While we are all familiar with the adage “don’t let good food go to waste,” the decision of what to do with excess food has become a pressing mandate for businesses. With environmental sustainability in sudden focus, organizations across the Food, Beverage, and Agribusiness (FBA) space are being tasked with reversing the food waste trend by finding alternative solutions to production and supply.
Each year, a tidal wave of food waste—to the tune of 63.13 million tons—washes over the United States. A whopping 58 percent of all food produced in Canada—35.5 million tonnes—is lost or wasted according to a report by Second Harvest. This waste is largely generated by the commercial, institutional, and residential sectors and also implicates all corners of the economy. Mitigating this outcome requires a collective effort, and it doesn’t just start at the end of the supply chain. The Environmental Protection Agency (EPA) is challenging companies to take stock of their actions at every stage of production. The EPA urges major organic waste generators to follow sustainable materials management by preventing and prioritizing the reuse of byproducts. Producers aim to eliminate waste by focusing upstream on system design.
Reducing food waste is not just an environmental imperative, but potentially a value-add for businesses hoping to score ESG investor points. In 2015, the U.S. Department of Agriculture and EPA set a goal to reduce food waste in the United States by 50 percent over the course of 15 years. To ensure progress, they’ve encouraged businesses to cut waste in half within their own operations by 2023, which could earn them a spot on the “U.S. Food Loss and Waste 2030 Champions” list. Many name-brand companies, including Whole Foods, Aldi, Kroger, and Wal-Mart, have signed onto this pledge, recognizing its importance for shareholders and consumers alike.
Of course, putting promise into practice is a much larger lift, requiring a collaborative effort from everyone involved. That’s why FBA businesses are teaming up to tackle the complex issue of food waste. Across the industry, we’ve seen companies join forces to implement creative reuse and recycling strategies. The Farm Powered Strategic Alliance is at the forefront of this trend. The Alliance was founded in 2020 by four major producers: Vanguard Renewables, Unilever, Starbucks, and Dairy Farmers of America. Several other organizations have since joined the initiative, including many more household name brands. Their objective is to avoid or eliminate food waste primarily. Anything that cannot be eliminated will be repurposed through farm-based anaerobic digesters to generate renewable energy. This process involves breaking down biodegradable material in the absence of oxygen to produce methane, which can be treated and recovered as energy. This specific recycling framework is unique, and reflective of a broader shift toward cross-sectional collaboration on waste management.
As collaboration continues, companies should consider the regulatory and legal requirements necessary to introduce more waste management infrastructure. When strategic partnerships take shape, it’s imperative that companies have a contract in place that ensures mutual protection and agreed-upon risk sharing. This is especially important as environmental initiatives often require capital investment in new technologies and fulfilling specific performance requirements. A well-drafted agreement can iron out uncertainties and provide a clear path forward.
Businesses should remain informed of local and state regulations governing food waste. Some governments have implemented specific rules, requiring larger generators to divert organics from a landfill if there is locally available infrastructure in place. These regulations have ripple effects throughout the food economy, as they create incentives to funnel new materials into new facilities, and spur development of waste management infrastructure.
Partnerships on waste management can take many forms. Among the most common are private partnerships, like the Farm Powered Strategic Alliance, and public-private partnerships (P3), which may include a municipality introducing food waste into their existing infrastructure for composting or anaerobic digestion. Even community groups are stepping up to meet the challenge of food waste—in 2017, a NYC-based organization called Rethink Food converted 1.5 million pounds of excess food into meals. This is one of many grassroots efforts in motion across the country.
When it comes to addressing food waste, there’s no single solution. Companies have many opportunities to advance waste management, both within their own operations and drawing support from partnerships industry wide.
We’re excited to continue guiding environmental sustainability efforts across the industry. Please reach out to David Wright with any questions.
