Risk factors

Animal welfare

Farm animal welfare is becoming an increasingly important issue for food companies along the supply chain, from producers to supermarkets and restaurants. Regulation, consumer awareness, pressure from the media and labelling requirements are key factors for change.

Key stats

75
%
of companies, valued at $217 billion and with revenues of $201 billion, categorised as ‘high risk’.

For example, while the EU put in place legislation to ban batter cages as far back as 1990, other regulators are beginning to catch up. In May 2019, the state of Washington passed a law that requires eggs sold in the state to come from cage-free hens by 2023. The introduction of laws that ban caged production will cost companies with caged-bird operations in the short term, but it will give privileged market access to companies that already produce cage-free eggs.

They will also lose market access, as global food companies such as McDonald’s, Walmart and Kraft Heinz adopt welfare-related commitments across species.

We assess meat and dairy companies on the strength of their welfare commitments, the quality of external auditing and assurance and their performance on confinement. We assess fish farming companies on the quality of the discussion on aquatic animal welfare, the disclosure of metrics such as stocking densities, behavioural monitoring, transport conditions and whether there is a plan to implement further animal welfare improvements that consider natural behaviour.

Results

  • Meat and dairy companies score an average of 22% on welfare commitments.
  • Meat and dairy companies score even lower (14%) on third-party auditing and assurance of welfare.
  • The lack of welfare commitments, especially on confinement, may present a material market and regulatory risk. For example, tighter regulations on confinement and the cage-free commitments of global customers such as McDonald’s and Kraft Heinz put companies without cage-free egg production at risk. Nearly 60% of poultry and egg companies do not have commitments to avoid close confinement and/or to move towards cage-free production.
  • Only 53% of fish farming companies discuss the importance of animal welfare to the company.
  • The discussion remains at a high-level as the discussion tends to focus on basic metrics such as stocking densities, housing conditions and reducing mortality rates.
  • Mowi is the only producer to have some of its operations (in Scotland) certified by RSPCA Assured.