A shareholder coalition founded in the U.K. is recruiting investors for a campaign to convince KFC parent Yum Brands Inc and other food companies to protect public health and corporate profits by reducing the use of antibiotics in the meat they serve in the United States and around the world.
Scientists warn that the routine use of antibiotics to promote growth and prevent illness in healthy farm animals contributes to the rise of dangerous infections from antibiotic-resistant bacteria known as superbugs, which kill at least 23,000 Americans each year and pose a major threat to global health.
"It's the kind of risk that doesn't discriminate. An illness that is resistant to antibiotics could happen anywhere, poor or rich," Natalie Beinisch, engagement manager at Aegon Asset Management, said by telephone from the Hague.
Members noted that chains like Chipotle Mexican Grill Inc and McDonald's USA have used strict antibiotic policies to elevate their brands.
"There is the potential for significant opportunity for those food companies that get the recipe for sustainable food production right," said Jeremy Coller, founder of the Farm Animal Investment Risk & Return Initiative (FAIRR) and chief investment officer at Coller Capital in London.
This year the coalition plans to keep up the pressure on Yum, whose policy lags those of major chains such as McDonald's Corp, whose U.S. restaurants last year stopped serving chicken raised with antibiotics important to human medicine.
The coalition also is pressing large food companies to set clear timelines for phasing out the routine use of antibiotics in chicken, pork and beef in all markets where they operate.
ShareAction and the FAIRR Initiative lead the group, whose members include Aviva Investors, Aegon Asset Management and Green Century Capital Management. The mostly European and U.S. coalition debuted last year with 54 investors representing about $1 trillion under management. It since has added 17 new members and doubled assets under management.
A broad campaign to curb antibiotics has been gaining steam in recent years with help from rising consumer interest, pressure from doctors and non-profit groups, and meaningful responses from companies such as McDonald's and Tyson Foods Inc, the world's second-largest poultry company.
"It's a domino effect. Once suppliers move ... there's no excuse not to move," said Leslie Samuelrich, president of Boston's Green Century Capital Management, who spoke at a coalition event for investors at BlackRock's New York City offices on Monday.