Show notes:

Did you know that ultra processed foods (UPFs) make 57% of the average British diet and up to 80% when it comes to children and people with lower incomes. And that the major food and drink companies lobbied to block the UK government’s efforts pushing for discounts on healthier and minimally processed products 

In the Indian sub-continent meanwhile, an average household derives more calories from processed foods than fruits (The Lancet study 2020). What is staggering is that this diet has been reshaped over the course of a single generation. While regulations around ultra-processed foods are tightening in both the UK and India, food regulations in India are considered weak, ambiguous, and industry-friendly, leading to a lack of strong front-of-pack labelling and effective advertising restrictions.

Last year I reached out to the Access to Nutrition Initiative (ATNI) in India - a pivotal global foundation dedicated to transforming the food industry to learn more about their work and the ATNI’s India Index. The India Index 2023 assesses the performance of the 20 largest food and beverage manufacturers of India. The findings based on 1,901 products are not unexpected but still staggering 👇🏾👇🏾👇🏾

👉🏾 The average Health Star Rating for all companies’ products is a shocking 1.9 out of 5, well below the ‘healthy’ threshold of 3.5

👉🏾 Sales of packaged F&B in India have surged by 15% every year since 2011, outperforming total food sales. Spending on F&B increased at a rate of 9% per year between 2011 to 2021

👉🏾 76% of sales are derived from less healthy products. Nineteen of the 20 companies derive most of their sales revenue from less healthy products.

👉🏾 The positives seven of the 20 companies have responsible advocacy plans and five institutional investors and shareholders of food companies in India have now signed up to nutrition frameworks such as the Investor Expectations on Nutrition, Diets and Health as part of their responsible investment strategies.

Another disappointing fact, specifically highlighted in the index is that products sold in low-income countries like India tend to have lower health star ratings than those sold in high-income countries, indicating that the nutritional value of products may be lower in lower-income markets.

The findings are an eyeopener for the food industry, consumers, regulators, investors and activists and reveal the need for reform and greater transparency.

And should we not be asking as to how and why is it acceptable for multinational companies to offer products with low nutritional value in poorer countries compared to their offerings in high-income countries?

Head to the podcast to listen to the episode 👇🏾👇🏾👇🏾

Episode Transcript:

Sudha: Good morning, Vivek. Wonderful to have you as a guest on The Elephant in the Room Podcast today.

Vivek: Morning Sudha. And thank you for giving me this opportunity to come to the podcast, The Elephant in the Room and share my thoughts with you.

Sudha: So let's get started could you introduce yourself for the benefit of the audiences?

Vivek: I'm Vivek Arora and I work in the area of food and nutrition. So right from the beginning in the career I was involved with the food production. And there was a turnaround in 2008 when I got the opportunity to produce therapeutic and supplementary foods, and that's how I got introduced to the space of Nutrition.

And since then, I found a purpose, earlier I was producing fast foods and now I'm producing food for a purpose or contributing towards nutritious foods. So that's the transition that has happened. Of late after that stint I worked with development sector like Tata Trust and then went on to be an advisor in the space of nutrition, where currently I am advising ATNI and GAIN. ATNI is access to nutrition initiative and GAIN is Global Access for Improved Nutrition. So both are, global foundations and I provide my advisory services to them.

Sudha: Amazing. So you've also made a transition from the private sector to the development sector and found your purpose with what you are doing with your experience to use your experience for the next stint. So tell us a bit more about what the ATNI is or Access to Nutrition initiative is.

Vivek: So basically Access to Nutrition Initiative is a global foundation. What we do is, we challenge the food industry, the policy makers and the investors to produce, nutritious food or, create food systems that are more nutritious.

So what we actually do is we analyse data and come out with actionable points that helps them to take on the decisions basically.

Sudha: Very interesting considering that the world is struggling with hunger in some places, and obesity in some places. And I read a news report yesterday that India is also on the cusp of struggling with, an obesity crisis. However, that's another conversation to be had.

So what do and sustainable investment look like for nutrition, and do you have examples of where it has worked? And what is the scale of investments that is being made in this industry and what is needed?

Vivek: So basically sustainable investment is like the investors and the bond holders.

They invest in food companies, which drive a sustainable change in the companies. So basically it is nudging the investors, and it is being done through different means so right from collaborative approach to we need to take shareholder resolutions.

