A landscape analysis of investors in the global breast milk substitute industry to target for advocacy

Abstract

The International Code of Marketing of Breast‐milk Substitutes and subsequent resolutions (the Code) was adopted to address increases in mortality and morbidity resulting from the practices of the breast‐milk substitute (BMS) industry. The lack of success in ensuring company compliance with the Code has prompted advocates to consider engaging with investors to shape the governance of BMS companies. To support these efforts, this paper aimed to identify prominent investors in the global BMS industry and explore their Code‐related policies and practices. Using multiple methods and data sources, we developed a novel approach to identify and rank investors in the world's leading publicly listed BMS companies. We also examined the policies and voting behaviour of a sample of investors using publicly accessible materials from 2020 to 2022. We found that a small number of large investors, led by BlackRock and Vanguard, hold a substantial share in the global BMS industry. Of the top‐10 ranked investors, only Norway's Government Pension Fund (NBIM) reported policy information relating specifically to BMS marketing. Most of these large investors also opposed the sample of public health‐related shareholder proposals analysed. In addition, we identified several investors that have reported engaging with BMS companies on Code‐related issues, including NBIM, Pictet, and UBS, along with several potential investor targets for future advocacy efforts, including some North American public pension funds. The inclusion of Code‐related issues as part of broader policies, disclosures and regulations related to environmental, social and governance oriented investment warrants increased attention.

This study identified several investors who reported engaging with companies to increase their adherence to the International Code of Marketing of Breastmilk Substitutes, as well as potential targets for future advocacy efforts. More broadly, the study highlights the need for accountability mechanisms to ensure that investors contribute to socially meaningful outcomes.

Key messages

• Large investors may have an important role to play in increasing company compliance with the International Code of Marketing for Breast‐milk Substitutes (BMS) and subsequent resolutions.

• Most top investors in the global BMS industry do not have policies on BMS‐related issues and tend to oppose public health‐related shareholder proposals.

• Some investors have reported engaging with BMS companies on Code‐related issues, although a lack of transparency makes it difficult for third parties to examine such engagements.

• The inclusion of Code‐related issues as part of broader policies, disclosures and regulations related to environmental, social and governance oriented investment warrants increased attention.

1. INTRODUCTION

An estimated 823,000 child deaths and 98,000 maternal deaths from cancer and type‐2 diabetes would be prevented every year in low‐ and middle‐income countries alone if breastfeeding rates reached near‐universal levels (Victora et al., 2016; Walters et al., 2019). Although breastfeeding rates are improving in many countries and globally, it has been estimated that less than half of all infants and young children worldwide are breastfed, as recommended by the World Health Organization (WHO) and United Nations Children's Fund (UNICEF) (Global Breastfeeding Collective, 2022). To achieve optimal growth, development and health, WHO and UNICEF recommend infants initiate breastfeeding in the first hour of life, are then exclusively breastfed for 6 months, and thereafter receive nutritionally adequate and safe complementary foods, while breastfeeding continues for up to 2 years of age or beyond (WHO, 2003).

One of the largest barriers to increasing breastfeeding rates worldwide is the practices deployed by the commercial milk formula and baby food industry, hereafter referred to as the breast milk substitute (BMS) industry (Baker et al., 2023; Rollins et al., 2023). For decades, the diverse strategies used by the BMS industry to drive and sustain BMS expansion on a global scale have been well documented (Baker et al., 2021; Muller, 1974). Such strategies include sophisticated and well‐resourced marketing campaigns, including through health systems and digital platforms (Rollins et al., 2023; WHO, 2022b). The BMS industry has also systematically engaged in a range of political practices, such as lobbying national and international policymakers and shaping research in their favour to protect their profit‐maximising capacities from government regulation and shifts in social and political norms (Baker et al., 2021; Granheim et al., 2017). Testament to the power of the global BMS industry is that global BMS markets have grown rapidly in recent decades, particularly in low‐ and middle‐income countries (Victora et al., 2016; WHO, 2022a; Wood et al., 2022), with ‘catastrophic consequences on breastfeeding rates and the health of subsequent generations’ (The Lancet, 2016).

