Global corporations are navigating a volatile world—geopolitical unrest, inflation, and supply chain shocks dominate the risk landscape. But a deeper, more systemic threat is gaining ground: the breakdown of natural ecosystems. As climate risk comes into sharper focus, it’s increasingly clear it can’t be separated from nature risk. The two are inseparable, and nowhere is that link more critical—or more exposed—than in the agrifood sector.
In its 2025 Corporate Climate Responsibility Monitor, the NewClimate Institute scrutinizes the climate strategies of five major food giants—Danone, JBS, Mars, Nestlé, and PepsiCo. It seems that despite headline-grabbing climate commitments, these companies are failing to deliver the deep, structural changes needed to align with a resilient future. “Indeed, we see only few commitments to structural emission reductions among those five major agrifood companies,” says Sybrig Smit, lead author of the report in an interview.
A Dangerous Loophole In Climate Accounting
At the surface, their climate strategies appear robust. They speak the language of net-zero, align with science-based targets, and participate in voluntary sustainability initiatives. But the NewClimate report finds that companies are relying heavily on land-based carbon removals—like afforestation and soil carbon projects—to meet their targets, while avoiding the more difficult task of cutting the structural emissions associated with the ways in which food is produced, processed, and delivered.
These are the core processes, supply chains, and business models of food and agriculture companies and they are not marginal or easily adjusted outputs. Addressing them requires reimagining the business model, not just tweaking the margins. The approach currently being taken in the agrifood sector, as well as in many others, gives the illusion of progress while masking inaction on the transformations that really matter.
Smit warns that, “Companies are counting on an unspecified volume of land-based removals to claim achievement of emission reduction targets. This could be misleading—emission reduction targets are actually reduction and removal targets, which are only in rare cases linked with commitments to key transitions for the sector.”
How SBTi Is Enabling The Problem
That distinction, between reductions and removals, is becoming a critical issue in terms of the credibility of corporate climate action. Under current guidance from the Science Based Targets initiative (SBTi), companies are allowed to blend the two. The SBTi FLAG (Forest, Land and Agriculture) framework enables firms to count land-based removals toward their emissions reduction goals, blurring the line between what has actually been cut and what has been impermanently removed.
“The actual meaning of emission reduction targets has become completely unclear and uncertain by allowing land-based removals to count towards emission reduction target achievement,” the report states. “We call on SBTi to alter their guidance to not allow for that anymore.”
Agrifood: Risk Maker And Risk Taker
The global agrifood sector is especially critical in this context. It’s both a major driver of environmental harm and one of the industries most exposed to it. The sector contributes nearly one-third of global greenhouse gas emissions, drives biodiversity loss, and is tied to several public health risks. It depends on healthy soil, clean water, and stable ecosystems yet continues to degrade them through industrial agriculture, deforestation, and overuse of fertilizers.
This dual role as both a risk maker and a risk taker places agrifood at the heart of the nature-climate nexus. Its transformation is not optional—it’s essential. That means real change: cutting methane emissions from livestock, scaling up plant-based protein, reducing fertilizer dependency, eliminating food waste and ensuring zero deforestation in the supply chain. These are not fringe reforms. They are the pillars of any serious effort to reduce agrifood’s climate footprint and secure long-term food system resilience.
The Methane Blind Spot
Yet according to the report, most companies are still avoiding these transitions. “Especially the lack of action to reduce methane emissions is worrisome, since it is such a potent greenhouse gas,” says Smit. Methane’s short-term warming impact makes it a critical lever in slowing climate change, but reducing it requires challenging core aspects of agrifood business models.
She adds, “It has significant implications for their value chains and how they produce their products. The transition requires deep, structural changes. That’s also why we argue they should begin to transition today: it requires time and effort, but cannot be postponed any longer.”
Empty Promises On Deforestation
Even where companies have made public commitments, such as halting deforestation by 2025, the details are often vague or riddled with caveats. Smit points out that while it’s positive to see deforestation pledges in place, implementation is murky.
“Accurate deforestation data is scarce, so any progress reported goes with a degree of uncertainty. Due to satellite monitoring, I think the data will improve and therefore claims around ‘deforestation-free’ products will become more accurate. However, to report a decline in emissions because you supposedly procure products that are deforestation-free, is a step too far. The products cannot be directly traced back to the deforestation-free land.”
From Pledge To Greenwash
The report doesn’t stop at critique—it also calls out what it sees as greenwashing. “I would say that any climate-related claim or pledge that sounds way better than it is in reality and cannot be backed up by proper evidence, is indeed greenwashing,” Smit says.
There are, however, notable differences in performance. Danone is highlighted as a relative leader, thanks to its dual commitments to reducing methane emissions from fresh milk production by 30% by 2030 and scaling up plant-based alternatives. These are actions with tangible climate benefits.
JBS, by contrast, received the worst rating in the report. “The company does not have any targets in place that would translate to deep emission reductions,” Smit explains. “The company also recently said its net-zero pledge was an aspiration, not a promise.”
Nature Risk Goes Beyond Food
While the agrifood sector is central, nature risk extends far beyond it. According to PwC, over 50% of global market capitalization is exposed to moderate or high nature dependency. S&P Global reports that 85% of the world’s largest companies rely directly on ecosystems—from water-intensive industries to forest-based supply chains.
A 2025 study by Norges Bank Investment Management and the University of Zurich found that nearly half of surveyed firms consider nature-related risk financially material. Yet most are still struggling to act meaningfully on that knowledge. Business depends on nature more than most realize and the challenge is that if we degrade it, we erode the foundation of the economy itself.
What Needs To Change—Now
The NewClimate Institute’s message is unambiguous: if we are to take climate and nature risk seriously, the rules must change. The report urges regulators and standard-setters to require companies to separate emissions reductions from removals and to link reduction targets to specific transitions, such as plant-based protein and methane cuts.
“We call for separate targets for emission reduction and removal,” Smit says. “Then, accountability in terms of deep, structural emission reductions becomes feasible. If you break the emission reduction targets down into specific GHG targets, the link to key transitions becomes traceable.”
No More Illusions
Climate leadership cannot be defined by glossy reports or carbon accounting tricks. It must be built on clear, transparent, and measurable action—especially in sectors as consequential as food and agriculture.
The call to action is clear: companies must move from recognizing nature risk to addressing it structurally, transparently, and urgently. Anything less is not just bad for the planet—it’s bad for business.
