153 Emma Chow and Eliot Beeby on how circular design for food is crucial for regenerating landscapes, and how large food companies can lead it

Emma Chow and Eliot Beeby of the Ellen MacArthur Foundation Food Initiative recently published The Big Food Redesign, a report that shows how rather than bending nature to produce food, food can be designed for nature to thrive.
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Most products we buy in the supermarket come from very few large companies also known as fast-moving consumer goods (FMCG ) companies. Many FMCG companies have made big commitments about climate change and biodiversity, but are they enough? Can’t they do better?  How big are the differences between better sourcing only and actually doing full food circular redesign?

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Transcript

SPEAKER_02: 0:00

Most products we buy in supermarkets come from a few, very few large food companies, also known as FMCGs, fast-moving consumer good companies. They've made very big commitments about climate change, about biodiversity, not all, but they should. But is that enough? Today we dive deep into why they need to fundamentally change the design of their products, and I'm not talking about packaging, which they also have to change, but about the ingredients and how to buy the ingredients what our landscape can produce regeneratively, and how to turn that into appealing and tasteful food. So join me in an episode about the big food redesign with an organization that works with most of the large food companies, which, mind you, touch about 40% of the farmland in the UK and Europe with their products and their sourcing. Welcome to another episode of In March last year, we launched our membership community to make it easy for fans to support our work. And so many of you have joined as a member. We've launched different types of benefits, exclusive content, Q&A webinars with former guests, ask me anything sessions, plus so much more to come in the future. For more information on the different tiers, benefits and how to become a member, check gumroad.com slash investing region. an egg or find the link below. Thank you. Welcome to another episode today with the team of the Ellen MacArthur Food Initiative. We recently published a report, The Big Food Redesign. Rather than bending nature to produce food, food can be designed for nature to thrive. I see a lot of things we should unpack there. So welcome, Emma and Elliot.

SPEAKER_01: 2:15

Thanks for having us.

SPEAKER_02: 2:15

Thank you so much for having us. And to start with a personal question to both of you, you can decide who steps in first. How did you end up working on the big redesign for food? Because it's quite a specific, it's very needed, but it's very specific within a niche.

SPEAKER_00: 2:30

Yes, maybe I'll start. For me, the origins were way back when I was 18 and I read Bill McKibben's book, The End of Nature. And that lit this fire in front of me that gave the sense of urgency that I'd never felt before, particularly around climate change and needing to be part of the solution. So it was then that I thought I would dive into economics and environmental studies when I pursued my degree. And I didn't dive deeply into food, though, at that point. It was years later when I was done my studies and I was volunteering on organic farms through Europe. That was so many aha moments. But I realized growing up in the city of Toronto in Canada, I really hadn't spent time on farms. And I was like so many urban citizens these days detached from the food I was eating, the stories behind it, the impact it had, the people that grew it, what soil even meant, right? What does healthy soil even look like? I knew nothing. And I felt like a total beginner, a child learning in this space. And I'm still very much a beginner when it comes to farming. But it was that moment that my whole relationship at a personal level was rewritten with food. And this food had such amazing flavor. And then suddenly I liked all these vegetables that I thought I hated growing up. And I had this question of like, how have I never been exposed to food like this in my life? First question. And second, why are we not in a world where this is the norm, not the anomaly? And what's it going to take to get there? Because it's not realistic to expect that everyone is going to, in our capitalist society, be ditching their jobs tomorrow and doing organic farming and living the stories that so many of the hosts I was with. were embodying. And so this question around how do we get this at scale sat with me for some more years and ultimately led me to this amazing opportunity to work at the Ellen MacArthur Foundation on food, just when we were starting to explore what contributions circular economy could make to positive food system transformation. And we've now been working on this for about four years on food and this latest publication, The Big Food Redesign, which we can unpack a lot more is about how we can get that scale with major food buyers, like the food brands that we see every day on grocery store shelves and the retailers that we get so many of our groceries from. So that's a short form version of my long journey to getting to where I am today and speaking to you about this.

SPEAKER_02: 5:20

One follow up question before we go to Elliot. I mean, you finished university and you decided to go hoofing on organic farms in Europe. That's quite a leap. I mean, for somebody who didn't grow up on farming and had an interest in food, but maybe not the huge interest. You said there were a lot of aha moments when you did that. Why did you decide to go and volunteer on organic farms in Europe?

SPEAKER_00: 5:58

my job. And so I thought, what am I going to do with this? And I didn't have a lot of money. And there's all sorts of work exchange platforms out there. And Woofing is one of those. And I thought, this could be cool. I can be in nature. I can learn something new, get a cultural experience. I had no idea what I was really signing up for.

SPEAKER_02: 6:19

And yet it changed your life. Fascinating. And what about you, Elliot? How did you end up working on the Bigfoot redesign?

