Lombard Odier Investment Managers (LOIM) has announced the launch of a strategy investing in the transition towards a more sustainable food system.
The New Food Systems product is managed by new recruit Conor Walsh (pictured), who joined LOIM in May 2022 having preciously worked at Sanlam and Bank of America, and Alina Donets who joined in 2020.
It will focus on agriculture, forestry and other land uses, which LOIM said is deemed to be a primary driver of planetary boundaries transgressions as it accounts for 24% of greenhouse gas emissions, 90% of forest degradation, and 25% of biodiversity loss.
LOIM added to protect the planet one billion hectares of land must be returned to nature by 2030, and to do so agricultural land—which now claims 50% of all habitable land on earth—must shrink by 20%.
The New Food Systems strategy holds 35-to-50 companies from three sub-themes:
- Sustainable food production: companies that produce biological and synthetic inputs, and agricultural products (ie. sustainable aquaculture, green fertilisers, new food additives and ingredients)
- Enabling solutions: companies that provide specialised enabling products and services along the value chain (ie. electrified farming equipment, technological solutions for precision agriculture, new forms of food packaging and logistics)
- Sustainable food consumption: consumer-facing companies, manufacturing, retailing and serving food (ie food manufacturers, retailer and restaurants focused on distributing tomorrow’s diets)
Jean-Pascal Porcherot, co-head of LOIM and managing partner at Lombard Odier, said: “Returning 20% of land to nature and improving the quality of the earth’s remaining agricultural land will be a critical part of realigning our economy with the earth systems that support it.
“This will leapfrog the sustainability-driven transformation of our food systems and unlock a market worth at least $1.5trn in annual revenues by 2030.
“The New Food Systems strategy seeks to capture these market opportunities, targeting companies with attractive business models and robust valuations with the objective to generate compelling sustainability-linked alpha returns for investors.”