Fast Food Chains Face Investor Concerns Over Climate Change

Climate Change

Investors are calling for fast food restaurants like McDonald’s, Burger King, KFC, and others to drastically cut carbon emissions from their meat and dairy farms. This call for change comes after the FAIRR report on meat and dairy producers was released.

Agriculture emissions are one of the biggest problems in the world and no reform plans have been suggested for the sector. Fast food chains rely heavily on farms to produce the meats and dairy served at these restaurants.

The Impact Of Agriculture

Farm Land

The growth of the agriculture sector has been unchallenged for decades, and that will be its undoing. While other industries have put in the effort to reduce their climate impact, agriculture remains stagnant.

Not only are emissions a problem, but water usage is another concern entirely.

Investors are calling for change now because it is only a matter of time until change is forced on the industry. Investors are the best way to get a company’s attention.  Over 80 investors sent a letter to fast food companies such as McDonald’s, Burger King, Wendy’s, KFC, Pizza Hut, and Chipotle urging change.

This will certainly have a resounding impact because these companies are estimated to be worth 570 billion dollars. These companies have the means to afford to change their practices and starting now makes more sense.

What Are Investors Asking For

In the letter, investors are calling for fast food chains to outline clear and precise requirements for their suppliers with a strong focus on cutting greenhouse gas emissions and lowering water usage. Suppliers that do not comply will lose access to their biggest customer.

Just How Much Does Agriculture Emit

Cows Drinking Water

The biggest question this raises is just how much does the agriculture sector emit? If we fast forward to 2050, agriculture will make up 70% of allowable greenhouse emissions. This number comes from the Paris Agreement that wants to limit global warming to only a 2C increase by the end of the century.

The emissions are the biggest problem now, but in the future, the water supply is expected to be a very hot topic. It is estimated that the sector uses 10% of the annual water flow. As water becomes more expensive and harder to obtain, it will cause problems for fast food meat and dairy producers.

Without a doubt, investors calling for action today, rather than later, can help save the planet as well as protect the companies’ profits.

McDonald’s Response

McDonald’s is the most recognizable fast food chain in the world and they had a very specific response to this letter.  A spokesman from Mcdonald’s reminded investors that McDonald’s was the first fast food chain to take action against climate change.

This took place in March 2018 when the fast food juggernaut began doing exactly what was asked of them in this letter before anyone asked them too. The company set a target of reducing emissions by 36% by the year 2030 and it was approved by Science Based Targets.

The Focus on Agriculture Continues

This is one example of a much larger examination of agricultural practices as a whole.  Since the recent EAT-Lancet Emission report, that stated that a 90% reduction in red meats and milk consumption must be made to feed an expected 10 billion population,  a complete reexamination of the industry and its practices has started.

As it stands, the agricultural industry has made no meaningful attempt at change or forming a plan, thus it falls on their largest customers to demand change or cut business ties. Losing fast food chains would absolutely destroy these meat and dairy providers, which means that change is very likely.

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