Investing in the Food Transition – Why?

 As the 2024 sustainability survey shows, these themes matter to the participants as well. That is why we are increasing our investments in the food transition on behalf of PFZW, with a particular focus on the shift from animal to plant-based proteins.

Food as a Connecting Link
Biodiversity is one of PFZW’s key themes. Over the past fifty years, 70% of all flora and fauna species have disappeared – and 70% of this loss is due to the way we produce our food. The food transition also impacts climate change (31% of global CO₂ emissions come from food production) and health, as what we eat strongly affects our wellbeing.

Because food touches all these areas, it acts as a connecting link in our sustainability strategy. As a long-term investor, we have the opportunity to make a real difference — from farm to fork.

Reducing Animal Proteins
A tangible element of the food transition is the reduced consumption of animal proteins. Shifting from animal to plant-based protein reduces pressure on nature and climate, while also improving health outcomes. Both the Netherlands and Europe have already set policies in this area. The Dutch goal to achieve a 50/50 balance between animal and plant-based proteins by 2030 is unique within Europe. Major companies like Albert Heijn are also aiming to make two-thirds of their product range plant-based by 2030. We actively take these developments into account when making investment decisions.

From Exclusion to Investing in Innovation
We deploy our full investment toolbox. Sometimes we exclude companies that are not aligned with the transition. At the same time, we selectively invest in companies that are leaders — or aspire to become leaders. These companies represent a significant part of the market, allowing us to make a meaningful impact. Think of food companies such as Danone and Unilever, and suppliers like DSM. Through their product range and marketing, they can significantly influence consumer behaviour.

We also will be looking for more opportunities in private markets. Especially at the start of the food chain — regenerative agriculture, new protein sources — venture capital investments are essential for impactful innovation.

Changing Behaviour Takes More Than Price
The food transition is quite different from, for example, the energy transition. In energy, it is mostly about new technologies and scaling up. In food it is primarily about behaviour. Many technologies are already in place. The experience of these food companies shows that influencing consumer behaviour is less determined by price than one might think.

In conversations with companies like Danone and DSM, we see how crucial taste and texture are. As shareholders, we actively encourage them to make the healthier choice more appealing. We cannot engage in these kinds of dialogues and engagement sessions with thousands of companies, which is why we are building concentrated portfolios of companies that truly matter.

Health and Biodiversity: Two Sides of the Same Coin
In conversations with colleagues and external speakers — such as during our two-day sessions in Austerlitz — we notice how strongly this theme resonates. Health affects us all personally, and healthy food matters. Scientific research increasingly shows that when health is lost, the path to recovery almost always involves more physical activity, healthy nutrition and a sense of purpose. In that sense, health and biodiversity are two sides of the same coin.

Policy in Development
In the coming months, we will continue developing our investment policies for biodiversity and the food transition. Unlike climate, where CO₂ provides a clear metric, this area is more complex. But complexity should not be an excuse for inaction. We are starting with a qualitative approach, learning as we go, and gradually moving towards measurable targets — similar to how Albert Heijn is promoting plant-based proteins.

Given the complexity of this transition, collaboration is key. We align our goals with international agreements such as the Paris Agreement, the Global Biodiversity Framework (GBF) and the EU Taxonomy. We also work with other investors, governments, NGOs and universities. In the food system, we aim to identify challenges and opportunities at every step of the value chain, and work together with market players to find solutions.

As long-term investor, our role is clear: we have the potential to influence the entire chain. Not just through public equities, but also through private equity, loans and engagement. Because we are focused on both financial returns and sustainability.