New analysis from the US$90 trillion-backed FAIRR investor network shows that, despite the business opportunity from plant-based proteins, many global food companies are not effectively meeting consumer demand – limiting the category’s growth and weakening the resilience of food supply chains through over-reliance on animal protein.
The report, Feeding Change: Building a Resilient Food System Through Protein Diversification, contains results from the second year of an investor engagement with 20 of the world’s largest food retailers and manufacturers supported by 73 investors with US$11.5trn in combined assets.
Investors are calling for companies to diversify their protein sources to address growing supply chain and transition risks and seize growth opportunities, as well as improve consumers’ nutritional intake and health outcomes.
The study notes that consumer trends indicate a move towards fitness, wellness and the use of GLP-1 drugs for weight loss. Although at least 70% of companies identify health and wellness as one of the most material issues to their businesses, only 30% of companies have nutrition expertise at the board level. Meanwhile, 25% of companies have no dedicated health strategy.
Demand for fresh, whole foods is increasing and scrutiny of ultra-processed foods (UPF) is on the rise. 88% of global dietary guidelines encourage greater intake of plant-based foods, including vegetables, legumes, nuts and whole grains to reduce diet-related disease risk, with the EAT Lancet Commission’s latest recommendations assessing that this shift could prevent up to 15 million premature deaths annually. Despite this, only 3 of 8 brand manufacturers launched a plant-based wholefood product in the past year – favouring more processed alternatives to animal products.
By focusing on plant-based wholefood proteins that align with consumer preferences, French grocery giant Carrefour exceeded its target of €500m in plant-based sales – originally set for 2026 – in 2024, and expanded its goal to €650m. In 2025, Ahold Delhaize expanded the scope of its target for all its European retailers to achieve 50% plant-based protein sales by 2030.
Further, 75% are yet to acknowledge the sustainability and nutrition potential from the substitution of animal ingredients with plant-based options. Only one company, Nestlé, has quantified the emissions mitigation opportunity so far.
Meanwhile, only 25% of companies in the engagement have surveyed their consumer base to better understand their preferences. This has led to a misalignment between product launches and market demand, with two companies acknowledging that some of the plant-based meat products launched in the last year were already discontinued due to low sales.
Access to and affordability of plant-based products similarly remain key barriers to consumer adoption of plant-based proteins. However, just 60% of companies disclosed evidence of working to improve either factor. Woolworths has added vegan and vegetarian filters to its online product search, and Tesco has replaced everyday items in its Express stores with cheaper options, including plant-based product lines.
The report also highlights consumer dissatisfaction with the taste and texture of plant-based proteins as a barrier to uptake. However, just 40% of the engagement cohort dedicated resources to increase product innovation – which could include research & development, partnerships and venture investments – compared to 45% in 2024.
Only 40% of companies have assessed the transition risk of failing to respond to changing consumer preferences for plant-based products and the impact of physical climate risks on their animal agriculture supply chains.
Diversification into plant-based products can help mitigate supply chain risks. For instance, this year has seen an outbreak of avian influenza leading US egg prices to almost double, while drought, interest rates and feed costs have caused US cattle herds to fall to their lowest levels since 1973, with material financial impacts for the sector.
Meanwhile, Danone is the only company reskilling its workers to support a transition to more sustainable and healthy diets by supporting its factory staff in Villecomtal-sur-Arros to produce oat milk, as the factory has shifted away from producing dairy yoghurt products.
Dana Wilson, Manager, Research & Engagements – Protein Diversification, at FAIRR, said: “Shoppers are looking for affordability, great taste and healthiness in 2025, yet food companies are investing too little in product innovation to cater for consumer expectations. By engaging customers towards nutritious and sustainable plant-based proteins, proactive companies can harness a significant market growth opportunity, as well as build a more resilient product portfolio.”
Sophie Kamphuis, Sr. Advisor Responsible Investment at MN, added: “The findings point to a sizable gap in the market at the intersection of wholefood, high-protein and reduced meat diets. Added to this, we have also seen a number of shocks to animal protein supply chains this year, due to changing weather patterns, macroeconomic conditions and zoonotic diseases. Diversification into plant-based proteins is a key strategy to increase resilience and meet climate goals, as well as to tap into a burgeoning market.”
