Food and Water

Businesses have a role to play in achieving global food security. This is what they can do

The image shows food piled up on a market stall to illustrate the fragility of global food security

Global food security is always less certain when major food supplying nations are at war. Image: Photo by Veera Jayanth on Unsplash

Margarita Lysenkova
Manager – Sector Program, Global Reporting Initiative
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Food Security

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  • Almost half of the world’s calorie intake is derived from essential crops, such as maize, rice and wheat.
  • Ukraine and Russia account for 29% of global wheat exports and 17.4% of the world trade in maize, meaning that the impact of the war in Ukraine extends well beyond its borders.
  • The GRI Agriculture, Aquaculture and Fishing Standard (GRI 13) is pushing for more companies to integrate food security into their sustainability strategies to help improve global food security.

Ores mined in war zones have long been subject to heightened attention when it comes to sustainability and reputational risks. Yet in 2022, it is the production and sourcing of ‘soft’ commodities, such as wheat, that are increasingly under scrutiny.

As the conflict in Ukraine continues to escalate, the impacts on sustainable development become more pronounced and the vulnerabilities in global food supply chains increase. Almost half of the world’s calorie intake is derived from essential crops, such as maize, rice, and wheat and, according to World Bank analysis, Ukraine and Russia account for 29% of global wheat exports and 17.4% of the world trade in maize. The supply of crucial cooking oils and fertilisers has also been affected.

Many companies have suspended trade and operations in Russia due to sanctions and stakeholder pressure. While the diplomatic agreement reached to unblock Black Sea trade routes from Ukrainian ports offers some encouragement, uncertainties remain. In addition, concerns over products being obtained under extortion add to the challenges for companies involved in commodity trade throughout the region.

Global food security woes: Rights to food are being eroded

When agricultural areas are devastated and water installations destroyed, the right to food of the local population is violated. Yet, the impact of the Ukraine crisis spreads well beyond its borders. It is expected that many millions of people will be at risk of hunger globally as a result of the tightening supply and affordability of essential crops. And this comes on top of existing difficulties that have been exacerbated by two and a half years of COVID-19.

The fewer crops harvested and planted in 2022 are likely to instigate a spiral of worsening global food security in the year ahead too.
The fewer crops harvested and planted in 2022 are likely to instigate a spiral of worsening global food security in the year ahead too. Image: Food and Agriculture Organization of the United Nations

Not all of the world's regions are exposed in the same way. Where people are already experiencing severe poverty, the risks of hunger and malnutrition are much higher. As the World Food Programme has warned, countries dependent on food exports from the conflict-affected region are being hit hardest. Meanwhile, to prevent local shortages, we are seeing some countries restricting food exports, which may further impact the global supply.

When viewed from a human rights perspective, the right to food for many is not primarily about a lack of sufficient quantity, but a lack of access – largely due to affordability. With continuing declines in Russia-Ukraine food exports, however, we are seeing heightened concern over the insufficiency of food availability. The fewer crops harvested and planted in 2022 are likely to instigate a spiral of worsening food security in the year ahead too.

Global baseline for transparency

Most food is produced, processed, traded and distributed by private businesses. At the same time, when an individual company looks at its impacts on global food security in isolation, it often struggles to determine them. Multinational companies may also focus on developed markets, where food security is not a significant concern. The risk is that food security is perceived as a macro ‘development’ issue, which is why expectations for transparency on food security is relatively new for many companies.

Have you read?

The GRI Agriculture, Aquaculture and Fishing Standard (GRI 13), launched in June, helps organizations communicate and disclose their sustainability impacts in a comprehensive and comparable way. This new reporting standard singles out food security as one of the significant issues that companies need to consider, providing a new global baseline for transparency on the topic.

As GRI 13 recognises, there is no silver bullet solution to global food security. A myriad of approaches and actions are needed, including:

Strengthening capacity so farmers can increase production and supply

This includes a newly launched $1.5 billion African Emergency Food Production Facility that is delivering urgently needed seeds and fertilizers and helps producers to cover food shortages in the region. Rising fuel and transportation costs are another pressure on farmers’ incomes, further increasing the vulnerability of small producers. By reporting their contribution to the economic inclusion of farmers, companies can demonstrate the role they are playing and where more action is needed.

Partnerships and collaboration to alleviate global food security concerns

This advocates some companies working with governments and international development institutions. For example, a link-up between the International Finance Corporation and Olam Agri will boost exports of wheat, maize and soy to developing countries. The existing distribution channels of companies can be leveraged in cases of a crisis for a prompt response. This is why GRI 13 recognises partnerships on global food security as key information to report.

Greater action on food loss to ensure more food is preserved for human consumption

According to the Food and Agriculture Organization, globally 13.8% of food is lost from harvest to retail. And, of course, mitigating food loss also brings cost savings and economic benefits, while reporting can help assess the efforts to minimise food loss.

Food sovereignty policies that emphasise local resilience

This will help countries that are largely dependent on food imports to redress the balance and reduce vulnerability to crises in other regions. Localised food production also reduces the distance between producers and consumers. By reporting actions to strengthen food security at the local and regional level, companies can highlight how they address food security locally or regionally.

Trade-offs and compromises

This covers issues related to land use for products or changes to align dietary choices with sustainably produced food. As the EAT-Lancet Commission report outlines, food production needs to shift to be beneficial for human health and the environment. This means businesses must make active decisions about how they are using land and natural resources.

A persistent and pressing challenge

The actions of the companies producing the essential food and materials on which humanity’s survival depends can be a multiplying factor when it comes to the UN Sustainable Development Goals. Given that we are on a trajectory to fail to reach SDG 2 (Zero Hunger), with 800 million people going hungry every day (according to a UN Food & Agriculture Organization report), it’s clear that we need private companies to take greater accountability for their food security related impacts.

Discover

What is the World Economic Forum doing to help ensure global food security?

The global population is projected to rise to 10 billion by 2050, meaning that we can expect the issue of global food security will continue to rise up priority lists – for governments, policymakers and businesses. This means that civil society groups, responsible investors and other stakeholders will press companies to be transparent.

Food is more than just a commodity that can be left to the whims of market forces. Its supply and security should not be undermined as a consequence of armed conflicts and natural disasters. The integration of food security considerations into the sustainability strategies of companies, as encouraged through GRI’s new Sector Standard, is a crucial next step towards a long-term solution.

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