Cast your mind back to November 2021. The COP26 summit had just concluded in Scotland with the signing of the Glasgow Climate Pact, which was focused on accelerating global climate action. Food and drink businesses rushed to match political ambition by setting net-zero targets for 2050, 2040, or sooner. It felt like the starting pistol had been fired on the race to decarbonize the food system.
Fast-forward to the present day and the landscape looks rather different.
Not only are several companies missing their net-zero targets, especially for Scope 3 value chain emissions, which account for by far the largest share of total emissions for food and drink companies. But many large multinational food companies are also revising or watering down their sustainability goals, focusing on nearer‑term, operational delivery while reassessing longer‑dated commitments.
This has coincided with the backlash against climate action from a new Donald Trump presidency, which appears to have spread to parts of the business world. A critical reading of the current state of play is that the climate has taken a backseat amid a wider boardroom retreat from an ESG agenda.
Yet this doesn’t tell the whole story.
In private, and sometimes in public, business leaders have acknowledged that net-zero targets were set without a clear sense of how they would be delivered. “In 2020, when we set ambitious environmental sustainability goals as part of our Spirit of Progress action plan, we didn’t have all the answers,” admitted Diageo in a statement announcing its revised sustainability targets in August.
“Five years on, we have better data, deeper insights, and a clearer view of the practical realities to deliver net-zero,” the drinks giant wrote.
Recalibrated climate action
Rather than businesses having dropped the baton on tackling climate change, it can be argued that the challenge has been reframed and the response recalibrated. Not only have climate modeling tools improved, making climate-related impacts more tangible and giving corporates a clearer picture of when and how to reach certain goals, but the business landscape is also fundamentally changing.
From geopolitical crises such as the Ukraine war and increasingly extreme weather events driving food prices up to growing competitive pressure from startups and white labeling, regulatory and tariff headwinds–especially in the US–and ever-changing consumer demands, food and drink companies are in one of the most challenging macro backdrops on record.
And while some food business leaders admit that pressures such as inflation did somewhat overshadow sustainability initiatives, corporates are now refocusing their environmental efforts from a largely marketing‑led push to meet a distant net‑zero target to a more immediate need to sustain their businesses and ensure long-term shareholder value.
The watchword for this attitudinal shift is resilience. More so than ever, businesses–and their investors–know they need to think long‑term if they are to guarantee the predictable supply of ingredients that supports their market proposition.
The term is even entering the policy realm. Future food security is one of three priority outcomes from the UK Government’s food strategy for England, which references the need to close “the resilience gap.”
Systemic challenge
“This is a systemic challenge globally,” Bob Gordon, director at the Zero Carbon Forum, which supports UK restaurants, pubs, and other hospitality sector businesses on their net‑zero journey, tells AgFunderNews. “At this stage, we’ve only seen systems put under pressure in one place at a time. When they’re all under pressure at the same time, that’s another problem entirely.”
Gordon, who previously headed up sustainability at Nando’s in the UK & Ireland, suggests UK hospitality businesses broadly fall into two groups. “One is those that fully expect to be around for the long haul, and they’re thinking about long‑term resilience.” The other, he says, consists of “businesses who are simply thinking about resilience for the next six months” as they grapple with spiraling input costs, tax rises, and labor shortages.
For some companies, direct climate impacts have provided a leadership wake‑up call. In 2023, multi-brand food manufacturer The Compleat Food Group encountered problems sourcing olives after producers in Spain and Greece suffered one of the worst crops in living memory following a period of drought that left water supplies critically low.
“That was massively challenging to our business,” says David Moore, ESG director at the manufacturer, which supplies retail and foodservice customers with deli, pastry, and plant‑based products.
Risk and resilience
Compleat is far from alone among suppliers in thinking deeply about the relationship between risk and resilience in ingredient sourcing. In its latest CSR report, chilled foods supplier Greencore noted how its ingredients and packaging materials “come from all over the world, expanding our impacts, risks and opportunities related to society and the environment.”
Greencore has a vast supplier network spanning 290 tier‑one suppliers (distributors), 1,860 tier‑two suppliers (aggregators), and up to 6,700 tier-three suppliers (farmers). Managing supply chain risk increasingly means not relying on a consistent supply of product from any one of those supply chains. That explains why Greencore says it is increasing its sourcing of salad leaves from UK hydroponic farms for better stability as the climate changes.
Moore says sourcing from different regions can help minimize the risk from shortages but can’t remove it entirely. “That whole notion of just being able to change things around isn’t going to be possible going forward, because there just won’t be those alternatives.”
That’s why Compleat is also working with existing producers within its supply chain to explore opportunities for longer‑term contracting arrangements and ways to implement more sustainable farming practices. “There’s more understanding now that we’re in a scenario where we need resilient suppliers who are doing things when it comes to water and biodiversity,” Moore says.
Compleat is also working to reduce the use of animal protein in recipes where meat can feasibly be substituted with high‑quality vegetables or plant‑based ingredients. A recent resilience report by the Green Alliance think tank notes that plant-based products offer a significant risk-minimizing advantage because they are not susceptible to livestock pandemic diseases such as avian flu and African swine fever.
“Plant‑based is not quite a silver bullet, but it’s not far off that,” says Moore.
Commercial value
To build a case for these strategic pivots, sustainability teams need to get closer to procurement and finance decision-makers and demonstrate their value to the business through both economic and moral lenses. “If I’m a sustainability manager inside a business, I’ve got to deliver commercial success to save us money,” says Gordon.
In the foreword to Greencore’s CSR report, chief executive Dalton Philips observed increasing alignment between commercial and sustainability interests among the business’s partners. “Although more work is needed to fully integrate these, the easing of inflation pressures is opening space for meaningful sustainability conversations that were previously overshadowed,” Philips wrote.
As the architect of Marks & Spencer’s Plan A sustainability strategy, first launched in 2007, Mike Barry was a pioneer in integrating environmental and social commitments into core business strategy.
Now co‑founder of food systems consultancy Planeatry Alliance, Barry stresses the importance of high‑quality data – spanning environmental and health impacts, as well as taxes and tariffs – in building boardroom awareness of emerging risks and how they compound at the category, product, and ingredient levels.
“The C‑suite needs to be collectively competent to understand what those different data points from different sources mean for their future business prospects,” he says. “The best chief sustainability officers out there are part of those conversations, framing those partnerships with procurement teams, product development teams, and commercial teams as well as with the chief financial officer and chief risk officer.”
Sector failure
None of this suggests that businesses have cracked the resilience code – far from it. In April this year, a group of anonymous food industry whistle-blowers working in sustainability broke ranks to warn of a sector-wide failure to tackle a series of interconnected crises – from extreme weather events to water scarcity – that threaten the future viability of their businesses.
Addressed to the directors, owners, and creditors of their businesses, as well as to investors, the group suggested corporate risks are still not being treated as critical to strategy, and sustainability is still viewed mainly through a compliance lens. Mitigation strategies, meanwhile, “are simply not commensurate with the level of the risk we are facing” and yet are being presented to investors “as a fitting ‘solution’ to the situation we are in.”
Barry believes many companies – although highly efficient in their particular market niche – are still struggling to translate peripheral awareness of systemic threats to their business models into comprehensive strategies to address them. “We haven’t collectively learned how to transform to respond to these multiple, overlapping, confusing drivers for change,” he says.
If resilience is the watchword for 2025, transformation must be top of the agenda for 2026 – with clearer targets, accountable ownership, and credible delivery plans to match.
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