Phosphorous and Nitrogen Agriculture

2017.08.27

Corporate environmental stewardship: a pathway to pollution management?

What is it and what can it deliver?

Food production degrades the environment through emissions of greenhouse gases, nitrogen, phosphorus, pesticides, and pharmaceutical residues. In particular, high-density chicken, pig, beef, and dairy operations, sometimes called factory farms, can be pollution hot-spots.

But we need to eat.

Rules about agricultural pollution vary greatly among countries and regions. Rules can be strict and mandatory, voluntary, incentive-based, poorly enforced, or non-existent. Consumers have limited knowledge about how their food is produced - and as a result, limited influence - because of the number of businesses that operate between the farm and the fork.

Having spent a number of years in the corporate world, I am intrigued by initiatives aimed at urging large, global food companies to address sustainability and pollution issues in their supply chains, the farms where "raw materials" for their products originate.

For example, the World Wide Fund for Nature and Ceres launched the AgWater Challenge last year. This program will engage major food and beverage companies to encourage stronger and more transparent water stewardship. Tyson Foods recently announced a partnership with the World Resources Institute to “develop industry leading, science-based greenhouse gas and outcome-based water conservation targets for its operations and…supply chain.” These efforts are extremely timely given reports that large meat companies contribute a disproportionate amount of nutrients to areas like the Gulf of Mexico.

Other initiatives target investors and raise awareness about financial risks stemming from unsustainable or polluting business practices. In other words, certain practices could lead to fines, lawsuits, changes in public opinion, increased costs, etc. that hurt the bottom line. Increased awareness puts pressure on companies to change their practices or potentially lose market value (and investors).

Activism by public pension funds, foundations, and other investor groups seeks to change company behavior through shareholder resolutions. I don't know how effective this approach is, but a recent study found that while these types of resolutions rarely receive a majority vote, they can nudge management to adopt some of the recommendations.

If these types of efforts are successful and food companies require producers in their supply chains to change pollution management practices, incremental costs would likely be passed on to consumers. Whether or not customers are willing to pay these costs depends on many factors.

To some extent, however, consumers are already paying for pollution management - as taxpayers. Because governments are reluctant to force environmental regulations on farmland, both the US Farm Bill and EU Common Agricultural Policy fund voluntary programs. Under these programs, farmers receive financial support in exchange for making commitments to implement certain practices. But given the continued and growing consequences of nutrient pollution (for example, in the Gulf of Mexico and Lake Erie), these programs need to be revisited. The effectiveness of agri-environmental schemes is also an area of active research and debate in the EU. In this context, there is the potential for corporations to play an important role in reducing pollution from agriculture.  

For now, I will follow these corporate initiatives as they progress. I hope they are more than green-washing, but time will tell whether or not they can deliver measurable changes.

Michelle McCrackin

Michelle McCrackin

Limnologist
michelle.mccrackin@su.se