‘How a Vegan Ends Up With Leather in Her Portfolio’

Ron Lieber with an interesting piece about investing and it’s relationship to veganism for the NYTimes:

First, the US Vegan Climate ETF. It is an index of sorts, with 268 American stocks, and it begins with subtraction: removing companies, and even whole industries, that it considers animal unfriendly. Pharmaceuticals? Poof, because of all the animal testing. Companies that extract and refine fossil fuels are gone, too. After all, animals are outdoors more than we tend to be, so climate change threatens many of them even more than us.

The Karner Blue Animal Impact Fund, named for the endangered butterfly, takes a different approach. It is an actively managed mutual fund, with fewer than half the number of stocks in the Vegan ETF, including companies not based in the United States.

Another big difference: It employs so-called positive screening, picking best-of-breed companies in as many industries as it can stomach.

“We are not animal avoidant,” said Vicki L. Benjamin, president of Karner Blue Capital. “We are animal engagement.”

This gets tricky rather quickly, and it may mean something like the following when it comes to the raising of meat, according to Ms. Benjamin, who is not a vegan but tends to stray from a plant-based diet mostly in the piscine direction: People are going to eat animal flesh for a good long while, so why not treat the animals better?

Do that, and it becomes more expensive to raise animals, since you’re doing so humanely, which is a good thing. The cash cost of eating meat will go up, people will eat less, and emissions will fall.

That’s how Karner Blue ends up with Chipotle in its portfolio: It likes the chain’s animal welfare efforts (its continuing food safety questions aside). But the parent of Burger King didn’t make the cut, even though it has a vegetarian Whopper with an Impossible Burger patty these days. That’s because the parent, Restaurant Brands International, also owns Popeyes, which only recently agreeed to take a big step to improve its treatment of chickens.

Any edge cases reflect the kinds of compromises that nearly any kind of investment may require for most consumers. Because of its desire to direct capital to above-average companies in as many industries as possible, Karner Blue sometimes ends up in a situation where it’s effectively buying the best house in a bad neighborhood.

Investing while trying to ‘Do The Right Thing™’ is a wild game. If you want to support change, investment is one of the easiest ways to do it. I mean if we’re putting tofu and Impossible burgers and tempeh in it… we might as well put our money where our mouth is too.

It is confusing and it makes sense that we are starting to see multiple offerings that are trying to find a way to navigate this tricky space.

‘CEO of Burger King owner: ‘We are all in’ on plant-based foods’

Brian Sozzi for Yahoo! Finance:

“I think it’s just the beginning. It’s a brand new category, it’s a category we are leading not just in the U.S. but globally,” Cil told Yahoo Finance fresh off the company’s fourth quarter earnings call Monday. “And we think there is a lot of work to do still in terms of raising awareness, what are the benefits of it and then being able to offer some different products as well as occasions so that the consumer could expand their knowledge of the product. We are all in.” […]

Meanwhile, Burger King’s fourth quarter same-store sales rose 2.8%. Same-store sales for the chain rose 0.6% in the U.S. and 4.7% in the rest of the world. Burger King’s same-store sales increased 4.8% in the third quarter.

If you have a fast food chain and aren’t copying this, you’re losing free money.

‘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.

‘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.

‘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.

‘Dean Foods, America’s biggest milk producer, files for bankruptcy’

Dean Foods’ business has struggled as more consumers turn to nondairy milk or buy private-label products. Americans’ per capita consumption of fluid milk has fallen 26% in the last two decades, according to data from the U.S. Department of Agriculture.

Great news. I can’t believe alternative milks have taken a 1/4 of the market. Now, one of the nutmilk companies just needs to make a campaign as fun and ridiculous as this.

‘Impossible Whopper drives 5% of Burger King’s Q3 US comp sales’

The Impossible Whopper drove 5% of Burger King’s comparable sales in the U.S. during the third quarter, the brand’s strongest growth since 2015, according to an earnings release. The Impossible Whopper was one of the most successful rollouts in Burger King’s history, Restaurant Brands International CEO Jose Cil told investors during an October earnings call.

Sales were highly incremental and attracted new types of guests, he said. While it attracted millennials and Gen Z consumers that appreciated the product’s sustainability, older generations such as Gen Xers that hadn’t visited the chain in a while returned to try the Impossible Whopper.

Cil said the launch provided great momentum, and that the company expects continued growth as adoption of plant-based items increases. He believes the company has a strong plant-based platform and looks forward to expanding it outside the U.S. The chain has already brought plant-based beef and chicken offerings to Sweden. Burger King is also considering expanding plant-based into Latin America and Asia, he said.

I can’t imagine owning a chain of restaurants, seeing these numbers, and *not* adding plant-based items to your menu. It’s free money at this point. New customers, new old customers, and new things on the menu. Adding plant-based foods is like a restaurant cheat code at this point.

