Seafood is one of the world’s most highly traded commodities, and global demand for it is set to nearly double by 2050. Yet between USD $1.93 and USD $2.89 trillion of seafood-related assets and revenue may be at risk over the next 15 years due to excessive fishing efforts, reductions in habitat quality, nutrient pollution, and disease outbreaks.
Traceability - defined as the ability to trace a product from the point of production (in the case of seafood, from the vessel or farm of origin) all the way through the supply chain - is essential for companies to address these and other seafood supply chain risks.Despite the challenges to achieving traceability, the growing industry consensus appears to be that the benefits outweigh the costs. This is highlighted by increasing public commitments to traceable seafood and participation in platforms such as SeaBOS, the Global Dialogue on Seafood Traceability (GDST), and the Seafood Taskforce.
To ensure that emerging seafood traceability commitments and systems are aligned with the best practice, the FAIRR Initiative, with support from the World Wildlife Fund (WWF-US), UNEP FI’s Sustainable Blue Economy Finance Initiative, the World Benchmarking Alliance (WBA), and Planet Tracker are bringing key seafood sector investors together to collaboratively engage in constructive dialogues with a core group of seafood companies.
This engagement will focus on seven seafood companies selected for inclusion based on sector influence (considering market cap and seafood revenue) and their “traceability-readiness” (Seafood Stewardship Index traceability score greater than zero). During the 2023-2024 cycle, participating investors will focus on encouraging target companies to further enhance the quality of their traceability commitments and to make progress against stated targets. Traceability commitments, targets, and work plans disclosed by these companies will then provide best-practice blueprints for the industry at large.
The seafood sector as a whole is exposed to a multitude of ESG risks, with current studies and initiatives focusing primarily on overfishing. This is despite the fact, as observed in FAIRR’s Oceans and Biodiversity report, that the catch method employed by fishing companies represents a material impact on biodiversity through overfishing, habitat destruction, carbon emissions. The environmental impacts of seafood supply chains alone are putting USD $2 trillion to USD $3 trillion of seafood-related assets and revenue at risk over the next 15 years. Major seafood companies must develop and implement robust, full-chain traceability systems as a means of identifying and addressing such key environmental impacts, dependencies and risks.
Full-chain traceability would also unlock a huge amount of opportunity, enabling seafood companies to validate sustainability claims and satisfy the growing demand for sustainable seafood, while also increasing their operational efficiency with more and better data. Research by Planet Tracker found that just a small investment in the right seafood traceability systems – as little as 1% of total seafood sales on average – could boost the industry’s profitability by 60%, by helping to cut spending on food recalls and food waste, while strengthening brand reputation and enhancing regulatory compliance. This could then unlock a predicted US $600 billion increase in the valuations of global seafood supply chain companies.
FAIRR is working alongside The World Wide Fund for Nature (WWF), UNEP Fl's Sustainable Blue Economy Finance Initiative, the World Benchmarking Alliance (WBA), and Planet Tracker to support the investor group to develop targeted asks and leverage their collective power to strengthen companies' commitments to and implementation of best practice in seafood sustainability.
This engagement is funded by the Jeremy Coller Foundation and the Gordon and Betty Moore Foundation.
Investors Signed On
Phase 1 of the engagement is supported by 35 investors, representing US $6.5 trillion in combined assets.