Collaboration is key for credible climate transition plans

In a welcome partnership, the global agribusiness, food and ingredients company Bunge is teaming up with the sustainability non-profit Ceres and seeking feedback from a consortium of the company’s shareholders to assess the feasibility of developing a 1.5 degree aligned Climate Transition Plan. Bunge is exemplifying best practice by fostering open dialogue and seeking collaboration to enhance its decarbonisation roadmap. This partnership showcases the potential of global agribusinesses to lead the way towards a more sustainable future for the industry.

Climate change & the food and agriculture sector

The food and agriculture sector is often referred to as a “hard to abate sector” due to the challenges of reducing greenhouse gas emissions within its complex supply chains and its impacts on land use. The end-to-end supply chain complexity and diverse activities contribute to its substantial carbon footprint, spanning agricultural production, processing, transportation, and distribution. Each stage of the supply chain presents unique obstacles to decarbonisation requiring a distinct transition pathway.

It is also confronted with the critical challenge of combating climate change impacts on food supply production. The sector’s heavy reliance on natural resources and vulnerability to shifting weather patterns amplify the urgency of adopting more sustainable practices. Rising temperatures, water scarcity, and extreme weather events threaten crop yields, affecting food production on a global scale, putting the sector at the junction of climate change, biodiversity loss and food security.

Despite the challenges, the food and agriculture sector need to continue nourishing the growing global population. To ensure a sustainable future for both the industry and the planet and to keep the 1.5°C target in the Paris Agreement within reach, it is imperative to prioritise decarbonisation. Companies must also enhance sector-wide collaboration and engagement with key governments and the finance sector to strengthen policies and investments to enable the environment for forest positive production and trade. Advancing the use of innovative technologies, preventing deforestation, promoting renewable energy use, and implementing regenerative agricultural practices that reduce emissions offer tangible solutions to reduce the sector’s environmental impact.

Success hinges on collaborative efforts

A successful transition to a sustainable society relies on innovative collaborations, both within companies’ value chains and between companies, their investors, governmental bodies and other stakeholders, such as farmers which are key in the decarbonisation process.

Involving non-profit organisations with deep topical expertise, like Ceres, and investors in developing Climate Transition Plans puts forward diverse perspectives, expertise, and resources to enhance decision-making and stakeholder buy-in. The collaboration with Bunge entails a stakeholder engagement process led by Ceres (as a facilitator) involving Cardano and seven other global financial institutions. The goal is to evaluate efforts that would be necessary for the company’s transition to 1.5-degree alignment. During the July meeting, investors provided views on how these elements could be included in the plan: Research & Development and product development alignment with a 1.5 C scenario, emissions profiling, investor expectations on short-term cost investments versus long-term payback periods, and carbon sequestration guidance. Looking ahead, the group will reconvene in the Fall of 2023 to discuss progress and for Bunge to provide an update on its efforts.

Agribusinesses like Bunge can promote progress, however, the ultimate success in adapting scalable food production business models to become more sustainable, while creating long term value for shareholders and meeting the economic and social needs of smaller operators and community members requires collective efforts from all players in the supply chain in combination with policy frameworks that incentivise sustainable production. The investors in this group hope that this initiative serves as a catalyst for encouraging other agribusiness companies, farmers, commodity suppliers, logistics services, consumer goods companies and food retailers to follow suit and seek out a collaborative approach to decarbonisation planning. By embracing similar processes and working together towards emissions reductions and making contributions to a nature-positive economy, the food and agriculture sector can make significant strides in combating climate change and biodiversity loss.