Consumers’ Research, a nonprofit consumer advocacy organization, launched a six-figure campaign this month to raise awareness about the environmental, social and governance (ESG) threat to agriculture. The effort, Consumers’ Research says, will drive up operating costs on U.S. farms and raise food prices at a time when consumers are already struggling with the effects of inflation on their grocery bills.

“There’s been a lot of attention paid to the net zero push on the fossil fuel industry, and people are starting to wake up to the implications that it has for the electricity grid. The reason we started this campaign is that we want to make sure that people understand that it goes further than that — all the way down to the apple you buy in the supermarket,” said Will Hild, executive director of Consumers’ Research, Only the news.

The six-figure Consumers Research campaign includes television ads in Washington, DC and New York, a billboard in Times Square, a website, a series of mobile billboards in DC, New York City and Charlotte, North Carolina, and a digital campaign.

Directed

Agriculture has become a favorite target of climate activists and the ESG movement. Earlier this year, the World Economic Forum (WEF) published a report on models for financing a “sustainable transition” in agriculture.

“Global food systems must rapidly transition to more sustainable forms of production as part of broader food systems transformation efforts. Food systems were responsible for more than 30% of global greenhouse gas emissions in 2020,” the report warns.

Modern agriculture has led to huge increases in crop yields of virtually every crop in multiple regions of the world. But it is also causing climate change, destroying rainforests and depleting the world’s freshwater supplies, according to the WEF report.

Among other initiatives the report proposes is that farmers should be offered “a flexible stack of financial and non-financial services” to help them transition to regenerative agriculture. Regenerative agriculture is an organic approach to farming that, among other things, uses manure instead of modern fertilizers.

In 2022, Sri Lanka began experimenting with organic farming when it banned modern pesticides and fertilizers, leading to a complete collapse of the Asian country’s agricultural sector and economy.

Hild said the ESG movement is pushing U.S. farms in the same direction. While ESG standards are seen as something adopted by corporations, Hild said they are trickling down to the family farm. Banks, he explained, are using their loan portfolios to build net-zero emissions requirements into the financing. These standards would assess emissions all along the supply chain, called Scope 3 emissions. That means that getting a loan or crop insurance, both of which are vital to family farms, requires that the operations meet emissions reduction targets.

Blackrock CEO “Larry Fink, who is sitting on Wall Street like a fat cat, is going to dictate what the Johnson family farm can do,” Hild said. Blackrock has been a leading proponent of ESG initiatives in the financial world.

The Buckeye Institute, a free-market think tank, released a report earlier this year that estimated the cost of complying with net-zero emissions policies and corporate ESG reporting requirements on U.S. farms. The report found that farmers will see costs increase by at least 34%.

When these costs are passed on to the consumer, a family with an annual grocery bill of $8,320 can expect it to increase by 15% to $9,650. The cost of American cheese is estimated to increase by 78%, beef by 70% and sugar by 43%.

Disappearing farms

In a video on the Consumers’ Research campaign website, Stephanie Nash, who runs a dairy farm near Nashville, Tennessee, told Hild how her family moved operations from California to Tennessee because of concerns about water availability and strict regulations, which drove up the cost of running the business.

One of California’s requirements is digesters, which reduce methane emissions from animal waste. Nash said there’s another issue with regulatory compliance besides cost.

“Ultimately the government will ask for more,” she said.

The dairies receive carbon credits for their digesters, but the Nash family worries about what will happen if the government asks for more carbon credits and they have none to give.

Dairy farms in the U.S. are disappearing, Nash explained. Because of high operating costs, Nash said, there were about 75,000 dairy farms in the U.S. in 2003, and now there are about 25,000.

“ESG has been a major factor in how we as producers can be, how we as farmers and ranchers can produce food for America and the world,” she said.

Hild said the problem with these agriculture-related ESG measures is that they are being set by people who have never farmed and have no idea what it takes to make a farm operation work. He said it is the embodiment of what former President Dwight Eisenhower meant when he said that “farming looks really easy when your plow is a pencil and you’re a thousand miles from the cornfield.”

“It’s very easy to plan all these things when you don’t actually have to do them in the real world,” Hild says.