The relationship between climate change and the agriculture industry presents an interesting paradox.\u00a0 The industry has traditionally been politically conservative, and thus climate change has often been viewed as a liberal cause which could lead to harmful regulation [1].\u00a0 Yet, there are few industries whose success is more linked to the health of the environment (and thus vulnerable to the effects of climate change).<\/p>\n
As an agricultural behemoth operating in 70 countries and earning over $100 billion in annual revenue, Cargill has a lot riding on the health of the environment and climate across the globe [2]. \u00a0To their credit, Cargill acknowledges that climate change is happening and could present challenges to their business [3].\u00a0 Their business depends on the resilience of crops to produce sufficient yields amid inconsistent climate patterns [4].<\/p>\n
To better understand the implications of climate change, Cargill executive chairman Greg Page has served as a member of the Risky Business Project [5].\u00a0 The project was started in 2013 by New York City mayor Michael Bloomberg, former U.S. Treasury Secretary Hank Paulson, and hedge fund manager Tom Steyer, and consists of a committee of policy and business leaders with wide ranging political beliefs concerned with measuring and exposing the potential economic impacts of climate change [6].\u00a0 Within Cargill\u2019s own operations, they are taking steps that provide themselves greater flexibility in the face of climate-change induced variability.\u00a0 For example, Cargill is building additional ports throughout the world so that they\u2019ll have more locations from which to ship crops if climate change limits yields in certain markets [7]. \u00a0\u00a0Cargill further demonstrated its commitment to the cause in 2015 when they signed the American Business Act on Climate Pledge [8].\u00a0 By signing, Cargill pledged to be a strong example of ongoing devotion to the climate change cause within the business community [8].\u00a0 In a step towards that pledge, Cargill has goaled themselves to make 5 percent improvements from 2015 to 2020 in regards to energy efficiency, greenhouse gas intensity, and freshwater efficiency [4].<\/p>\n
While the actions above seem to indicate a high level of climate change concern, there are other areas in which Cargill is coming up short.\u00a0 Despite the preponderance of evidence, the Cargill isn\u2019t ready to concede that climate change is induced by human action [7].\u00a0 Furthermore, Cargill\u2019s commitment to addressing climate change hasn\u2019t extended to the financial donations that they make to political campaigns.\u00a0 Roughly 60% of the money that the company\u2019s Political Action Committee donated in 2016 went to candidates who deny the existence of climate change [8].\u00a0 Why would Cargill make these seemingly inconsistent contributions?\u00a0 In large part, the discrepancy seems to derive from the fact that Cargill and the customers that they serve are more concerned by the potentially negative short-term impacts of regulation that addresses climate change than they are about the impacts of climate change itself in the long-term.<\/p>\n
So, where does Cargill go from here?\u00a0 It seems to me that they are mostly saying the right things but are unwilling to go all-in as a climate change combatant.\u00a0 I believe positioning themselves for long-term success will first require honest conversations with their farming partners.\u00a0 In some respects, Cargill should be more capable of weathering the effects of climate change than the farmers themselves.\u00a0 There\u2019s a chance that climate change will lead geographically feasible regions for growing certain crops to shift to higher latitudes [4].\u00a0 While extremely inconvenient, Cargill may be able to identify farmers in those higher latitudes who can produce the crops.\u00a0 However, many of the farmers themselves wouldn\u2019t have the mobility to move to a new location if climate change severely impacted the yields of their farms.\u00a0 For the sake of all parties involved, Cargill must try to convince their farming partners that full-throated support for climate change activism is the best long-range strategy to ensure the survival of their business.\u00a0 Additionally, ceasing donations to politicians whose beliefs are incongruent with this stance would help build the image of Cargill as a true leader in the fight against climate change.<\/p>\n
Cargill\u2019s precarious position in the climate change debate shows that a company\u2019s position on this issue can\u2019t always be categorized in black and white terms.\u00a0 Today the company occupies a very grey area between activist and holdout.\u00a0 Here\u2019s to hoping that they can find the courage to embrace a long-term view rather than letting short-term profit concerns determine their path on this issue which will ultimately shape the industry\u2019s future.\u00a0 (728 words)<\/p>\n
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[1] Burt Helm, \u201cClimate Change\u2019s Bottom Line,\u201d New York Times<\/em>, January 31, 2015, http:\/\/www.nytimes.com\/2015\/02\/01\/business\/energy-environment\/climate-changes-bottom-line.html?_r=0<\/a>, accessed November 3, 2016.<\/p>\n [2] Cargill, \u201cAt a Glance,\u201d http:\/\/www.cargill.com\/company\/glance\/index.jsp<\/a>, accessed November 3, 2016.<\/p>\n [3] Jacob Bunge, \u201cCargill\u2019s Food Empire Adapts to a Changing World,\u201d The Wall Street Journal<\/em>, October 16, 2016, http:\/\/www.wsj.com\/articles\/cargills-food-empire-adapts-to-a-changing-world-1476670081<\/a>, accessed November 3, 2016.<\/p>\n [4] Cargill, \u201cWhat are the implications of climate change for agriculture and Cargill?\u201d http:\/\/www.cargill.com\/news\/issues\/food-security\/climate-change\/index.jsp<\/a>, accessed November 3, 2016.<\/p>\n [5] Alicia Mundy, \u201c\u2019Risky Business\u2019 Report Aims to Frame Climate Change as Economic Issue,\u201d The Wall Street Journal<\/em>, June 23, 2014, http:\/\/www.wsj.com\/articles\/risky-business-report-aims-to-frame-climate-change-as-economic-issue-1403578637<\/a>, accessed November 3, 2016.<\/p>\n [6] Risky Business, \u201cAbout Us,\u201d http:\/\/riskybusiness.org\/about\/<\/a>, accessed November 3, 2016.<\/p>\n [7] Nathanael Johnson, \u201cFood giants Cargill and General Mills believe in Climate change. Will they defend themselves from it?\u201d, Grist<\/em>, October 23, 2014, http:\/\/grist.org\/food\/food-giants-cargill-and-general-mills-believe-in-climate-change-will-they-defend-themselves-from-it\/<\/a>, accessed November 3, 2016.<\/p>\n [8] Robert Holly, \u201cReport: Cargill backs climate change deniers despite pledge,\u201d Midwest Center for Investigative Reporting<\/em>, October 10, 2016, http:\/\/investigatemidwest.org\/2016\/10\/10\/report-cargill-backs-climate-change-deniers-despite-pledge\/<\/a>, accessed November 3, 2016.<\/p>\n <\/p>\n Image<\/u><\/p>\n