Efforts to address increases in mortality and morbidity resulting from the practices deployed by the global BMS industry are longstanding. Notably, in 1981, the International Code of Marketing of Breast‐milk Substitutes (the Code) was adopted by the World Health Assembly (WHA) (WHO, 1981). Among other things, the Code—a living document strengthened through successive WHA resolutions—calls on BMS companies to operate according to its principles and aims. Yet extensive evidence shows that company violations of the Code are ongoing, systematic, and widespread (Becker et al., 2022). Moreover, the implementation and enforcement of Code‐aligned national regulations have faced strong resistance from the global BMS industry (Baker et al., 2021; Russ et al., 2021). As of 2022, only 32 of the 194 WHO Member States had regulatory measures in place that were substantially aligned with the Code, compared to 121 that had implemented some provisions, and 50 that had implemented none at all (WHO, 2022b). The lack of success in ensuring full company compliance with the Code has prompted various United Nations agencies and civil society organisations to examine diverse strategies to increase company compliance with the Code (BMS Call to Action, 2020; Save the Children, 2018).

Building on the longstanding advocacy efforts of the International Baby Foods Action Network (IBFAN) (Allain, 1989; Sokol, 2005), public health advocates are increasingly turning to the potential of leveraging the influence of large investors to shape the governance of BMS companies (Access to Nutrition Initiative, 2020; Save the Children, 2018). Investors, especially large asset managers and institutional investors, can influence corporate governance in several ways (Kölbel et al., 2020). For instance, investors can directly engage with the corporations in which they have invested, such as via face‐to‐face meetings, video conferences, and written communication, to support or push for changes in company policy and practice (Kölbel et al., 2020). This direct engagement can be bilateral, or it can occur in the form of investor coalitions (Dimson et al., 2015).

Another way by which investors can influence corporate governance is through the strategic use of their shareholder voting and filing rights (Fichtner et al., 2017). For example, if investors are unhappy with the company's current policies or practices, they can threaten to vote against company decision‐makers at shareholder meetings (Fichtner et al., 2017). Similarly, investors can vote in favour of shareholder proposals demanding that corporate decision‐makers act on a specific environmental, social, or governance (ESG) related issue (Kölbel et al., 2020; ShareAction, 2022).

Large investors can also indirectly influence corporate governance through their capital allocation strategies relating to which companies they include and exclude from their investment portfolios (Kölbel et al., 2020; Robinson et al., 2022). Some investors, for instance, have screening policies that require them to exclude companies that profit from products considered harmful (e.g., fossil fuels, chemical weapons, and tobacco) (Camilleri, 2017). Conversely, some investors have screening policies that dictate the companies or industries (e.g., renewable energy) in which they can invest (Robinson et al., 2022). Passive investors that invest in index funds (i.e., a portfolio of stocks that match or track the components of an index) likely have a more limited scope to influence corporate governance in this way. Still, investors that invest in index funds can choose which index funds they invest in and divest from, so they can still exert some degree of influence through their investment choices.

To date, prominent investors in the global BMS industry have not been systematically identified. Furthermore, the ways in which investors have sought to increase company compliance with the Code have not been systematically examined. This paper aimed to address these gaps by identifying and describing prominent investors in the world's largest publicly listed BMS companies, as well as by exploring their policies and practices regarding the Code. The goal of this paper was to support public health advocacy efforts seeking to leverage the influence of investors to promote and protect the public's health.

2. METHODS

In this study, we developed a novel approach to identify and examine key investors in the world's leading publicly listed BMS companies (see Figure 1 for a diagrammatic overview of the approach taken in this study). This approach encompassed multiple methods and data sources, which are described in detail below following the author reflexivity statement.

Figure 1.

A diagrammatic overview of the approach taken in this study.

2.1. Author reflexivity statement

The authorship group consisted of public health researchers with expertise in the corporate and commercial determinants of health, including experience applying a wide range of quantitative and qualitative research methods. The authorship group consisted of one female and four males (self‐identified), while the wider research team that was involved in the study consisted of four females and five males (self‐identified). All members of the research team were invited to contribute to the paper as authors. Four members of the research team opted out of the authorship group, instead preferring to be mentioned in the acknowledgements. The authors recognise that a more balanced gender composition of the authorship group would have been preferable. This concern notwithstanding, the authors would like to acknowledge that this paper does not seek to describe or analyse infant and young child feeding behaviours, nor does it seek to provide education or advice directed at mothers, parents, carers, families, households, or any individuals. Instead, the manuscript is primarily about corporate governance—and more specifically, about exploring various ways to align corporate governance with an internationally accepted policy and normative framework.

