Inside Mondelēz’s New Sustainable Futures Investments in Regen Ag, Compostable Packaging

With sustainability a major concern across CPG, a number of food and beverage giants are investing in emerging companies working to advance high-impact solutions at the intersection of climate, community and circularity.

Against that backdrop, Mondelēz International announced today the newest recipients of funding from its Sustainable Futures Impact Investment Platform, spanning regenerative agriculture, inclusive financing and circular packaging ambitions. This year’s recipients include:

eAgronom: An ag-tech company that supports farmers’ transition to regenerative agriculture, a practice that improves soil health, reduces carbon emissions and enhances financial resilience through sustainable practices. Through its support – which includes on-the-ground assistance, technology and financial access – eAgronom claims to have helped transition over one million hectares to regenerative farming.

Investment in regenerative agriculture thus far has been slow, signaling that the traditional venture capital playbook may not work for this concept that is relatively new to CPG. Since 2014, there have been 130 transactions in AgTech totaling over $6 billion in M&A activity, per food and agribusiness advisory firm Farrelly & Mitchell. However, the firm expects to see $700 billion invested in regen ag by 2050.

As outlined in its Snacking Made Right sustainability report, Mondelēz itself is seeking to transform how it does business with suppliers and farmers. This shift includes improving cocoa farming practices in West Africa and promoting regen ag in wheat fields across the Midwest U.S., among other moves.

• European farmers in the company’s Harmony Wheat sustainability program reserve at least 3% of their fields for planting flowers to promote local ecology.
• Mondelēz’s Cocoa Life program invested $400 million over 10 years to help 200,000 cocoa farmers.

ZIRO: A Colombian fintech providing small merchants – including manufacturers, distributors and B2B marketplaces – with affordable inventory financing, helping them increase sales, better maintain consistent stock levels and build financial sustainability. ZIRO aims to reach approximately 100,000 small merchants over the next three years.

“Finding ways to support and empower small merchants, the vast majority of whom do not have access to financing, is a priority to generate impact in the communities where we (Mondelēz) operate,” Susanne Mathis-Alig, Mondelēz’s head of impact investment, told LatamList.

Pack2Earth: A materials company working to replace approximately 60,000 metric tons of plastic packaging with its home-compostable material by 2028. Pack2Earth bio-based packaging is biobased, made from plant matter and minerals, and can be discarded with organic waste in city organic waste bins or composted at home. It decomposes into toxin- and microplastic-free compost, supporting new plant life.

A growing number of CPG brands are turning to compostable packaging for their products (not connected to Pack2Earth), including Coyotas grain-free tortillas, Petit Pot dessert cups and David’s Tea tea sachets.

Though none of Mondelēz’s brands have shifted to compostable packaging, the company is working to create a more circular economy for its packaging. Approximately 96% of its packaging is designed to be recyclable.

• However, Mondelēz’s efforts to reduce overall virgin plastic use have stagnated; 5% of its overall greenhouse gas emissions were linked to packaging.

When it comes to investment, Mondelēz employs a three-pronged approach: direct investments, fund investments and technical assistance.

Last year, the company’s backing of Circulate Capital Ocean Fund helped circulate or avoid over 7,600 tonnes of plastic waste, reducing more than 10,700 tonnes of greenhouse gas emissions. Additionally, in partnership with precision farming startup SAM-DIMENSION GmbH, Mondelēz built out a multi-year pilot that demonstrated the value of innovative technology in a real, large-scale situation.

“Sustainability is embedded as the fourth strategic pillar of Mondelēz International’s growth strategy,” said Christine Montenegro McGrath, chief impact and sustainability at Mondelēz, in a statement. “These Sustainable Futures investments are part of our company’s investments in new, scalable solutions that we believe can help address key challenges and create long-term business resilience.”