The global food industry is currently undergoing enormous transformation led by rapidly evolving sector dynamics. Consumers are leading the charge, prioritising products and ingredients…
Phase 4 of the engagement is now underway.
In this phase, the engagement asks 25 global food retailers and brand manufacturers to publicly disclose information on their intention and long-term approach to transitioning protein portfolios towards lower impact and more sustainable sources that include plant-based and/or alternative proteins to support a dietary transition in line with a 1.5-degree world.
Alternative proteins are now big business: plant-based foods are leading growth for the food sector. For investors, an expanding alternative protein portfolio is a lever for growth. More importantly, it is a fundamental and necessary component to manage a company’s exposure to the most material ESG risk facing the food sector. A sole focus on supply chains, which is isolated from portfolio composition, will result in greater capital investment to address risks as demand for meat, dairy and fish continues to grow.
Companies must complement their supply chain interventions with a systematic transition to ensure their protein portfolio results in better health outcomes and is in line with planetary boundaries.
What do we mean by protein diversification?
Any protein diversification strategy cannot simply focus on adding a few new alternative protein products to the current portfolio. It requires companies to develop a comprehensive strategy to expand product development and research, explore the applicability of new food technologies and acquisitions, leverage their marketing power to influence consumers to embrace new products and engage their supplier community to mitigate impacts on farmer livelihoods. To undertake such a transformation, companies must:
- Evaluate their current exposure to animal proteins and the risk profile of these supply chains
- Assess the strategic implications of growth plans that are predicated on a higher reliance on animal proteins (through scenario analysis).
- Commit at the highest level to transitioning their global business model to less resource-intensive food products
- Develop a cross-functional strategy (involving R&D, marketing, sustainable sourcing) to undertake a transition
- Set clear goals and timelines to achieve a transition
- Report on the right metrics to evaluate portfolio transition
Contact: Jo Raven, Engagement Manager
Explore the FAIRR reports which address the growing alternative protein sector.
The latest report is a progress update on our Sustainable Protein engagement with 25 global food companies. It provides industry insight on how companies are beginning to diversify their protein sources to drive growth and support a low-carbon product portfolio.
One of the greatest challenges facing the world today is to ensure that the growing population has access to adequate, sustainable and nutritious food.…
Why investors should guide companies to produce protein in ways that stay within our planet’s limited resources.…
Investor members can log into FAIRR’s investor portal to access individual company-level analysis and download the full report.