World Wildlife Fund Sustainability Works

filtered by category: Supply Chain Management

  • Date: 01 January 2018
  • Author: Jason Clay, SVP Markets, Exec Director of the Markets Institute

The Markets Institute at WWF identifies global issues, trends, and tools around the most pressing challenges of our time. Each year we release a list of what we see as the top emerging industry developments that may not be apparent to help stakeholders stay ahead of the curve, and to help us all shift faster.

The lists are identified through research, interviews, data analysis, and discussions with our Thought Leader Group. Here are the top issues, trends, and tools to keep an eye on in 2018:

ISSUES

Trade wars

With the recent resurfacing of nationalism around the world, we should expect an increase in trade wars as countries use trade to negotiate many different issues including global parity around cost of production as well as positioning countries to support domestic political platforms and constituencies. If/when trade wars come to include food—whether to close borders entirely or even just limit exports—then it will most certainly cause environmental impacts.

Plastics and food waste

The rush to limit plastic in the environment and particularly plastic ending up in the oceans is unprecedented. The full extent of the environmental impacts of plastic are only beginning to be understood. However, plastic does have several benefits, especially when it comes to food in terms of both safety and improved storage life. We need to be careful that we don’t move so far to remove plastics that we begin to increase food loss and waste. We need to find ways to recreate the benefits and convenience of plastic, or we need to find ways to keep plastics out of the environment or both.

From traceability to transparency

For several years, companies have become more and more interested in where their products are produced. Certification and verification systems do this (to some extent), but they are expensive and often proprietary, so many different systems have been created including—but not limited to—Blockchain. The traceability systems, however, rarely go all the way to the farm where production happens, or even further back to feed and other inputs. And now companies are beginning to realize that it is probably more important to know how the product is produced as where it is produced.

The rise of urban and controlled environment agriculture

There are hundreds of vertical, soilless agriculture operations in the US and thousands around the world. These operations offer the opportunity of producing food in urban areas, in food deserts, and in areas with severe water shortages. They also have the potential to reduce food loss and increase shelf life. While the number of species grown is still rather small and dominated by leafy greens, it is broadening. The cost of production remains high, but the operations are akin to that of solar and wind power in the 1970s. As the industry grows and people innovate, the costs will go down and these systems will be more affordable and more versatile. Even better if the actors can share knowledge on certain technology and grow more quickly through collaboration.

Finance resilience

The impacts of climate change, both chronic and extreme weather events, have occurred more quickly than anyone thought. We are already seeing undeniable impacts on production, livelihoods, and nutrition. Two places where this is most pronounced are with smallholder producers of tree crops: cocoa in West Africa and coffee in Central America. Many producers are beginning to struggle as their products and production systems falter in the face of unpredictable rains and drought and the spread of pests and diseases. Governments have generally reduced funding for food and agriculture just when they need to be increasing it. Companies need to find ways to invest in the producers in their supply chains not just for traceability and transparency but also for resiliency.

Cyber warfare, food security
To date, cyber-attacks have largely ignored food and food security targets. However, as food delivery via e-commerce platforms grows, the potential for cyber-attacks increases. As trade becomes more politicized, food production also becomes a bigger target. Finally, as food productions increasingly depends on electricity or digitally based systems for irrigation, feeding, or detection, cyber warfare targeting food systems will become a lot more common.

TRENDS

Food e-commerce

E-commerce for food has grown considerably in recent years. It started with fast food delivery services like pizza in the US. But it has expanded to include uncooked food home delivery, mostly in China starting with Alibaba, and then on to the US with Amazon, Blue Apron, and more. Some grocery retailers have been delivering food for over a decade and they are stepping up the pace to compete. This trend will only expand.

Changing consumption patterns

Consumption patterns have shifted for as long as people have been exposed to different foods and types of cuisine. This of course increased as mass transportation became more common, and it has increased even more as social media has connected people around the world through food. Today, health and nutrition concerns, as well as age also influence consumption. However, as food becomes more global and even niche markets can be quite large, global finance is also increasing the pace and scale of change. When coupled with high net worth individuals with strong food preferences and opinions, even more funding becomes available.

M&A over R&D

In the face of climate change, the rise of nationalism and increasing trade wars, companies are investing increasing amounts in mergers and acquisitions and less in research and development. It is cheaper to buy innovation and market share than it is to build it out from scratch. There are simply too many things that can be relevant to a viable company today than ever before.