‘Can a Burger Help Solve Climate Change?’

Tad Friend writing a behemoth of a feature for the New Yorker on vegan burgers (specifically Impossible Foods and Beyond Meat), the technology behind it, and our world as it chomps down burgers. This is easily the most comprehensive piece I’ve read on any vegan food. There is a lot to comb through. Everything in bold is mine and done for emphasis. It opens with a bang:

Cows are easy to love. Their eyes are a liquid brown, their noses inquisitive, their udders homely; small children thrill to their moo.

Most people like them even better dead. Americans eat three hamburgers a week, so serving beef at your cookout is as patriotic as buying a gun. When progressive Democrats proposed a Green New Deal, earlier this year, leading Republicans labelled it a plot to “take away your hamburgers.” The former Trump adviser Sebastian Gorka characterized this plunder as “what Stalin dreamt about,” and Trump himself accused the Green New Deal of proposing to “permanently eliminate” cows. In fact, of course, its authors were merely advocating a sensible reduction in meat eating. Who would want to take away your hamburgers and eliminate cows?

Well, Pat Brown does, and pronto.

It’s going to be interesting in 20 years when we look back on this societal shift and here it call inevitable. Pat Brown’s language in this piece is revealing. It feels much more assertive and direct than Ethan Brown of Beyond Meat and Josh Tetrick of JUST, Inc. Pat’s language is practically confrontational.

Meat is essentially a huge check written against the depleted funds of our environment. Agriculture consumes more freshwater than any other human activity, and nearly a third of that water is devoted to raising livestock. One-third of the world’s arable land is used to grow feed for livestock, which are responsible for 14.5 per cent of global greenhouse-gas emissions. Razing forests to graze cattle—an area larger than South America has been cleared in the past quarter century—turns a carbon sink into a carbon spigot.


Every four pounds of beef you eat contributes to as much global warming as flying from New York to London—and the average American eats that much each month.


“Legal economic sabotage!” Brown said. He understood that the facts didn’t compel people as strongly as their craving for meat, and that shame was counterproductive. So he’d use the power of the free market to disseminate a better, cheaper replacement. And, because sixty per cent of America’s beef gets ground up, he’d start with burgers.

There were lots of things that were news to me. I hadn’t realized that 60% of America’s beef is ground up. Any product broken down and synthesized like that is firmly in the crosshairs of veganism. It means that product is a blend or processed in some capacity — and, so far, plant-based products have made massive leaps specifically in these areas recently.

And then it becomes essentially vegan pornography, and will likely be the inspiration to the next Willy Wonka sequel:

Brown assembled a team of scientists, who approached simulating a hamburger as if it were the Apollo program. They made their burger sustainable: the Impossible Burger requires eighty-seven per cent less water and ninety-six per cent less land than a cowburger, and its production generates eighty-nine per cent less G.H.G. emissions. They made it nutritionally equal to or superior to beef. And they made it look, smell, and taste very different from the customary veggie replacement. 


[I]n taste tests, half the respondents can’t distinguish Impossible’s patty from a Safeway burger.

Buckle up, this next section has Glenn Beck.

Ninety-five per cent of those who buy the Impossible Burger are meat-eaters. The radio host Glenn Beck, who breeds cattle when he’s not leading the “They’re taking away your hamburgers!” caucus, recently tried the Impossible Burger on his show, in a blind taste test against a beef burger—and guessed wrong. “That is insane!” he marvelled. “I could go vegan!”

There ya go. I feel like every Impossible commercial should just be ranchers who can’t tell the difference. Like the Coke vs. Pepsi challenge but for protein.

“We plan to take a double-digit portion of the beef market within five years, and then we can push that industry, which is fragile and has low margins, into a death spiral,” he said. “Then we can just point to the pork industry and the chicken industry and say ‘You’re next!’ and they’ll go bankrupt even faster.”

It’s true. From here on out, the margins for plant-based protein can only become more affordable.

Mike Selden, the co-founder and C.E.O. of Finless Foods, a startup working on cell-based bluefin tuna, said, “Pat and Impossible made it seem like there’s a real industry here. He stopped using the words ‘vegan’ and ‘vegetarian’ and set the rules for the industry: ‘If our product can’t compete on regular metrics like taste, price, convenience, and nutrition, then all we’re doing is virtue signalling for rich people.’ And he incorporated biotechnology in a way that’s interesting to meat-eaters—Pat made alternative meat sexy.”

In time, I think people will forget that what brought most people into veganism or eating vegan foods was the re-labeling of vegan products as plant-based. The stigma around the v-word made it inescapable, but this gave flexible folks another-nother alternative.