2.2. Identifying the world's leading publicly listed BMS companies

We conducted a quantitative analysis of BMS market data to identify the world's largest publicly listed BMS companies. Data on global milk formula and baby food sales for 2021 were sourced from Euromonitor International's Passport database (Euromonitor International, 2023). Companies that held a share of one per cent or more in either the global commercial milk formula or global baby food markets were identified. The threshold of one per cent was selected because it was deemed sufficient to capture all major BMS companies. Refinitiv's Eikon database, which provides access to a wide range of international market and business data, was used to verify companies that were publicly listed at the time of analysis (Refinitiv, 2021).

2.3. Identifying and ranking investors in the selected BMS companies

Data on share ownership, both as a percentage and as an absolute value in United States dollars (USD), for the identified publicly listed BMS companies were examined. All investors with a share of 0.2% in one or more of these companies were identified. The threshold of 0.2% was chosen to ensure that most, if not all, prominent shareholders in the BMS industry (based on market share) were captured in the analysis. Investor data on type (e.g., asset manager, sovereign wealth fund), predominant investment style (e.g., active, index), and headquarters location by country were collected. These data were sourced from Refinitiv's Eikon database during April 2022.

We chose to rank investors based on their approximate share in the global BMS industry by calculating a ‘weighted average’ for every investor. The weighted average was calculated by multiplying the percentage of shares an investor held in a company by that company's global BMS market share and then averaging these values across all 11 companies. The formula can be summarised as follows:

$$\begin{array}{l}\text{Weighted average of investor A}\\ =\left[\right(\text{share ownership of investor A in company}1\\ \times \text{share in global BMS market held by company}1)\\ +\mathrm{\dots }+(\text{share ownership of investor A in company}11\\ \times \text{share in global BMS market held by company}11\left)\right]÷11\end{array}$$

We chose to use weighted averages, rather than unweighted share ownership averages or absolute value of investments, to rank the identified investors for two main reasons. First, we felt that unweighted averages would fail to account for the global shares of the BMS market held by each company, and thus could potentially shift focus away from the companies with the largest global BMS market shares. Second, we felt that the absolute value of investments would skew our results towards investors with investments in the BMS companies with the largest market capitalisations. Based on the investor rankings by weighted average, we identified the top 10 ranked investors in the world's leading publicly listed BMS companies.

In addition to identifying the largest investors based on a weighted average, we also chose to identify and rank the investors that were signatories to the Access to Nutrition Initiative's (ATNI's) ‘Investor Expectations on Nutrition, Diets and Health' at the time of analysis (Access to Nutrition Initiative, 2020). This is a document that explicitly calls on investors to engage directly with BMS companies to ensure that these companies commit to achieving ‘full global compliance, as soon as possible but by 2030 at the latest, with the International Code of Marketing of BMS and subsequent relevant WHA solutions, including WHA 69.9’, as well as ‘demonstrate a commitment to… [not] undermine regional, national, and subnational policy, regulations, guidelines, and standards designed to improve health’ (Access to Nutrition Initiative, 2020). For the purposes of this study, we considered that these investors had pledged commitment to improving company compliance with the Code.

Furthermore, we chose to identify and rank the largest sovereign wealth fund and public pension fund managers with respect to investments in major BMS companies. Notwithstanding substantial variations in their operational independence, the managers of these funds tend to be accountable, at least to some degree, to the relevant government authorities (Musalem & Palacios, 2004). Thus, in cases where the respective governments are accountable to the public, the management of these funds can, in principle, be influenced by public pressure.

2.4. Exploring the policies and practices of a sample of investors

We reviewed the policies and practices of a purposively selected sample of 16 key investors. This sample encompassed the top 10 ranked investors by weighted average, the top five ranked investor signatories to ATNI's ‘Investor Expectations on Nutrition, Diets and Health’ by weighted average (one of these was in the overall top 10 investors), and the top three ranked sovereign wealth funds and public pension funds by weighted average (one of these was in the overall top 10 investors). Specifically, we searched for any policy information pertaining to BMS products or the Code, as well as any mention of BMS products or the Code, in the publicly accessible communication materials published by these 16 investors between 2020 and 2022. Data were sourced from the investors' websites.

