News & Analysis

Institutional investors say animal welfare creates value

Eighteen institutions and impact investors with £1.5 trillion in assets under management have said they will consider animal welfare in their analysis of food companies.

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Institutional investors with £1.5 trillion in assets under management, including BNP Paribas Investment Partners, insurers Aviva Asset Management and ASR Netherlands, Standard Life and Schroders, have declared farm animal welfare important to value creation in the food sector.

The signatories to the “global investor statement” will include welfare in their analysis of food companies.

Rory Sullivan, advisor to the Business Benchmark for Animal Welfare (BBFAW), said, “It’s probably still fair to say that animal welfare as an ethical issue is still emerging, but we are seeing growing awareness among investors. This statement is a signal to all investors that this is an issue they also need to be concerned about.”

The news comes as a US biotech and life sciences company Santa Cruz Biotech was hit with a $3.5 million fine and ordered to suspend all animal research by the United States Department of Agriculture for alleged violations of the US Animal Welfare Act. The company was accused of leaving animals in pain with large tumours and other injuries, as well as keeping goats in unregistered facilities and filing no records of how they were disposed. Santa Cruz Biotech did not admit or deny the allegations.

Sullivan said the fine highlighted the financial risk for investors. “This shows investors need to be concerned about the animals in [a company’s] care,” said Sullivan.

Only paying attention to the company’s products, he said, would be a mistake: “The story is one of risk to investors and of not understanding what the companies are doing with animals.”

The other signatories were Dutch impact investor Actiam, Australian Ethical Investment, Central Finance Board of the Methodist Church, Coller Capital, EdenTree, Epworth, family office manager LWCO Trust, Canadian responsible investor NEI Investments, Rathbone Greenbank, Robeco, Trillium, Triodos and Walden Asset Management (Boston Trust).

The BBFAW is an independent programme sponsored by Coller Capital, Compassion in World Farming and World Animal Protection.