Multi-National Corporations

‘The Alphabet Soup of Responsible Investing Needs a Good Stir’

Mark Gilbert for Bloomberg Opinion about the shortcomings of responsible investment opportunities:

Investors continue to pour funds into passive investment products that aim to replicate the performance of benchmark indexes. They’re also increasingly keen that their money gets used to influence corporations to stop damaging the planet and improve social inclusiveness. Unfortunately, many of the products designed to achieve both objectives currently fall short on the goal of responsible investing.

The shift in emphasizing environmental, social and governance issues puts pressure on the index providers to come up with benchmarks that more accurately reflect the concerns investors are attempting to express by allocating capital to ESG investment products. Currently, though, even dedicated ESG indexes have shortcomings that many investors are probably unaware of.

The U.S. Vegan Climate exchange-traded fund, for example, tracks a $124 billion index created by Beyond Investing that excludes companies engaged in a laundry list of potentially harmful activities, including animal exploitation, human rights abuses and fossil fuels extraction. While the $14 million ETF’s top five holdings — Apple Inc., Microsoft Corp., Facebook Inc., Visa Inc. and Mastercard Inc. — may all meet those criteria, they’re hardly the first names that spring to mind when thinking about the words vegan or climate. And there are many other examples.

But Gilbert sees a way out:

There are two main routes whereby ETF providers can meet the implicit demands of clients allocating money to passively managed ESG products. The first is to use their collective muscle to prompt index providers to increase the granularity of the benchmarks used to shape asset allocations. Improving the discrimination of ESG indexes would go a long way to ensuring investors aren’t being hoodwinked into products that aren’t as green or socially savvy as they first appear.

The second is trickier. Excluding companies deemed to be damaging the environment or being socially irresponsibly isn’t enough to move the needle. Engaging with the boards of those firms and using the clout of a shareholding to force them to change their ways is much more effective.

After BlackRock announced last week that it would try to shift its focus to try to reflect its values, I hope we continue to push this discussion into wider forums. Voting with cash is the strongest vote we have.

‘Nestle Adds Plant-Based Sausages to Menu Amid Faux Meat Race’

Corinne Gretler for Bloomberg:

The KitKat maker will start selling a pea protein-based sausage in the U.S. and a soy-based version in Europe this spring, the company said.

This is the first time I’ve heard of the same product being sold with different proteins in different locations. Is this only because of American’s fear of soy? Those have been debunked.

And I saw this tidbit, which is great news:

Nestle is also developing plant-based tuna for its first fish substitute, Chief Technology Officer Stefan Palzer said. The tuna product could be added to pizza, sushi or served as a patty, he added.

But who on earth is adding tuna to pizza? What are you talking about, Mr. Palzer?

‘BlackRock C.E.O. Larry Fink: Climate Crisis Will Reshape Finance’

Andrew Ross Sorkin at the NYTimes:

Laurence D. Fink, the founder and chief executive of BlackRock, announced Tuesday that his firm would make investment decisions with environmental sustainability as a core goal.

BlackRock is the world’s largest asset manager with nearly $7 trillion in investments, and this move will fundamentally shift its investing policy — and could reshape how corporate America does business and put pressure on other large money managers to follow suit.

[…]

The firm, he wrote, would also introduce new funds that shun fossil fuel-oriented stocks, move more aggressively to vote against management teams that are not making progress on sustainability, and press companies to disclose plans “for operating under a scenario where the Paris Agreement’s goal of limiting global warming to less than two degrees is fully realized.”

Something like this could radically grow companies with a focus on vegan products. If they’re looking to have an effect on climate change, it’s an easy step to expand plant-based line-ups.

‘PETA bought stock in Starbucks to help vegans save 80 cents on nondairy milk’

Lydia Dishman of Fast Company:

People for the Ethical Treatment of Animals (PETA) just announced that it has become a shareholder of Starbucks Corporation in an effort to be heard at the coffee giant’s annual meetings. The animal-rights group, known for its embrace of theatrics, is planning to protest Starbucks’s upcharge of 80 cents on nondairy milk options for its drinks.

The squeaky wheel gets the grease, and hopefully free oat milk too.

‘Kroger rolls out Simple Truth Emerge plant-based meat’

Russell Redman for Supermarket News:

Kroger said Wednesday that Simple Truth Emerge pea-based meatless burger patties and grinds are now available in its store banners nationwide. Plans call for another 50 plant-based food products to be added to the Simple Truth line during 2020.

Kroger is making 50 *new* plant-based products this year. Again, I repeat: 50 new products. This year.

And so is every major supermarket chain around the country. Everyone is imitating Beyond Meat’s pea-protein burger product. From what I’ve seen around, most people still seem to think Beyond’s tastes best. All of this competition will improve the products, and all of us win.

I guess this is what representation looks like. Let’s just hope the representation is delicious.

‘Despite All the Buzz Around Fake Meat, Real Stuff Still Pays Off’

Lydia Mulvany and Deena Shanker for Bloomberg:

Imitation meat may be all the rage at the moment, but producers of the real stuff are doing just fine.

Sure, vegan burger maker Beyond Meat Inc. stole the headlines this year with a wildly successful market debut and a dizzying 200% gain. But conventional beef companies Minerva SA and JBS SA aren’t too far behind. Even U.S. meat suppliers like Tyson Foods Inc., hamstrung by the China trade war, have posted their biggest stock gains in years.

