As demand for plant-based meat grows, we consider the health and investment implications.

  • There is a greater understanding of the health benefits of a plant-based diet
  • Demand for plant-based meat substitutes is rising
  • The prospect of increased regulation clouds the investment outlook

Recently, there has been increased focus on the health implications of excess meat consumption, and the benefits of a plant-based diet. While there is evidence that reducing meat consumption in favor of a plant-based diet is beneficial for human health as well as the environment, the specifics are heavily contested, and as yet there is no definitive evidence on the optimal level of meat consumption, or as to whether red meat is more damaging than white meat.

The overall ‘healthiness’ of a product cannot be boiled down to a single measure. Furthermore, the impact of specific micronutrients varies according to the health status of the individual consumer. This makes evaluating the health implications of ingesting a specific food subjective, and potentially contentious. Complicating the debate, there is significant misinformation and misunderstanding relating to nutrition.

The number of calories in a given food is not an overall measure of ‘healthiness’. However, given the global prevalence and costs of obesity, a calorie count is an important input. For example, almost two-thirds (63%) of adults in England are overweight or obese, which is estimated to cost the country’s National Health Service £6 billion a year.1 Given the outbreak of Covid-19, and the increased risk the virus poses to the obese, excess weight is rising up the public-health agenda, as shown by the recently announced UK government obesity strategy.2 This proposes banning television advertisements for products high in fat, salt and sugar during peak viewing hours, and that restaurants and takeaways include calorific labelling for their products.

Beyond Calories

In order to consider the health impact and nutritional characteristics of a product, we need to consider a range of indicators. The Global Nutrition Report3 highlights several key health concerns that are prevalent in developed markets. These include hypertension (high-blood pressure), Type 2 diabetes, and being overweight or obese. I have selected the indicators below in order to evaluate the ‘healthiness’ of the plant-based meat alternatives within the context of these global health challenges.

Salt – Regulation and Reformulation

A diet high in salt is understood to increase blood pressure, which is a significant contributor to cardiovascular disease. The Global Nutrition Report recommends a 30% reduction in salt consumption. As a result, salt and sodium content is also at increased risk of regulation. In turn, this may require product reformulation, which can be an expensive process given how components such as salt can affect the flavor and taste of foods. Given their high-salt content, this is the most material consideration when analyzing plant-based meat alternatives relative to traditional meat. The comparison is even worse versus plant-based foods such as lentils or tofu. However, when compared to a selected handful of other processed burger products, plant-based versions are actually not any higher in sodium. Ultimately, processed foods tend to be far higher in salt, increasing risks of specific health concerns, shifting consumer preferences, and regulatory action. The health risks are not easily mitigated, as processed food products often rely on salt for flavor, as a preservative, and, in the case of plant-based products, to replicate the ‘meaty’ taste. 

High levels of cholesterol are linked to heart disease and strokes. Here, plant-based products score points as they typically contain no or very little cholesterol, whereas animal-based products generally have higher cholesterol levels, regardless of whether they are unprocessed or not (e.g. a chicken breast or beef burger). Plant-based alternatives are therefore well placed should increasing regulatory and consumer attention focus on the risks of cholesterol.

Saturated fat is arguably the most scientifically contentious indicator, but high levels of fat consumption are linked to cancer, heart disease and strokes, and increase ‘bad’ LDL (low-density lipoprotein) cholesterol levels in the blood. Moreover, saturated fat requires consideration as the average western diet includes more saturated fat than is recommended, and again this is often a nutritional indicator that consumers focus on as a ‘bad’ fat.

It is widely known that animal products are high in saturated fats, but it is not always appreciated that plant-based oils, such as coconut and palm oil, are too. The plant-based meat alternatives can be far higher in saturated fat than other plant-based foods such as lentils, and even higher in saturated fat than animal meats. As with salt, the saturated fat content of plant-based meat alternatives is often similar to that of other processed food products.

