These Global Food Giants See a Future Full of Alternative Proteins

Some global food giants are embracing the alternative proteins boom while others are falling behind, a new report from the FAIRR investor network found. The $5.3 trillion investor coalition cautions food multinationals that relying on factory-farmed meat, fish, and dairy poses a material risk to their businesses.

Currently valued at $19.5 billion, the alternative protein market is expected to reach $100 billion in value within 15 years, the investor network says. “For the first time since the advent of industrial animal agriculture nearly 60 years ago, alternative proteins — whether plant-based or cell-based — present a viable path forward to meet the global demand for proteins sustainably,” according to FAIRR.

For the new report, Appetite for Disruption, FAIRR evaluated 25 food-based multinationals on areas like business strategy, forward-looking analysis, R&D investment levels, and consumer engagement to find out how they are capitalizing on the rising demand for alternative proteins.

FAIRR’s collaborative engagement found that five of the firms evaluated achieved top “proactive” ranking: Unilever, Tesco, Nestlé, M&S, Conagra. In particular, Nestlé anticipates plant-based sales to reach $1 billion in 10 years.

Falling behind on the plant-based market: Hershey, Costco, Saputo, and Amazon, which owns Whole Foods, were all given the “reactive” bottom ranking.

Other key takeaways:

• 23 of 25 companies expanded — or announced plans to expand — their alternative protein product portfolios in the last 12 months.
• 64% of the companies included terms like “plant-based” and “vegan” in their annual reporting and/or quarterly earnings calls in 2018–2019.
• Seven of the 25 were awarded higher scores based on official Scope 3 climate targets that explicitly referenced their efforts to reduce their supply chain emissions from agriculture.
• Marks & Spencer, Conagra Brands, General Mills, and Groupe Casino have undertaken some type of risk assessment specifically on their protein supply chains.
• Some companies, including M&S and Carrefour, have set some type of target to increase their exposure to alternative protein products.
• Retailers Sainsburys, Tesco, Kroger, and Woolworth Group are trialing placing alternative protein products adjacent to more traditional animal proteins.
• None of the companies in the report have formal, publicly reported metrics in place to track and report on their protein exposure.

“We now have new ways to emulate the taste and texture of meat and to make it in a way that is better the planet,” said Faryda Lindeman, senior responsible investment specialist at NN Investment Partners. “Food retailers and manufacturers cannot afford to simply respond to these changes, they must should leadership to grab the market opportunity and manage the risk.”