SPEAKER_01: 6:28

So I started I studied climate change at university, and as I was studying that, I kind of realized that the food system was both such a major driver of many of the problems that we face in the world today, but also could potentially be a big part of the solution as well. I came across this term, regenerative agriculture, some way through my studies and got reading about it, and it just really struck me as something that would potentially solve so many of the problems that the food system faces, like climate change, which is what I've been studying, as well as the biodiversity crisis and then improving social economics of rural communities as well. So it really felt like if it was done right, it could be an amazing solution to some of the problems we face. I guess what I wanted to contribute to the space was to really ensure that it didn't just become a greenwashing term, which is something that I kind of feared if it fell into the wrong hands or if it was approached from a very shallow perspective. I really don't think it should be or or that it is, but I wanted to contribute to make sure that there was an evidence-based agenda around regenerative agriculture to make sure that outcomes are measured and just to try and help organizations working in that space to develop a bit more of a deeper understanding of what regeneration can be.

SPEAKER_02: 7:47

So let's start to unpack the circular design for food, because I think many know the Ellen MacArthur Foundation from the food work, but also from the circular economy work, from the broader work, and of course, sailing around the ocean by herself. But what I mean, you joined Emma when the food focus started and you said it's been like a four year journey now leading to a number of reports, a number of work pieces. And at the end now to this big one on a redesign of food, which is quite, quite deep. It goes quite deep. So what is circular design for food to both of you? I mean, obviously who wants to take this one?

SPEAKER_00: 8:17

I'll start with the basics and then Elliot can build. I'll start, especially for listeners who may have never heard of circular economy, which is perfectly normal and fine if you never have, but it's based on three principles of eliminating waste and pollution, circulating nutrients and products at their highest value, and regenerating nature. And so we can take these principles and we can apply them throughout all aspects of our economy to move from today's what we call linear take-make-waste system to one that is restorative and regenerative by design. So that's the starting point. And you heard at the end there, by design, which is just so central.

SPEAKER_02: 8:56

I feel that design piece is going to be huge. Fundamental,

SPEAKER_00: 8:59

yeah. We're talking about redesigning business models, services, products. And here, we're talking about redesigning food. So we can move towards a future where our food is contributing to that nature-positive outcome. And through its very productive production, actually helping to regenerate nature, rather than today, which is, at large, hugely degenerative. And it all starts with design. We can't just try and incrementally improve the sourcing of current ingredients. We actually need to rethink what foods are being offered on the market. And this is where we see that a big part of that unlock sits with a relatively small group of major food manufacturers, what we call FMCGs, and retailers. And we found that about 40% of the agricultural land in the EU and UK are supplying ingredients to the top 10 FMCGs and retailers.

SPEAKER_02: 9:59

And FMCGs is, for anybody not in the sector, fast-moving consumer goods, I think, right? The stuff we buy in the supermarkets.

SPEAKER_00: 10:06

Often called CPGs in North America. So we all know these brands. And just like our clothes or the device that you're listening to this on today, we don't think about it so much, but our food is designed just like a pair of jeans are. And what I mean by that is one or often several people have made decisions on your behalf that determine the flavor, the texture, the nutrition, the price, and the impact of the foods that you eat, whether it's the pasta you're gonna make for your family this evening or the cereal that you ate for breakfast today, those design decisions have been made for you. And we're not today fully realizing the potential of that food design process to maximize the positive impacts that the food can have for your own body and nutrition and well-being, but also for the farmers who produce those ingredients for the soil and the nature that gave way to those ingredients as well. And so that's what this whole piece of work was all about. I'll stop there because I'm sure there's

SPEAKER_02: 11:13

more questions. So what you're saying is the current design of the things we find in the supermarket shelves, and we're not talking about even potentially the fresh stuff, but mostly the processed things is not made for regenerative agriculture producers or practices. It's made for a different system. And if we want to change the agriculture system, we have to change the design recipe. So we're not talking about the design of the packaging. We're talking about design of the products in it, just like you're talking design of the headphones. I happen to wear one that you can actually fix. You have phones that you can actually fix, like the same principles you apply to products. We can also, and have to apply to food because otherwise we'd just be making very very small marginal changes and we're not going to get the results we're looking for

SPEAKER_00: 11:54

exactly

SPEAKER_02: 11:55

so what does it mean like how does that concrete you have a number of examples in the report i will link it below obviously for everybody to read it it's very visual relatively short and it's amazing to read it's one of the best ones or one of the nicest and interesting ones i've seen last year but let's bring it to life what are some examples where we see that the current design is limited and design changes could unlock a lot of potential benefits

