Davos Agenda

Consumers want sustainable options. What food producers, suppliers, and retailers can do now

At least 65% of consumers want to make the right spending choices to live a healthier and more sustainable life.

At least 65% of consumers want to make the right spending choices to live a healthier and more sustainable life. Image: Uta Scholl/Unsplash

Mark Schneider
Chief Executive Officer, Nestlé
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Davos Agenda

This article is part of: World Economic Forum Annual Meeting

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  • At least 65% of consumers want to make the right spending choices to live a healthier and more sustainable life.
  • Global food systems must quickly adapt to be more sustainable - while properly nourishing the growing global population.
  • Through clearer information about nutrition, and a wider product range of sustainable goods, food producers can appeal to evolving consumer appetites while looking after the planet.

Supply comes quickly on the heels of demand. When it comes to tackling climate change, supply side transformation is necessary, but not the whole picture. Transforming consumer demand is needed to help supercharge our collective ability to urgently get to net zero. While it can pay off to be one step ahead of consumer demand, experience elsewhere shows it can be risky to be too many paces in the lead. We must raise our game to help inspire, as well as meet, consumer appetite for products that are good for people and good for the planet.

In the food sector, the reality of climate change is increasingly felt from the farm to the supermarket shelves. Record droughts of 2022, exacerbated by the climate crisis, have worsened the food shock in many countries across the world. But food can also impact climate change: agri-food systems are linked to almost a third of global greenhouse gas (GHG) emissions.

Accelerating sustainable options for consumers

We must move rapidly to a better way of nourishing our growing population, in a way that is equitable, healthy, affordable, and sustainable. At Nestlé, we recognize our critical role in accelerating this transition, as a global food manufacturer that connects with farmers, suppliers, retailers, and consumers. As such, we are making it our business to help the world succeed - our own resilience and success depend on it. That’s why we are already partnering with our 500,000 farmers to accelerate the transition to regenerative farming practices that enrich the soil, replenish natural water cycles, and soak up carbon.

But transforming the food system means changing more than how food is farmed and produced: it requires changing what we all want and choose to eat. This means partnering with consumers to inspire demand for more sustainable food. We know an increasing majority, currently some 65%, of consumers want to make the right choices to help them live a more sustainable life. With families facing acute pressures on their finances, it’s on us as food producers, suppliers, and retailers to help make sustainable options the easy, affordable, and attractive option, and to urgently accelerate our shared efforts.

But how to do that? Here are three ways:

1) Clear and credible information

Consumers don’t yet have enough of the right information, or enough time, to make more sustainable food choices at the point of purchase. Studies show that eco-labelling can lead to more sustainable consumer choices. But we have a confusopoly of different claims and labels: today, shoppers are faced with an estimated 455 eco-labels across 25 industry categories. We need clear and consistent information, so the environmental impact of what’s on offer is obvious, ensuring information is not greenwashing but credible and independently verified.

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To achieve this the food industry needs to work hand in hand with regulators to harmonize rules for a high-level playing field, with accountability for action. In Europe, for example, we actively contribute to environmental footprint labelling initiatives at EU and local levels, to help develop a scientifically robust and meaningful system for consumers that can then, we hope, be scaled up in an EU-harmonized approach. We are seeing progress in this area. Recent proposals, such as those on empowering consumers for the green transition or on green claims, will set out a course that should lead to a single credible approach across the region.

We also welcome initiatives by supermarkets to encourage sustainable choices at the point of retail.

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2) Affordability and availability

Experience shows that it is difficult to change behaviour with sticks. Right now, with economic pressures mounting, that’s not what will help consumers. We need carrots. Data shows that one in two consumers cite cost as the main barrier to making more sustainable choices. Developing new and innovative solutions sometimes begins with offering premium products to early adopters. But ultimately, we must ensure that affordability goes hand in hand with sustainability. We won’t change the food system if sustainable options remain an expensive niche.

At Nestlé, we are committed to continuing to invest in R&D to build sustainability into our products as standard, ensuring these options are at least as good value. As part of that effort, we are seeking new efficiencies and absorbing costs to the tune of billions of dollars, to help consumers make healthy and sustainable choices. For example, the reformulation of our Ninho Forti+ milk powder resulted in annual cost savings of CHF8 million and GHG reductions of 175,000t.

Meanwhile, we are expanding our range of sustainable products to give consumers greater choice to suit their needs and preferences. In the last two years alone, we launched over 100 plant-based innovations and are seeing strong growth in alternative protein sales.

As an industry, our focus must be to make climate friendly products the easy and affordable option for consumers, not letting the current high inflation rates extinguish these efforts.

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3)Attractiveness

Taking away the obvious barriers of price and availability, while providing the clarity to allow informed decisions, is only half of the conundrum. It is also vital that we make sustainable options as tasty and appealing, if not more so, than less sustainable alternatives. We can’t compromise on quality and enjoyment. That requires innovation, reformulation, quality ingredients, and listening closely to what consumers want.

That’s why Nestlé is investing in innovation to help develop new approaches that maximize enjoyment and bolster climate credentials. For example, we are working with start-ups in precision fermentation for better alternative proteins and using newly developed digital tools to optimise the climate impact, nutrition, and cost of products. We are also harnessing innovation to ensure popular products have sustainable alternatives, such as our Nescafé and Nespresso coffee pods, which now have paper and bioplastic capsule options.

As an industry we must challenge ourselves to make sustainable products attractive and enjoyable, not a guilt-ridden choice that doesn’t deliver on taste or enjoyment.

Have you read?

The urgency of the climate crisis accentuates the need to seize the opportunity to unlock the potential of sustainable food choices. Working together with governments and consumers, the food industry can help make sustainable and healthy food the most affordable and accessible, in a way that is good for people, good for business and good for the planet.

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Davos AgendaClimate ChangeClimate and Nature
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