Merck's SBV assessment on cultured meat finds health benefits for people and planet

Awareness of sustainability issues is continuing to gain momentum across the globe. This is a positive development, considering sustainability impacts everyone. Corporate sustainability efforts are playing an increasingly important role for consumers, employees, investors, governments, and other stakeholders; therefore, sustainable action is indispensable for the future business success of companies. It is also being strongly demanded in the EU through the 'Green Deal', for example, which will provide great opportunities for companies by creating markets for clean and healthy technologies and products.

As a global science and technology company, sustainability is an essential part of Merck's corporate strategy. The aim is to harmonize ecological, social, and business aspects. The company wants to be economically successful and create a positive value contribution for society through its business activities. The aim is to avoid consequential social costs.

To determine the value contribution to sustainability, Merck has developed the 'Sustainable Business Value' (SBV). This business value approach was developed together with the Boston Consulting Group based on their Total Societal Impact (TSI) concept. The SBV method enables Merck to determine the impact of its products in a uniform manner.  It is used to calculate both positive and negative impacts of the company's activities.

The focus of such a calculation is primarily on three dimensions (environmental aspects, customer benefits and the socio-economic value). The environmental dimension includes all emissions, resources, water use, as well as the impact of waste through various recycling routes. During the production of goods, there are potential negative impacts on the environment that can be offset through energy and resource efficiency. The customer benefit dimension quantifies the (usually positive) impacts of products on end users, such as increased health or safety. The socio-economic dimension includes the value created for society by the company's own employment as well as by collaborating with and contracting suppliers. This value quantifies both individual (via net income) and societal prosperity (via taxes).

SBV promotes an assessment that is based primarily on the consideration of benefits and harms for society, customers, and the environment. The entire value chain, including its suppliers and consumers, is considered. The insights gained from the calculated data help the company to align its business in a sustainable and future-oriented way.

One example: Despite various longstanding global and local campaigns encouraging the public to consume less meat, the demand for meat is growing in line with the rising world population. Yet the associated meat production poses one of the biggest problems for sustainable and climate-friendly global nutrition. A not inconsiderable share of man-made greenhouse gas emissions is attributed to breeding of livestock (about 14%, according to The Food and Agriculture Organization of the United Nations). This is even slightly more than the entire global transport sector. So, it's about time to think about alternative food production.

Besides vegan products, 'cultured' or 'cultivated' meat is a real alternative. Meat cultivated in a laboratory and bioreactor without having to keep and slaughter animals: Using biopsies, stem cells are taken from the muscle tissue of animals, which then divide and multiply again and again in cell culture. In the next step, they differentiate into the desired muscle, fat or other cells. Using a wide variety of technologies, the resulting 'biomass' can be given a solid structure to produce a steak, fish fillet or similar.

A few years ago, this was still a distant utopia. With the first products already commercially available in Singapore, the goal is becoming real. In 2030 – studies predict – cultured meat will then account for 10% of the total meat market, with impressive growth rates of around 40% annually from 2025 (AT Kearney). The 'clean meat burger' will soon be a matter of course.

Merck's contribution is not that of a player producing cultured meat and selling it to consumers. The company's focus is on providing innovative technologies and solutions that will enable the scalable, economical, and safe production of cultured meat. An important example is the development of sustainable and efficient cell culture media of non-animal origin. This goes hand in hand with Merck's ambition to integrate sustainability even more strongly into its business activities.

That is why Merck has reviewed its cultured meat activities and their impact using the SBV method. Excerpts from this and the impact on the environment and consumers are described below. The scenario adopted was the year 2030, in which a significant cultured meat market, which Merck supplies with cell cultures, is already established:

In the environmental aspect, Merck paid particular attention to the issue of greenhouse gases. On the one hand, it analyzed its own consumption and, based on life cycle assessment studies (CE Delft), the total consumption along the entire value chain. It is both encouraging and impressive to see how the generation of greenhouse gases can be reduced when switching to the biotechnological process. Beef can be reduced to around 90% of its greenhouse gases (GHGs). With additional consideration of standardized values for, for example, defined damage costs of 1t of a CO2 equivalent gas (assumption 1t CO2eq corresponds to €180 [Federal Environment Agency]), societal consequential costs can be calculated from these as monetary values. A similar approach can be taken for water and other wastes. In doing so, Merck has determined both the entire value chain and its partial contribution.

A summary of significant potential savings is shown in Figure 2.

Merck also examined the product or consumer benefit in comparison with conventional meat. In principle, meat helps to meet people's protein and iron requirements. But there are many dangers lurking. The increasing use of antibiotics in animal husbandry is leading to resistance, which is then also raising health concerns in humans. However, this effect is still difficult to quantify. Zoonoses, on the other hand, are quantifiable; these are infections that are transmitted from animals to humans.

Their group includes the most prominent causative agents, namely Salmonella and Campylobacter bacteria, which can be clearly attributed to the consumption of meat. Merck has therefore focused for the SBV assessment to these most common infections. Also considering a high number of unreported cases, it determined infection figures from western industrialized countries. It is estimated that, in 2030, about 12 million people in the USA and the EU will contract Campylobacter or Salmonella due to meat consumption. This could clearly be avoided through the sterile biotechnological process of producing cultured meat. There are recognizable advantages to switching from conventional to cultured meat. Considering a switch rate that Merck can also influence through its market share, almost 250,000 consumers in Western industrialized countries could no longer be affected by Campylobacter or Salmonella in 2030. Assuming that such infections are usually associated with an average of just under five days of illness, the change in consumption will lead to a healthier and therefore more productive population. This has a positive effect on the gross national product per capita.

Using the SBV method, Merck can quantitatively describe that cultured meat poses fewer health risks than conventional meat. Furthermore, global warming and additionally land consumption can be reduced significantly. Conventional meat production also produces significant amounts of waste that must be disposed of.

In perspective, cultured meat can be produced with special tailored nutritional profiles, for example by adding healthier fats such as Omega-3 fatty acids, vitamins, or other nutrients.

With the implementation of the data-based SBV method, we are at the beginning. SBV provides particular insight into how well a company's products address social needs and thus fulfil their purpose. That's why Merck wants to incorporate this new perspective into business decisions and directions in the future. These arguments are also important for maintaining the social license to operate.

In addition, the international financial market is a driver of impact measurement. Sustainability-oriented investors want to be able to assess the positive and negative impacts to which companies contribute with their (future) activities. In the medium term, uniform, standardized solutions will be necessary here. Sustainable Business Value is a suitable tool for this purpose and the case study on cultured meat proves this.

Merck is one of 30 exhibitors showcasing their expertise at The Future of Protein Production LIVE! conference and exhibition, taking place at RAI Amsterdam on 11/12 October. To register for your delegate's pass, click here