Australian Senator Asks Which Fund Manager Should We Kill and Eat First?

When an investment fund describes by itself as ethical, I’m always curious. Who decides what is ethical and what’s not really? And why are some teams of ethics perceived to be superior to others?

Those questions came to mind when I read how?superannuation fund Australian Ethical has concluded that agriculture is not sustainable. Therefore, it will not be investing in any food production companies. A couple of other funds have made similar noises.

The choice has been widely criticised in the media as unrealistic and ridiculous, given food production is fundamental to our lives. It is ridiculous, but my interest is in the company’s claim that it is acting ethically. What are the values behind claiming? Are they values that the everyone else should accept?

You get a sense of Australian Ethical’s values from the fund’s website. It says it does not invest in things like tobacco, uranium or fossil fuel mining, exploitation of people or old growth forest logging, as well as says it will not invest in organisations that pollute land, air or water, or destroy or waste non-recurring resources.

Organisations that ‘extract, create, produce, manufacture, or even market materials, products, goods or services which have a harmful effect on humans, non-human animals or the environment‘ will also be out.

It supports the development of sustainable land use and food production, the preservation associated with endangered eco-systems, and the dignity as well as wellbeing of non-human animals. It also aspires to build a ‘new low-carbon economic climate, fund medical breakthroughs, technology breakthroughs, efficient transport and more.‘

And it seeks to use its influence to improve ‘ethical behaviour’. In other words, such as missionaries promoting religion, it is so persuaded of the merits of its integrity it feels entitled to distribute them.

One may question why anyone would oppose zero emission nuclear energy, poverty-relieving coal-fired electrical power and renewable forestry. However, I don’t think I’ve ever met anyone who purposefully advocates activities that are harmful to the environment or animals. Definitely all the farmers I know are ardent environmentalists, and caring properly for livestock is simply good business.

What it comes down to is that the fund has a particular concept of durability, perhaps the most over-used and misused word in the English vocabulary. Everybody uses it, but there is no agreement as to what it means.

A manager might suggest that maintaining the current business course isn’t sustainable; a lawyer might dispute a particular case is not environmentally friendly; an athlete might declare a certain training program to be unsustainable; and increasingly, the impact of an exercise on the environment might be described as unsustainable. The only thing you can be sure associated with is that being ‘unsustainable’ is not great.

It has long been green dogma that modern agriculture is not sustainable. Conditions such as monoculture, factory farming as well as industrial agriculture are used in a derogatory sense to reinforce that view.

Plenty of people, either in a nature of compromise or because they do not know any better, go along with the suggestion that agriculture should be ‘more sustainable’, the assumption being that it isn’t now.

My preferred definition of the word originates from former Norwegian Prime Minister Gro Harlem Brundtland, who said, ‘Sustainable development is development that fits the needs of the present without compromising the ability of future generations to meet their own needs‘.

Based on that definition, modern farming is not only sustainable, but more sustainable than it has ever been.

Here in Australia we’re often informed that anything done by people to change the environment is proof in itself of unsustainability. The key presumption behind the term ‘wilderness’ is the absence of human impact, or at least of white Europeans.

That thinking is less common outside the country. A farm owner in Eire once told me of proof of human settlement in the area returning 5000 years. He also said that his farm, which has been in the family for generations, could run 20 cattle in the 20’s, 50 in the 1950s, One hundred at the turn of the hundred years and was now up to 120. He expects it to be running 150 within a decade.

It is obvious his farm has not only been capable of providing for its previous and present owners, but will continue to do so for future generations (in this case the actual farmer’s children) as well. In other words, it’s long been sustainable and is environmentally friendly now.

What’s more, it’s the utilization of modern technology — so despised through green dogmatists — that makes this feasible. Vaccines (increasingly the product associated with genetic engineering) and chemicals help keep cattle healthy. Meadow management using hybrid seed products and chemical fertiliser indicates there is enough food on their behalf. High tech nutritional supplements ensure they receive a balanced diet. Advanced synthetic breeding technology means cows produce a calf each year which the calves grow quicker or produce more milk than ever before, and that there are more heifer than bull calves on dairy farms.

If agriculture is to feed the world, it needs more durability like this. It will be modern technology, not really a return to the last century or beyond, that ensures the soil and water are preserved. Genetically modified crops and pasture plants, for example, are not only seen fundamental to raising the nutritional value of pasture, but combating desertification and drought.

What’s needed is recognition that human impact on the environment is not only unavoidable but mostly highly good. Moreover, the concept of virgin backwoods untouched by humans should be exposed for the lie that it’s.

Australia’s ‘old growth’ temperate forests are all regrowth following repeated burning through Aborigines over thousands of years. The bison-grazed plains of North America were reprocessed by Native Americans long before Men and women showed up. Many of the mist-shrouded treeless grasslands of the exotic Andes are the result of burning as well as grazing after locals cut down the natural forests centuries ago.

It is a simple fact that nature is resilient and adaptable. In a thousand years the farms of today will be producing far more meals and fibre they do now. That makes them sustainable, and provides the lie to the ethics of Australian Ethical.

There is completely nothing ethical about leftover rooted in the past, using outdated technology to produce food that lots of people cannot afford to buy. Indeed, by my ethical standards, Australian Ethical is unethical in its refusal to invest in modern agriculture and contribute to the supply of high quality, nutritious, affordable meals produced more sustainably than ever before.

Which raises an interesting question: in the event that everyone decided investing in farming was unethical, we would quickly find ourselves in an ethical problem. Given an inevitable shortage of food, which fund manager don’t let kill and eat first?

Regards,

David Leyonhjelm,

Contributor, Money Morning

Editor’s Note: David Leyonhjelm is a normal Money Morning contributor. He has worked in agribusiness for 30 years and is the NSW federal senator — and somewhat of a controversial figure. Donald represents the Liberal Democratic Celebration in the Senate. The LDP is a libertarian party which advocates individual freedom and choice, and limited government.

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