Brown doesn’t care that plant-based meat amounts to less than 0.1 per cent of the $1.7-trillion global market for meat, fish, and dairy, or that meat contributes to the livelihoods of some 1.3 billion people. His motto, enshrined on the wall of Impossible’s office, is “Blast ahead!” During the six months that I was reporting this story, the company’s head count grew sixty per cent, to five hundred and fifty-two, and its total funding nearly doubled, to more than seven hundred and fifty million dollars. Brown laid out the math: to meet his 2035 goal, Impossible just has to double its production every year, on average, for the next 14.87 years. This means that it has to scale up more than thirty thousandfold. When I observed that no company has ever grown anywhere near that fast for that long, he shrugged and said, “We will be the most impactful company in the history of the world.”

Obviously, this is insane — but I love the insanity.

For another thing, meat is wildly inefficient. Because cattle use their feed not only to grow muscle but also to grow bones and a tail and to trot around and to think their mysterious thoughts, their energy-conversion efficiency—the number of calories their meat contains compared with the number they take in to make it—is a woeful one per cent.

Has anyone else seen this written anywhere else? That 1% claim would be a deal and I’ve never heard it said anywhere else.

“Another advantage we have over the incumbent technology is that we keep improving our product every week. The cow can’t.”

This is possibly the most interesting part of this article. I’m interested in seeing what they think are improvements over time. I remember years ago reading an article about scientists working on Doritos to find the perfect satiation point where people wanted more but also couldn’t burn out. Same thing I’d heard for sodas. Engineering is great to a certain point, but has its limits and a certain cultural stigma. I’ll be very interested to see how all of these companies navigate language and understanding of what it means to “engineer” food.

Brown remains mystified, for instance, by Americans’ eagerness to add protein to their diets when they already consume far more than is necessary. Nonetheless, he beefed up the protein in his burgers. “There are things we do that are effectively just acknowledging widespread erroneous beliefs about nutrition,” he said. “For the same reasons, we initially used only non-G.M.O. crops, which was essentially pandering. We’re not trying to win arguments but to achieve the mission.

Brown sees himself as a guide rather than as a micromanager—“I have no idea if the company paid taxes last year. The C.E.O. is supposed to know that, I guess”—but he is determined to retain control. When Google made an early offer to buy the company, he said, he turned it down “in less than five seconds, because we would have just been one of their suite of nifty projects.” And he made it a condition of his deal with Khosla Ventures that Impossible couldn’t be sold without his approval to any of about forty “disallowed companies”—meat producers and agricultural conglomerates.

There is a small contingency of old-school vegan eaters that this is really important too. There’s a nice market in Los Angeles called BESTIES that only carries vegan food made by all-vegan companies. I would assume Impossible already alienated people who shop at places like BESTIES and similarily interested vegans with their heme testing for the FDA. Obviously, it’s a challenging line to walk.

While the Impossible Burger is still trying to match the flavor of beef, in certain respects it’s begun to improve upon the original. Celeste Holz-Schietinger, one of the company’s top scientists, told me, “Our burger is already more savory and umami than beef, and in our next version”—a 3.0 burger will be released in a few months—“we want to increase the buttery flavor and caramelization over real beef.”

This was news to me and I’m already excited for it. It’d be interesting if they made an annual event where they would release their new products like Apple does with the iPhone.

Early on, Brown believed that his burger would be cheaper than ground beef by 2017. His original pitch claimed, in a hand-waving sort of way, that because wheat and soy cost about seven cents a pound, while ground beef cost a dollar-fifty, “plant based alternatives can provide the nutritional equivalent of ground beef at less than 5% of the cost.” But establishing a novel supply chain, particularly for heme, proved expensive. The company has increased its yield of the molecule more than sevenfold in four years, and, Brown said, “we’re no longer agonizing over the impact of heme on our cost.” He now hopes to equal the price of ground beef by 2022.

It’ll happen even sooner if the government stops subsidizing beef. Spending $38 billion annually to subsidize beef and dairy while almost none on vegetables and fruit is an atrocity.

When Impossible meat is equal to or cheaper than the cost of beef, I want it to be the first national vegan holiday. Block parties, grills, neighbors, new friends, old friends. It’ll be one to remember.

‘Where’s the fake beef? Not at Kraft Heinz, investors worry’

Investors are chewing out Kraft Heinz Co (KHC.O) for failing to lay out a full strategy for how it plans to compete in the roughly $3 billion-a-year plant-based protein market.


Products by rivals Beyond Meat Inc (BYND.O) and Impossible Foods have become the hottest food trend in recent years, gaining popularity among mainstream consumers looking to cut back on meat consumption.


Kraft Heinz has been ranked one of the least proactive major food makers in the plant-based protein market, according to FAIRR, a major investor coalition that includes several Kraft Heinz shareholders. The company’s main meat-alternative brand, 40-year-old BOCA Burger, has lost market share since 2013.

“Any company ranking at the bottom clearly has some catching up to do,” said Peter van der Werf, head of responsible investment management at Robeco

This almost made my brain melt. Five years ago, this would have been a headline from The Onion.