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ASSET OWNERS

Investor coalition calls on food and beverage companies for better water management

CalSTRS was joined by 63 other institutional investors calling on Kraft Heinz Co., Archer Daniels Midland Co., Hormel Foods Corp., Tyson Foods Inc. and 11 other food and beverage companies to better manage water risks, said a news release Wednesday from the coalition coordinated by Ceres.

In letters sent Aug. 5 to the CEOs of the companies, the investors wrote, “that global water risk management is a critical aspect of financial risk oversight in the food and beverage sector.”

“In California, we are keenly aware of how water scarcity can impact lives and businesses, as our state struggles to manage a depleting water supply,” said Anne Sheehan, director of corporate governance at the $191.4 billion California State Teachers' Retirement System, West Sacramento, in the news release. “CalSTRS actively engages market participants on improving environmental risk management and disclosure, and we believe that water scarcity can materially impact portfolio value, so we want to know how companies are managing and mitigating water risks.”

The group of signatories of the letter oversee combined assets of $2.6 trillion and includes the €5.06 billion ($5.55 billion) Northern Ireland Local Government Officers' Superannuation Committee, Belfast; AllianceBernstein (AB); and Hermes Equity Ownership Services.

Other targets of the letters are Dean Foods Co., Dr Pepper Snapple Group, Flowers Floods Inc., Fresh Del Monte Produce Inc., Hain Celestial Group Inc., Ingredion Inc., JBS USA Holdings Inc., Monster Beverage Corp., Pilgrim's Pride Corp., Pinnacle Foods Inc., and WhiteWave Foods Co.

The delay in announcing the water-risks targeting “was simply to make sure (companies) had received letters before they were asked about them — especially given summer, vacations, etc.,” Peyton Fleming, Certes spokesman, said in an e-mail.

“A few companies have been in touch” prior to the Sept. 15 deadline set by the letter for responses, giving “firm commitments,” while a few others are in discussions, said Siobhan Collins, Ceres spokeswoman.

Hain Celestial committed to disclose its water-risk management in a response to the investor group, according to a letter from the company provided by Ceres.