SPEAKER_01: 12:17

yeah we um we worked with a designer agency in North America called Alpha Food Labs, who are specialists in design and innovation. And we wanted to work with them to create some speculative food products of the future to try and illustrate what some of these products could actually look like in future, what it would look like if companies redesign their product portfolios in line with circular economy principles, and then how that would affect agricultural landscapes. Because as Emma was saying, the decisions that are made upstream in offices and research and development labs and And places, they ultimately influence what farmers grow, how they grow it, and that ultimately influences what agricultural landscapes look like. So one of the examples, my favorite example from the report actually is called Silvo. So Silvo is a line of cheeses which is made from all the outputs of the Silvo pasture system. So many of your listeners may know already, but Silvo pasture is when you're grazing animals in a field which also has lots of trees in it. And those trees are also used to produce, they could be used, to produce food. For humans, they could be used to produce feed for animals or timber or oils or other useful products. So the line of cheese and silver is made from walnuts and then from dairy milk. And yeah, in the case of silvose farms, The cattle that are grazed amongst the walnut trees are also managed using a system called managed intensive grazing. So this is when you have cattle in a sort of bigger agricultural land that are fenced into a much smaller portion of that agricultural land. And each day they're moved to a different section of that agricultural land. It's kind of like herds of waterbeest in Africa or bison in North America. Because they're constantly moving, they're not degrading the land in the same way as if they were staying in that same place all the time and the nutrients that they produce in their urine and in their dung helps to fertilize that land and build the soil health as well. So when you do silvopasture and when you manage the cattle in that silvopasture system using managed intensive grazing, under the right conditions, that farm system overall could actually be sequestering more carbon than all the greenhouse gas emissions produced by the cows living in that system, which is amazing, like such incredible regenerative outcomes. And this is a really nice example of how if If you're designing food products with the intention of them having regenerative outcomes from the start, then you can really achieve these quite impressive outcomes at the end. And just one final thing to say on Silvo, there's quite an important design decision made by the imagined product concept.

SPEAKER_02: 15:02

Because just to be clear, this is not for sale yet. Unfortunately, this is not on the shelves. If everybody starts Googling now, or DuckDuckGo or Ecosia, it doesn't exist yet. We wish. So it's really important. design decision made.

SPEAKER_01: 15:14

No, no, I definitely should have mentioned that, you're right. But one important feature is that, so this line of cheeses is made from the cow's milk, it's made from the walnut's milk. So you have a vegan walnut milk cheese, you have a normal dairy cheese made from the gent of cow's milk, you have a blended cheese made from the walnuts and the cow's milk together. Rather than selling those individually to help match the demand of what the agro ecosystem can actually produce, the cheeses are sold in a just in a tasting package. So you can't just buy the vegan cheese if that's what you want. So in that way, you're sort of matching the demand with what the agro ecosystem can actually provide. And it's those types of seemingly small decisions that they can actually help to, yeah, help those adjustments in the buying models can actually be pretty powerful for farmers.

SPEAKER_02: 16:50

So almost like we have the nose to tail or using the full vegetable. I mean, there's a lot of discussion on that, but in this case, you're saying use the full landscape, harvest the full landscape, make those products and don't allow somebody to buy one thing out of it and then hope that it will lead to a huge change but actually force through design because it's forcing you you don't have to choose that you can buy another brand but force through design these landscape outcomes almost

SPEAKER_01: 17:15

yeah definitely that that most detail analogy that you just made is actually a really nice one you're matching the using everything that the landscape provides and designing products around that rather than just saying we want cow's milk and it doesn't matter what else the landscape is producing

SPEAKER_02: 17:30

how do you different is that from the current situation? I mean, let's say, of course, we can imagine many other of these products and then going to your partners and the people you're working with in these large, because you mentioned 40% of the agricultural land in Europe and the UK is influenced directly by a very small amount of, I mean, large companies, but very small amount of companies. When you bring this to them and say, look, there's a huge difference from sourcing one ingredient and hoping for a better outcome of these grain practices because you're making pasta. It's a very big shift to saying this is what a landscape could produce how is is or was the reaction because it's quite a significant shift not different than the the circular economy shift in physical products or like you've been doing that for years how has been the response or has been the reception let's say from this huge food redesign because this is a fundamental like you force companies or you ask companies to to change their recipes to change their products literally not just to change packaging a bit and put a nice green logo on it

SPEAKER_00: 18:27

so yes does entail a big shift right and that can be much much harder to rethink, renovate old products or innovate new ones in a fundamentally different way from how things have been done before. And at the same time, I would say the response has been incredibly positive and hugely spilling over with inspiration because this is a new way of doing things and there's so much potential because of the influence they have. They can use their demand fairly quickly, if we do things right, to influence these positive outcomes that are much better for biodiversity, for climate, for farmers and their incomes, and for total food output because you're making the most of the land that we're using. So that's supporting these businesses' goals on multiple levels. One is we're seeing a wave of many companies now setting in stone commitments and roadmaps for climate and increasingly biodiversity as well. So those are CEO-endorsed commitments that they need to deliver on, and we're giving them a how and a pathway. So that's one thing. And two is the increasing resilience piece and de-risking supply chains, which again is hitting companies' bottom lines, especially as extreme weather instances are becoming more frequent. So again, it's not just the sustainability piece. It's actually coming to the core business. And we quantified and we looked at different scenarios by imagining these different products for wheat, dairy, potatoes in the EU and the UK. And we found that across the board, it's consistent you are getting much better outcomes when you take this design approach rather than just saying, okay, I'm using this type of wheat today. I'm going to try and source it better. That can still get you some good outcomes. and food offerings more broadly that consumers want, that are tasty, that are nutritious, and make this nature positive future the norm and bring it as soon as possible, which is what we need.