We also analysed the proxy voting behaviour of the same investors to better gauge their appetite to actively pressure companies on public health nutrition‐related issues. To do this, we examined how these investors voted on a set of 15 relevant shareholder proposals filed in either 2021 or 2022. As we were unable to find any BMS or Code‐related shareholder proposals during this period, we instead chose to include 15 shareholder proposals that were related to nutrition, public health, and political influence. The only large publicly listed BMS company that was found to have relevant shareholder proposals filed in 2021 and 2022 was Abbott. We also chose to include food companies outside of the BMS industry for comparison. PepsiCo, Coca‐Cola Co, and McDonald's were the only major publicly listed food companies that were found to have relevant shareholder proposals filed in 2021 or 2022. Data on how each investor voted at the annual general meeting (AGM) of these four companies were extracted. Some of the shareholder proposals included in the analysis were the same proposal, filed at different companies or in different years. Voting data were sourced from Institutional Shareholder Services' proxy voting dashboard and the U.S. Securities and Exchange Commission's Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system (mutual fund voting records, Form N‐PX), and, where relevant, supplemented with proxy voting information published on investor websites.

3. RESULTS

In this section, we first highlight the world's leading publicly listed BMS companies. Following this, we outline the top 10 ranked investors in these companies by weighted average, as well as all identified investor signatories to ATNI's ‘Investor Expectations on Nutrition, Diets and Health’, sovereign wealth fund managers, and public pension fund managers. Where applicable, we also describe investor policies and practices regarding the Code, as well as investor voting behaviour for the selected public health nutrition‐related shareholder proposals.

3.1. Largest BMS companies by global market share

In 2021, 11 publicly listed companies held at least a one per cent share in either the global commercial milk formula (CMF) market or the global baby food market (Table 1).

Table 1.

Overview of the 11 publicly listed companies that held at least a 1% share of the global commercial milk formula market or the global baby food market in 2021.

Company name (headquarters location)	Global commercial milk formula market share	Global baby food market share
Nestlé (Switzerland)	16%	19%
Danone (France)	13%	12%
China Feihe (China)	10%	8%
Reckitt (UK)	10%	7%
Abbott (USA)	8%	6%
Inner Mongolia Yili Industrial Group (China)	3%	2%
A2 Milk Co (NZ)	1%	<1%
Morinaga Milk Industry Co (Japan)	1%	<1%
China Mengniu (China)	1%	<1%
Vietnam Dairy Products (Vietnam)	<1%	1%
Kraft Heinz Co (USA)	<1%	1%

Note: Data sourced from Euromonitor International's Passport. Health & Happiness (H&H) International Holdings was excluded from the list because Biostime Pharmaceuticals, a private company, had a large controlling interest in the company. Ausnutria was excluded from the list because, at the time of analysis, Inner Mongolia Yili industrial Group was in the process of finalising an acquisition to give it a majority stake in the company.

3.2. Top 10 ranked investors in the world's leading publicly listed BMS companies

Table 2 provides an overview of the top 10 ranked investors in the 11 identified BMS companies. BlackRock and Vanguard, both of which predominantly invest via index funds, were the top two ranked investors in these companies by weighted average. BlackRock held more than 1% of shares in seven of the 11 companies, while also holding shares in the other four. Vanguard held more than 1% of shares in eight of the 11 companies and held shares in two others. Capital Group was found to be the top‐ranked ‘active’ investor by weighted average, holding more than 1% of shares in six of the 11 companies. The top‐ranked manager of government funds was found to be Norway's Government Pension Fund (NBIM).

Table 2.

Top 10 investors in the world's 11 leading publicly listed breast milk substitute companies, April 2022.

Rank by weighted average score	Name (headquarters location)	Investor type	Approx. share value held in the 11 identified BMS companies (USD billion)	Manages funds that hold shares in:
				Nestle	Danone	Feihe	Reckitt	Abbott	Yili	A2 milk	Morinaga	Mengniu	Kraft Heinz	Vinamilk
1	BlackRock Institutional Trust Company (USA)	Asset manager	38.25
2	The Vanguard Group (USA)	Asset manager	36.16
3	Capital Research Global Investors (USA)	Asset manager	28.79
4	MFS Investment Management (USA)	Asset manager	14.94
5	Norges Bank Investment Management (Norway)	Sovereign wealth fund	15.26
6	Morgan Stanley Private Equity Asia (USA)	Asset manager (private equity)	0.67
7	Artisan Partners Limited Partnership (USA)	Asset manager	2.22
8	First Eagle Investment Management (USA)	Asset manager	3.33
9	Morgan Stanley Investment Management (UK)	Asset manager	5.70
10	Amundi Asset Management (France)	Asset manager	2.56

Note: Data sourced from Eikon and Euromonitor International's Passport. *Weighted average = [(share ownership % in company X company's global share in CMF market)]/11. Dark green box = share ownership greater than or equal to 1%. Light green box = share ownership less than 1% but greater than or equal to 0.2%. White box = share ownership less than 0.2%.

