Why ESG’s Next Frontier Could Be Animal Welfare

A new foundation from Coller Capital’s founder aims to animal welfare to the ESG equation.

There’s nothing new about ESG, and—I thought—not much more to be written about it.

Environmental, social and corporate governance has been in the news for a variety of reasons, including several college and university endowments being urged by students to divest holdings the students find objectionable.

Privcap has covered it extensively—from discussions on how impact capital is a hard sell to whether investors should give up on striving to put capital into ESG-focused sectors.

But recently, an article that had all of the earmarks of talking about “just another rich person creating a philanthropy to fund a cause near and dear to them” had a tidbit that stood out. Jeremy Coller, founder of Coller Capital, has started an eponymous foundation that’s running an initiative intended to raise awareness about factory farming and its risks for investors.

Coller says the initiative’s goal is to get farm animal welfare on the agenda of the PRI, the United Nations-backed network of fund managers pursuing sustainable investment strategies.

In the recently released Business Benchmark on Farm Animal Welfare 2015 annual report (Coller Capital was one of three organizations supporting its release), Tyson Foods CEO Donnie Smith notes that “Ensuring proper animal welfare in a business environment is a top-down job that has to be woven into the company’s culture.”

Large food industry players such as McDonald’s are listening to customer and public interest group demands for humane animal treatment. But what about private equity? Will other firms heed Coller’s call to add farm animal welfare to the list of ESG standards? Some smaller firms, such as Equilibrium Capital, are already focusing on sustainable agriculture and food production.

Time will tell if others will jump on the bandwagon, although if potential investors in their funds ask about animal welfare standards, it’s almost certain more PE firms will take notice.