Go North (or South), young man

Climate change is driving chronic changes in crop growing zones, winter freezes, and average rainfall as well as increasing extreme weather like hurricanes, droughts, floods, fires, and dust bowls. Crops are moving North in North America but also in Europe and Asia, and South in Africa and Latin America. And habitat conversion continues and GHG emissions increase.

Precompetitive platform uptake

The number of precompetitive platforms has increased rapidly as companies begin to realize that many of the most important issues they must address are shared with others, as are the solutions. Sustainability is a precompetitive issue. Companies are responsible for what they do directly, however, most of the biggest impact of food products are where and how raw materials are produced and then consumed. What happens in the middle has fewer impacts. No company can solve production and consumption issues alone. Climate change and other crises will spur more collaboration.

TOOLS

Common protein and nutrition metrics

As questions on healthier and more nutritious diets become more common, calories will no longer be a sufficient metric for malnourishment. We need a common set of metrics to compare proteins and other key nutrients from very different kinds of foods so that we can compare apples to apples, so to speak. Many plants have proteins—are they the right ones? Many animal proteins have nutrients—are they the right ones? At what ages are different proteins and nutrients most important in human lives? How many of these proteins and nutrients already exist in household gardens of local communities and indigenous people but have never been studied by science? Is there a way to create averages or ranges, or is every individual truly unique?

CRISPR & gene editing

CRISPR and other types of gene editing allow for the selection and replication of traits that already exist within a genome, e.g. productivity, flavor profiles, and nutrient density. However, they are also tools that can be used to help make organisms more resilient in the face of climate change, e.g. drought or heat tolerance, disease resistance, or geographic and conditional variation. These same tools can be used to create GMOs, but their benefits can also come from working on single species. Whether that happens or not in some geographies will depend on if gene editing within a species is considered a GMO or not. Portable DNA sequencers are another genetic tool to keep an eye on, with potential for hunting down pests, testing for viruses, and bringing science directly into the hands of farmers.

Agrobots and tech

There have been a plethora of new robotic and other technology developments along the value chain. Drones monitor field conditions including soil moisture, plant health, and disease outbreaks at a fraction of the costs of humans, and very quickly with higher levels of certainty. Tractors drive themselves while also geo-spatially monitoring seeding rates and fertilizer applications, herbicide applications and pest issues, and productivity tied back to inputs used. Agrobots can be used to help determine optimal harvest times and increasingly, harvesting can be automated. Finally, distribution centers are automated and home food deliveries can be made by bots. There’s no question this will be a multibillion dollar industry in short order, but how it will impact labor and if/when it will price some farmers out of the business remains to be seen.

Science-based targets for supply chains

Many companies are making commitments to reduce GHG emissions to help limit global warming to below 2 degrees Celsius. They have started with scope 1 emissions (what they produce themselves onsite) and scope 2 emissions (the energy they purchase). However, in the food industry, scope 3 emissions (how raw materials are produced upstream and how products are consumed) are by far the largest contribution. As we have seen with other certification programs, making commitments is one thing, making change happen is quite another. If the food sector is going to make a meaningful contribution to prevent climate change, we need to find the right incentives.


Social media and misinformation

Social media has allowed the spread of misinformation at unprecedented levels. Couple that with the fact that more people seem to be driven by their own opinions or those of trusted friends than they are by science, and there’s a perfect storm of misinformation. This is a minefield for anyone interested in science-based solutions for the world’s most pressing problems, but it is increasingly difficult for government and the private sector to navigate this space. Social media and the underlying technology are powering the spread of misinformation, and at the end of the day the platforms intended to bring us together are leading to social polarization.

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  • Date: 21 February 2017
  • Author: Jason Clay

When a large, global food company commits to deforestation-free commodities, its entire supply chain listens. And when McDonald’s does so, other global food companies follow suit. That’s why the company’s commitment to source only deforestation-free beef by 2020 in regions with identified risks relating to the preservation of forests holds such promise to protect critical habitats, including Latin America’s most valuable ecosystems.

While deforestation has slowed across parts of the Amazon, it remains the world’s largest arc of deforestation. Furthermore, as if to compensate for progress in the Brazilian Amazon, deforestation has intensified in other Amazon regions of countries neighboring Brazil, as well as the Cerrado savannah of Brazil, and the Chaco mixed grass and woodlands of Paraguay and Argentina.

