A group of investors is predicting that governments around the world will soon start taxing meat products over environmental and health concerns. The Farm Animal Investment Risk and Return (FAIRR) Initiative explores this possibility in a new report to their investor members.
Called “The Livestock Levy: Are Regulators Considering Meat Taxes?” FAIRR’s report notes that more than 180 countries impose a tax on tobacco, 60 jurisdictions tax carbon, and at least 25 tax sugar. FAIRR predicts that meat may be next.
The demand for meat is increasing, but the global livestock production sector is also associated with a range of environmental, health, and social problems, FAIRR says. They include greenhouse gas emissions, threats to global food security and water availability, as well as soil degradation and deforestation, according to the initiative.
FAIRR cites evidence that meat taxation could be a way for governments to mitigate these challenges. Such levies are already on the agenda in Denmark, Sweden, and Germany, the initiative’s report points out.
As Bloomberg’s Emily Chasan notes, a VC fund owned by Tyson Foods recently invested in the plant-based protein producer Beyond Meat. Although the amount was not made public, Tyson Foods’ move increased its ownership stake in the company.
This fall, Tyson Foods’ president and CEO Tom Hayes announced that sustainability will play a key role in the company’s strategy for 2018 as they strive for a sales growth of 6% next year. He added that their sustainability initiatives will ultimately fund themselves.
Tyson Foods isn’t alone in introducing more plant-based food, Chasan reports. Marissa LaFave, a shareholder advocate at Green Century, told her that companies including General Mills, Campbell Soup Company, Unilever, Kraft Heinz Company, and Kellogg Company are doing the same.
Shifting toward plant-based products appears to be a smart strategy given the likelihood of new taxes that FAIRR predicts.
“Meat taxation is not a short-term risk for investors. Yet large pension funds and asset managers would be remiss not to put it on their agenda,” the executive summary of FAIRR’s forthcoming report says. “As the international community works to implement the Paris Agreement and the UN Sustainable Development Goals, governments and other international institutions will need to create a pathway to a more sustainable global food system — meat taxation may well feature on that road.”
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