Source: Michael Fielding, MEATINGPLACE, 11/22/16


Forty-five institutional investors collectively managing more than $1 trillion in assets are pressing some of the nation’s largest producers of turkey and other meat to address the significant water pollution risks associated with feeding, slaughtering and processing livestock.

The investors – among them more than a dozen non-profit health systems and Catholic religious orders – sent joint letters to four of the largest producers in the meat industry, Cargill, Inc., JBS, Perdue Farms, and Smithfield Foods.

The letters come one month after Hurricane Matthew inundated poultry and hog farms in North Carolina, flooding manure lagoons and killing more than two million chickens, turkeys and hogs.

“As investors analyzing water risks in our portfolios, we believe that robust management of water quality challenges is a critical aspect of risk management in the meat industry, and one of increasing importance in the context of climate change and growing weather extremes,” the investors wrote. 

Investors who signed onto the letters are members of the nonprofit sustainability organization Ceres and the Interfaith Center on Corporate Responsibility.

“Broad mismanagement of local water resources can lead to devastating regulatory, reputational, and litigation risks, weakening a company’s ability to operate profitably,” said Kristel Verhoef, active ownership specialist at Dutch fund and asset manager ACTIAM, one of the signatories.

Processors respond
Cargill has reduced water use in its North America protein business by 15 percent over the last decade, according to Mike Martin, director of communications. “We monitor and upgrade our systems to effectively treat wastewater, which is then used to irrigate local farms surrounding many of our facilities,” he wrote in an email sent to Meatingplace. “Several of our meat processing facilities provide 100 percent of their treated wastewater to local farm irrigation. Our facility design and operations have built-in water recycling systems to safely use water several times before it is finally treated for discharge.”

Cargill is also working with a variety of customers, competitors, suppliers and conservation groups on water stewardship – including the U.S. and global roundtables on sustainable beef; Field to Market; Living Lands and Waters; World Resources Institute; and the recently launched Midwest Row Crop Collaborative, a multi-stakeholder group working to reduce nutrient runoff into the rivers and streams of the Mississippi River Basin. 

Smithfield
“We’ve moved beyond regulation compliance and entered an era of innovation that drives our industry-leading, proactive approach to water management across our farms, facilities and throughout our supply chain,” Stewart Leeth, vice president of regulatory affairs and chief sustainability officer at Smithfield Foods, told Meatingplace in an email. Ceres ranked Smithfield No. 1 in water management practices among leading meat companies last year.

“We continue to leverage cutting-edge science to handle manure responsibly including our significant investment into water treatment facility improvements, which help protect local waterways,” he added. Smithfield has become an active partner with several nonprofit organizations, including the Environmental Defense Fund (EDF), to reduce fertilizer consumption in its supply chain and minimize water runoff during feed production.

Not the first time
The recent letter comes on the heels of several shareholder proposals filed with other meat sector players, including Tyson Foods, Hormel Foods, Pilgrim’s Pride and Sanderson Farms, that call for improved water management.

“Comprehensive water stewardship policies are critical to avoid the risks present at several points in the supply chain of meat producers like Hormel,” explained Sister Patricia Daly of the Tri-State Coalition for Responsible Investment. “We are encouraged by [Hormel’s] commitment following the withdrawal of our shareholder proposal, to put a water stewardship policy in place that will apply to major suppliers, contract animal growers and feed suppliers.”

Last year, Ceres released a report that ranks major food companies on water risk management, and it identified several meat companies as poor performers.

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