Many factors drive deforestation, but beef production is the biggest. Cattle ranching occupies about 80 percent of the deforested area in the Amazon, and it has led to the conversion of nearly 200 million acres of Cerrado habitat. Between 1976 and 2011, more than 29 million acres of Chaco habitat were converted largely first for the production of beef and then soy, a feed source for livestock.

The environmental impacts of deforestation are clear: it contributes to climate change, drought, soil degradation and erosion, water pollution, the spread of disease, and the loss of biodiversity. There are a number of social impacts as well from land conflicts to bonded and child labor, the displacement of indigenous cultures, and deterioration of water quality for drinking and fish, the most common source of protein in many affected areas.

From multinational traders to smallholder farmers, businesses increasingly recognize the economic risks of deforestation, such as resource scarcity and soil degradation, supply chain instability, legal jeopardy, and reputational harm. Its impact on weather variability is particularly troublesome for Latin American farmers who largely rely on rain as opposed to irrigation. Indeed, research indicates that deforestation has contributed to several “once-in-a-century” droughts and floods in Brazil since 2000.

Global food companies are in a unique position to influence not only their own supply chains but also that of their rivals. McDonald’s need for ground beef from select cuts leaves the majority of each animal for other buyers. In other words, for every pound of deforestation-free beef raised on farms that supply to McDonald’s, several more pounds of food—as well as leather and other byproducts—are destined for other companies’ supply chains, facilitating a sector-wide move to conserve forests.

WWF is working to support the transition to deforestation-free commodities, such as beef, soy, palm oil, timber, and so on. As a founding member of the Global Roundtable for Sustainable Beef, for example, WWF works with producers, other industry players, environmental NGOs, and researchers to push for the adoption of locally appropriate indicators and metrics that help producers reduce the footprint of the beef they produce. In collaboration with National Wildlife Federation, The Nature Conservancy, and the Gordon and Betty Moore Foundation, we are securing commitments from other companies in the beef and soy supply chains to eliminate deforestation in the Amazon, Cerrado, and Chaco ecosystems specifically.

Just as the global, interconnected food system means that environmental and economic impacts can reverberate around the world, so too can positive commitments to protect forests ripple out across the entire industry. As one of the largest single buyers of beef, McDonald’s influences producers, processors, distributors, and other companies at every point along the value chain. Today, it is sending a clear message to all of them: the future of beef is deforestation-free.

  • Date: 14 February 2017
  • Author: Richard Holland, director, markets programme (interim), WWF

One way to tackle daunting, seemingly impossible, challenges is to break them down into manageable “chunks” and share-out responsibility for these among a large number of willing and qualified people. Such is it with the UN’s Sustainable Development Goals that were adopted by 198 governments in September 2015 and which comprise some 17 goals and 169 targets, mapping out a routeway for the world community to 2030. 

Action to address these targets is being picked-up by partnerships of governments, companies, international organizations and civil society working from the local to global levels. In effect, it’s a type of large scale crowd-sourcing exercise and certainly one that is unparalleled in its ambition to eliminate extreme poverty, reduce inequality, and protect the planet in just 13 years.

To make progress toward the targets many of these programs and partnerships need information, tools, organization and funding which will come from hundreds, or more likely, tens of thousands of sources. Voluntary sustainability standards represent one set of ready-made tools and platforms that can help business take positive steps towards several of the 2030 targets. And do so in a way that supports many millions of small-holder farmers, fishing communities and forest owners improve their standards of living, while satisfying growing consumer demands for more ethical products.

The ISEAL-WWF Report “SDGs mean business: how credible standards can help companies deliver the 2030 Agenda“ provides a clear explanation as to the role that credible voluntary sustainability standards can play in helping business contributing tangibly to the SDG agenda, and start doing this now.

 

The Report provides examples of results that have already been achieved towards the Goals for food security, health, gender equality, water management, decent work, sustainable consumption and production, climate change, life undersea and on land, and for partnership.

Voluntary standards are of course no “silver bullet”. They are only one means to make progress and ultimately governments and businesses will need to combine these with many other efforts and measures. Still they can be employed efficiently by businesses at every link in the value chain – enabling producers, harvesters and processors to achieve a recognized level of sustainability, and traders, manufacturers and retailers to address the impacts of their supply chains. In doing so, they contribute across a number of SDGs.

