March 23, 2023

What Are the Sustainability and Net Zero Goals of Large Consumer Food Companies (CFC)?

Food production is crucial in society’s path to sustainability. Agriculture, Forestry and Land Use make up 18.4% of global greenhouse gas emissions (source: CO2 and Greenhous Gas Emissions, Our World in Data, 2020), not accounting for the negative environmental impact of food processing and the logistics associated with bringing food from the farm or factory to the tables of consumers. The large food and beverage companies have all jumped on sustainability and Net Zero pathways, aligned with the UN’s Sustainable Development Goals and Net Zero commitments, stemming from the global climate accords. Furthermore, the companies have made a habit of labelling their products as “emission-neutral” or “eco-friendly,” and this has proved to work. Recent studies confirm that consumers increasingly care about environmentally sustainable products, and the products making ESG-related claims have accounted for a larger share of growth in the past five years than products without them. This creates a clear incentive for companies to dedicate more of their resources to foster the sustainability of their products, industries and value chains.  

 

In order to better understand the sustainability and Net Zero goals companies have chosen, we looked at fifteen of the largest public food and beverage companies in the US and Europe. The goals they have chosen can be categorized into 4 impact areas, namely: 

  • Sustainable Raw Materials: In the case of raw materials, which are sourced externally, companies have set goals and are implementing regenerative agriculture initiatives with a high bar on how the land is treated and the crops are grown. In those cases, companies transfer their requirements down the supply chain and the suppliers have the ultimate responsibility in implementing the measures. 
  • Resource Efficiency: These include i) green energy transition goals and related projects and those that generate savings in the consumption of energy, and ii) water and waste reduction. 
  • Environmental Residue: goals in this category are equally divided among improving packaging (mainly reducing plastic use) and reduction in CO2 emissions, linked to food production, storage and transport. 
  • Product Adaptation: several companies have included goals and initiatives that re-think their traditional products by introducing portion control or reducing unhealthy ingredients, such as added sugar or sodium. 

 

The infographic below maps the four impact areas and highlights where the Consumer Food Production(CFP) companies’ current efforts are allocated. It points out that the companies are largely focusing on broader environmental residue-linked goals, specifically in emissions, which is one of the main topics taking the spotlight globally. At the same time, there are significant efforts to achieve industry-specific sustainability, with sustainable raw materials as well as environmental residue (plastic-substitution), stressing both the impact in destination of the final product and its origin. The impact area with smallest level of effort is product adaptation. However, this may backfire in the mid to long-term as consumers increasingly are turning to healthier lifestyle and food consumption choices and products.  

 

Balancing between the four impact areas will be crucial for the companies and how fast they move to sustainability and Net Zero in the 2025–2030 timeline. It would be interesting to gain insight as well as learn about the robustness of the goal definitions, their monitoring and their implementation. 

Sustainability Food Production Graph
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Written by the team at Thirdway Partners

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