Why Sustainability Pays Off: Lessons from Climate & Company’s Work with Food Companies

From Climate & Company's work with food businesses, why is it important to keep investing in sustainability, even when the benefits aren't immediate?

For food companies, sustainability management is the foundation of long-term profitability. Compliance, renewable energy infrastructure and more sustainable farming practices all require high upfront investment. But food companies feel the effects of climate change and supply chain disruption immediately, so investing in sustainability is inevitable risk management.

But the transformation takes time. In food and beverage retail, supply chains account for around 87% of total emissions, so companies can't transition by focusing on their own operations alone. They need to work with their suppliers. Waiting for the costs of inaction to materialise only makes this task bigger.

Sustainability management also unlocks business opportunities. Companies that invest early build customer trust, strengthen their supply chains and secure long-term market share. The food company followfood shared a striking example at our Climate Innovation Forum roundtable: their strict sustainable fishing policies led them to switch early from overfished Atlantic cod to Pacific cod. When competitors faced price jumps of up to 80% in 2025, followfood kept supplying fish at stable prices.

How can sustainability reporting help companies understand the risks of inaction and make better business decisions?

Sustainability reporting gives companies of all sizes the structure and data to assess and prioritise the risks, opportunities, and impacts of their business activities.

Take the German family-run manufacturer RAU GmbH: The energy crisis exposed how dependent it had become on external energy suppliers. Using data from its sustainability report, RAU identified where its biggest energy costs and risks lay and developed a roadmap to energy independence. That analysis not only won management support for the necessary investments, but it also helped them secure better loan terms for financing a new battery storage and a PV system.

This illustrates why sustainability reporting is much more than a compliance exercise. It builds the transparency companies need to weigh trade-offs, convince financial stakeholders, and make decisions that strengthen resilience and competitiveness.

What can businesses do to better support farmers and suppliers in making the transition to more sustainable practices?

A good starting point is understanding the supply chain, where suppliers are located and how they work. Long-term partnerships help here.

Tchibo, one of Europe’s largest coffee roasters, uses satellite data and farm visits to track sustainability impacts in its growing regions. Local partners then provide targeted training for coffee farmers in these regions such as on fertilizer use, soil management, and ways to increase productivity and quality.

Support looks different for a smallholder farmer, a large agricultural business, or food processor. It might mean regular exchange, access to networks, capacity building, such as in Tchibo’s case, or access to finance for more sustainable infrastructure and technologies.

At our Climate Innovation Forum roundtable, supply chain intelligence provider Secaro shared that companies increasingly focus engagement on their most strategic suppliers. They are going deeper with the few that account for the most environmental and social impacts rather than spreading their effort across all. This approach allows companies to drive meaningful change where it is most urgent.

Why is it important for companies to share both their successes and their challenges as they work towards more sustainable food systems?

Most companies are convinced that without a sustainability strategy, they will not be competitive in the long term. Yet, they have become more cautious about communicating their sustainability work, wary of greenwashing accusations.

But when companies stop sharing what works and what doesn’t, the whole industry loses the chance to learn from each other, slowing down the transition.

Silence on progress and challenges also feeds the political backlash against sustainability. Voices calling for deregulation dominate the debate, leaving little room for a constructive conversation on how to make rules work in practice.

The resulting political uncertainty damages the transformation. A recent survey of 2500 decision-makers at German companies found that 73% had postponed important investments because of it.

With so much uncertainty around sustainability policies, how can businesses stay focused on long-term progress, and how does Climate & Company help them do that?

Sustainability policies help companies navigate their transition, and the people implementing them, such as sustainability managers, recognise their value. But the wider organisation, especially senior management and business units, does not always see it.

Sustainability managers thus need to translate that value for each department: security of supply for procurement, the cost and risk of inaction for finance, brand value and consumer trust for marketing.

Still, teams spend too much time on compliance when they could instead focus on meaningful transformation. Companies tell us they need better guidance and AI-supported tools and processes to reduce the administrative burden. Climate & Company helps by guiding companies through sustainability requirements, developing free practical implementation tools, and sharing successful examples from other companies.

About Climate & Company

Climate & Company is a Berlin and Brussels-based sustainable finance and environmental policy think tank. Together with partners in more than 25 countries, we co-develop policy and data solutions with regulators and market actors and test them in real-world situations at the critical choking points of value chains. We focus on deforestation-free supply chains, climate and nature transparency, resilient materials value chains and transition finance, and we design every solution to be practical, investable and ready to scale.