As well as helping tackle challenges described by the SDGs, the use of voluntary standards generally align well with business interests in many sectors. Indeed at their best they allow companies to differentiate themselves from their competitors, anticipate increasing consumer demand for new products, secure access to needed resources and increase the value of their brands.

By providing a way to link economic interests with contributing to the SDG agenda, the chances of attracting more people to get involved should increase. In this way voluntary standards can help generate a few of the many, many hands that will be needed to achieve the SDG goals over the coming 13 years.

  • Date: 01 January 2017
  • Author: Jason Clay, SVP Markets, Exec Director of the Markets Institute

The Markets Institute at WWF identifies global issues, trends, and tools around the most pressing challenges of our time. Each year we release a list of what we see as the top emerging industry developments that may not be apparent to help stakeholders stay ahead of the curve, and to help us all shift faster.

The lists are identified through research, interviews, data analysis, and discussions with our Thought Leader Group. Here are the top issues, trends, and tools to keep an eye on in 2017:

ISSUES

Climate change as a threat multiplier

We are seeing more and more anecdotal evidence of the impacts of climate change. Nowhere more so perhaps than in the global food system. There are more pests and pathogens, weeds are healthier, seasons more variable, and there are more extreme weather events from drought to floods, hurricanes, tornados, dust bowls, fires, and more. We are also seeing the beginning of shifts in where crops are—or can be grown. Going forward, we need better systems to monitor climate impacts so we can begin to anticipate and get ahead of them.

Decentralization of global governance

Global governance systems are being undermined and replaced with bilateral arrangements and a more decentralized system. This can be seen most clearly with the World Trade Organization being moved aside by bilateral and regional trade deals. But it is also happening in several other ways. There are some issues that are truly global and that cannot be solved by one, two, or even a handful of countries. Everyone needs to be engaged. This is especially true of environmental issues—biodiversity loss knows no boundaries; neither does pollution, and GHG emissions, perhaps the biggest pollution issue of all, will not be solved without cooperation, rules of the game, measurement and continuous improvement, with everyone doing something.

Emerging zoonoses

It feels like zoonotic diseases have become a more regular occurrence. In fact, we have had an average of two every year for the past century. Except for the Spanish influenza, most of the outbreaks have not been global. However, it’s growing clearer that they are being caused by clearing natural habitat and forcing more biodiversity onto smaller amounts of land. New hosts are being found in the wild but also with the most common mammals—livestock and people. As we clear more land, encroach on more habitat, and raise more livestock, we can expect more outbreaks. And if hundred-year storms are now a twice-a-decade event, we can expect a big one, or more, on the horizon.

Microbiomes

We are at the beginning of a groundswell around microbiomes, whether it is the gut microbiome of people or animals, soil or even plant microbiomes. As we understand more about the microbiomes of different species, we have a much better idea about their role in nutrition, nutrient uptake and recycling, and the production of GHGs like methane. Microbiome research and understanding how they function will be key to changing diets of people and livestock, but also in how we feed plants and take advantage of natural processes to reduce soils amendments.

Trump & Bolsonaro: Wild Cards

No two national leaders reflect the rise of nationalism, protectionism, and the rollback of environmental protections more than Trump and Bolsonaro. Unfortunately, they are not alone, and others are likely to follow suit as we experience major pushback on globalization, as well as social and environmental agendas—and the polarization that each seems intent to encourage. Their governments look less like democracies and more like a “winner takes all” strategy. And, with these two it will get worse before it gets better; each has a constituency of loyal followers.


TRENDS

Plant-based Everything

As the movement, particularly in developed countries, toward plant-based diets gains momentum, we are seeing alternatives for anything that traditionally contained animal protein. Some of these attempts work and will begin to find market share. Most fail. But the trend is here to stay—plant-based diets will be an increasing share of the food market. The questions are how big it will become, where it will gain most tractions, how long will it take, and if they can keep the environmental impacts low if—and when—they start to scale.

Momentum from the Paris Accords

Coming out of the Paris COP, many companies have decided that they can’t wait for governments to start reducing GHG emissions. More and more companies are making commitments to reduce their own scope one emissions, as well as scope two three emissions. It is great to see this movement. The question is whether it will help drive government ambition higher.

