It is no secret that reducing meat and dairy consumption is the “single biggest way” an individual can reduce their carbon footprint, given that livestock is estimated to be responsible for around 14.5% of global greenhouse gas emissions.
Meat and dairy consumption alone is predicted to account for more than half of global warming between 2030–2100, according to a study published in Nature earlier this year. If dietary patterns remain constant through to the end of the century, the industry will contribute to at least 0.7°C of global warming. Given that consumption of ruminant meat (beef and lamb, for example) is expected to grow by around 90% by 2050, and all animal products (including dairy) by 70% within the same time frame, the study’s authors warn that the industry’s total contribution to global emissions could be higher still.
New data from the FAIRR Investor Initiative, which represents $70trn in global assets, shows that the top 20 global meat and dairy producers, which supply to household names including McDonald’s and Walmart, have reported a combined annual emissions increase of 3.28% in 2023.
For context, global energy-related CO₂ emissions grew by 0.9% between 2021 and 2022, according to the International Energy Agency.
In response to this data, Jeremy Coller, FAIRR’s chair and founder, said that investors hope that the first-ever publication of a food and agriculture low-carbon road map at COP28 this month “will catalyse the transition to 1.5 degrees and a more sustainable food system”.
FAIRR’s report does find that the top meat and dairy companies are improving their levels of emissions disclosure, with 40% of the 20 largest meat and dairy companies now disclosing scope 3 emissions, while all but one company is disclosing its scope 1 and 2 emissions.
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The fact that a number of companies are increasing their disclosure while simultaneously increasing their emissions raises the question of why disclosure is so important. However, as Coller says, “what you can measure, you can manage”, and FAIRR’s data does indicate that companies that are more transparent are more likely to be in the process of reducing their emissions.
Four of the companies in FAIRR’s study have set targets approved by the Science Based Targets initiative (SBTi), an independent regulatory body that approves companies’ net-zero targets, widely considered to be one of the most reliable benchmarks.
These are Danone, Tyson Foods, Charoen Pokphand Foods and Emmi, three of which are among those companies on FAIRR’s list that have reduced their year-on-year emissions in 2023. Thai company Charoen Pokphand Foods, which increased its emissions by 4.3%, is an outlier.
A further three companies – Inner Mongolia Yili Industrial Group; Saputo inc and JBS – have committed to setting targets via the SBTi, meaning they have signed up to the initiative but are yet to have their targets approved.
Chinese companies make up nine of the 20 top meat and dairy producers globally. However, not a single Chinese company on the list has targets approved by the SBTi.
Analysis of SBTi data shows that Chinese companies make up a relatively small share (3%) of SBTi targets set across all sectors, meaning it is not too surprising that none of the meat and dairy companies in this list have set targets. Interestingly though, Chinese companies make up a much smaller share (0.4%) of targets set by companies within the food and beverages sector, while FAIRR notes that Chinese meat and dairy companies are the least likely to have animal welfare policies in place. A similar pattern is observed, to a lesser extent, among a few other countries.
While FAIRR praises the uptake of companies disclosing and setting targets for their scope 1 and 2 emissions, these make up just 5% of meat and dairy producers’ total emissions, according to an analysis from the Dutch bank ING. By contrast, scope 3 ‘upstream’ emissions (which include farms and transportation) account for 80–85% of the sector’s climate footprint. Scope 3 ‘downstream’ emissions (which include consumption and sales of products), account for the remaining 10–15%.
Tackling scope 3 emissions from meat and dairy
ING argues that reducing scope 1 and 2 emissions within the meat and dairy industry, mainly by making improvements in energy efficiency, electrifying production processes and switching to renewable energy sources, is "quite straightforward”.
Companies like multinational food conglomerate Danone are among those investing in renewable assets. Two years ago, Danone signed a ten-year power purchase agreement with renewable energy producer Iberdrola for the output from a 590MW solar photovoltaic plant in Spain. FAIRR highlights Danone has been one of the companies globally to set FLAG (Forest, Land and Agriculture) targets aligned with the SBTi, which includes a commitment to reduce its methane emissions from fresh milk by 30% by 2030.
ING says that the real challenge for meat and dairy companies is reducing their scope 3 (supply-chain) emissions. This will require "close cooperation with suppliers and customers", and the implementation of a "diverse range of measures”. Such measures include: reducing the carbon footprint of animals on farms (for example, improving their health and using additives to reduce methane emissions); moving towards deforestation-free animal feed; reducing on-farm energy use; and finally taking steps to improve plastic packaging and reduce the transport emissions from products in the value chain.
The link between global food systems and climate change, which exacerbates food insecurity, particularly among communities in the Global South, will be a key talking point at COP28, with the COP28 presidency recently issuing a call for increased global action to address the "interlinked challenges across climate change and the food systems, including production, consumption, trade and resilience".
In September this year, COP28 UAE president-designate Sultan Al Jaber invited world leaders to sign the COP28 Declaration on Resilient Food Systems, Sustainable Agriculture, and Climate Action, and align this commitment in their climate action plans.