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 Once considered niche issues, humane food-sourcing practices like
cage-free egg buying and gestation crate bans have won
headline-grabbing commitments from global companies such as
McDonald's Corp, Wal-Mart Stores Inc and Nestle.
On Thursday, BlackRock Inc will host investment fund managers at its
New York City headquarters for a "Humane Economy" event focused on
the financial impacts of social issues on restaurants, retailers and
other consumer-focused companies.
BlackRock, Fidelity Investments, MFS Investment Management, Coller
Capital and the Humane Society of the United States (HSUS) are
sponsoring the event, which is billed as a first of its kind. It is
expected to draw more than 50 attendees from firms representing a
combined $17 trillion in assets under management.
Sponsors say the success of companies such as burrito chain Chipotle
Mexican Grill Inc and specialty grocer Whole Foods Market Inc
demonstrates the financial and social benefits of adopting humane
sourcing policies.
The track records of those companies have investors weighing the
risk of not getting on the humane-sourcing bandwagon against a
tradition of avoiding social issues perceived to have little impact
on share prices.
The issues also are grabbing attention in executive suites and
boardrooms.
"Ten years ago, we were mostly engaging with quality assurance
staff. Now we regularly engage at the CEO level, said Matthew
Prescott, senior food policy director for HSUS, who is leading a
discussion on industrial food production at the event.
HSUS has worked with dozens of food companies on humane sourcing
practices, including McDonald's, which recently announced a North
American switch to cage-free eggs by 2025.
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"There is a lot more debate around these issues and it's across so
many segments of society," said Michelle Edkins, a BlackRock
managing director and global head of the firm's 22-member corporate
governance and responsible investment team.
With consumer tastes changing quickly, companies may be best served
by preempting or anticipating changing sentiment rather that waiting
to be hurt by the shifting tide, said Edkins, who added that policy
issues around antibiotic resistance and obesity also weigh on
investors minds but are not the subject of the meeting.
Carol Geremia, co-head of global distribution at MFS, said
environmental, social and governance (ESG) topics have gained
traction with the Boston firm's mainstream clients in recent years.
"They want to know we're out there collecting information," said
Geremia, who added that MFS tries to integrate ESG into many
investment decisions.
(Additional reporting by Ross Kerber in Boston; Editing by Ken
Wills)
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