Soil’s moment in the sun

It’s about time that the importance of soil is more widely recognized. With current farming techniques, without soil we would have no food. That is why soil (e.g. its health, erosion rates, nutrients, and biodiversity) is such an important biome for people. Regenerative agriculture, climate-smart ag, land stewardship, agroforestry, and eco-agriculture are all pushing for better soil management. Now, with the potential to pay farmers for improving soil (not for soil carbon per se, but reduced input use and increased efficiency and resiliency) rather than mining it, hopefully we will see vast improvements in productivity and reduced negative impacts.

Decline of regulation

With economic growth declining, the rise of nationalism, and the volatility of primary product pricing, most countries have less revenue and are cutting government. Many are pulling back precisely when the need to do more has never been greater, as social safety nets are disappearing and any gains for the poor are rolling back. In this vein, governments are also becoming laxer about enforcing existing regulations. This has resulted in a gradual, but pervasive increase of illegality in global food trade affecting both domestic and global food systems. It continues to go unchecked, hurting both producers and consumers, but also the planet.

Protein tradeoffs: land, sea

As people become more selective about protein sources, they are beginning to choose based not only on human health issues such as links to disease, aging, or the latest nutrition study in the news. Many are shifting from land-based proteins to those from the ocean. The real question is how does one compare proteins of different types of livestock with different seafoods, and then also production methods, e.g. free range or grain-fed and wild-caught or farmed. This trend will lead to more research about proteins and how they fit into personal nutrition plans.

Material accumulation vs. well-being

Increasingly, material accumulation is confused with well-being. This is true not just in developing countries where more people are being lifted out of poverty but also includes developed countries and the wealthy wherever they live. Displaying wealth in the form of things leads to accumulation and unnecessary consumption. It can be something as simple as having twenty t-shirts in a drawer, but only wearing three. And as things are displayed it becomes competitive and drives more accumulation. Unless people see the folly of this it only ends at the resource limits of the planet.


TOOLS

Crowdsourcing

Crowdsourcing is increasingly being tested and used in the US for a wide variety of needs from fundraising to research. Contributions through citizen science have led to the identification of new species, species distribution and population counts, and even things like weather patterns, the impacts of climate change, and the search for criminals. However, crowdsourcing is also being used to support peer-reviewed, primary scientific research, and eventually crowds may do more of the reviewing.

Personalized nutrition

Now that we can sequence everyone’s personal DNA, we can not only anticipate medical issues or inherited traits but can keep them in check if monitored. Now it is clear that it is possible to also understand the impact of diet on health and even anticipate and ‘prescribe’ personalized nutrition plans to abate certain health issues.

Precompetitive venture capital

When XPRIZE launched the space tourism prize, they discovered that many entrants didn’t have access to the capital they needed maximize their chances to win the $10 M prize. They did not win the contest, but after the prize was awarded, four of them launched IPOs and raised $2 B in venture to take their inventions to market. Realizing that they had missed an opportunity, the Foundation created BOLD Capital, a venture fund to invest in groups that qualified to compete for XPRIZEs. The goal was to create a fund that invested in all the horses in the race. This is a way to de-risk VC is going forward.

Forest carbon sequestration

As companies attempt to reduce their GHG emissions, many realize that there is no way that they can reduce their direct GHG emissions, so they are looking for other ways to make a meaningful contribution. While it doesn’t make sense for oil and automobile companies, even airlines or thermal power plants to invest in carbon sequestration, it might make sense for banks, insurance or IT companies to reduce global emissions by investing in reforesting degraded areas or forests that are being degraded or likely to be cut. This helps solve a carbon problem and rehabilitates degraded land for nature. But this should only happen in addition to setting a broader, transparent, science-based strategy to reduce emissions in their operations and across their supply chains.

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  • Date: 21 November 2016

WWF’s Bioplastic Feedstock Alliance (BFA) works to encourage the responsible development of plant-based plastics. Members of the BFA, including WWF’s lead on packaging and material science, Erin Simon, recently traveled to the Northern Great Plains, one of only four remaining intact temperate grasslands in the world.

The BFA members journeyed to the Northern Great Plains to see how sustainable agricultural practices can help conserve and protect the prairies for generations to come. The members were on a fact-finding mission: to see first-hand how they could leverage their collective power to achieve WWF’s goal of sourcing crops (or “feedstock”) for plastics production in a way that also protects this ecologically-sensitive region. Here is a look at what they learned about the importance of ecosystem health in their travels.

