By Louisa Hodge, Food & Health Engagement Manager, ShareAction

Major investors have stepped up their fight to tackle obesity today, with a fresh call on supermarkets to take action.  

As the Covid-19 pandemic continues to shine a light on public health, members of ShareAction’s Healthy Markets Investor Coalition, representing over $1 trillion in assets under management, have come together to ask UK supermarkets to set ambitious targets to increase sales of healthy products.  

We think it is vital for supermarkets to support the health of the public, for instance through better labelling. Not only because they have a responsibility to promote health but also, from an investment perspective, to demonstrate whether their business is well-positioned for the increase in regulation and the societal shift to healthier diets says Guy Rolfe from M&G Investments. 

The role of supermarkets in supporting a healthy population cannot be underestimated. 

On average, a family in the UK spends 80% of its grocery budget on food to eat at home in supermarkets. The products available and the way they are marketed directly affect the food we buy and ultimately our health. 

In the UK, data shows that the risk of death from Covid-19 is 33 per cent higher for people with obesity 

Building a healthy society and preventing underlying health conditions, many of which come hand in hand with obesity, is essential. Tackling childhood obesity will be a central piece of this puzzle. 

Guys’ and St. Thomas’ Charity, who fund the Healthy Markets initiative noted that, “Food and drink retailers have a huge role in ensuring healthy, affordable food is accessible for everyone — no matter how wealthy they are. Not only is this the right thing to do, but also good business. Companies need healthy customers and employees if they are to remain profitable and competitive.” 

Yet, as an investment topic, health has traditionally fallen behind other issues, such as the environment or corporate governance.  

This is all set to change. 

The pandemic has highlighted just how a public health emergency can impact on businesses profitability and sustainabilityAnd with new government restrictions on the promotion and sale of unhealthy food products, the time for action is now.  

Continuing ‘business as usual’, with shelves stacked full of foods high in fat, sugar, salt and calories, food and drink retailers expose themselves to a number of significant risks.  

As well as asking UK supermarkets to set ambitious targets, ShareAction’s coalition of investors, which includes BMO Global Asset Management, M&G Investments, Newton and EQ Investors, are also asking supermarkets to disclose the proportion of their sales that come from healthy products.  

Some supermarkets, such as Sainsbury’s and M&S have begun to make commitments to disclose this. However, others are lagging behind. Most worryingly of these is Tesco, which holds the largest market share of UK retailers.  

Lousiana Salge from EQ investors commented “Tesco have a huge opportunity to become leaders in this field and to help their customers have much needed access to affordable, healthy food. Disclosing the percentage of sales from healthy food allows us, as investors, to understand if they are already taking action on the shared responsibility to tackle obesity, and obesity-related illness. We ask that they, alongside other major UK retailers, respond to our letters so that we can work together to prioritise both public health and the sustainability of their businesses.” 

ShareAction and the Healthy Markets Investor coalition will continue to support retailers to achieve these asks and are looking for further investors to join forces on this topic.  

Asset managers and owners who are interested in finding out more about the Healthy Markets Initiative and becoming part of the coalition can contact Louisa Hodge, Engagement Manager