Nutraceuticals Industry ESG Thematic Report, 2023

Environment, Social and Governance (ESG) in Nutraceuticals Industry

A whole new era of changes in sustainability are driven by forces of change by the governments, corporations and consumers in terms of environmental, social and governance.

Industry leaders of the industry are promoting a healthy lifestyle by engaging the consumers through their products. There are a wide range of products in the nutraceuticals industry, ranging from food and beverages to dietary supplements, available in different forms such as tablets, capsules, and drinks. The mentioned products are viewed as a solution for supplementing necessary vitamins and minerals and also as preventive measures. Increase in awareness of healthy lifestyle and the demand for performance enhancement are the key factors that drive the market.

The nutraceuticals industry impacts the ESG arena in two aspects, environment through the packaging and preservation process and the social through the products.

The United Nations’ Sustainable Development Goals (UN SDGs) is a comprehensive framework that helps companies in this market obtain a perspective on the impact of their products and operations on ESG parameters.

ESG Trends

There are a wide range of products in the industry ranging from prebiotics, probiotics to health supplements, that are consumed as a medication and also as support in diet, to improve health and prevent any possible diseases or ill-ness, creating a positive impact on the social sphere of ESG in the market.

The probiotics segment of the market positively impacts the social aspect by improvising social health. The probiotic products of the market are reportedly used for a variety of purposes from improving health, although it impacts digestion mainly, treating illness related to digestion process, such as IBS and similar disorders to mental health in a significant manner, effectively treating OCD and depression. Due to its impact on digestion, the probiotics products are reported to help reduce obesity and improve the immune system.

Further minerals segment of the nutraceuticals market, which cater the health supplements of the consumers have been stated to create positive outcomes on the health by improving the bone health, cardiac health and brain health of the consumer. Further, ingredients such as amino acids of the products of the health supplement segment of the market are reported to reduce the acid levels in the body thereby creating an overall positive impact on the social health of the ESG, promoting the UNSDG goal of good health and wellbeing (SDG3).

Conversely, there are certain side effects of the products of the industry. For example, certain products of the health supplement segment of the market, which contain ingredients such as Beta alanine amino acid, are reported to cause side effects such as paresthesia, tingling sensation in hands and feet, at certain times. Further, histamine, an ingredient presents in the products of the probiotic segment of the market, when levels are increased causes headache along with redness and swelling in the impacted area.

Another challenge for the nutraceutical industry arises in the environmental sphere of the ESG. The packaging used for preserving and increasing the shelf life of products is made up of Polyethylene and polystyrene, which are used for preventing the oxygen from entering the package. The usage of such plastics to preserve products is carbon intensive in terms of value chain, which includes production, logistics and usage and the disposal of such plastic strains the environment, hindering the promotion of United Nations sustainable development goals of climate action (SDG13). 

Growth of the Nutraceuticals Market

The nutraceuticals market was valued globally at USD 454.55 billion as of 2021 and is expected to grow with a CAGR (compound annual growth rate) of 9.0% from 2021 to 2030. Although the key leaders of the industry are promoting the UNSDG goal of good health and wellbeing (SDG3), through creating a positive impact on the social health, the manufacturing and the global scale value chain are adversely impacting the environmental aspect of the ESG. In this regard key companies of the nutraceutical industry have taken up certain policies to create positive outcomes in the environmental aspect by inducting sustainable changes in the value chain of the market.

Key Companies in this theme

    • Cargill

    • Incorporated

    • Archer Daniels Midland Company

    • DuPont

    • Nestle S.A.

    • Danone

Scope of the Nutraceutical Industry ESG Thematic Report

    • Macro-economic and ESG-variable analysis of the industry, including regulatory, policy, and innovation landscape

    • Key insights on infrastructure developments and ESG issues affecting the theme

    • Identify key initiatives and challenges within the industry

    • Identify ESG leaders within the industry

    • Understand key initiatives and the impact of companies within the sector to fuel an informed decision-making process

    • Analysis of industry activities based on multi-media sources, including significant controversies and market sentiment

Key Aspects of the Nutraceutical Industry ESG Thematic Report

    • Offers a global perspective of the nutraceutical industry and the policies and measures taken by the players, for overcoming the challenges faced in terms of Environment, Social and Governance.

    • Key insights into the sustainability practices of major players in the market.