Restaurant Antibiotics Engagement
Engagement Overview
Background
In 2016-2019, FAIRR successfully facilitated a collaborative engagement with 20 quick-service restaurant (QSR) companies; the engagement aimed to improve antibiotic stewardship through the development of formal policies on antibiotic use. By 2019, all companies in the engagement had either a formal policy in place or were in the process of developing one.
However, since the closure of FAIRR’s engagement, and in the absence of sustained investor pressure, company efforts have faltered, clearly highlighting the need for investors to re-engage the sector to ensure companies are adequately addressing the risks associated with routine antibiotic use in their protein supply chains.
The objective of this engagement is to facilitate communication between investors and the quick-service restaurant sector to improve disclosure around how companies are mitigating antimicrobial resistance (AMR) risk in their animal protein supply chains. This engagement will ask companies to (i) demonstrate sufficient rigour and scope of existing policies, (ii) develop antibiotic policies to cover all key proteins, (iii) provide evidence of implementation through target setting and auditing.
Target Companies
This engagement focuses on twelve of the largest North American QSR companies, all of which operate internationally.
Material Risks
Reliance on antibiotics in factory farming, for growth promotion and prophylaxis, has resulted in animal agriculture sector consuming the largest quantity of antibiotics globally. AMR already causes more than 1 million deaths per year and left unmitigated may be responsible for 10 million annual deaths and an estimated 3.8% global GDP decline by 2050. The loss of productivity due to sickness and premature death will have a widespread impact across multiple sectors; agriculture is predicted to experience an 11% decline in livestock production by 2050, creating the potential for supply chain volatility.
As awareness of animal agriculture’s contribution to AMR increases, governments are seeking to regulate the use of antibiotics in livestock production and there is greater consumer demand for antibiotic-free meat. This scrutiny on antibiotic use worldwide has resulted in a subset of consumer-facing companies adopting antibiotic policies for some of their protein supply chains. However, there is significant room for improvement in the robustness of policies and disclosure on the implementation of these policies remains poor with most companies continuing to source key proteins without having an antibiotic policy in place.
Investors Signed On
Phase 1 of the engagement is supported by 71 investors, representing US $15.2 trillion in combined assets.