We work with the companies we analyse; we share the data with them, and then they take action. So either the companies take it or we then provide the reports to the investors. Who then take it to the board or the CEO to take actions and produce more nutritious or sustainable food and healthier options to the population basically.

So the motto of ATNI is providing healthier diets for all so we are nudging the companies who are producing food in the market to provide and give healthier options. Just to give you an example, we worked with Unilever and there were certain, board resolutions and there was a collaborative approach where we had three rounds of meetings with them. And they later started disclosing data on healthier options that they provide. So there are different profiling models available across the globe. And there are government recognized standard profiling models. They started disclosing the data on it and that's the way you come out in public, you commit in public, and then you improve. Unilever is a very, very good example. They almost, kind of stopped marketing unhealthy food to the children. So it was a big achievement I would rather say.

Sudha: Yeah that's a big thing. My interest in this question is because I look at the intersection of equity and inclusion and ESG and sustainable development and I understand from some of the information that you have shared that there are at least 88 financial institutions who manage like 21 trillion in assets who are working with you to invest more responsibly in nutrition. So all of this conversation around ESG being dead or sustainable development should not be a priority, I think, sounds more and more like rhetoric.

Vivek: You are right. See there are people who want the healthier option, and that's what our approach is because where do you consume food from? You consume food from markets. Now imagine if the markets are not able to provide in any case would consume food. So the objective here is to drive that market and transform them into healthier options and more sustainable options.

That's what we are working for, basically.

Sudha: And you have sufficient traction on this from investors. I can see.

Vivek: Definitely 21 trillion of assets under management and 88 investors on our side and growing. So, it's almost one third of the total investment by the company. So significant and with more popularity, where the index gets recognized and used by more investors, we see a good progress here.

Sudha: That's great, so ATNI released the Indian Index in 2023. What was the focus of the index and what is the methodology of the research?

Vivek: So basically this ATNI index 2023 is not new to India. So the first index was in 2016 where we analysed 10 companies. And the second index came in 2020, where 16 companies were analysed. In 2023 in total, 20 companies were analysed. These 20 companies produce about, say, 36% of the total processed food available in the Indian markets, which is significant.

So how do we analyze? There is a set methodology, and under each section there are several questions and the companies are asked these questions and each question is marked, and then the then a ranking is published. Just to give you an example the different sections.

So the first section is, the methodology. So the first one is nutrition policy, so do they have a policy? Do they have a written policy? The questions are like, do you have targets under this policy? Suppose they have a written policy, but they do not have targets, they will not get full marks.

That is one that we analyse. The second is the products, so whatever products they're producing. So this is analysed based on the Australian star rating. So if it is having a more than three and a half star it is a healthy product or if it is below three and a half star, it is a less healthy product. So in total, out of this 20 companies, 1,901 products were analysed to come out with the results.

The third section is the responsible marketing, section where we ask them questions like, unhealthy products are not being marketed to children, or they are not using certain advertising means to consumer to consume, products which are unhealthy.

The fourth focus is on the labelling, so how are they labelling their products? Is it easy for the consumers to read the labels or judge from the labels. Is proper information provided in the labels. So that is also analysed.

And the fifth is the governance. So what is their governance mechanism? How transparent they are with the governance. So that is analysed.

And the sixth section is the workforce nutrition. So for their own employees? if they are providing the food or what is their policy, are they doing nutritional checks on their xxxxx. Is breastfeeding space provided in their factories. So such questions are asked and analysed.

And the last section is affordable diets. So do they take steps to make their food affordable and accessible for all? The biggest example is like having smaller packs of biscuits available so that it's more affordable. Or a small pack of oil.

The daily labourers in India, they buy oil every day, they don't earn money to buy one litre of oil. Initially they used to buy a loose oil, which was adulterated, not safe to consume. So now small pack of oil, they're available in the market so that they can procure this packaged oil and get safe oil. So those kinds of initiatives are appreciated.

So that's the whole methodology and once that scoring is done, then the ranking is published.

Sudha: And what were the key findings from the India Index? Were there some things that were startling and surprising for you?

Vivek: Yeah, so the biggest surprise, not a surprise because our indexes from last 10 years also showed similar trend. But the biggest revelation was that 76% of the products available from this 20 companies were less healthy.

Sudha: Oh my God.