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  • Date: 17 November 2016

During World Water Week in Stockholm on Sept. 1, 2016, WWF’s Lindsay Bass, The Coca-Cola Company’s Greg Koch and LimnoTech’s Paul Freedman took a seat to participate in a recorded SIWI Sofa session, “Balancing Act: What Now for Corporate Water Goals?”

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  • Date: 25 August 2016
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WWF and The Coca-Cola Company have been working together since 2007 to help conserve the world’s freshwater resources. We’ve made great strides in 2015 to help ensure healthy, resilient freshwater basins in our focal areas of the Mesoamerican Reef catchments in Mexico, Belize, Guatemala, and Honduras, and the Yangtze River in China.

Learn more about our progress in measurably improving environmental performance across Coca-Cola’s supply chain, integrating the value of nature into decision-making processes, and convening influential partners to solve global environmental challenges.

A Transformative Partnership to Conserve Water: Annual Report 2015

  • Date: 23 August 2016
  • Author: Dave McLaughlin, WWF

From ice cream to cold cream, many of the processed foods, cosmetics and other consumer goods in our supermarkets contain palm oil. This ingredient is the world’s most popular and efficient source of vegetable oil, yielding several times more oil per acre than soybeans or canola. Yet its popularity is also its vulnerability; palm oil plantations are expanding rapidly, encroaching on wildlife habitat, destroying rainforests, and contributing to climate change.

For companies buying and using palm oil, it’s critical they trace the products all the way back to the plantation where the oil-yielding palm fruit is grown. This is the only way to be certain their supply is produced responsibly and free of deforestation. It’s also the best way to help producers improve their environmental and economic performance.

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  • Date: 01 January 2016
  • Author: Jason Clay, SVP Markets, Exec Director of the Markets Institute

The Markets Institute at WWF identifies global issues, trends, and tools around the most pressing challenges of our time. Each year we release a list of what we see as the top emerging industry developments that may not be apparent to help stakeholders stay ahead of the curve and to help us all shift faster.

The list for 2016 was identified through interviews of more than 50 C-suite executives and then narrowed down by our own Thought Leader Group. Here are the top trends identified for 2016:

ISSUES

The need to move the middle
Current efforts to improve food production focus on the best – or most progressive—producers or companies, with the notion that this will inspire movement in the rest. Yet this strategy is not likely to move the worst producers much less entire sectors. The biggest impacts will be achieved by focusing on the middle, or even the least effective producers, or those having the worst impacts and poorest productivity. Governments will probably be the most effective at changing the performance of those at the bottom, but it is not clear that governments have the appetite to do that. Still, we can’t achieve scale if we don’t at least move the middle and most likely the bottom as well.

Chasing Water
Water use has been growing exponentially, but water shortages are also on the rise. The potential economic impacts of water shortage are devastating if you consider that for human use: 70% to produce food, 20% for other industries like manufacturing and energy, and the rest is for personal consumption and use. Companies with foresight have a water risk and contingency plan, others do not. Investing in solutions that use water more efficiently can have positive impacts on both people and the planet. The question is, do governments and businesses want to invest in water now or chase it later?

Planetary boundaries
It should go without saying that Earth’s systems are finite. Yet business’ focus continues, for the most part, to be on constant growth. The concept of ‘planetary boundaries’ is starting to gain awareness – the idea of what natural systems are necessary for life to be able to continue. Yet many companies are already feeling the impact of resource constraints, water shortages, climate-associated changes, land-use change and degradation, and more. We need to much more quickly consider and shift to work within these boundaries if we are to continue to exist – through tactics including rehabilitation of degraded lands, better land use planning, and more.

Financing the food system
The U.S. SEC is starting to take seriously the question of sustainability in business practices by proposing that companies must disclose risks in climate change, water scarcity, human rights, and other risks to companies and investors. Investors are seeing the advantages of such sustainable practices, and there is a growing interest in direct investment in farm-level agriculture and venture funding in ag-tech. However, governments currently provide nearly $500B of agricultural subsidies in the top 21 food-producing countries, and these subsidies have been blamed for accelerating deforestation, excessive water use, market distortions, and the inability to transition to true-cost accounting. What is needed is capital to fund growth, innovation, climate adaptation, and reducing loss and waste. Could subsidies be shifted to cover these costs and make production more resilient at the same time? Or, the capital could take the form of long-term contracts that will buy down the risk of investing in more sustainable production.

