Change we must - Time for a review to secure the future of food
Sustainability will emerge as a critical issue for any company’s survival in the longer term and existing food and agriculture practices will need to be thoroughly reviewed in order to face these issues. This means companies must walk the talk and invest in sustainability-related activities if they haven’t already done so.
Food currently produced is enough to feed the world’s population. ‘Insufficient production’ was not stated as ‘the most pressing sustainability issue’ in a recent poll (see Figure 1) and as the current food production and distribution systems seem to be working well, there is a reluctance to make radical changes.
But, although enough food is produced currently, climate change is threatening the status quo. ‘The impact to climate change and the environment’ was stated as the most pressing sustainability issue in the poll, but attention also needs to be paid to the ‘impact from climate change’ (see Figure 1).
It was therefore encouraging to see that 86% of respondents on the poll declared sustainability as the ‘highest priority’ on their company’s agenda and goals (see Figure 2). While data from previous years is unavailable, it won’t come as a surprise if a similar survey conducted five years ago yielded other more important priorities ahead of sustainability. But, looking into the future, sustainability will emerge as a critical issue for any company’s survival in the longer-term. Companies must therefore walk the talk and invest in sustainability-related activities if they haven’t already done so.
Food wastage provides business opportunities to explore
Investing in sustainability may also present potential business opportunities. Improving efficiencies in food distribution and avoiding food wastage is an example of a sustainability linked endeavour which offers immense business opportunities. As identified by the Business and Sustainable Development Commission, reducing food waste in the value chain has an opportunity size of USD 155bn-USD 405bn annually, and reducing consumer food waste presents another USD 175bn-USD 220 bn opportunity1. Not surprisingly, ‘food loss and wastage’, was selected as the second-most pressing sustainability concern in the poll (see Figure 1)
Transformative technologies offer hope, but more is needed
A range of technologies can offer solutions to the challenges outlines above. These include sensors, robotics, genome editing, plant-based proteins, urban farming, solar-powered cold rooms, temperature tracking devices and AI and blockchain to name but a few. Business leaders, however, are more demanding and do not feel that the innovations currently available are sufficient to address sustainability issues (see Figure 3).
Disruption is a work in progress
The food and agricultural sector ticks a number of the boxes for industries ripe for disruption – complex experiences, broken trust, redundant intermediaries and limited access. Disruption has always been around and incumbents in most instances see them coming – it’s only a question of whether they decide to act to avoid being disrupted.
The Asia Food & Agriculture Advisory Board meeting
Business leaders at a recent Rabobank Advisory Board meeting took part in discussions and a live poll (some of the results have been discussed above). The Asia Food & Agriculture Advisory Board meeting is Rabobank’s premier client event bringing chairmen and CEOs of leading Food & Agribusiness companies and commodity traders together, mainly from Asia, but also from other regions.
1 Source: Valuing the SDG prize in food and agriculture, October 2016
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Where to go from here
Umesh MadhavanAnalyst – Consumer Foods Read more