It’s no secret that the question of how we’re going to feed a global population of nine billion people is becoming one of the world’s most pressing issues. Over the past few decades, our collective diets have become increasingly centered around meat and dairy with growing demand in developing nations. Now, you might think that more people having access to meat and dairy, like we do here in the U.S., is a good thing. But when you zoom out and see how these products are negatively impacting animals and the environment, as well as effectively hindering our ability to produce food for more people, the flaws in animal agriculture are revealed.
You see, in the past few years, the environmental footprint of the livestock industry has been shown to be the largest singular driver of greenhouse gas emissions, in addition to being one of the leading sources of air and water pollution. And the cherry on top of all this is the fact that our current food system isn’t even doing what it was created to do, feed people. In fact, nearly one billion people across the globe suffer from hunger.
With these statistics, combined with rising consumer concerns over how eating animal products can negatively impact their health and growing awareness of the poor state of animal welfare in factory farms, it seems only natural that more and more people are opting to leave meat and dairy off the menu and pursue more sustainable protein sources. Knowing this, there is a huge opportunity for brands to react to these trends and start focusing more on plant-based proteins. There are many start-ups who are doing just that, but recently, an impassioned group of investors decided to step in and encourage some of the biggest food producers to look at the business side of this growing catastrophe and quite simply, shift away from selling meat and focus on plant-based proteins.
A Huge Opportunity for Plant-Based Protein
The $1.25 trillion coalition of 40 institutional investors, including Swedish state pension funds AP2, AP3, and AP4, Aviva Investors, Boston Common, Coller Capital, Folksam, Nordea and Robeco, officially launched an engagement with 16 multinational food companies highlighting the material risks posed by industrial animal production. According Farm Animal Investment Risk & Return Initiative (FAIRR), one of the groups that organized the investor group, among the companies targeted were Kraft Heinz, Nestle, Unilever, Tesco and Walmart.
In addition to writing to these powerhouse companies, FAIRR and ShareAction created a new briefing called “The Future of Food – the Investment Case for a Protein Shake Up,” where the featured investors warn of the risks associated with the growing global demand for protein and an overreliance on the unsustainable factory farming of livestock for its supply.
In the briefing, the authors state, “Currently, much of the world relies on meat for its protein requirements – with approximately 70 percent of livestock now produced in factory farms. However, as recent research by FAIRR and others has shown, factory farming is emerging as a high-risk production method linked with significant environmental damage and major public health issues, such as the emergence of antibiotic-resistant bacteria and outbreaks of pandemics such as avian flu.”
Rather than seeing this as an entirely negative situation, the briefing’s authors see this instead as a huge opportunity for investors. While the meat and dairy market might not be sustainable, and ultimately not the best investment, the plant-protein market is just starting to kick-off. Jeremy Coller, founder of the FAIRR initiative and chief investment officer at private equity company Coller Capital, explained to Fortune, “Investors want to know if major food companies have a strategy to avoid this protein bubble and to profit from a plant-based protein market set to grow by 8.4 percent annually over the next five years.”
The Future of Food
And the good news is that plant-based protein is a readily viable solution to this problem. “The plant-protein space has been witnessing rapid growth, fueled largely by tremendous consumer interest in protein from cleaner sources,” said Nil Zacharias, Co-Founder of One Green Planet. “The current meat substitute or alternative protein market is estimated to grow to $5.2 billion by 2020 and according to some estimates, plant-based meats could make up one-third of the entire market by 2050. That’s just current projections based on consumer behavior and market trends, which I believe are far too conservative.”
Adding to these numbers, we’ve seen brands and restaurants introducing plant-based protein options to their offerings. Wendy’s and White Castle introduced veggie burgers, large food conglomerates are acquiring plant-based plant-based protein companies, and even the Culinary Institute of America has designed a program focused on replacing meat-heavy dishes with vegetables instead. The times are certainly changing and it is about time that investors and the overall food world come to the realization that the future of food is plant-based. After all, if you had the chance to invest in a product that could heal the environment and help feed billions of people, why wouldn’t you?
Image source: Mushroom and Lentil Burgers With Pickled Red Onion