34 investors representing US $5.9 trillion join a new initiative to help advance seafood traceability 

Seafood is one of the world’s most highly traded and valuable commodities, with global demand expected to double by 2050. Yet a significant amount of seafood-related assets and revenue [LL1] – up to US $2.89 trillion over the next 15 years – may be at risk due to overfishing, habitat degradation, nutrient pollution, and disease. These negative impacts can pose significant financial risks to seafood companies – and their investors, lenders, and insurers – by reducing fisheries productivity, increasing supply chain volatility, and causing serious reputational damage.

Traceability can identify risk and unlock value

To deal with these risks, companies must first understand where and how they manifest within supply chains. Traceability – defined as the ability to trace a product from the point of origin (in the case of seafood, from the vessel or farm of origin) through the supply chain – is a critical tool for identifying and monitoring potential risk exposure. What’s more, full-chain traceability can also unlock a huge amount of opportunity for seafood companies, enabling them to validate product claims and satisfy growing consumer demand for transparent and responsible seafood, while also increasing their operational efficiency through additional and higher quality data. A recent study found that just a small investment in the right seafood traceability systems – as little as 1% of total seafood sales on average – could boost the industry’s profitability by 60%, by helping to cut spending on food recalls and food waste, while strengthening brand reputation and enhancing regulatory compliance. This could unlock a predicted US $600 billion increase in the valuations of global seafood supply chain companies.[1]

Despite these benefits, the overwhelming majority of global seafood production today is still not adequately traceable.[2] Operational obstacles, inconsistent industry data standards, and implementation costs are often cited as impediments. But momentum is building with a growing number of public commitments to traceable seafood and participation in pre-competitive industry platforms, such as SeaBOS, the Global Dialogue on Seafood Traceability (GDST), and the Seafood Taskforce.

The power of investor stewardship 

Investors, as shareholders, can play a unique and critical role in building on this momentum by incentivizing and supporting their portfolio companies to adopt robust, full-chain traceability systems to improve the transparency of their business operations, commitments, and actions. What’s more, by engaging collaboratively, groups of investors can amplify the weight of their asks of key actors in the seafood value chain and scale their collective impact.

This is the unique value proposition that the FAIRR Coller Initiative’s newly launched Seafood Traceability Engagement brings to the table. At the 2023 World Ocean Summit last March, WWF, in collaboration with the FAIRR Coller Initiative, UNEP FI, the World Benchmarking Alliance, and Planet Tracker jointly launched the Seafood Traceability Engagement, bringing together key seafood sector investors together to collaboratively engage in constructive dialogues with a core group of seafood companies to align seafood traceability commitments and action as a step towards addressing longstanding problems in global supply chains such as illegal, unreported, and unregulated (IUU) fishing and overfishing.

Kicking off its first year, the initiative has seen tremendous interest from the investor community, with 34 investors representing US $5.9 trillion in combined assets. The engagement season will begin with an investor webinar on February 20th, 2024, where expert panelists will share key considerations and industry perspectives on advancing seafood traceability. During Q2 2024, investors will participate in structured dialogues with seven major seafood companies to discuss plans to enhance the rigor of traceability commitments and systems.

“We’re very pleased with the overwhelming investor interest in this engagement. With this degree of investor participation, we believe the initiative has the potential to drive significant improvements in both the quality of corporate traceability commitments, and progress towards implementation.”  

Lucy Holmes, Senior Director of Blue Finance at WWF-US
Beyond traceability: Additional environmental and social risk and impact guidance for financial institutions 

Complementing the Seafood Traceability Engagement, WWF and its partners have developed several resources for financial stakeholders interested in understanding and addressing their exposure to environmental and social risks and impacts in their seafood portfolios. These include:

  • The Sustainable Blue Economy Finance Principles – the world’s first global guiding framework for banks, insurers and investors to finance a sustainable blue economy 
  • The Turning the Tide Guidance – a market-first practical toolkit for financial institutions to pivot their activities towards financing a sustainable blue economy. 
  • An E-learning course on Sustainable Seafood Finance 
  • Two baseline reports on the landscape of current bank and investor seafood sector policies (with updates forthcoming in March 2024) 
  • A Seafood Finance Working Group, co-managed by WWF and UNEP FI, as part of UNEP FI’s Sustainable Blue Economy Finance Initiative. The working group is open to all interested financial institutions. 

Through these innovative tools and collaborative initiatives, WWF is working to highlight the economic importance of healthy oceans and to ensure that nature and people are prioritized as we develop solutions that enable the transition to a nature-positive blue economy. 

[1] https://planet-tracker.org/traceable-returns/

[2] https://planet-tracker.org/implementing-traceability-seeing-through-excuses/