Vivek: So this was the biggest finding I would say. And the sales that were being derived by the companies. So 19 of the 20 companies were deriving more sales from unhealthy products or less healthy products, I would say.

Sudha: Wow.

Vivek: So that was the clear finding that we could see and over these years, I would say that there was a slight change, so about a percent, of the company's producing more healthier products. But it was not, what we had expected.

Sudha: So one is about how unhealthy products are being marketed and that most products that are marketed are not the healthier ones.

Vivek: The healthier is 3.5 and about unhealthy, 76% is below 3.5 rating.

Sudha: Below 3.5. Was there an urban, rural, divide.

Vivek: No, it's difficult to find the data of urban and rural divide because we are analysing the companies and the sales from the company.

So on the affordability, yes, there is some data available as to what initiatives the companies have taken to capture the rural market because it's a very price sensitive market in India. So that data is available and they're making their products more affordable to reach the rural market.

Sudha: So more affordable but less healthy or more affordable and more healthy?

Vivek: Both. The nudge to the companies actually is to provide healthier options at affordable prices. So that's the nudge.

Sudha: Is there a difference between how local companies and multinationals behave? Because I feel personally having worked across the UK and India, that there is a stark difference, on how companies may behave in the UK, and then how they come into India and they behave differently.

Vivek: So, in that sense, yes, I would say that, if a multinational company is coming into India, then I would say that they should also bring in the global standards. But one stark difference that I observed, during the assessment was that the multinational companies are more organized in their documentation.

So they're able to present themselves better than a comparative Indian company. The Indian company might be doing things or taking lot of initiatives, but they have never documented that. So while assessment was being done, by ATNI, we also observed that there were certain companies which realized that, we are doing a lot, but we are not doing it in an organized manner.

We're not monitoring our progress over the years. So because of our assessment that also kind of a development or initiative, those companies who participated in the 2020 Index for the first time. They started now documenting.

Just to give you an example, one of the companies. So they, had a data of 250,000 people. Health data because they had developed an app, which was helping their employees for say consultation on health issues and XXXXXX data of their employees, plus their families. So imagine how much impact can they create, because they have a tool that is available with them to, disseminate good information and provide education to their employees plus their families.

Sudha: That's an opportunity to speak more about healthy choices. A lot of the Indian companies have not been very structured in capturing data, and so they may not have legacy data on where they started and what progress they may have made. But the good thing is, like you say, that they are getting on board and understanding the importance of capturing that data for the future.

Vivek: And, to everyone's surprise. This is an Indian company, so very progressive.

Sudha: Yeah. that's amazing. , Vivek, I have a question.

Should it be illegal for companies to be greenwashing to the extent that they do? Because if you look at , I don't want to name companies and all that, but if you look at some of the major, packaged food producers in the country, they all have some mandatory requirements, because of legislation to report on, what they're doing.

But in the recent past, a lot of people, instead of presenting specific data, they have used like vague sort of things to say, oh, we sell nutritious, or we believe in healthier, or they advertise about healthier. But they're not necessarily healthier products So there is a lot of greenwashing that is happening in the sector. First of all, should it be illegal and does India have policies and laws that require these companies to ensure that they comply with, best practice, nutritional standards? In the last response, you said, that when multinationals come into the country, they should bring in global standards that are good or best practice? What are your thoughts?

Vivek: See, in India, all the food companies, they are governed by the food regulator, which is FSSAI, Food and Safety Standards Authority of India. And there are standards laid down. Plus, the claims also are very well defined by FSSAI, so they need to follow and all of them do follow the regulation, but the gray area here is that there is no clear definition for unhealthy food.

So in want of that definition, there are certain gray areas where, the companies do go in for greenwashing. I would rather say. Also with multinational companies, the standards being adopted, say for example, an EU standard is more stringent than the FSSAI standard, but the companies are the experts. If the company or the manufacturer believes that this is a good standard, then whether it is the law of the land or not, they should bring in the global practice to the country. That's what I believe.

Sudha: That's true. They have a responsibility and an opportunity to do so.

And of course with, changing consumer behaviours, consumers are getting more and more conscious about what they're buying, I think that would be the way forward for them.

Vivek: I would say currently the consumers are ignorant. And, the manufacturers are the experts.

So the manufacturers should not take the benefit of the ignorance.

Sudha: That's very kindly put, I'd say,