SPEAKER_02: 20:54

What I really like about the report is you quantified this, you modeled it. Could you speak a bit about that? Because you looked at reduction of biodiversity loss, the obviously emissions and total food output. It's something like, oh, can we feed the world? It always gets thrown at the food sector. And of course, farmer profitability, like how big is the difference if you have the numbers on top of your head. Otherwise, I would push everybody to read the report. But how big are the differences between better sourcing only and actually doing this full food circular redesign for food?

SPEAKER_00: 21:22

So what we see is the climate reduction is about 70% reduction when you're doing the redesign approach

SPEAKER_02: 21:31

versus... Again, on potatoes, what are the four, the three or four?

SPEAKER_00: 21:36

Wheat and dairy. So those are the three that we assessed for some of the changes. And then We also looked at upcycling opportunity, which was a bit of a different approach, and we can speak to that too.

SPEAKER_02: 21:47

Which is massive,

SPEAKER_00: 21:47

yeah. For sugar, which is super interesting. But what we see in the greenhouse gas emissions reduction for better sourcing is about 50% reduction, but then you can get a further 20% to get 70% total reduction if you take the circular design for food approach. Similarly, with biodiversity loss reduction, it's about 20% reduction when you're doing better sourcing only, but then if you do circular design for food, you get a 50% reduction.

SPEAKER_02: 22:14

Which is a massive difference.

SPEAKER_00: 22:15

Yeah. And a lot of that is the footprint, right? Maximizing what we're getting from the land and making as much as possible everything that's coming out becoming edible and an ingredient. And again, because of that, we see a huge difference. 5% increase in total food output when we're doing better sourcing, but a 50% increase in total food output when we're doing circular design for food. And then because of that higher total food output and yield, you can say for the farmer, profitability rather per hectare in US dollars, it could be$200 more with better sourcing alone, or we see about$3,100 in the US for circular design for food.

SPEAKER_02: 23:01

That's massive as well.

SPEAKER_00: 23:03

Yes.

SPEAKER_02: 23:04

That's a huge, those differences, I mean, even on the emissions, it's a lot, but the other ones are just off the scale. So I think, I I can imagine a lot of these companies get very excited. But what then? What is the next sort of pathway? Like you're working on that now. You released this report, obviously. It took a while to write and then it gets released into the world in September. And now what are the next steps, the pathways? I mean, all the companies are excited, but getting them from excitement to actually action. What does it look like in your ideal world, in the current world as well?

SPEAKER_00: 23:34

Maybe I can speak about the five action areas that we laid out. But before that, I think it could be good to define even what circular design for food is if Elliot you want to you want to just lay out the four design opportunities and how we see them being combined

SPEAKER_01: 23:50

yeah definitely so I mean yeah just linking back to very briefly to food design earlier so we mentioned how food design is it's a set of decisions that are made at the product level about how food should look it should taste and its price its nutrition etc and the difference between that which is done today and circular design for food is applying the principles of the circular economy to every aspect of food design. So I could just run through some of the steps that that could look like. So to start with, you actually have to embed this very early on in the product concept stage. So in order to give the rest of the team the agency to try and achieve regenerative outcomes, if you embed that in the product concept, and if you set targets, embedding nature-positive regenerative targets in the product brief, then that can give the team down the line, much clearer incentives, give the product development team, the research and development team, much clearer incentives to design for these outcomes. And then after that, research and development teams and procurement teams who probably traditionally worked in two different silos, probably didn't talk to each other perhaps as much as they could have or should have, they can work together to make the ingredient selection and sourcing decisions together. So that would mean talking together and deciding what ingredients they should include, how those ingredients should be produced, and then not only that, but then think about how those ingredients could play a role in regenerating landscapes as well. And then, last but not least, a really important thing as well is actually thinking about the packaging as well, because it wouldn't be much good having a beautiful, diverse, regenerative, up-circuit ingredient-based food product that's then put into single-use packaging that then goes up in the ocean. So these are the different steps that can take place through the design process. And we'd argue that there's four main design opportunities that companies can use and can combine to achieve the best outcomes. So this is using diverse ingredients, using lower impact ingredients, so shifting from ingredients that in a conventional agricultural system have a higher impact to those that have a much lower impact in the conventional agricultural system. So that might be shifting from conventional animal-based products to plant-based ingredients, or it might be shifting from a higher impact plant-based ingredient to a lower impact plant-based ingredient. So that's the second one. The third one is including upcycling ingredients as well. So upcycling ingredients or upcycling, I should say, is when you take a byproduct of the food industry that's typically considered to be inedible. So it might be a banana skin. It might be spent brewer's grain, the byproduct of the beer industry. You take those, and although they're typically considered to be inedible, you can transform those into food ingredients to be used in these types of products as well. And then the fourth one, which everyone, all your listeners are very familiar with, is regeneratively produced ingredients as well. And we found that by combining those four different design opportunities, you can really get the best outcomes. So just one example of that would be Lower impact, a lower impact ingredient could be switching from conventionally produced cow's milk to conventionally grown oat milk, oat milk made from conventionally grown oats. There's probably a significant reduction in the impacts, but to really maximize that, you could be growing those oats regeneratively and then having a regeneratively produced oat milk. Or to link it back to the silvo example that we used earlier, you could be producing both plant-based products and animal-based products in the same system. And that's where you get the most benefits we've found.

