usinesses and in particular food businesses which have thrived in the Covid pandemic are being asked to support a fund to end world hunger by 2030.
The ask is for US$5 billion from corporates in an annual fund of $33 billion.
- What’s the social imperative for companies to support the End Hunger fund?
- Should food businesses expand their sustainability agendas to address hunger?
- Is it hard to get businesses interested in hunger?
The benefit to corporates would be threefold, say those behind the fund. Firstly, contributing firms would be more attractive to the growing band of Environmental, Social and Governance (ESG) investors.
Second, it would increase the bottom line – studies show that strong corporate social responsibility adds to return on assets after the first two to three years.
Third, it would give employees a greater sense of purpose. Younger employees in particular are looking to reward companies that display a greater sense of social mission. They are looking for increased meaning in their work.
“These numbers we’re asking for seem big in an absolute sense but in the context of Covid relief packages, the increase in the value of the Nasdaq, the S&P 500, and personal wealth, this is actually a really small number,” he says.
“We know that governments and donors are strapped for cash at the moment so let’s see if businesses can contribute.
“Some of the big food corporations, retailers, are going to have to stand up. It can’t be just tech”
“Our job is to build momentum for that, to announce something at the Food Systems Summit in September.
“The value of corporate social responsibility funds (CSR) in Fortune 500 companies is at least $15 billion a year. Imagine if we could get a third of that focussed on one thing, hunger.
“The amount we’re asking is the equivalent of one dollar out of $500 in profits. It’s 0.2 per cent.”
The aim is to announce the “End Hunger, Nourish the Future” Fund at the United Nations’ first Food Systems Summit this year.
Lawrence Haddad says an extra $33 billion a year for 10 years will eradicate the number of those who are hungry because of dysfunction in the food system, in other words, for structural reasons. This would reduce the world’s hungry by 500 million, to less than 200 million, in a decade. The remaining 200 million are those who are hungry for other reasons, for example as a result of war or conflict.
“It’s not handouts, it’s investing in the infrastructure to get food grown, to get it to people who need it, and to allow them to have the income to buy it,” Lawrence Haddad says.
“Food businesses have done well, they will have to consider donating,” he adds. “It can’t be just the tech companies. I’ve contacted Zoom about a Zoom out hunger campaign.
“Some of the big food corporations, retailers are going to have to stand up. They’d much rather move into areas that are going to give them some kind of commercial return. The big food companies are very keen to promote sustainability because that reduces their costs as well as doing good things for the environment. Hunger and malnutrition are harder asks.”
“The public sector saved the private sector during Covid. It’s time for the private sector to step up”
Carin Smaller, a programme director at the International Institute for Sustainable Development is also working on the fund. She led the research which inspired and guides the fund’s development, Ceres 2030.
Carin Smaller says, “Ten years, a tiny effort in comparison to the amounts we are seeing in profits and stimulus packages, and we’re done with this issue. It’s been too long that we’ve had to deal with the problem of hunger.
“The public sector has stepped up a huge amount to save the private sector during the Covid pandemic. It’s now time for the private sector to step up.
“There is a growing awareness that if we don’t contribute to this social contract, this social licence to operate, if we don’t think beyond our shareholder interest and feature broader stakeholder interest, our companies will not be profitable in the long term.
“I think it will be easier today to get the private sector to give up some of their profits to a fund like this than it may have been even a decade ago.”
Lawrence Haddad says, “It’s essentially a doubling of what governments and donors currently spend. I can’t remember ever feeling the end of hunger is within our grasp as much as it feels like it today.
“This is especially important as before Covid, the hunger numbers had been going up since 2015, and now with Covid, because of income collapses and food system distribution disruptions, in 12 to 18 months’ time we’re going to be in the midst of much intensified hunger crisis. The estimates range from an additional 100 to 250 million in the next two or three years. That is very serious.
“So, the time to get on top of this is now.”
“There is optimism that we can discipline some bad subsidies to increase budgets for hunger”
The Ceres 2030 modelling addresses this expected rise, leaving the remaining hungry figure at around 200 million.
Hunger and malnutrition has long been the biggest killer in the world. Even in 2013, the UN estimated 25,000 a day were dying from hunger and that climate change alone could lead to an increase of up to 170 million in the number of undernourished people.
The pair say that while the campaign’s solutions target structural change in the food system, they deliberately side-step subsidies to food producers and companies.
Lawrence Haddad says, “The subsidies one is hard. Change will happen country by country, stakeholder group by stakeholder group, and vested interest group by vested interest group.”
Carin Smaller adds, “The subsidies debate is a very difficult one. We at the International Institute for Sustainable Development have been fighting for an end to fossil fuel subsidies as the most urgent need. That will not only create budgets to invest in better things but will also help us reduce greenhouse gas emissions.
“Ending fossil subsidies in a no brainer, it’s do-able, it should be done.
“Fisheries subsidies is another interesting one. At the World Trade Organization, with the Director-General Ngozi Okonjo-Iweala, there’s a big push to come up with a fisheries subsidies agreement. She’s trying to bring ministers together by the end of July to agree to address over-production and over-fishing.
“Very hard. But I think there is optimism that we can discipline some of these really bad subsidies and get an agreement going. It’s clearly through that we’re going to get the government ability to increase budgets for hunger and other social initiatives.
