Solution Cluster 1.4.2
Develop new standards and legal frameworks to drive private-sector change and hold companies accountable for their social and environmental impact
The vast majority of food consumed worldwide is produced or handled by the private sector. There is thus an urgent resulting need to engage this sector in building a sustainable, scalable food system. This solution is focused on 1) improving the social and environmental performance of businesses in the food industry and 2) creating greater corporate accountability for the impact the private sector has on all stakeholders. The resulting targeted outcomes for end consumers and the planet include: reducing hunger and food waste, improving nutrition and health, advancing the quality of workers’ livelihoods, respecting planetary boundaries, and mitigating the industry’s carbon footprint.
Unfortunately, the private sector’s prioritisation of profit before people and the planet has intensified many of our food system challenges, including malnutrition, equitable access, climate change, biodiversity loss, and income inequality. These pressing issues cannot be solved by governments, international organisations, and non-profits alone. Systemic change, at the pace needed by people and our planet, requires credible leadership and engagement from the private sector.
To catalyse this private-sector engagement, this solution includes: 1) the creation of best-in-class, social and environmental standards for the food system industry integrated into the largest impact management platform in the world (the B Impact Assessment) to drive behaviour change in food system corporations and improve nutrition, health, and access; 2) the promotion and adoption of a corporate legal framework that holds companies accountable for their impact on society and the environment; and 3) the promotion of an inspiring narrative with case studies of best-in-class food sector businesses that can serve as an inspiration for others to engage. The end objective is a fundamental shift in the food system to be more inclusive, equitable, health-supporting, and regenerative.
About this Solution Cluster
The misalignment in the interests of stakeholders – from local to global levels – mostly due to asymmetries, requires deliberate focus and coordination to ensure that every nation develops the means to scale up or down, or modify, the game-changing solutions emerging from the UNFSS process to meet their aspirations for food systems transformation, while also maintaining the necessary global links to accelerate the pace of the diffusion of know-how. This is especially necessary in light of the interdependent nature of multiple SDG-related outcomes within the context of food systems transformation, for which the collaboration of multiple sectors will be needed to achieve success.
Achieving the high-level objectives of the UNFSS process will require a chaperoning mechanism that allows for the contextual implementation of ideas and strategies from local to global levels. Participants of the ongoing Food Systems Summit Dialogues have expressed demand for a mechanism to support each of them on their unique but aligned journey to food systems transformation. AT 1 has recognised this in its engagement with 26 member states.
Food Standards: This proposal would add a specific addendum focused on the food sector to the existing B Impact Assessment, highlighting the unique challenges, opportunities, and practices for the industry. The B Impact Assessment is a free, online platform that allows companies to measure, manage, and improve their social and environmental performance. This management tool provides a comprehensive assessment of a company’s impact on all of its stakeholders (consumers, workers, community, environment, and governance), and encourages businesses to improve. In 2020, B Lab partnered with the UN Global Compact to reframe this platform around the SDGs and launch a new product, the SDG Action Manager, to encourage companies to contribute toward the SDGs. To date, the B Impact Assessment and SDG Action Manager have been used by more than 145,000 companies across the globe. The proposed Addendum would include multiple tracks, creating best-in-class standards across the food system, from growers to food service providers. In collaboration with existing standards in the food systems space, B Lab would partner with established criteria, including the work of the Global Reporting Initiative, the Sustainability Accounting Standards Board, the World Benchmarking Alliance, and the Access to Nutrition Index, to name a few.
Legal Framework: A broadly distributed set of food standards that improve industry reporting and benchmarking are a necessary element of infrastructure to improve private-sector behaviour, but alone they are insufficient to catalyse permanent structural change in the food system. To drive different long-term outcomes, there must be a different set of rules that govern the industry. B Lab has developed, introduced, and supported a new corporate governance structure that shifts the fiduciary duty of business to balance the interests of stakeholders and shareholders. This legal framework has been developed in more than 40 countries, with specific legislation creating a new corporate form (the Benefit Corporation or equivalent) passed in 43 US states and seven jurisdictions (Canada, Colombia, Ecuador, France, Italy, Peru, Rwanda). This shift in corporate accountability is particularly applicable in the food sector, where businesses should be legally required to consider their impact on society as well as their financial performance. This proposal would create a set of clear policy recommendations for governments (the ‘Stakeholder Governance Toolkit’) to drive broader adoption of this corporate structure in their global food chains, creating accountability for corporate impact on society, nutrition, health, and the environment. The toolkit would include a broad range of policy recommendations, including the passage of the Benefit Corporation legislation in new jurisdictions as well as tax preferences, procurement preferences, and other economic development incentives to support accelerated adoption of these new standards and legal framework by companies.
Inspiring Narrative and Leadership Community: The scale-up and broad adoption of the standards and legal frameworks outlined above, from best-in-class companies to the global norm for the food sector, will occur through shifts in the cultural expectations of private-sector players in the food system. This cultural shift will be catalysed by the creation of an inspiring narrative and examples of industry leaders that are at the forefront of such change. An example of this is B Lab’s globally recognized certification, Certified B Corporation, that highlights best-in-class companies that have demonstrated the highest standards of social and environmental performance, transparency, and legal accountability. This certification has been awarded to 4,000+ companies, including approximately 500 in the food and beverage sector. This proposal includes the production, distribution, and marketing of five case studies, highlighting these leaders and sharing innovations that are currently being deployed at scale to improve food systems around the globe.
This Game Changer proposal will scale existing proven solutions in the Food Sector to drive economic systems change. B Lab has been a pioneer of economic systems change since 2006, influential in shaping and advancing the movement to harness the power of business to create social and economic change. Through the B Corp Certification, B Lab laid the foundation for the current understanding of socially responsible business and inspired another 150,000+ companies to use business as a force for good. This global constituency of credible leaders, now among the largest business communities in the world, has served as proof of concept for economic systems change.
For 15 years, B Lab has been using demonstration effects to drive systems change by highlighting industry leaders and providing management tools for others to follow their lead. In 2020 alone, Certified B Corporations protected 200,000 hectares of land, offset 16 million tons of carbon, saved 225 million litres of water, and diverted 207 thousand metric tons of waste. This leadership community is 75% more likely to hire workers from chronically underemployed populations, 68% more likely to have a majority female workforce, 210% more likely to screen suppliers based on positive social and environmental performance, and averages a pay ratio of 7:1 from CEO to lowest paid worker (compared to the average S&P 500 CEO-to-worker pay ratio of 264:1).
In collaboration with other standards organizations (e.g., GRI, WBA, ATNI, SASB) and distribution partners (e.g., UNGC, YPO), the creation of new food standards will provide the roadmap for corporate behaviour change for tens of thousands of global businesses, while the legal framework will create the accountability to ensure this change is built to last.
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