SPEAKER_02: 27:41

And potentially using a sweetener that is upcycled. I think there was something in, was it cacao or coffee? How much we throw away of that, of the bean at source, which is actually a perfect sweetener, which could replace a very... large amount of the sweeteners we use in the world which we should be using less but still we're going to be using that for quite a while and replacing that with an upcycled with a waste product basically is a very interesting opportunity there and then of course the packaging which is a whole different topic and so when are we going to see any of the because products look amazing if you look in the the imaginary products obviously and the model products look amazing when are we going to see something similar or maybe even better or more interesting in shelves or going to be pilots launched what is next for to making this become a reality and not just an amazing report that's going to be on a shelf somewhere.

SPEAKER_00: 29:03

Well, I hope soon. I hope soon. I think there's lots of promising efforts and examples that we are starting to see hit market, often very small or quite niche. So the question is like, how do we get the scale piece? And I think that links to what we call the five action areas for these major food companies, the FMCGs and retailers that they can already start taking today. to get us on that right trajectory. So the first one is within their own companies, creating these ambitious and well-actioned, or well-resourced rather, action plans to transform their entire portfolios, which is a massive undertaking. And so that's why already we need to get going on the baseline and understand what ingredients you're using today, where those are coming from, the impacts, and then what are the pathways for transformation? So that's the first piece. The second is kind of reinvigoring these relationships with farmers and creating a new collaborative dynamic with farmers. Right now, the relationships can really range where you can be going through multiple suppliers or aggregators as a buyer. And it's often, there's a real lack of visibility, but even more so there's something that's quite qualitative in nature, but it's the relationship with the farmer. And so we are seeing some major food companies starting to do farmer kind of relationship projects where they are, it's very small at first and more working with these farmers to understand what does a regenerative future on that plot of land actually look like? Because that's where we need to get to. And it needs to be this two-way conversation of what does the land need? What would be produced there? Okay, what ingredients do I use today? And then jumping out forward and saying, what ingredients could I use in the future if I design products that are ready for market that use those ingredients? So then it's a demand-driven, the right financial incentives are there. The market is actually working for these farmers. And there's ways that companies can modify things like the contracts. And the terms, the duration, helping to lower the perceived risk for farmers and create the right incentives, even doing things like equipment sharing programs and new innovative ways to support farmers with what they need to go through this transition. The third action area is about having iconic products out in market. We were mentioning about plant-based milks earlier, and I often cite Oatly as a great example. I would count as being iconic, right? They have amazing marketing. It really helped set the plant-based milk alternative industry off on a new trajectory. And we need to see these sort of iconic products for what positive impact foods can actually be in the market to inspire industry to move along and show what's actually possible. Because until we have that North Star and can see what's possible, we can't start moving towards it. But once you have that, it's like the four minute mile. Once you overcome what you thought wouldn't even be a threshold you could break, suddenly everyone's able to do it. Not everyone, but...

SPEAKER_02: 32:13

Yeah, no, it's interesting with Oatly. I mean, there's a lot of discussion on drinking oat milk in general, but we haven't interviewed them yet. But then of course you get the ones that say, okay, how do you grow these oats? And wide open agriculture in Australia is very small, but it's very pushing and they wouldn't be there without an Oatly or they wouldn't be there without And so you start, yeah, once you overcome like actually a large company in the plant-based milk space, which probably 10 years ago, we thought wouldn't be even possible, remotely possible. And they became very large. And suddenly everybody else is seeing that as an example of this is possible. Let's innovate further. Let's push it. Let's et cetera, et cetera, et cetera. And it forces them to be pushed further because of course, I think they went public. So they are under huge scrutiny, of course, of the financial markets. So they need to keep pushing as well. So it creates a very Very interesting flywheel.

SPEAKER_00: 33:02

Yeah, for sure.

SPEAKER_02: 33:03

And hopefully better contracts for farmers. And that's the underlying.

SPEAKER_00: 33:07

Yeah. And then there's two final elements. And one is really having that foundation of metrics. So what we don't see today, but we'd like to see these businesses doing is contributing to the development and adoption of common on-farm metrics that are able to measure these outcomes that we're looking for. And also definitions, which there's lots of debate and confusion and ambiguity around. So that's an important foundational piece to get right. And then the final piece, which I was mentioning briefly earlier, is policy. So advocating for policies that can support a nature-positive food system.

SPEAKER_02: 33:46

Which they can, yeah. Which maybe the small, tiny startups can't. I mean, they don't have the capacity to also lobby. And it sounds really like a decommodification of the food industry, and not just on the commodifying part, but also on the recipe part. How much is this a risk to them? Like how much of these large food companies are made or are successful because of the commodity? And this is sort of an existential threat, maybe the same as in renewable energy that we'll see potentially many, but this is a very difficult question, but many energy companies or oil companies not making the shift. Some will do and some will thrive, but how much of this commodification is part of their DNA or how do you see also there the shifts happening? Like we need to get closer to farmers, but it means we probably need some kind of long-term agreement with them and we cannot just shop around for the cheapest oats. We actually are committed to this. How deep runs this change of this shift?

