We recognise the multitude of risks and opportunities facing the food industry linked to issues such as food waste, nutrition and sustainable supply chains. How companies respond to these issues and to the changing regulatory, consumer and other stakeholder demands surrounding them will influence not only their social licence to operate but also the long-term resilience of their operating models and supply chains.

There have been several collaborative investor engagement initiatives focused on driving better company disclosure on the ESG risks and opportunities facing food companies. In parallel, investors have been engaging directly with companies for several years on this topic.

Various industry-level or company-specific systems for measuring and reporting on nutrition information exist, but there is significant variation in what these frameworks measure, how results must be reported and the scope of their coverage. There is consensus among experts in nutrition that greater standardisation is needed to prevent companies from gaming the system.

A lack of published data on food industry practices continues to hinder the ability of investors to compare performance across the sector and accurately understand what progress is being made. Mandatory reporting and well-designed regulation in this area would help to solve this data challenge and create a level playing field for companies.

The UK Government has six months to respond to the NFS recommendations with a whitepaper. There is therefore a window of opportunity for investors to weigh in on this subject and engage with policymakers. We see this statement as the first step in a longer-term programme of investor-policy engagement in this area and we are hoping there will be an opportunity to convene interested investor parties in a dialogue with policymakers in January 2022.

Please email Archie.Pearson@rathbones.com if you have any questions.