Dairy industry leads in global nutrition drive, report shows

GLOBAL – Dairy companies are stepping up as key players in improving global access to nutritious foods, according to the fifth edition of the Global Access to Nutrition Index. 

The report evaluates 30 of the world’s largest food and beverage manufacturers on their efforts to enhance access to healthy and sustainable diets, representing a substantial share of the global market.

It assesses companies across 51 priority indicators, grouped into eight weighted categories: Product Profile (30%), Responsible Marketing (15%), Nutrition Governance (15%), Affordable Nutrition (15%), Portfolio Improvement (10%), Nutrient Profiling Models (NPMs) for reporting purposes (5%), Workforce Nutrition (5%), and Responsible Labeling (5%). This framework provides a detailed picture of each company’s efforts to address global nutrition challenges.

Rising nutrition challenges and dairy sector’s response

As per the report, global nutrition trends over the past two decades reveal a concerning dual burden. Micronutrient deficiencies still affect nearly half of children and two-thirds of women of reproductive age.

While the prevalence of adult underweight has halved since 2000, global obesity rates have doubled, rising from 7.9% in 2000 to 15.9% in 2020, with projections indicating a further increase to 20.3% by 2030. Malnutrition in all its forms is expected to cost the global economy over $41 trillion in the next decade, driven by both undernutrition and the growing obesity epidemic.

The report indicates that dairy companies are at the forefront of tackling these challenges. They have shown significant progress in product development, responsible marketing, and affordability. Companies like Danone, FrieslandCampina, and Arla Foods stand out for adopting internationally recognized NPMs to classify and report healthier product options.

Additionally, the focus on product healthiness within the food and beverage (F&B) industry continues to evolve, with companies now deriving 34% of their sales from products that meet the “healthier” threshold. This trend is supported by systems like the Health Star Rating (HSR), which assesses food products based on their nutritional quality.

In 2022, 31% of the 52,414 products analyzed using the HSR system met the healthier threshold, indicating progress in improving product portfolios. However, despite these advancements, only 30% of companies have achieved their goal of deriving at least 50% of sales from healthier products, highlighting the gap that remains in meeting future targets for healthier offerings.

Dairy companies have emerged as leaders in achieving healthier product portfolios. Among the companies evaluated, Yili Group, a prominent dairy producer, stands at the forefront with 78% of its products classified as healthy. Other dairy companies also perform strongly, with Danone at 70%, Mengniu at 70%, FrieslandCampina at 68%, and Lactalis at 61%, all surpassing the general industry standards in product healthiness.

Continued progress needed to meet global goals

Despite these advances, the report emphasizes that the sector must continue progressing to meet global nutrition goals. The disparity in product healthiness between high-income countries (HICs) and low- and middle-income countries (LMICs) is evident. In LMICs, food products are generally less healthy, with an HSR score of 1.8 compared to 2.3 in HICs.

The availability of micronutrient data is also lower in LMICs, with just 36-37% of products providing this information, compared to 52% in HICs.

Currently, only 34% of dairy companies’ sales come from healthier products, falling short of the 50% target set for 2030. The industry’s continued focus on aligning with global nutrition standards and promoting healthier dietary habits will be crucial in bridging this gap.

According to the report, dairy companies have emerged as key contributors to global nutrition improvement. While their progress is commendable, achieving comprehensive global nutrition targets will require sustained effort and collaboration across all sectors.

Recommendations for industry, policymakers, and investors

Food and beverage manufacturers

As per the report, food and beverage manufacturers must evaluate, transform, and disclose their product offerings to ensure alignment with global nutrition goals. Manufacturers are encouraged to evaluate the suitability of products marketed to children, assess the healthiness of their portfolios, and review strategies on affordability.

They should set specific, measurable, and time-bound targets to increase the proportion of sales from healthier products, improve marketing practices, and increase the affordability of healthier products. 

Policymakers and governments

Governments must support voluntary industry regulations with mandatory policies and fiscal measures that can drive the availability and affordability of nutritious foods.

Revenue generated from taxes on unhealthy products should be redirected into health-related programs. National policies should mandate restrictions on the marketing of unhealthy foods to children, using World Health Organization (WHO) recommendations to enforce these policies.

Governments should also adopt front-of-pack labeling systems based on a government-endorsed NPM, signaling unhealthy products to consumers.

Investors

Investors are encouraged to utilize existing nutrition frameworks to assess and promote company performance on nutrition. Companies should be required to disclose detailed information on the healthiness of their product portfolios using a government-endorsed NPM.

Working with governments, environmental, social, and governance (ESG) data providers, and industry bodies to embed nutrition within reporting frameworks will be crucial in ensuring long-term industry-wide commitment to improving public health.

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