Australian-founded global investment and advisory firm, Pollination, is working with some of the world’s largest food companies to develop and finance scalable solutions that will help decarbonise supply chains and accelerate the transition to more sustainable food systems. Food & Drink Business editor, Kim Berry, speaks to Pollination managing director APAC Team, Hamish Reid.
Pollination’s latest white paper, Resilient Farms and Food Supply: Who Foots the Bill? is the distillation of best practice by food companies working to transform their operations, it has seen.
Pollination managing director APAC Team, Hamish Reid, says most companies now recognise that shifting to more sustainable practices is necessary and critical.
“We’re at a similar point with food systems as we were with climate change years ago,” Reid says.
“Recently, there’s been a growing realisation across the industry that the scale of this transition is just phenomenal. Many companies have done an excellent job identifying their environmental impacts and building detailed strategies. They’ve piloted solutions across various crops and livestock systems, but when they look at the overall scale of change required, the truth hits hard – enormous capital investment is needed to make this transition happen.”
“In the report, we analysed 79 global food and retail giants, worth more than $3 trillion. We found nearly two-thirds of them mention regenerative agriculture initiatives in their disclosure statement, but less than 10 per cent of them have allocated financial budgets to support their transition finance needs and incentivise the uptake of regenerative practices by producers in their supply chain,” Reid says.
What Pollination uncovered, was the growing recognition of the importance of regenerative agriculture had outpaced actual understanding of the topic by key potential financial actors in the food and agriculture value chain.
“It’s crystal clear that one company alone cannot spearhead the monumental shift needed towards a regenerative evolution for global agriculture. Yet, the bold decisions of individual leaders can spark a cascading effect.
“To shift the global food system towards sustainable practices, we’re talking about a level of financing that requires collaboration across industries and sectors, including government and philanthropic sources,” Reid says.
Pollination’s analysis found food companies lack a clear picture of how supply chains are dependent on nature and implicated in delivering poor environmental outcomes. That lack of understanding leads to food companies overlooking interactions across the food system that are required to enable the shift to more flexible, resilient supply chains and forms of agriculture.
“The first step towards taking action is creating a shared understanding of what good looks like, before we can begin forging the shared intent that is needed to get there,” the report said.
The multiplier effect
Reid says there needs to be greater acknowledgment that more climate- and nature-friendly practices are not a cost burden, but rather a profit opportunity.
Leveraging existing research, customising opportunities, and pre-competitive collaboration were three benefits that come with a changed mindset.
“When companies only pursue isolated initiatives, they miss out on a multiplier effect. By joining up these initiatives under a larger strategy, they can achieve much more progress and realise greater returns,” he says.
Customisation is key
Reid emphasised that while the principles of regenerative agriculture may be universal, their application varies widely.
“Wheat farming in Australia isn’t the same as in the American Midwest, and rice growing in Arkansas differs from Japan or Vietnam. Each region has unique needs that must be considered.”
That said, Reid believes that a more coordinated rollout of best practices – while still allowing for regional nuances – could significantly improve resilience, yields, and economic prosperity.
“There’s an immense opportunity here if we collaborate more effectively across geographies. We need to embrace a pre-competitive approach where companies can share processes and systems that benefit everyone, without infringing on intellectual property.”
Emotional engagement leads to action
“The neurologist Donald Calne said, ‘Rational statements lead to conclusions; emotional engagement leads to action’. Data alone rarely drives change. People need an emotional connection to a challenge for them to act. For some, that connection comes through hard numbers; for others, it’s visualising a dystopian future or a more positive one,” Reid says.
For Reid, this is one of Pollination’s point of difference. “We are not just technical advisors; we see ourselves as a catalyst for engagement across supply chains.
“Our job is to help clients transition to systems that benefit both people and the planet. But how we engage with them – and how they, in turn, mobilise their own value chains – determines if we move from conclusions to action.”
The call to action
Reid says Pollination is seeing an increasing interest from governments to support the transition, by implementing grant schemes and funds to support sustainable practices.
“Governments are playing a more prominent role, which is brilliant. Many companies are surprised to learn about the external sources of capital available to help them deliver on their ambitions. In one US project, we helped a major food producer stack capital from federal, state, and philanthropic sources, which allowed them to secure internal approval for a major decarbonisation project,” he says.
Reid notes that food and fibre companies in Australia often express frustration at the perceived lack of government support for a sustainable future. However, he remains optimistic, emphasising Pollination’s approach is about connecting companies with the resources they need to act – whether through internal initiatives, external partnerships, or public funding.
Reid says food companies must take a broader view of sustainability and recognise the urgency and complexity of the task ahead.
“We’ve done an incredible job over the last 70 years, feeding billions more people with less. But this has come at a tremendous cost. We’re running out of runway on our current path.
“The transition to net-zero and nature-positive practices by mid-century requires wartime urgency and effort from every participant in the food value chain, from small coffee growers to massive industrial farms,” he says.
Confident that with the right strategic approach and cross-sector collaboration, the food industry can move towards a sustainable future, Reid notes it will require resilience, innovation, and a deep commitment from all stakeholders.
Pollination’s white paper offers a seven-stage process for food companies aiming to decarbonise their supply chains and scale regenerative agriculture. These steps, informed by years of collaboration with global industry leaders, cover essential actions, from supply chain mapping to establishing partnerships that can support financing and operational change at the necessary scale. The firm has also released a guide, in collaboration with The Rockefeller Foundation and Transformational Investing in Food Systems, detailing how to mobilise capital for this transition.