In our review of publicly accessible materials published by these 10 investors, we found that only NBIM reported policy information related to the marketing of BMS (refer to Supporting Information S1: File S1 for more details). In 2021, NBIM reported that one of its thematic dialogue topics was ‘responsible marketing of infant formula’, which was grouped under the category ‘human rights’ (Norges Bank Investment Management, 2021). Between 2018 and 2021, NBIM stated that it had engaged with 13 companies in relation to this topic, although the full details of these engagements were not publicly disclosed (Norges Bank Investment Management, 2021). In contrast, some of the other major investors made their views on the potential financial benefits of growth in infant formula operations explicit. In 2019, for instance, Capital Group reported that opportunities for investment growth in China included increasing demand for infant formula (Capital Group, 2019). Similarly, Artisan Partners noted that infant formula was ‘particularly valuable’ in a document describing its ‘International Value Fund’ (Artisan Partners, 2021).

Out of the top 10 ranked investors, only Amundi voted in favour of the majority (13) of the 15 selected public health nutrition‐related shareholder proposals (Table 3). In comparison, BlackRock and Vanguard voted against all 15 shareholder proposals, as did MFS Investment Management. Morgan Stanley Investment Management was found to vote against 14 of the shareholder proposals, Capital Group against 13 of the shareholder proposals, and NBIM against 11 of the shareholder proposals.

Table 3.

Key BMS investor proxy voting decisions for 15 shareholder proposals in 2021 and 2022.

	Company and relevant Shareholder Proposal*
	Abbott**			The Coca‐Cola Company			PepsiCo				McDonald's Corporation
	2022	2022	2021	2022	2022	2021	2022	2022	2021	2021	2022	2022	2022	2021	2021
Investor	Report on Lobbying Payments and Policy	Report on Public Health Costs of Antimicrobial Resistance	Report on Lobbying Payments and Policy	Report on Global Public Policy and Political Influence	Report on External Public Health Costs	Report on Sugar and Public Health	Report on Global Public Policy and Political Influence	Report on Public Health Costs of Food and Beverages Products	Report on Sugar and Public Health	Report on External Public Health Costs	Issue Transparency Report on Global Public Policy and Political Influence	Report on Public Health Costs of Antibiotic Use and Impact on Diversified Shareholders	Report on Lobbying Payments and Policy	Report on Sugar and Public Health	Report on Antibiotics and Public Health Costs
Amundi										R
Artisan Partners
BlackRock
CalPERS
Capital Group
CPP Investment Board
First Eagle Investment Management
Legal & General Investment Management
MFS Investment Management
Morgan Stanley Investment Management
Morgan Stanley Private Equity Asia
NBIM
Pictet Asset Management
Schroder Investment Management
UBS Asset Management
Vanguard

Note: Data sourced from Institutional Shareholder Services’ proxy voting dashboard; U.S. Securities and Exchange Commission's Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system (mutual fund voting records, Form N‐PX); proxy voting information published on investor websites. Green cell = investor voted in favour of the shareholder proposal; Red cell = investor voted against the shareholder proposal; Grey cell = not applicable.

^*A selection of four publicly listed food and beverage companies that had relevant shareholder proposals filed in 2022 and 2021 were included: Abbott, The Coca‐Cola Company, PepsiCo, and McDonald's Corporation. Relevant Shareholder Proposals were defined as those relating to nutrition, public health, and political influence.

^**Abbott was the only company from our sample of BMS companies to have a relevant shareholder proposal filed in 2022 or 2021.

