15 Dec 2021 — A coalition of 18 UK institutional investors are urging the British government to enforce a mandatory reporting scheme among food businesses’ sales of unhealthy food and beverages, in addition to sustainability parameters such as food waste.
Several large food and retail businesses have already supported the call for mandatory reporting requirements, including Tesco, Compass Group and Greggs. Mandatory reporting is expected to help increase the comparability of data on food businesses’ targets, commitment and progress.
The group, led by Rathbone Greenbank Investments, represents over £3 trillion (US$4 trillion) in assets under management or under advice, and includes Legal and General Investment Management, Aviva Investors and EOS at Federated Hermes (on behalf of its stewardship clients).
“Taking action on the National Food Strategy’s recommendations must be a priority for the UK. Not only is our health worsening, with public spending on obesity-related ill health set to keep rising, but we will not be able to meet our climate commitments without acting on sustainable food,” remarks Anna Taylor, executive director at The Food Foundation.
“We urgently need consistency in how food businesses report on health and sustainability metrics, to ensure that we have clear, industry-wide evidence of how the food sector is transitioning to healthier and more sustainable food sales,” she stresses.
“To achieve that, we need government and investors to work together and help drive this shift to regular and transparent reporting.”
Galvanizing the national industry
Although some businesses are voluntarily reporting on healthy and sustainable food, the coalition underscores that there is a lack of consistency in how metrics are being reported, with certain sectors lagging behind.
Last August, analysis revealed that the UK’s top ten food companies made “limited changes” to the healthiness of their products in response to Public Health England’s (PHE) voluntary reformulation targets – with the exception of sugar reduction in soft drinks.
Meanwhile, reports from the Food Foundation indicate that while five out of 11 UK supermarkets have now set targets for reporting on healthier food sales targets, only two report on the percentage of their protein sales that come from animal versus plant-based sources – a shift that is urgently needed for the UK to meet net zero targets.
The coalition of investors, which also has support from charity company ShareAction, is calling on the UK government to introduce new legislation on mandatory reporting of sales-weighted metrics, as recommended by the National Food Strategy.
They urge that this legislation should cover large retailers, restaurants, caterers, wholesalers, manufacturers and online food ordering platforms that have operations within the UK.
The investors stress that mandatory reporting should include a wide set of metrics, including sales of food and beverages high in fat, sugar or salt (HFSS), sales of protein by type, sales of fruit and vegetables and food waste.
Moreover, they call upon the government to “consider the full range of regulatory tools at its disposal” – including fiscal interventions and enhanced regulation – to promote sustainability in the food system.
Food systems first
The food system is responsible for a third of global greenhouse gas emissions and is one of the principal drivers of biodiversity loss, the coalition further underscores. According to Innova Market Insights’ Top Trends for 2022 forecast, consumers now rank planetary health as their number one concern, overtaking personal health, which has been the top priority in recent years.
At the same time, over half the population is classified as being overweight or obese (identified as a risk factor in severe COVID-19), with the gap between rich and poor also widening, and those on low incomes being more likely to suffer, and die from, diet-related conditions.
Increased transparency will help highlight which food supply chains are addressing their impacts,” asserts Steve Waygood, chief responsible investment officer at Aviva Investors.
“The future of civilization will depend on whether we pass tipping points that set in motion consequences that we will not be able to stop. The food transition is as much a part of that as the energy transition. Investors have an important part to play in facilitating this much needed change, but it requires prudential government action to drive real world change.”
By Benjamin Ferrer
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