Climate Action 100+ sets net zero targets for the food and beverage sector
Climate Action 100+, the world’s largest climate investor engagement initiative, highlighted the decarbonization efforts of food and beverage companies in its latest report.
The investor initiative highlighted that the food and beverage sector is responsible for around a third of global greenhouse gas emissions, with the largest contribution coming from its supply chains.
The Climate Action 100+ report said that for the sector to align with the International Energy Agency’s Net Zero scenario by 2050, Scope 3 terrestrial emissions must be reduced by 85% compared to a business as usual scenario.
“The sector is currently not on track to achieve this target with a certain margin, with little evidence of specific strategies to measure and reduce Scope 3 emissions. Scope 1 and 2 emissions, which represent around 17 % of emissions from the food and beverage sector should also be reduced as much as possible, ”the investor initiative said.
Principles for Responsible Investment CEO Fiona Reynolds said food and beverage companies and their investors need to tackle emissions throughout supply chains.
“This includes the commitment to objectives of reducing the impact of emissions linked to agriculture and animal husbandry, the securing of the ecological transport and distribution of products and the search for sustainable packaging solutions, between others, ”she added.
Climate Action 100+ consulted with external industry experts and agribusiness companies to define the following key expectations for industry companies:
- Integrate supply chain climate action into decision-making processes and company procurement policies
- Encourage and support agricultural producers to reduce the climate impact of crop and animal production and improve agricultural carbon absorption
- Align capital spending, product development and R&D with a 1.5 degree scenario
- Transition to more efficient and renewable energy use and transport across operations, distribution and supply chains
- Improve processing, manufacturing and packaging practices to reduce emissions and food loss
- Partner with peers, suppliers and policy makers to drive transformation across the industry
Jared Fernandez, ESG analyst and head of proxy voting at Boston Trust Walden, said decisive action is needed to decarbonize the food and beverage industry faster.
“This requires going beyond risk mitigation to move to innovation, involving farmers to reduce impacts on manufacturing and production and reorienting the allocation of capital to companies aligned with a 1.5 degree scenario, “he added.
The Food and Beverage Sector Strategy Report is part of a new and broader scope of work of Climate Action 100+. The investor group released sector strategies for the aviation and steel industry earlier in 2021.