3.3. Investor signatories to ATNI's ‘investor expectations on nutrition, diets and health’

Table 4 outlines the identified investors that were signatories to ATNI's ‘Investor Expectations on Nutrition, Diets and Health’ as of the end of 2022. Amundi (discussed in the previous section) was the top‐ranked of the investor signatories by weighted average, holding more than 1% of Danone's shares, while also holding shares in eight of the other BMS companies. Regarding the next four top‐ranked investors in Table 4, UBS Asset Management had shares in 10 of the companies (including greater than 1% of Nestlé's shares), Schroders had shares in eight of the companies (including greater than 1% of China Mengniu's shares), Legal & General had shares in all 11 companies, and Pictet had shares in nine of the 11 companies.

Table 4.

Identified signatories to ATNI's ‘Investor Expectations on Nutrition, Diets and Health' that invest in the world's leading publicly listed breast milk substitute companies, April 2022.

Rank by weighted average score	Name (headquarters location)	Approx. share value held in the 11 identified BMS companies (USD billion)	Manages funds that hold shares in:
			Nestlé	Danone	Feihe	Reckitt	Abbott	Yili	A2 milk	Morinaga	Mengniu	Kraft Heinz	Vinamilk
10	Amundi Asset Management (France)	2.6
15	UBS Asset Management (Switzerland)	6.6
24	Schroder Investment Management (UK)	2.6
39	Pictet Asset Management (UK)	2.6
41	Legal & General Asset Management (UK)	2.6
53	BNP Paribas Asset Management (France)	0.62
65	T. Rowe Price Associates (USA)	2.0
66	Columbia Threadneedle Investments (US)	2.4
98	Aviva Investors (UK)	0.39
102	Candriam (Belgium)	0.66
105	Mirova (France)	0.15
113	Nomura Asset Management (Japan)	0.20
123	MUFG Bank (Japan)	0.063
140	Sarasin & Partners (UK)	0.19
181	Federated Hermes International (UK)	0.34
184	GAM Investment Management (Switzerland)	0.12
211	Stichting (Netherlands)	0.068

Note: Data sourced from Eikon and Euromonitor International's Passport. Weighted average = [(share ownership % in company X company's global share in CMF market)]/11. Dark green box = share ownership greater than or equal to 1%. Light green box = share ownership less than 1% but greater than or equal to 0.2%. White box = share ownership less than 0.2%. Either the entity listed is a signatory or, in some instances, the group they are a part of is a signatory. List of signatories accessed on 31 August 2022 from ATNI's webpage on investor signatories (Access to Nutrition Initiative, 2024) https://accesstonutrition.org/investor-signatories/.

Out of the top five ranked investor signatories, only Pictet was found to report specifically on the Code and the marketing of BMS products, as part of its nutrition fund strategy (see Supporting Information S1: File S1). Pictet also reported that it had started to engage with companies on the issue of BMS marketing (Pictet Asset Management, 2021). In 2021, one of Pictet's nutrition fund managers stated that (Pictet Asset Management, 2021)

‘When it comes to the marketing of breast milk substitutes, we have been calling on companies to comply with the World Health Organization code for healthy marketing of such products. They may be the only viable nutritional substitute when mothers are unable to breastfeed but they must not be marketed too aggressively so exclusive breastfeeding remains a priority’.

Also in 2021, UBS Asset Management reported that it had led a collaborative engagement involving 30 investors with China Mengniu (UBS Asset Management, 2021). In their 2021 Stewardship Report, UBS Asset Management stated that China Mengniu had been receptive to the engagement and, as a result, had committed to enhancing the disclosure of existing practices related to nutrition (UBS Asset Management, 2021). However, the extent to which this related to their BMS products was not disclosed.

Regarding the voting behaviour of the top five ranked investor signatories (including Amundi, which was discussed in the previous section), we found that Pictet voted in favour of all 15 public health nutrition‐related shareholder proposals (Table 3). In comparison, Legal & General voted in favour of 11 of the shareholder proposals and Schroders and UBS Asset Management voted in favour of 10 of the shareholder proposals.

3.4. Sovereign wealth funds and public pension funds

Table 5 provides outlines the major sovereign wealth funds and public pension funds that were found to have invested in the world's 11 leading publicly listed BMS companies. NBIM, the largest manager of such funds, was discussed in a previous section. The California Public Employees’ Retirement System (CalPERS), the Florida State Board of Administration, and the California State Teachers Retirement System (CalSTRS) were all found to have shares in 10 of the 11 BMS companies. Caisse de Depot et Placement du Quebec and the Canada Pension Plan (CPP) Investment Board were found to have shares in eight and seven of the 11 BMS companies, respectively.

Table 5.

