ForumforAg Food Systems Podcast Summary

Knowing the true cost of food will help fix broken systems

In our latest podcast, we talk to Adele Jones, Deputy CEO of the Sustainable Food Trust, about how true cost accounting can identify the real cost of food, including the cost of its impact, to the benefit of nature, society and farmers. We also discuss how it could be practically implemented, and whether the political will to implement it exists today. For a taster, read our short summary below, or dive into the full 33-minute Food Systems Podcast for much more. 

Can you give us an overview of true cost accounting?

It’s a new way of looking at how we value things and how we value the impact a company or a person might have. It doesn’t just look at traditional financial profit and loss but also at the impact on the natural environment and public health. It places value on externalities, as economists call them. We’re not just looking at the financial cost of producing a carrot, but also its environmental impact and its impact on people when they eat it. It’s a massive part of the solution in terms of how we fix our food system.

There’s been a lot of development in this area, but how much closer are we to implementing true cost accounting than ten years ago?

In some ways we’re closer. Perhaps we put the cart before the horse by starting to gather an idea of how we value natural and social elements of food and farming. But what we didn’t have was a common way of measuring those things on farm in the first place. It’s very difficult to start meaningfully valuing externalities until you have a common way of measuring external impacts.

At the Sustainable Food Trust, we believe the common framework of measurement should begin at the farm and be a suite of metrics and indicators which empower farmers to be part of the change – things like soil health, biodiversity, water quality, air quality, animal welfare, social capital, human capital.

Then farmers can easily see the steps for improvement. You can start to shift the balance of financial advantage towards farming in a way that promotes positive nature, mitigates against climate change, and produces food in a way that contributes positively to public health and strong communities.

How do you assign a value to assets on a farm, particularly biodiversity?

Biodiversity is probably the hardest category to value. But, until we start to place a value on some of these things, companies and politicians won’t act because they won’t necessarily see how important they are as part of our economy and our future well-being.

With biodiversity you can think about how much it would cost to hand-pollinate or mechanically pollinate an orchard, for example. We are trying to create a common set of metrics for measuring sustainability, the Global Farm Metric. For instance, directly measuring biodiversity on the farm by looking at key indicator species like birds, insects etc.

Do farmers have the knowledge and time needed for measuring?

In the developed world, farmers already have to supply information to different sources – certification schemes, government grant applications, compliance requirements, carbon foot printing. If we can find a way of harmonizing the way we measure impacts on farms, we can draw it from the places farmers are already sending information to. Of course, there are some parts of the world where farmers will need help, particularly smallholders.

One study said that for every £1 in the shop, there is 97 pence unaccounted for in externalities. Are we talking about doubling consumer prices?

What consumers pay at the till is not the true cost. The way food is priced is not right and the ‘cheapest’ is actually the most expensive. The cheap food is costing us so much, and it might cost our children and grandchildren the right to go for a walk in the woodland that we love.

If true cost accounting is implemented, the cost of food might go up, and that impacts low-income societies. There are some interesting initiatives, like one in the US where food stamps are worth double if you spend them at a farmers’ market.

Isn’t that being prescriptive and saying to people ‘this is the food you should eat’?

It can be about choice. Increased transparency in supply chains is going to happen. It’s about giving people more information on which to make decisions.

Is there a political will to tackle the issue?

It’s starting to emerge. Politicians will only act when they feel pressure from the public. We have to find ways to shift public opinion in favour of transparency in supply chains, people wanting to know the story behind food.

If you had one policy suggestion or practical farm idea to make to food system more sustainable, what would it be?

If we incentivize all farmers to start measuring their impact, it’s going to inform so much policy decision making in future. As part of new schemes, as part of reform, as part of the Agriculture Bill, introduce an annual sustainability assessment just to start collecting the data in a common way.

If you have found this short summary interesting, there’s lots more to hear in the full 33-minute conversation. It is available now on iTunes, Podbean or Spotify or on this website.