The beverage giant announced in December that it would need an extra five years to hit updated water stewardship, packaging and climate goals originally targeted for 2030 and that it would no longer have a voluntary goal on agriculture. The company attributed the delay and shift in priorities in part to the complexities of the challenges the goals address and also a need for increased collaboration, targeted investments and well-designed policies it says are “crucial to help create shared value for all.”
The move preempts a change in US political power that could turbocharge criticism of ESG efforts and greenwashing lawsuits, while simultaneously relaxing enforcement of climate change initiatives and policies.
To better understand how the food and beverage sustainability landscape will change in 2025, sustainable food rating company HowGood’s General Counsel Ramya Ravishankar joins this episode of FoodNavigator-USA’s Soup-To-Nuts podcast. She shares how emerging policies and competing priorities will reshape environmental goal-setting and why she remains optimistic about ESG advancement.
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A changing landscape
While the Coca-Cola Co. may be one of the first and largest food and beverage brands to signal a delay in reaching sustainability efforts, Ravishankar predicts it will not be the last. She adds industry is not alone in recalculating timelines – legislators and regulators are too – signaling a significant shift from the modus operandi of recent years.
In the last five to ten years, consumers have pushed food and beverage brands to provide more information and transparency about how food is grown and made – prompting companies to set “ambitious targets and very public targets to reduce their sustainability footprints – whether that is their carbon footprints, their water footprints, the land that they use in growing their ingredients, their impact on biodiversity or the type of labor standards that are involved in manufacturing the goods,” Ravishankar said.
In the last few years, though, “we are seeing a little more of a pumping of the breaks” by legislators pressuring companies to undertake environmental initiatives and report their progress, she said.
Accordingly, companies have scaled back the scope of their goals and timelines, she added.
Biggest trends of 2024 and what to expect in 2025
This story is part of FoodNavigator-USA's recent collection of articles and podcasts exploring food and beverage trends in 2024 and what is on the horizon in 2025. Check out the full collection in this letter from the editor .
More impactful projects take more resources, are less flashy
But just because companies may be extending their targets or adjusting their environmental sustainability goals, does not necessarily mean they are pulling back on their efforts or investing less. Rather, Ravishankar optimistically argues they may be tackling less flashy and harder to attain initiatives that could have a more significant impact.
She explained that many companies began their ESG journeys by going after low-hanging fruit that they could control, but which might not have a significant impact. As they achieve those goals, or learn more about what is needed long-term, she said, they are undertaking less flashy and more difficult projects that may require more resources and time but which have a greater impact.
Many of these projects are upstream in the supply chain and require collaboration, which often takes more time and finesse.
Green-hushing reduces proclamations but not underlying work
Companies also may be doing the same or more to advance environmental sustainability, but choosing to do so on the downlow to avoid false claims and greenwashing litigation or political pushback, which Ravishankar explains is on the rise.
“I have seen a little more shrinking in the type of public facing claims that companies are making,” she said. “That is a result of a couple of things.”
One is a rise in lawsuits alleging greenwashing or false advertising, which even if they are not true, are distracting and companies do not want to be “dinged for their bona fide investments in this space,” she said.
The other is due to a change in political climate in which “certain jurisdictions” are taking a “more adversarial approach to businesses that are publicly communicating their priorities around ESG,” she said.
Is AI helpful or harmful for sustainability?
Part of the upcoming investment in sustainability might be in AI – which holds significant potential to address environmental challenges in a way that does not negatively impact production. But, as Ravishankar notes, there is a tradeoff in the massive amount of power needed to run the computing centers on which AI relies.
Assuming the computing centers can mitigate the impact of their energy consumption, Ravishankar said she see significant potential for AI to help predict crop yields, improve soil health or help with other aspects of the food and beverage industry’s impact on the climate.
Recognizing that many companies are dividing limited resources across multiple priorities, Ravishankar suggests that companies can get more bang for their sustainability dollar by investing higher upstream – such as the farm level.
She added HowGood can help companies develop an environmental sustainability strategy that is high impact and which uses resources such as time and money responsibly because it works with businesses across the food system – from the field to the factory and the retail.
“HowGood can help you by giving you greater insights into how your growing practices and manufacturing practices translate into carbon and water footprints, your land use footprints and your biodiversity impacts, your labor impacts,” she said. It can then help identify supply chain changes and solution for the most impact.
