
15 Vital Farms 0.7 United States Medium Risk 
16 JBS S.A. 15.6 Brazil Medium Risk 
17 Tyson Foods Inc 28.6 United States Medium Risk 
18 Scandi Standard AB 0.3 Sweden Medium Risk 
19 Minerva SA 1.1 Brazil Medium Risk 
20 Hormel Foods Corp 23.0 United States Medium Risk 
21 LDC SA 1.9 France Medium Risk 
22 MHP SE 0.7 Ukraine Medium Risk 
23 Thai Union Group PCL 2.8 Thailand Medium Risk 
24 China Modern Dairy Holdings Ltd 1.3 China Medium Risk 
25 Sanderson Farms Inc 4.2 United States Medium Risk 
26 Nippon Suisan Kaisha Ltd 1.4 Japan Medium Risk 
27 Cal-Maine Foods Inc 2.4 United States Medium Risk 
28 WH Group Ltd 8.0 Hong Kong High Risk 
29 Inghams Group Ltd 0.7 Australia High Risk 
30 China Mengniu Dairy Co Ltd 22.4 Hong Kong High Risk 
31 Australian Agricultural Co Ltd0.7 AustraliaHigh Risk 
32 Bell Food Group AG 2.0SwitzerlandHigh Risk 
33 NH Foods Ltd 3.5 Japan High Risk 
34 Almarai Co JSC 13.0 Saudi Arabia High Risk 
35 Emmi AG 6.3 Switzerland High Risk 
36 Japfa Ltd 0.9 Singapore High Risk 
37 Muyuan Foodstuff Co Ltd 43.8 China High Risk 
38 Vietnam Dairy Products JSC 7.9 Vietnam High Risk 
39 Inner Mongolia Yili Industrial Group Co Ltd 41.7 China High Risk 
40 RCL Foods Ltd/South Africa 0.6 South Africa High Risk 
41 Thaifoods Group PCL 0.8 Thailand High Risk 
42 Maruha Nichiro Corporation 1.0 Japan High Risk 
43 Astral Foods Ltd 0.5 South Africa High Risk 
44 GFPT PCL 0.5 Thailand High Risk 
45 Industrias Bachoco SAB de CV 2.1 Mexico High Risk 
46 COFCO Joycome Foods Ltd 1.5 China High Risk 
47 QL Resources Berhad 2.9 Malaysia High Risk 
48 New Hope Liuhe Co Ltd 10.8 China High Risk 
49 Cherkizovo Group PJSC 1.6 Russia High Risk 
50 Wens Foodstuff Group Co., Ltd. 19.2 China High Risk 
51 Beijing Sanyuan Foods Co Ltd 1.4 China High Risk 
52 San Miguel Food and Beverage Inc 8.3 Philippines High Risk 
53 Prima Meat Packers Ltd 0.9 Japan High Risk 
54 Beijing Shunxin Agriculture Co Ltd 4.5 China High Risk 
55 Seaboard Corporation 4.6 United States High Risk 
56 Great Wall Enterprise Co Ltd 1.6 Taiwan High Risk 
57 Venky’s India Ltd 0.4 India High Risk 
58 Grupo Bafar SAB de CV 1.0 Mexico High Risk 
59 Fujian Sunner Development Co Ltd 4.7 China High Risk 
60 Fortune Ng Fung Food Hebei Co Ltd 0.8 China High Risk 

 

About FAIRR 

The FAIRR Initiative is a collaborative investor network,  founded by Jeremy Coller, with a membership of $70 trillion assets under management. FAIRR works with institutional investors to define the material ESG issues linked to intensive livestock and fish farming systems and provide them with the tools necessary to integrate this information into their asset stewardship and investment decisions. This includes the Coller FAIRR Index, the world’s first comprehensive assessment of the largest global animal protein companies on environmental, social and governance issues. Visit www.fairr.org and follow @FAIRRInitiative