SPEAKER_00: 34:38

Well, I think it's all embedded and intertwined with the rise of the industrial food system, which is linear in nature and their businesses and the models and the types of products that are offered and commoditization of commodities, as you're mentioning, are all outcomes of that. And what's really interesting and I often look to as a moment of hope is remembering that if you look at human history, it's quite a recent little blip where we've really gone off the rails when it comes to food. I truly believe we have inherently this wisdom and ability to work symbiotically with nature in how we are feeding ourselves. That's what we did for ages, right? It's very recent that we've deviated away from that. So while there's a system that may look quite locked in and entrenched to day, we can transform that. And we've seen that happen in things like energy. And once you get that momentum going, it can move quite quickly. So I think there's, yes, there's some risks, of course, on the table. If you're looking out as a company and go, oh, in order to do this, that's good. That's going to be overhauling my supply chains. That's going to be all, will it even work, right? Will these numbers actually transpire? But there's much bigger risks if On two fronts. One is the threats to your supply chain. Because if you don't get moving, are you going to exist 100 years from now? If your soils, which are your battery of your supply chain, are dead? You can't grow food in dead soil, right? The

SPEAKER_02: 36:16

answer is no.

SPEAKER_00: 36:17

Yeah. So that's one. And then the other is the market shifting. We are seeing rapidly increasing market growth in areas like organic food, like plant-based, which is signaling that customers are wanting industry to provide better solutions you know climate awareness is increasing and there's other reasons too including nutrition healthy soil equals high nutrition food so it's not just about environment but actually there's a business play here and we're seeing increasingly that there's a pure competitive advantage in the marketplace

SPEAKER_02: 36:55

so what's the role of investors what should people listening here and entrepreneurs as well that maybe they're exposed to the food companies, of course, you can pressure, but I'm not imagining many have like a significant stake in the big eight or the big 10 to actually pressure them on this. What would be the role for smart investors, obviously, without giving investment advice and entrepreneurs in this space? Where do you see gaps and the most interesting places to get to work or to put money to work?

SPEAKER_01: 37:20

So full disclosure, Emma and I are not investment gurus, but we do have some thoughts on this.

SPEAKER_02: 37:26

And I would not trust any investment guru, by the way. That's a whole different... That's a whole different podcast.

SPEAKER_01: 37:31

Yeah. No, fair point. But yeah, just a few thoughts on that. I suppose, so regenerative agriculture is an increasingly popular idea right now. And I think rightly so. I think we all fully, all of us on this call right now fully believe that it can solve many of the problems with the food system like we talked about earlier. There's a lot of good being done in the space right now. Don't get me wrong at all. But I think there are some companies and some organizations that are in the space or maybe entering the space that that maybe have a bit of a shallow understanding of what regenerative and regeneration really is and really can be. And maybe as the idea becomes a bit more popular, it's not a new idea really, is it? But as it becomes more popular, I think there could be a risk that it could stray into the realms of greenwashing if they're not careful. So I guess my first tip would be that investors should be avoiding any organization that only really demonstrates a shallow understanding of what regenerative really is. So a couple of examples I could give would be if an organization is only talking about practices rather than outcomes. So an example of that could be, you know, if an organization talks about just applying a couple of practices here and there, like no-till, for example, regardless of the context, and they call that regenerative, that's a bit of a shallow understanding. Because Yeah, don't get me wrong. No-till in certain contexts for certain crops is amazing for soil health. It can really work. But not in all contexts and not without pairing it with different other practices like cover crops, living mulches with agroforestry. And of course, not just combining it with practices, but combining it with a specific set of practices to achieve a specific set of regenerative outcomes. So regenerative isn't about just bolting on a few new practices here and there, but it's about transforming landscapes, providing ecosystem services and helping to achieve these outcomes. So to summarize that first point is not just talking about practices, but considering the long-term outcomes, but not only considering the long-term outcomes, but also measuring them as well. It's not just enough to talk about carbon sequestration or biodiversity provision, but we do need that evidence base, that rigor to measure the outcomes and to make sure that You know, if you're going to invest in payment for ecosystem services, for example, to make sure that farmers are appropriately rewarded for the types of outcomes so they're actually providing not just what a certain practice may or may not provide in any context. And then final thought from me is just Yeah, for food buyers, whether it's food manufacturers, retailers, whoever, to move away from an expectation that they will be able to just source exactly the same ingredients in exactly the same quantities with regenerative as a little add-on at the end. To link back to the work on circular design for food, like we've talked about for most of this call, yeah, we hope that this is one tool that these companies can use to try and develop a bit more of a nuanced understanding and see how yeah if they apply the principles of the circular economy and if they design around what agro ecosystems can provide that demonstrates a bit more of a deeper understanding of regeneration and if companies are doing that then maybe they would be maybe there would be a good bet to invest in