For as big of a year as Beyond, Impossible, and every other vegan company had in 2019, we need to remember that it’s currently only a drop in the pond. We’re still David to their Goliath, and our David is a pacifist.

‘Beyond Meat Brings in Coca-Cola Veteran to Head Marketing’

Beyond Meat Inc will bring in Coca-Cola Co veteran Stuart Kronauge as its chief marketing officer, the vegan patty maker said on Thursday, as it looks to boost its presence in retail and restaurants.

Beyond Meat last month named former Tesla Inc executive Sanjay Shah as its chief operating officer.

Kronauge, who has been with Atlanta-based Coca-Cola for over 20 years, headed the company’s sparkling business unit in North America.

She is credited for the resurgence of soda brands such as Coca-Cola, Coke Zero, Diet Coke, Sprite and Fanta. The beverage maker has been able to grow sales with the launch of smaller-sized cans of its sodas, in tune to a change in consumer tastes.

Beyond Meat is expanding sale of its plant-based meat burgers in retail stores and partnering with more restaurants as it builds on the recent hype for vegan patties that taste, cook and look like real meat.

I honestly am never quite sure how to interpret news like this. I think it’s a good thing that someone with experience for a global brand is being brought in, but Coca-Cola is (I hope) a very different kind of company than Beyond Meat. Whereas Coca-Cola sold sugar drinks, I think Beyond wants to be thought of as doing something better for the landscape of food.

Full disclosure: I love Coke. Roy Rogers are one of my favorite small pleasures.

‘United Airlines overhauls its 2020 menu to cater more to the vegan crowd’

Barbara Booth for MSNBC:

Although the airline started introducing healthier options this year, with gluten-free alternatives, the carrier is now focusing heavily on plant-based options, said United Airlines’ Executive Chef Gerry Gulli. Among United’s 2020 offerings: red beet hummus with roasted vegetables; roasted curry cauliflower with whipped hummus and pomegranate; and vegan stuffed grape leaf with dolma infused yogurt.

United is not alone. Turkish Airlines, Air New Zealand, Emirates and Aegean also offer plant-based options. In July 2018 Air New Zealand collaborated with Silicon Valley food tech start-up Impossible Foods, becoming the first airline to serve the plant-based Impossible Burger as part of its Business Premier menu on flights from Los Angeles to Auckland. Emirates claims it has more than 170 plant-based recipes in its kitchen to cater to its vegan customers, and vegan meals rank as the third most commonly requested special meal in economy class.

I’ve had some terrific food on international flights in the past few years. British Airways, Virgin, and Delta all offered flavorful vegan options—usually a curry with rice and vegetables. And always with fresh berries or a wonderful raw, chocolate cake.

‘The New Makers of Plant-Based Meat? Big Meat Companies’

David Yaffe-Bellany for the NYTimes:

Analysts project that the market for plant-based protein and lab-created meat alternatives could be worth as much as $85 billion by 2030.

What’s interesting about that figure is that UBS thinks $85 billion could be a conservative figure.

“When companies like Tyson and Smithfield launch plant-based meat products, that transforms the plant-based meat sector from niche to mainstream,” said Bruce Friedrich, who runs the Good Food Institute, an organization that advocates plant-based substitutes. “They have massive distribution channels, they have enthusiastic consumer bases, and they know what meat needs to do to satisfy consumers.”

This is the thing that spooks me when companies like this enter the market. I want everyone to have access to the best, and if theirs are only 80% as good as the best then it’s a massive disservice to people’s piqued interest in all new plant-based foods.

“We’re a meat company, first and foremost,” said Mr. Pauley, the Smithfield official. “We’re not going to apologize for that.”

A spokeswoman for Tyson, the largest meat producer in the United States and the creator of a new line of plant-based chicken nuggets, put it more bluntly. “Right now,” said the spokeswoman, Susan Wassel, “it’s really about the business opportunity.”

And this is a hard pill to swallow. Of course, I want everyone involved in vegan foods to have similar interests—but that’s unrealistic. Most business people are only into making money and don’t care how it’s made. So… I hope lots of evil people make bajillion dollars decreasing animal usage, saving the earth, and helping other people. In the end, it’s a net positive. Though, I’d prefer the good people make the bajillion dollars. I can’t control that.

“If the products are not that great, if they’re just basically repurposed veggie burgers, the harm it does to us is not competition,” [Pat Brown, Impossible Foods CEO] said. “It’s reinforcing consumers’ belief that a plant-based product can’t deliver what a meat lover wants.”

I really like Pat Brown’s turn of phrase. He really understands how to say something with a bang.

Beyond Meat is valued at nearly $9 billion, making it about a third the size of Tyson.

This was news to me, and I love it—especially because Tyson used to own a small stake in Beyond. It’s good to see Beyond eating Tyson’s dinner after what Tyson did last year. For those who don’t know, Tyson learned everything they could from Beyond and then sold off their shares to go off and try to make a competing product. Good riddance.

‘McDonald’s Picks Beyond for Canada Trial, U.S. Prize Remains’

McDonald’s Corp. has selected Beyond Meat Inc.’s faux-meat patties for a plant-based burger test in Canada. But the real prize will be the fast-food giant’s roughly 14,000 locations in its home market, and that race is still anybody’s game.

One step closer to the USA.