Beyond Bulls & Bears


Quick thoughts: Arugula is the new popcorn—a conversation on food innovation

Feeding a growing global population requires innovation in food and agricultural technologies. Learn about how investors have a role to play.

Feeding a growing global population requires innovation in food and agricultural technologies. We must re-think old paradigms and invest in solutions that not only boost agricultural productivity and food’s nutritional value but also reduce negative impacts on the planet. As part of our “Promise of Progress” series, I discussed these issues with Hanneke Faber, President of Nutrition at Unilever; Marc Oshima, Co-founder of AeroFarms; Anne Simpson, Head of Sustainability at Franklin Templeton; and Patrick Vizzone, Head of Agri-Food at Franklin Templeton Asia Pacific Alternatives. Here are my top takeaways:

  • Food production’s broad societal impacts. According to Anne, food security is one of the top issues for global human wellbeing. Hanneke mentioned that at current depletion rates of fertile soil, we may only have 50 years of harvests left without major changes. And Patrick pointed out that diet-related issues are driving 80% of healthcare costs in the United States, mainly attributed to a food system designed post World War II to deliver calorie dense and shelf stable products. Marc’s company is addressing this concern by growing micronutrient rich veggies, using data- and precision-driven farming methods. Hanneke and Unilever are focusing on regenerative agriculture—agricultural practices that improve soil health and decrease emissions and water use.
  • Localization is critical to improving supply chains. AeroFarms builds vertical farms directly in communities, reducing transportation costs, spoilage and waste. According to Marc, they produce up to 390 times greater productivity per square foot, while using up to 95% less water and no pesticides. Specifically, traditional fields produce two to three harvests of leafy greens per year, as opposed to 26 harvests in vertical farms. Recently, Unilever realized only 27% of the ingredients in food they sold in Africa was grown in Africa. Through local sourcing, they increased it to more than 60%. Localization improves supply chain resilience, improves community food security and is often less expensive. Patrick believes we are essentially seeing a rewiring of trade flows to be shorter, localized, more regionalized, less risky, and not purely built on cost projections.
  • Private and public capital partnership is necessary. Patrick confirmed food production innovation follows a similar investment path to other industries. However, going forward, governments, endowments and foundations have a critical role to play, particularly in risk mitigation in developing countries. These sectors must create supportive environments within the food ecosystem. Anne mentioned that clear measures and standards are needed for investors to make better informed decisions on the impact companies have on the environment.
  • Taste AND health are key. Hanneke knows it’s critical that food product design not only wins on taste, but also on health benefits and the health of the planet. Marc takes a similar approach with their arugula, which contains 100% more vitamin C than field-grown varieties. Its rich flavor and attractive packaging promote it as the “the new popcorn!”

Sustainable investment in food is about taking care of people, taking care of the planet, and creating a shared prosperity through investment opportunities that take natural capital into account. This trifecta leads to the investment opportunities we need to find as fiduciaries. To hear the complete conversation, sign up for the on-demand webinar HERE.


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