SPEAKER_02: 41:31

and i think it's very interesting the shallow part and the outcome versus practices and i think we've seen the regenerative washing very strongly already in a number of places and i mean one is the lack of a definition which is also a strength at the same time but looking at the outcome piece and focusing on that and really like, what do we want to see? And what does the landscape want? Or what does nature want? We had an interview on that before. We have to see if it's already out there. Otherwise I will link it on Centropic Agroforestry and really deep discussion. What does this piece of land wants to be or could be, or what is actually a full expression of the full biodiversity of life on that place? Which is a very deep question, which most farmers can't ask at the moment because they're locked into a lot of other things, but which is a very fundamental question to ask at a landscape scale, like what could be here and what could be here over the next 20, 30, 40 years with all the climate models in mind, obviously. So what if you would both, or one of you be in charge of a large investment fund and it would be, of course, not investment gurus, this is not advice, but if you had to, you were forced to put, let's say a billion dollars to work, what would you focus on? Where would you start and what would be your priorities?

SPEAKER_00: 42:41

If I can start, to everything that we've discussed today and the especially what Elliot was just emphasizing. I think... Investors are quite well placed to have this helicopter view of a full landscape, which very few other actors have. And while we can optimize for a single plot of land in that landscape, it's almost like Lego blocks. It's like we need to set the conditions for all of those little pieces of that broader tapestry to be part of that regeneration for that place, which sits beyond just the one square plot. So I think I would want to embed that ethos and approach at the very core of that investment. Definitely allocating a solid share of it to be directly supporting farmers in their transition because it does take new equipment, it does take training, it does carry costs that we can accelerate this transition if we get the finances right. So helping those farmers move, but that's only one piece of the puzzle. Because we do see some of that already happening, and that's great. But then how do we link it? Is there a way to structure such a fund or model, for instance, in that you have off-takers, including at least some of these major food buyers, to be calibrating their design and demand with the ingredients that are transitioning and evolving over time? Because a farmer who's purely growing coffee today and goes in an agroforestry system, maybe it will be five years, 10 years before they start producing mangoes and different fruits that are also part of that system and so there's this calibration that right now there's a missing link and so there's also a piece around for me in my dream if I had one could a portion of that investment that one billion be supporting or investing in really tech innovators to create the digital marketplace for not only having the metrics and the data and transparency of those ingredients, but also giving those like, you know, in two years, in five years, what's the output of those farms going to be so that it makes it possible suddenly for these companies to actually have visibility for the first time as the future supplies of the high integrity, I'll say, like measured ingredients that they're looking for and start to design their product pipeline accordingly.

SPEAKER_02: 45:15

Because you know it's coming. It's going to complexify. So I'm going to have, like in your example, mangoes, et cetera, coming. I need to be ready to absorb them.

SPEAKER_00: 45:23

Yeah, that's the thing. We need to to find ways to lean into the complexity, which is inherent in regenerative systems. And so we can't be scared of that. We need to lean into it. We need to use things like digital, et cetera, and how we structure things like funds to enable that because otherwise it is simplifying. And if we're simplifying, nature isn't simple. Then we get into reductionist approach and it's putting the regenerative label on something that is not truly having, aiming for positive. I can

SPEAKER_02: 45:56

sense tension there, but a good tension to have. Like, how do we hold that complexity in our supply webs, probably not chains anymore, in the landscapes? And it's

SPEAKER_00: 46:08

going to be a bit messy, but it's okay. of ingredients because we're so far at the other end of the spectrum today.

SPEAKER_02: 46:29

And you, Elliot, what would you do? Tomorrow morning, you're an investment guru with a billion dollars under management. Where would you start? I

SPEAKER_01: 46:36

mean, how do you follow such a nuanced answer as Emma just gave there? I mean, if I could... No pressure. If

SPEAKER_00: 46:43

you'd add it to my fund.

SPEAKER_01: 46:45

Yeah, I'd just pull... We'd have$2 billion.

SPEAKER_02: 46:47

Network effects, for sure.

SPEAKER_01: 46:50

I think if I can just lean back on the Silvo example that I gave earlier, because I think it was actually a nice example here as well. So we talked earlier about how silvopasture has many benefits in terms of ecosystem services, but probably one of the big sticking points is for when you're setting up a new agroforestry system, well, the walnut trees in Silvo's example take somewhere between eight and 13 years to reach maturity and to be bearing a full tree of walnuts. And that is obviously a pretty big turnoff for farmers in the current system who have tight margins and who probably don't have the luxury to think in the long term by spending that type of money that won't pay back for years. So I think I would target money towards these types of interventions which have much bigger, longer-term payoffs but are probably not so appealing to farmers in the short or medium term simply because of the economics behind them. So whether that is transition finance to help them plant the trees, whether that is longer-term contracts like Emma was talking about, so that over a 20-year period, a food buyer can buy initially the milk, then the regenerative milk as the managed intensive grazing system is established, and then once the trees meet maturity, then they can start buying the walnuts as well. Some kind of incentivization to build those long-term contracts. And then link to that as well as the payment for ecosystem services as well, which probably agroforestry is a particularly good example of sequestering that carbon. I think actually in a silvopasture system where managed intensive grazing takes place, the carbon is stored 50% in the soils and 50% in the trees or so. So it's not just the trees. The actual grazing is having a real good effect as well. But it's just one example of, although we shouldn't just think about practices, as I mentioned earlier, it's an example of a practice that probably is very well suited to payment for ecosystem services. So if all those mechanisms played together, I think that could really make some of these longer-term thinking objectives work.

