A three-year global investor engagement campaign focused on some of the world’s largest fast food giants has resulted in several of the world’s biggest brands setting global greenhouse gas reduction targets approved by the Science-Based Targets initiative (SBTi), it has been announced.
The campaign, which was co-ordinated by the FARR network of global investors and sustainable investment grpoup Ceres, called on Chipotle Mexican Grill, Domino’s Pizza, McDonald’s, Burger King-owner Restaurant Brands International (RBI), Wendy’s Co., and Yum! Brands, owners of KFC, Pizza Hut, and Taco Bell, to set ambitious new decarbonisation goals.
The group, which represents investors with $11tr of assets under management, successfully secured new science based emissions targets or commitments to set such targets from all six fast food companies. For example, Chipotle has now committed to reduce its Scope 1, 2, and 3 emissions by 50 per cent by 2030.
“For many years, fast food companies have been laggards when it came to acting on climate risk, so we are pleased to see that all six of these fast-food giants have now committed to Science-Based Targets – an increase from just two in 2020,” said John Anzani, executive committee member for the Local Authority Pension Fun Forum (LAPFF), one of the investors involved pushing for the change.
However, a progress report published today by FARR and Ceres raises concerns for investors about the management of both emissions and water usage in the supply chains of the global restaurant chains.
Titled Global Investor Engagement on Meat Sourcing Progress Updatethe report warns that there remains a “lack of supplier transparency and action” when it comes to the fast food brands’ efforts to cut their value chain emissions with target-setting yet to result in adequate action by meat and dairy suppliers.
The report shows that well over 90 per cent of fast food companies’ emissions come from Scope 3 emissions, primarily from their meat and dairy supply chains. It found that only two of the firms engaged – RBI and Yum! – report the proportion of emissions arising from their suppliers of animal agriculture products. In both cases, these represent more than 50 per cent of the firms’ entire emissions
Meanwhile, McDonald’s is the only company that has conducted a comprehensive water risk assessment that includes its supply chain, according to the report.
“Regulators and operating frameworks such as the Science-Based Targets initiative (SBTi) are tightening requirements for the food sector to report and act on climate,” said Cristina Figaredo, senior manager for research and engagement at FAIRR. “So, investors are very concerned that ambitious climate targets by fast food companies are not translating into action along the supply chain.
“The lack of alignment of supplier policies with corporate climate ambitions risks undermining the efforts of these high-street brands to tackle climate risk. Their performance on water is also alarmingly poor, and efforts to mitigate risks related to water scarcity and pollution have stagnated over the past year.”