Helping Humanity

Groups Seek to Reduce Food Waste through Shareholder Engagement

supply chain management
June 26, 2018

In France, grocery stores are banned by law from throwing away edible food. Prodded by 2016 legislation intended to reduce food waste, stores donate unsold food to about 5,000 charities in a national food-bank network. The network now gets half of its food from grocery stores, NPR reports.

But in America, food waste is still rampant. According to Wasted: How America Is Losing up to 40 Percent of Its Food from Farm to Fork to Landfill, a report from the Natural Resources Defense Council (NRDC), as much as 40% of food is wasted each year, with over 400 pounds discarded per person.

Now American faith groups, impact investors, and green groups are working to reduce food waste in the US. Instead of seeking national legislation, they’re going directly to large food retailers. While many big companies are responding to the call, some have been resistant.

The Problem with Food Waste

Many have framed food waste as an ethical problem. While literal tons of food are wasted, hunger persists in the US. Nearly 42 million Americans lack a secure supply of food, including 6.5 million children, according to USDA statistics.

Food waste can also be seen as an environmental problem, since the production of food is a major consumer of fresh water, energy, and land. According to the NRDC’s Wasted report, food waste is the largest single source of material sent to landfills, where it accounts for at least 11% of landfill-generated methane emissions. Methane is “a greenhouse gas up to 86 times more powerful than carbon dioxide in terms of its global warming potential,” according to the report.

And food waste is expensive, costing consumers $218 billion annually, or 1.3 percent of GDP.

Infographic showing impacts of wasted food.

Infographic source: The Natural Resources Defense Council’s Wasted: How America Is Losing up to 40 Percent of Its Food from Farm to Fork to Landfill

Some food producers are stepping up to reduce waste in the growth, processing, and transport of food. Food retailers are increasing donations of unsold food and helping solve logistical challenges. Walmart has worked to cut waste throughout its global supply chain, and donated 180 refrigerated trucks to hunger-relief agencies around the country in 2013, according to the NRDC report.

Faith Groups Are Seeing Success…

But there’s still more work that can be done. The Interfaith Center on Corporate Responsibility (ICCR) is putting pressure on companies they perceive as not doing enough to prevent food waste. The ICCR is a coalition of 300 institutional investors who have “pioneered the use of shareholder advocacy to press companies on environmental, social, and governance issues” since 1971. Started by faith institutions, it has expanded to mainstream investors.

Last year, ICCR member Trillium Asset Management filed shareholder resolutions at Costco and Target. Both resolutions were “successfully withdrawn” after negotiations, according to Trillium. Trillium cited Costco’s “progress in reducing food waste, its intention to report on its efforts, and a commitment to continued dialogue on the issue.” Target “committed to expand food waste related disclosures in its Corporate Social Responsibility Report in 2017.”

…But There’s Still Room for Growth

A similar shareholder resolution garnered 30% support at Whole Foods, but with the sale of the company to Amazon last year, progress has slowed.

When Green Century Capital Management and other investors refiled the resolution, asking Amazon to increase reporting on how they would reduce food waste, Amazon challenged the request at the Securities and Exchange Commission.

Green Century replied to the challenge. “We’re not asking them to change operations or implement any kind of costly changes. So we decided not to withdraw [the resolution] and to submit our rebuttal to their challenge. Now we will wait and see what the SEC decides,” Green Century’s Leslie Samuelrich told Supermarket News.

Amazon notes that they already donate millions of pounds of food to Feeding America, a national hunger relief organization.

Concern about food waste is unlikely to wane, as more individuals and investors become more focused on sustainability and supply chain efficiency. ICCR and other groups are likely to continue to engage with companies on food waste issues.

FacebookTwitterGoogle+LinkedIn
FacebookTwitterGoogle+LinkedIn