The largest food and beverage companies in developed countries are set to fall short of an industry target to cut their carbon footprint for 2030, research claims.
After analysing pledges made by more than 200 food and beverage companies based across EMEA and the US, management consultants at AlixPartners estimate carbon emissions will have been cut by 29% from 2019 to 2030. If that materialises, that would fall short of the global industry goal for a 38% reduction under the United Nations’ 2015 Paris Agreement and the Science Based Targets initiative.
AlixPartners, which came to its conclusion “having analysed the carbon-reduction commitments made so far by the largest western food and beverage companies”, said carbon emissions have so far only been cut by 1% since 2019.
As the world chases a sustainability strategy to limit global warming to 2 degrees Celsius under the Paris accord, and more ambitiously to 1.5 degrees, AlixPartners said food and beverage companies have a “lack of confidence” in their ability to meet carbon-reduction targets.
It said 49% of suppliers, 36% of manufacturers and 31% of retailers claim “to be very confident that they will meet their carbon-reduction goals related to their own carbon emissions (as opposed to those created elsewhere in their value chains)”.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
Andy Searle, a partner at AlixPartners, said: “Consumer-products companies need to determine what they need to do and who within their business needs to act within the next 12 months and then within the next 24 months.
“The ‘doing’ needs to be transferred from the sustainability teams to those in operational roles, and with those in operational roles empowered to take action and goals embedded across the company’s organisational culture. Speeding-up and scaling-up will be vital to driving a successful outcome.”
AlixPartners’ research was based on findings from 235 food and drinks firms in EMEA and the US assessed by the Netherlands-headquartered World Benchmarking Alliance, a body seeking to forward sustainable development goals.
The consulting business also analysed commitments made by the “west’s 13 largest food and beverage packaging companies”, as well as a survey of 200 sustainability and operations executives.
Scope 3 emissions targets, those coming from a manufacturer’s supply chain, unlike internal Scopes 1 and 2, were also found wanting.
AlixPartners said 27% of executives from suppliers, 13% of manufacturers and just 4% from retailers “are confident that they will meet their carbon-reduction goals relating to emissions made by other companies in their value chains”.
The consultants added: “This lack of confidence may have been exacerbated by companies’ limited certainty in measuring upstream and downstream carbon emissions across their value chains. The research findings reveal that only 34% of the executives from the suppliers surveyed feel that they are successfully measuring their downstream carbon footprint.
“Manufacturers show similar uncertainty, with only 25% claiming to be successfully measuring their upstream footprint and only 32% claiming to be successfully measuring their downstream footprint.”
Randy Burt, another partner at AlixPartners, said: “While it is encouraging to see the progress that has been made in cutting carbon emissions since the 2015 Paris Agreement, it is clear that greater collaboration is required across the food and beverage industry if its carbon-reduction goals are to be met.
“Manufacturers, suppliers and retailers alike need to look across their entire value chains to understand and exert influence all the way back to the start of those chains, as well as downstream towards the end-consumer, if they are to make truly exceptional progress on this front.”