ESG Investing

UN Resolution Signals Growing Support for Animal Welfare and Cruelty-Free Investing

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As shareholders pressure corporate boards to address animal cruelty in their supply chains and the United Nations issues its first resolution devoted exclusively to animal welfare, animal welfare investing has new ground to emerge as a key focus within ESG. Add to that the growing market for plant- and cell-based meats, and ESG-minded investors are finding increasing avenues to support animal welfare and cruelty-free investing.

Animal Welfare Links to Sustainable Development

Recognizing the importance of animals to sustainable development, the UN’s March 2022 resolution incorporates animal welfare into the organization’s Sustainable Development Goals. The result of the efforts of numerous nonprofit organizations, the resolution is an official acknowledgment of the link between animal suffering and environmental harm.

Climate change adversely impacts livestock production, both directly through higher temperatures affecting productivity and mortality and indirectly via effects on ecosystems, species distribution, and diseases. In turn, intensive livestock production impacts the environment through its greenhouse gas emissions as well as land and water use. Given this interplay, supporting sustainable policies and legal frameworks to manage livestock production is crucial as the world continues to increase its consumption of animal protein.

another central concern of animal welfare advocates is the exploitation of animals in the global food supply chain.

Investor Concerns for Animals Prompt Corporate Conflict

In addition to the impact of animals on sustainable development, another central concern of animal welfare advocates is the exploitation of animals in the global food supply chain, exemplified by practices that involve killing thousands of “non-target” animals in commercial fishing or housing livestock in cramped, dirty cages. As animal welfare advocates raise awareness of such activities, some investors look to public companies to address animal welfare and cruelty concerns.

For example, billionaire Carl Icahn attempted in June to establish two board members at McDonald’s to revise the company’s animal welfare policies. In doing so, he criticized the company’s use of “gestation crates”—small crates for pregnant sows which generally prohibit the animal from moving—for pigs in its supply chain.

Similarly, the Humane Society of the United States put forward a shareholder proposal for inclusion in Wendy’s proxy materials to request that Wendy’s either confirm gestation crates “will be eliminated from its North American supply by the end of 2022” or disclose the use of gestation crates in its pork supply chain. Wendy’s moved to block the move with the SEC, but the regulator denied its request, and the proposal will go up for shareholder vote.

Cruelty-Free Investing and Animal Welfare Find Support

Investors can support animal welfare by investing in companies that adopt sustainable practices and urging additional companies to improve their sustainability practices surrounding animals in their supply chains.

Another approach to reducing the effects of intensive livestock production on the environment and minimizing the inhumane treatment of animals is to remove animals from the supply chain altogether. Supporting the development of plant- and cell-based food production can help reduce land and water use, pesticides and antibiotics, and the overall number of animals in the food production system.

Animal welfare investing ranges as widely as investment funds designed for animal rights advocates and nonprofit organizations that support change on the ground. For instance, cruelty-free investing involves seeking out investments in companies that do not test cosmetics, toiletries, and other household products on animals. Whichever approach an investor takes, supporting animal welfare not only benefits animals but makes a wider impact on people and the planet.

Any company, security, fund or other investment identified herein is provided solely for illustrative purposes and should not be construed as a recommendation or solicitation for the purchase or sale of any such investment. By clicking on a weblink included in the above article, you may access a website operated by a third-party. Please review the website’s terms of use and privacy policy upon entering the site. We are not responsible for any content, links, products or services available on third-party websites.

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