An Investor Presses His Case Against Industrial-Scale Farming

Author: Andrew Martin

Environmental and animal-rights groups have spent decades arguing against large-scale, intensive livestock facilities, arguing that these so-called factory farms are bad for the environment, farm animals, and human health. A private equity investor is taking a different approach to the same fight.

Jeremy Coller, who founded London’s Coller Capital, is warning investors that ignoring animal welfare and other risks associated with industrial livestock farms can be bad for their bottom line. He created the Farm Animal Investment Risk & Return Initiative to create a network of  like-minded investors who consider animal welfare and other factory farm issues in their decisions. Coller, a vegetarian, said the effort is “about materiality,” not morality. “It’s about being a bad investment risk.”

Coller has just released a 31-page report that includes “killer stats investors can’t ignore” about intensive livestock farming. The report doesn’t single out companies for investors to avoid. Instead, he outlines more than two dozen environment, social, and governance issues related to industrial livestock farming that he says pose financial risk. For instance, the report notes that livestock produce greenhouse gases that contribute to climate change, threaten human health by creating antibiotic resistant bacteria, and consume vast natural resources, such as land and water.

Consumers, companies, and regulators are already making changes to the market, leading to reductions in reducing antibiotic use and the phasing out gestation crates for sows and battery cages for hens. But he believes investors have been slower to consider the consequences of factory-style farming as part of a responsible investment strategy. “There is a huge knowledge gap for investors,” Coller says. “What we are trying to do is start this network to fill this knowledge gap.”

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