New research reveals the practices of ten consumer goods companies in the soy value chain. The study highlights key sustainability issues and offers practical recommendations for improvement to companies and investors.
Over the past 20 years, the soybean market has more than doubled to a value of $123 billion annually, with soy emerging as one of the world’s most important agro-commodities. However, this rapid rise in economic importance has come with a suite of negative impacts. Soy production is strongly linked to deforestation, ecosystem loss, increased greenhouse gas emissions, social displacement, and the problematic aspects of genetic modification.
Indeed in its latest report on Climate Change and Land, released on 8th August, the Intergovernmental Panel on Climate Change highlighted the critical role of sustainable land management in the fight against climate change.
Soybean was among the agricultural commodities the report called out as having "driven profound landscape transformations… contributing to increased deforestation rates and associated GHG emissions".
In this context, LTS International - a member of the NIRAS Group - recently completed a bespoke research assignment on the key sustainability issues in soy production.
The research was commissioned by Stewart Investors - part of First State Investments - a global asset management firm with more than USD$143bn assets under management - on behalf on their clients.
LTS International examined the approach of ten consumer goods companies in the soy value chain to these issues.
Project Manager Danny Smith commented: “As part of the research, LTS along with our client Stewart Investors sought to engage directly with the companies on their strategies to the sustainable sourcing of soy, understanding their approaches, and suggesting practical findings and recommendations for them to implement. In LTS and NIRAS our aim is to engage in a constructive dialogue and thereby contribute to a meaningful change in companies, and to support them in their contributions to achieving the SDGs.”
The findings identified seven key areas of focus for companies in soy sustainability, and drew the following conclusions:
Global focus is turning increasingly to sustainable land management as a critical factor in achieving SDGs 12 (responsible consumption and production), 13 (climate action), and 15 (life on land) in particular.
NIRAS sees engagement and partnership with a variety of stakeholders on these issues - including investors, financial institutions and the private sector – as significant, particularly in the complex global supply chains of agricultural commodities such as soy.
A summary version of the report is available here.