SPEAKER_02: 48:59

Basically using the one or two billion to force longer-term thinking, if I had to summarize it, which is extremely needed. I mean, we all need the trees and nobody wants to pay for the planting, which sort of sounds like a finance question. It's like, how can we bridge that time between now and eight years or 13? Or in the case of chestnuts could be, what are they here? 20 plus years before they're fully, I mean, you get some chestnuts before, but, and it's amazing because we have some that are planted by the Romans. So if you calculate, we can't, but if we calculate the ROI from that little seed to a tree that has been producing for a good 2000 plus years, I mean, that wouldn't even fit in your spreadsheet, but still we are able to find the money to plant many of them. And it comes down to processing and de-risking and of course, planning carefully and changing climates, et cetera, et cetera, and building the food brands around it, which includes these products. And to ask a final question to both, you already hinted a bit, but you were still in your investor role, Emma. What if you had a magic wand to change one thing in the food and agriculture system? What would that be? So you're no longer investing. I'm sorry, we took away your fund. But you have a magic power, which is pretty powerful. You can change one thing and one thing only. Some people start to say, yeah, the first thing I would do is like, no, this is a one thing only. But it is powerful because it could be anything from global consciousness to taste to banning subsidy. I mean, anything you can imagine.

SPEAKER_00: 50:19

Well, mine... would definitely be in the space of rewiring our relationship with food, starting at a personal level. I mean, I shared at the very beginning that was what set things in motion. The

SPEAKER_02: 50:32

vegetables.

SPEAKER_00: 50:32

For me, yeah. And we're in an era where very few of us ever set foot on a farm or really know where our food comes from, the land that grew it, the hands that tended to it, that harvested it, and the people and places behind it. it. And food has such a rich story that we used to be so much closer to. And as a result, the way we valued it, which can go both ways, right, in terms of how it was produced and what that food actually is in the first place and how we enjoy it, it really shifts when we look at the relationship that we have at large today versus probably many generations ago, our ancestors. And at the end of the day again for so many of us who are in this privileged position where we actually have an abundance of food you know we can afford more food than we actually need at the end of the day food is what we depend on for our existence and our survival but so often we live our entire lives and forget all of that let alone the incredible other kind of roles that food plays as a centerpiece of culture, of social and convening, of flavor and experiences that touch all of our senses. So yeah, I think it's just remembering, remembering what food really is for us at this human level.

SPEAKER_02: 52:01

And what about you, Elliot? What would you change overnight? Apart from planting trees, obviously, everywhere.

SPEAKER_01: 52:07

I mean, I grew up in rural Leicestershire in the UK, and whenever I go back there, I'm so disappointed with how boring the landscape looks around there. Even if it is all agricultural, it's pretty much rapeseed, commodity grains, maybe some cows, maybe some sheep, but that's about it. And that's probably one of the main consequences of the industrial food system, isn't it, that we've gone to this great simplification where farmers probably just do one or two crops or one or two animals and that's about it so if I had a magic wand it would be to bring back diversity that we used to have and to have the countryside filled with thousands and thousands of smaller farms that are producing diverse locally appropriate varieties of different crops and combining livestock and arable systems on the same farm and yeah lots of trees as well you probably got probably realized that I'm pretty big into agroforestry and linked to that um yeah I mean you've probably heard the term terroir in terms of wine, how the climate and the soil and geology and all those local conditions really affect the flavors of the grapes and the wine. That's always talked about in the context of wine and maybe more so now in the context of coffee and chocolate and a couple of other ingredients. I don't see why there's any reason why that couldn't really apply to any food ingredient if we decommodify and move to these more diverse, interesting varieties. So if we could start applying the principles of Turkish economy to food and create some food products that do celebrate that terroir, that diversity, I think we'd be heading in the right direction for that. And maybe we don't need a magic wand. Maybe we just need to read the big food redesign and move from there.

SPEAKER_02: 53:58

And apply it, yeah. I want to thank you both so much for your time and unpacking this a bit. I mean, there's a lot more and I urge everybody to take the report, have a good read and then apply it, please, because this shouldn't be one of the things that lies in a shelf somewhere digitally or non-digitally. And thank you so much for sharing and very interested in the following steps of what comes, how this report is going to be brought to life with the partners you have, which are many of the larger food companies in the space. So thank you so much.

SPEAKER_00: 54:25

Thank you. Yes, stay tuned and look forward to seeing great products soon. Thanks

SPEAKER_01: 54:32

very much for having us. Really appreciate it.

SPEAKER_02: 54:35

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