Identified sovereign wealth funds and public pension fund managers that invest in the world's leading publicly listed breast milk substitute companies, April 2022.

Rank by weighted average score	Name (headquarters location)	Approx. share value held in the 11 identified BMS companies (USD billion)	Manages funds that hold shares in:
			Nestle	Danone	Feihe	Reckitt	Abbott	Yili	A2 milk	Morinaga	Mengniu	Kraft Heinz	Vinamilk
5	Norges Bank Investment Management (Norway)	15.26
33	California Public Employees' Retirement System (USA)	2.53
35	Canada Pension Plan (CPP) Investment Board (Canada)	1.70
64	Florida State Board of Administration (USA)	1.00
75	California State Teachers Retirement System (USA)	1.20
96	Caisse de Depot et Placement du Quebec (Canada)	0.83
118	State Capital Investment Corporation (Vietnam)	3.36
130	Abu Dhabi Investment Authority (UAE)	0.33
152	Washington State Investment Board (USA)	0.14
169	GIC Private Limited (Singapore)	0.14

Note: Data sourced from Eikon and Euromonitor International's Passport. Weighted average = [(share ownership % in company X company's global share in CMF market)]/11. Dark green box = share ownership greater than or equal to 1%. Light green box = share ownership less than 1% but greater than or equal to 0.2%. White box = share ownership less than 0.2%.

During our review, we found that neither CalPERS nor the CPP Investment Board reported any information regarding the marketing of BMS (see Supporting Information S1: File S1). In our analysis of proxy voting data (Table 3), we identified that the CPP Investment Board voted against 13 of the 15 shareholder proposals and that CalPERS voted against nine of the 15 shareholder proposals.

4. DISCUSSION

This study, the first of its kind to analyse key investors in the global BMS industry, identified that there is a diverse range of investors in the world's leading publicly listed BMS companies. Nevertheless, as with many industries across the global corporate economy (Braun, 2021), we found that a relatively small number of large investors, led by BlackRock and Vanguard, hold a substantial share in the global BMS industry. With only a few exceptions, there is little sign that these very large investors are seeking to pressure companies into acting on any Code‐related or other public health‐related issues. Indeed, our findings suggest that the voting behaviour of many of the top investors in the global BMS industry may even be posing a considerable barrier to investor‐led advocacy efforts seeking to pressure companies into taking action on public health‐related issues. That being said, we identified several prominent investors with relatively large shareholdings in some of the world's largest BMS companies that have reported being concerned about the harmful marketing of BMS products. In recent years, these investors have voted on shareholder proposals in a manner that suggests that they are willing to use their voting rights to pressure companies to act on specific public health‐related issues.

Our findings are in line with recent work demonstrating that many of the world's largest investors typically vote against shareholder resolutions aimed at compelling corporate decision‐makers to incorporate social and environmental considerations in their decision‐making. Wood et al. (2022), for instance, show that the so‐called ‘Big Three’—BlackRock, Vanguard, and State Street —voted against all public health‐oriented shareholder resolutions targeting major ultra‐processed food corporations between 2012 and 2022 (Wood et al., 2022). Similarly, Baines and Hager (2022) highlight how the voting behaviour of the ‘Big Three’ more often than not leads to the failure of climate and environment‐related shareholder resolutions targeting major publicly listed fossil fuel, cement, and mining companies (Baines & Hager, 2022). At the same time, our findings support recent analyses in the Australian context, suggesting that a number of large investors have been increasingly recognising the importance of incorporating public health‐related issues into their investment decision‐making processes (Robinson et al., 2020; Robinson et al., 2022). Below, we discuss various opportunities for public health advocates to leverage this momentum as part of efforts seeking to increase company compliance with the Code, along with various implications for government policy.

4.1. Implications for public health advocacy

The study suggests that there are various opportunities for public health advocates seeking to engage with investors to influence the governance of BMS companies and increase compliance with the Code. For example, public health advocates could support existing BMS‐related investor initiatives in several ways. As a suggestion, public health advocates could seek to support ATNI by engaging with and mobilising investor signatories to ATNI's ‘Investor Expectations on Nutrition, Diets and Health’ (listed in Table 4) to take concrete action on the issue. In particular, it could be worth exploring avenues to engage with Amundi, Nomura Asset Management, and Schroders, given their considerably large shareholdings in BMS companies Danone, Morinaga, and China Mengniu, respectively. Our study also revealed a number of potential public pension fund managers to target for future public health advocacy efforts. Specifically, our findings suggest that there could be merit in supporting advocacy campaigns in California targeting CalPERS and CalSTRS, as well as in Canada targeting the CPP Investment Board and Caisse de Depot et Placement du Quebec.

