Katie Pearmine, associate director of global food systems partnerships at the Global FoodBanking Network, discusses the needs of food banks amid rising economic uncertainty, and outlines the business case (not just the moral incentives) for the food industry to support food banks at this time – and how they can do so.
The new year has brought with it new worries for many of the world’s economies, including the potential of a new wave of recessions. Economic insecurity is expected to worsen, which will invariably have a more significant impact on communities facing rising food insecurity.
Already, falling consumer confidence is leaving its mark on the food industry as consumers prepare for a likely recession and become less likely to spend as a result. Likewise, in the face of inflation, many food companies are feeling the impact and having to adjust to higher operating costs and volatile supply chain issues as well.
Yet, food businesses of every kind continue to witness high levels of lost and wasted food that could otherwise be distributed to serve people experiencing hunger. This is particularly pressing as economic insecurity continues to rise.
Globally, it is estimated that 7% of all food that is available to consumers at the retail and restaurant level is wasted. This amounts to more than 380 million tons of food – each year – that could otherwise serve a positive purpose. For instance, in 2022 alone, an estimated 1.3 billion people faced food insecurity, a far greater number than originally anticipated, increasing the need for food banking services and broader food security safety nets across the globe.
As such, there is a clear moral argument for businesses to support the role of food banks in supporting communities, but there is also a strong business case for doing so.
© Vicente Chipa Cardenas
Take it to the bank
Through donations of surplus, off-grade or otherwise safe but not salable food, businesses have the opportunity to not only support greater food security, but they can also realize cost savings. Partnerships with food banks open the door to reducing costs associated with transportation, storage, handling and disposal of products that are no longer destined for the market.
Furthermore, ensuring wholesome food reaches people rather than waste streams also has the added benefit of reducing and preventing harmful environmental impacts caused by food waste, which generates annually up to 8% of the total greenhouse gas emissions produced by humans.
For starters, businesses can work alongside food banks to plan and forecast more effectively. While companies are making substantial progress in reducing food loss and waste, some amount of surplus in the supply chain is inevitable. By partnering from the start with food banks, businesses are able to maximise the potential of shared benefits – such as cost savings, community stewardship and reduced environmental impacts.
For example, businesses can take inspiration from the growing number of voluntary agreements to reduce food loss and waste, like Pacto por la Comida where Banco de Alimentos de México is leading efforts with consumer packaged goods companies and the broader food industry to halve food loss and waste in Mexico by 2030.
Indeed, there are significant opportunities to coordinate with food banks and build mutually beneficial relationships across the entire supply chain, including entities in the food packaging, transportation and storage realms.
Supporting food banks and food security can also clearly go beyond donating food and funds alone. Food businesses are central in making introductions to industry partners who may not, at first sight, appear to be natural connections—but that can have dramatic impacts on the success of food banks nevertheless.
This includes providing links to entities such as software companies, particularly those involved in data management and analysis, as well as industry groups such as the Global Cold Chain Alliance, which can provide food banks with greater technical knowledge and connections across broad industries.
Time to engage
Finally, businesses can also play a key role in engaging the public sector to shift policies and practices that strengthen food donation incentives and capabilities. By working to facilitate a better food donation policy environment, businesses can not only help unlock policy benefits for food banks but can also continue to meet their wider social and environmental goals.
For instance, the adoption of specific policies, such as tax incentives for businesses making food donations, clearly shares benefits between both food banking organisations – through greater and more effective food donation – and businesses – through deductions and credits.
2023 is already on course to present more economic challenges that will increase the need to reduce costs and maximise existing resources, especially within the food industry. At the same time, the demand for food banking services continues to rise.
Food businesses of all shapes and sizes can take proactive steps to ensure that food banks are well-equipped to face these challenges, and it is in the interest of the entire industry to minimize the impact of an economic downturn.
Ultimately, thriving communities result in thriving businesses. With margins narrow and economic pressures high, businesses can minimise their own costs, while helping food banks to ensure that more people are supported with nutritious and healthy food. In the face of economic uncertainty, there is not only a clear moral case for food businesses to support food banks, but also a pragmatic one.
© FoodBev Media Ltd 2023