World Economic Forum
This article originally appeared on World Economic Forum.
Today’s food system produces millions of tiny miracles every day. Never before has food been so plentiful, hunger been so limited and choice been so broad.
While many worry about how our planet will feed the growing human population, at the current rate of consumption, the world’s food supply will be capable of doing just that until 2040.
But stop to consider the undesirable outcomes from historical and current practices in the food system. An estimated 820 million people are still under-nourished while almost 2 billion adults are overweight or obese, creating a range of health problems governments and citizens can ill afford.
There is over-exploitation of land and water resources, excessive carbon emissions and an extensive loss of biodiversity. Increasing food prices and low self-sufficiency continue to threaten food security, especially for low-income countries. And imbalanced development of different communities involved in the food system reinforces global inequality. Without action, these outcomes will only get worse.
We work with a diverse set of stakeholders ranging from large entities such as growers, traders, consumer goods companies and food retailers to smallholder farmer communities and enabling agents in emerging and frontier markets. Through this experience, we have identified a number of myths in the current food system:
Myth 1: there is not enough food to currently feed everyone on Earth.
Reality: while hunger is a way of life in many countries, reducing the surplus of calories in over-consuming countries can eliminate undernourishment and feed an additional 760 million people, according to the Food and Agriculture Organization.
Myth 2: we’re going to run out of resources to produce food for the future.
Reality: different foods have very different resource footprints; only if we don’t optimize usage will we run out of resources.
Myth 3: eating healthily costs more.
Reality: in most developed countries, reducing food consumption to guidelines on calorie intake would allow for healthy eating within current spending levels.
Myth 4: environmental health and nutritional health are at odds with each other.
Reality: taking the US as an example, several foods such as grains, starches, beans, nuts and seeds can improve both environmental and nutritional health. Also, if Americans ate a diet in line with government guidelines, they would, by some estimates, use roughly 50% less land and emit about 50% less greenhouse gases from agriculture than they currently do. Consider that red meat, dairy and pork produce over 70% of agriculture’s greenhouse gases while contributing just over 10% of calories.
The food system needs a critical transformation based not on the myths but on the realities of the situation.
For example, while we have until 2040 before running out of total calories to feed the growing human population, that window is shrinking when we account for the fact that the human body needs a combination of calorie types such as protein, fat, and carbohydrates. Consider protein production levels. They are dropping to the point that production per-capita will fall below recommended daily intake by 2034.
Compounding the situation, the decline in protein supply coincides with a boom in demand fuelled by increasing disposable income. What makes it even more concerning, is that those sinking production levels may be further reduced by the effects of climate change, ageing farmer population and crop concentration risk.
Globally, the average age of a farmer is 60 years old, according to the Food and Agriculture Organization, and by some reports, about two-thirds of the world’s food supply comes from just four crops.
While challenges abound, several global trends offer glimmers of hope. In many countries, consumers now place greater emphasis on health and wellness and on supply chain traceability and sustainability. One recent study found that only 10% of consumers trust food safety and quality—and nearly 70% are willing to pay more for “clean label” products they trust more: those with simple ingredients, no artificial ingredients and minimal processing.
Businesses are innovating for new technology solutions that can reshape profit pools or create new addressable markets. A single example: the hugely popular, plant-based Impossible burger uses only 26% of the water, 5% of the land, and emits 13% of the greenhouse gas emissions of cows, according to the company.
Investors are incentivizing perceived “positive” behaviour with their investments while asking businesses to accelerate efforts to change. Spurred on by NGOs, governments are passing important regulations. France has set a global example by fighting food waste with law and public initiatives. When frustrated by the speed of change, NGOs and other stakeholders are forming new and powerful alliances.
In our view, business can take a lead in accelerating the food system transformation, with approaches rooted in realistic change management principles. We see three areas for action: production, consumption and enablers.
In production, agribusiness companies can transform yields while restoring the environment, for example, relying on such advanced technologies as precision farming techniques to minimize fertilizer usage while maximizing output.
In consumption, consumer goods companies can tempt consumers with healthier, more sustainable products. Many of the insurgent food brands which have performed strongly in the past few years are organic, healthy, equitable and clean label.
In enablers, innovation and technology can help establish transparency and traceability across supply chains, support increased farmer income, and decrease food fraud and waste. New financing techniques can make better inputs more broadly available, encourage good farming practices and reduce risk for companies and farmers pursuing new approaches.
And indeed leading businesses can play a role in advocating for government action to support food transition, redirecting subsidies to encourage the production of healthier crops in more sustainable ways and educating people to be more aware of food impacts on health and the environment. Australia’s “Go for 2&5” social marketing campaign, for example, increased vegetable consumption by 23% and fruit consumption by 13% in that country between 2002 and 2005.
Transitioning into a new food future will require new business models and ambitious collaborations. In many situations, a portfolio of actions taken by businesses will be more effective when reinforced with philanthropy and advocacy. Working with NGOs or government regulators is a way to align incentives to address parts of the system where it is harder to make change happen and create effective partners that will help push for and implement change.
Systematically addressing these three areas can help bring the food system to a successful transition that is healthy for people, healthy for the planet, healthy for rural communities and healthy for businesses who make the food system thrive.
Jenny Davis-Peccoud is a Partner and the Head of Global Sustainability & Corporate Responsibility at Bain & Company.