The Implications for Company Analysis

When undertaking company-specific research on food retailers and manufacturers and restaurants, we consider the company’s strategy relating to healthy-product offerings, including marketing practices and product portfolios. There are significant risks of consumer preferences shifting towards healthier product options, as well as of increasing regulation, which may increase operational costs. We also consider the thematic drivers of plant-based foods, and potential growth opportunities for companies. While the debate around the health impact of these products is more nuanced, it is clear that, from an environmental perspective, there are benefits from reducing consumption of animal-based products, something that consumers are increasingly aware of.

Finally, a pillar of our approach is engagement with companies across the food value chain. We are part of two key initiatives providing further insights to supplement our security-specific research, which also provide platforms for collaborative engagement. These are FAIRR (Farm Animal Investment Risk and Return), which focuses on risks and opportunities associated with animal agriculture, including pandemic risk and sustainable protein sourcing, and Healthy Markets at Share Action, whose raison d’être is to improve public health, in particular with regard to childhood obesity.


  1. UK Product Profile 2019 – Access to nutrition initiative


Rebecca White

Rebecca White

Global ESG integration lead


Your email address will not be published.

Newton does not capture and store any personal information about an individual who accesses this blog, except where he or she volunteers such information, whether via email, an electronic form or other means. Where personal information is supplied, it will be used only in relation to this blog, and will not be collected or stored for any other purpose. Comments submitted via the blog are moderated, and, as a result, there may be a delay before they are posted.

Newton manages a variety of investment strategies. Whether and how ESG considerations are assessed or integrated into Newton’s strategies depends on the asset classes and/or the particular strategy involved, as well as the research and investment approach of each Newton firm. ESG may not be considered for each individual investment and, where ESG is considered, other attributes of an investment may outweigh ESG considerations when making investment decisions.

Any reference to a specific security, country or sector should not be construed as a recommendation to buy or sell this security, country or sector. Please note that strategy holdings and positioning are subject to change without notice.

Important information

This is a financial promotion. Issued by Newton Investment Management Limited, The Bank of New York Mellon Centre, 160 Queen Victoria Street, London, EC4V 4LA. Newton Investment Management Limited is authorized and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN and is a subsidiary of The Bank of New York Mellon Corporation. 'Newton' and/or 'Newton Investment Management' brand refers to Newton Investment Management Limited. Newton is registered in England No. 01371973. VAT registration number GB: 577 7181 95. Newton is registered with the SEC as an investment adviser under the Investment Advisers Act of 1940. Newton's investment business is described in Form ADV, Part 1 and 2, which can be obtained from the website or obtained upon request. Material in this publication is for general information only. The opinions expressed in this document are those of Newton and should not be construed as investment advice or recommendations for any purchase or sale of any specific security or commodity. Certain information contained herein is based on outside sources believed to be reliable, but its accuracy is not guaranteed. You should consult your advisor to determine whether any particular investment strategy is appropriate. This material is for institutional investors only.

Personnel of certain of our BNY Mellon affiliates may act as: (i) registered representatives of BNY Mellon Securities Corporation (in its capacity as a registered broker-dealer) to offer securities, (ii) officers of the Bank of New York Mellon (a New York chartered bank) to offer bank-maintained collective investment funds, and (iii) Associated Persons of BNY Mellon Securities Corporation (in its capacity as a registered investment adviser) to offer separately managed accounts managed by BNY Mellon Investment Management firms, including Newton and (iv) representatives of Newton Americas, a Division of BNY Mellon Securities Corporation, U.S. Distributor of Newton Investment Management Limited.

Unless you are notified to the contrary, the products and services mentioned are not insured by the FDIC (or by any governmental entity) and are not guaranteed by or obligations of The Bank of New York or any of its affiliates. The Bank of New York assumes no responsibility for the accuracy or completeness of the above data and disclaims all expressed or implied warranties in connection therewith. © 2020 The Bank of New York Company, Inc. All rights reserved.

Explore topics