Fourteen years ago, I started my first job at an organization urging food companies to improve farm animal treatment in their supply chains — an almost foreign concept at the time. I’d call purchasing directors and CEOs to ask about possibly shifting to products like cage-free eggs and hear crickets on the other end of the line.
“Huh? We already have eggs — we don’t want to buy your eggs,” I recall a major burger chain telling me, thinking I was attempting to sell them eggs rather than sell them on a concept about how to buy eggs.
Fast forward a decade and a half and much of the industry is now in a race-to-the-top on this issue, with major companies scrambling not just to provide food at a good value, but good food that aligns with consumers’ values — especially when it comes to animal treatment.
Taco Bell recently announced, for example, that it will be the first major American restaurant chain to ensure 100 percent of its eggs come from cage-free chickens, a transition it plans to make within just one year. The move catapults the fast food giant ahead of McDonald’s, Burger King, Jack in the Box, TGI Fridays, Starbucks, Panera Bread, Kellogg’s, General Mills, Unilever, Aramark, Sodexo and others that have each announced similar cage-free initiatives, though with phase-in timelines ranging from five to ten years, instead of one.
Companies competing over who can best — and more quickly — address animal welfare? I could never have imagined this progress 14 years ago when my calls were greeted with such skepticism.
It’s a shift that comes as corporate America more fully embraces the notion that how companies interact with the world around them, including the rest of the animal kingdom, can have major bottom-line impacts.
Take SeaWorld. The company’s been plagued by controversy and diminished sales since 2013’s Blackfish, a film alleging abuse of captive orcas at its theme parks. Since Blackfish’s release, SeaWorld’s stock has plummeted over 52 percent, sending investors into a tailspin and the company bustling to address concerns.
The ripples have extended far beyond SeaWorld’s tanks. Indeed, the movement today in the food sector may very well be owed, at least partially, to a growing desire to avoid becoming the next pariah among consumers interested in supporting companies that treat animals well.
And a great many customers that is. “Shoppers want food retailers to prioritize animal welfare [even] over environmentally-sustainable practices,” reports the Food Marketing Institute, the supermarket sector’s largest trade association. “Animal welfare must now therefore be considered as a shopper value that retailers need to manage towards.”
Even Wall Street is taking notice. Interest in companies’ performance on animal welfare, while once relegated to the likes of socially-responsible investment funds, is now taking root amongst mainstream firms.
In September, BlackRock, the world’s largest asset manager, hosted an event at its New York City headquarters on the topic, titled The Humane Economy. There, leaders from financial firms representing $17 trillion in combined assets-under-management gathered to discuss the material risks associated with animal cruelty in the food supply, and financial opportunities associated with embracing issues like shifting to cage-free eggs.
The concept of better animal treatment correlating to better balance sheets has drawn major support from investors. In 2013, shareholders of the restaurant chain Cracker Barrel voted — nearly unanimously — to support the company’s work addressing animal welfare. And last year, a shareholder proposal at Kraft Foods urging disclosure of the risks associated with selling eggs from caged chickens received more than a third of the shareholder vote.
Shareholders’ interest in this issue makes sense: Citigroup reports that animal cruelty is a “headline risk” to restaurant companies, and the World Bank’s International Finance Corp. reports that it can “put companies and their investors at a competitive disadvantage.”
It may be those risks — that possible disadvantage — that have caused the food industry to progress a long way since the days when the idea of purchasing products with animal welfare in mind caused confusion. Nowadays, investors are taking into account how the companies they hold treat animals, and many of the world’s largest corporations are aggressively tackling the issue — moving chickens out of cages at warp speed, for example, to show their customers and investors that doing good can indeed be part and parcel to doing well.