“We estimate $33 billion spent on these things will generate an additional $52 billion per year in private sector spending in the food system”
“The other key thing is expanding the tax bases. Too many governments in the poorest countries give too many tax breaks, incentives and tax holidays to come and invest in their countries. It’s destroying the tax base that could be used to raise these additional funds. Finding a way to expand that tax base is really critical.
“Issues on living wage are a lot more complex. They are about better labour laws, better labour standards, better enforcement of labour laws and labour standards. The investments in our fund are not about bigger regulatory or policy issues.”
She explains the solutions entail funding governments to deliver the programmes, saying, “One: it’s about empowering the excluded. These are direct cash transfers for social protection. Also, investment in education and vocational training. And strengthening the farmers organisations.
“Number two is on-farm investments. Research and development for climate resilient crops to adapt to climate change.
“Extension workers, so farmers are learning how they can better adopt those technologies. How to improve production and processing methods. Investing in agro-forestry. The capital endowments needed to rent or purchase machinery to make their farms more productive and commercially oriented. Investment in irrigation. Subsidies for inputs.
“Then, three is helping to move food to markets. Investments in value chains, storage facilities, roads.
“We estimate $33 billion spent on these three things will generate an additional $52 billion per year in private sector spending in the food system. The better roads, storage facilities, more commercially oriented farmers, will be better able to deliver.
“I’ve been quite shocked by the lack of interest in hunger. That’s the acid test, that’s job number one”
“It will double the incomes of 545 million small-scale producers. It’s this lack of income that’s often causing hunger. Farmers who are producing food but don’t have enough money to buy the food they need to meet their own nutritional needs.
“The other important outcome is maintaining Paris Climate Agreement agricultural commitments.
“It’s all about the long-term investments needed to make the food system more sustainable, more resilient and to get people out of hunger.”
The biggest challenge, they believe, will be in competing for attention.
Lawrence Haddad says, “I’ve been quite shocked by the lack of interest by stakeholders including governments, not just businesses, in what’s happening on hunger. It almost feels like hunger is a bit passé. Try telling that to those without food.
“You can’t talk about food system transformation if you don’t talk about hunger. That’s the acid test, that’s job number one.
“I think Covid-19 has woken up governments and businesses in Europe and North America to the fact that hunger is everywhere. We’ve seen what’s happened with food banks in so-called wealthy countries. The usage of them has just gone crazy.
“Hunger and malnutrition, climate change, biodiversity, resilience, livelihoods are indivisible”
“I think that’s helping to sensitise people about hunger.
“I like to talk about building forward better, rather than building back better. This is what the UN Food Systems Summit is all about. Hunger and malnutrition, climate change, biodiversity, resilience and livelihoods. These five things are indivisible.
“So, the fund’s investment areas are going to double the income of 545 million small holder farmers, in ways that lower greenhouse gas emissions, promote biodiversity, generate livelihoods and promote resilience.”
Carin Smaller explains further, “The highest priority is in sub-Saharan Africa. This is where two thirds of the additional money is going to need to be spent. There’s an ecosystem of organisations and agencies who know how to do the work. They need to do it better than they’re currently doing.
“But the key now is doubling their resources, getting them focussed on key action areas and making sure that roll out happens.”
Lawrence Haddad believes that Africa presents an overlooked investment opportunity. He says, “The median age in sub-Saharan Africa is 27 or 28. In other words, more than half the population is under 30. Youth and digital technology is already changing agriculture. It’s a way of making small and medium enterprises, starts ups, grow.
“We’re talking about a conveyor belt for agricultural talent. Get young kids in school understanding what agriculture is, get them involved in producing nutritious foods, which generate low greenhouse gas emissions, low water use, improve literacy about food in schools. Get that into the colleges and universities, the startups and SMEs.
“I think the UN Food Systems Summit is doing a great job of breaking down barriers”
“In Africa SMEs make up 70 per cent of food production and processing. That’s where most people get their food from. If businesses grow a certain way, they will shape their food systems.
“African systems don’t have to generate the obesity and non-communicable diseases, the diabetes and the hypertension that European and North American food systems have generated. They can take a different course.
“We need private and public investors to be brave. There’s a lot of talk about supporting youth in agriculture in Africa but there’s not a lot of money in it. Foundations have no excuse; they are supposed to be making the high-risk high -return investments to catalyse public and private investment.
“Africa is a good example of the need for interests to coalesce. There are 10 groups working on solar-powered irrigation in Africa. They need to come together. There are 15 youth in agriculture groups in Africa. They’re not achieving their goals because they are too disparate, they are too fragmented. They have to come together.
“I think the UN Food Systems Summit is doing a great job of breaking down barriers. One of the things is how fractured the space is. We’re trying to bring groups together.
“All the efforts on under-five wasting, there are too many organisations with a small piece of the pie. Come together.
“It took 10 years to get the number down and will take 18 months to go back up again”
“Looking at wasting numbers – children under five who are too thin for their age – they are skin and bone, it’s called wasting. Very prone to premature death. It took 10 years to get that number down by 10 million. Pre-Covid those numbers were 50 million worldwide.
“The projections are, because of health system and food system interruptions and income loss, that wasting numbers are going to go up by about nine million in 18 months.
“It took 10 years to get the number down and will take 18 months to go back up again. These are very rigorous estimates.
“There’s strength in unity. Mind-set shifts are going to be a very powerful legacy of the summit, and long after the global hunger fund.
“When we look at this summit in future years, I hope we’ll be able to say this was the moment we began to dream about ending hunger, and realised it.
“And I hope we don’t need an end hunger fund after 2030!”