Smallholders need capital
Smallholders have been an integral part of the global food landscape since the dawn of agriculture. However, global changes currently underway bring into question the future of smallholder agriculture – population and food demand is rising, meaning significant changes in the food system will be necessary to either put more land into production or greatly enhance productivity and efficiency per hectare. The global discourse is very strongly in favor of improving the livelihoods and efficiency of the hundreds of millions of people who make their livings from small plots of land. Yet this may not be the best choice for companies, countries or even the people themselves for without great care such programs do more to maintain poverty than to alleviate it.

TRENDS

Calling for the return of government
Recent decades have seen a withdrawal of government across the development and management of soft commodity industries, replaced by businesses. Companies are responding more rapidly and at scale than governments to global issues and problems. Governments have abnegated their roles in many contexts, hoping that companies would assume these functions. This is not working, and governments need to return to a more active role in the marketplace, creating the enabling conditions and enforcing mechanisms needed to be more sustainable and businesses to succeed. In the food arena alone governments need to shape the development of agricultural finance, create and apply tax incentives, foster agricultural development and innovation, take greater risks in funding, manage common pool resources, enforce laws on illegality, take steps to control food loss and waste, and create regulations to address changing technology, products, market opportunities, and environmental conditions.

Controversial topics: Science vs. Beliefs
Food is one of the most discussed – yet often one of the most polarizing – topics in the world. Controversy permeates from production practices across the value chain to marketing. What one eats—or won’t eat, organic vs. conventional, GMO vs. non-GMO, labeling and naming, nutritional guidelines, environmental impacts climate change, ag-biotech, just to name a few. The data and the science behind these issues are often unclear or contested. This is occurring at a time when the public is increasingly skeptical about science, and the media covers all sides equally, NGOs often fan these flames, taking values-based positions that are presented as science-based positions. Business, meanwhile, is retreating from public discussions of these issues.

Funding for innovation
Innovation has been the buzzword of the last year or so. But innovation must be more than innovation for its own sake; to be effective, it needs to be directed towards the major problems facing both people and the planet. In 2016 several major governments and multilaterals launched innovation funding to support agricultural innovation or technologies to improve global food production and security. Business investors in the US have “discovered” food as a place to innovate and invest. The launch of new food and ag funding sources including crowdfunding, accelerators, impact investment funds, corporate incubators will likely double in the coming year. But these efforts must be targeted and well-deployed if they are to change practices or reduce key impacts of production and along product chains.

Growing global inequality
The richest 1% of people now have more wealth than the rest of the world’s population. There is growing inequality not just between individuals but between countries, and this is especially so when it comes to food. The U.S. population spends an average of 6.9% of its income on food while Angolans spends up to 80% of income on food. Due to limitations of access and distribution some 2.3 billion people in developing countries consume under 2.500 kcal/day while 1.9 billion in developed countries are consuming more than 3,000 kcal/day with a growing problem of obesity. Food inequality will only increase in the years ahead with climate change, land scarcity, and water scarcity. Population growth and unequal increased incomes will lead to greater targeted food demand. All of these trends will result in increased pressure on the land, higher and more volatile food prices, increased likelihood of price shocks, and the persistence of malnutrition and stunting.

TOOLS

Certification programs
Many efforts of the past few decades to address the environmental and social impacts of food production have focused on the development and implementation of third-party voluntary certification standards. While share of certified products has grown rapidly for certain soft commodities (palm, sugar, cocoa, cotton) it still represents a small percentage of the main commodity supply chains and other commodities have seen slow uptake, limited market penetration, and confusion created by competing labels. There is a growing need for and interest in assessing the effectiveness of this tool, and we face the potential need to redefine how they are deployed, whether they measurably reduce impacts and the underlying theories of change.

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  • Date: 05 August 2015

The green Forest Stewardship Council (FSC) logo on a product means the most responsible forest management practices were used to make the product. Smaller trees were not harmed when harvesting larger trees, the rights of people living in or near the forest were respected, wildlife habitat was not degraded, and more.

Many forest operators know this or are learning about it. That’s huge progress. But taking action to get the FSC certification is another story. Often, they think the cost of FSC will have a negative impact on their bottom line.

A WWF study published today dispels this belief.

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