Public health advocates could also seek to support BMS‐related investor initiatives by building awareness and providing technical guidance to support investment decision‐making. This could include ensuring comprehensive and up‐to‐date information on Code compliance is collected in many contexts and shared among interested parties. Such support could also include technical support on ways to engage with companies to ensure Code compliance by 2030, as well as on how to incorporate Code‐related issues into their capital allocation strategies (e.g., the negative screening of companies that routinely violate the Code past an agreed upon date). As part of such advocacy efforts, it will be important that public health advocates present not just ethical and normative arguments but also expose the material risks posed to investors with investments in BMS companies that do not comply with the Code (Robinson et al., 2022). In this respect, important risks to focus on include those related to the scaling‐up of BMS‐related regulations worldwide, the risk of being subjected to large‐scale consumer boycotts by citizen–consumers concerned with the adverse health impacts of BMS marketing, and shifts in citizen–consumer preferences.

Still, even for investors with a longer‐term perspective, the argument could be made that the short‐term financial benefits of breaching the Code might outweigh the abovementioned risks to mid‐to‐long‐term financial performance. In any case, there could be merit in working with responsible investors to push for the scaling‐up and strengthening of government Code‐aligned regulations, as well as of the government regulation of ESG funds and stock market indices. Both measures, we argue, could provide responsible investors with considerable competitive advantages vis‐à‐vis other investors. Companies that fully comply with the Code, it could be argued, would not be burdened with any transition costs relating to the implementation or strengthening of BMS‐related regulation. On the other hand, poorly compliant companies would likely be burdened with such costs, perhaps to the detriment of their short‐term financial performance, thereby reducing the potential returns for investors with investments in such companies. Relatedly, responsible investors that establish genuine ESG funds would likely benefit from stricter government regulation of ESG funds and stock market indices to prevent the green‐, health‐, nutrition‐, and blue‐washing practices of some financial actors, a point to which we return below.

It could also be worth identifying ways to leverage the political nature of public pension funds, such as CalPERS, CalSTRS, CPP Investment Board, and Caisse de Depot et Placement du Quebec to push for increased company compliance with the Code (Wang & Mao, 2015). Campaigns targeting public pension funds could draw from the work of Save the Children Norway, which has spent many years engaging with NBIM (Koffeld, 2019), and be adapted to the respective political and institutional contexts with the support of local civil society organisations. Notably, the study identified the Florida State Board of Administration, which invests in 10 of the world's 11 leading BMS companies, as a potential advocacy target. However, such efforts would likely be severely restricted by recent measures prohibiting Florida's public fund managers from considering ESG factors in their investment decisions (Ron DeSantis, 2022).

4.2. Implications for government policy

This study exposes the importance of accountability mechanisms related to BMS‐related investor initiatives, including monitoring of relevant activities undertaken by investors. A major barrier to monitoring investor engagements with BMS companies is that most investors do not disclose the details of such engagements, and thus, it is difficult for third parties to assess whether such engagements are effective, appropriate, and evidence‐informed. While some investors might be willing to publicly disclose the details of their engagements, a more systemic solution would likely be for governments to mandate the public disclosure of information pertaining to the process and outcomes of shareholder engagements (Fichtner et al., 2023). A recent proposal made by the U.S. Securities and Exchange Commission (SEC) provides an illustration of how this could potentially be achieved. Among other things, the SEC proposed to amend rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940 to require funds that engage with companies ‘as a significant means of implementing their ESG strategy’ to disclose information concerning such engagements (U.S. Securities and Exchange Commission, 2022).

Relatedly, our study highlights potential concerns regarding the way in which some ESG funds and ESG stock market indices allocate ESG capital into BMS companies with poor Code compliance records, whilst parading these funds as ‘responsible investments’. As an illustrative example, BlackRock, whose equity investments in the world's largest BMS companies were valued at nearly 40 billion USD at the time of analysis, markets a ‘Sustainable Balanced Fund’ that includes two major BMS companies with poor Code compliance records (BlackRock, 2023b). It also markets a fund containing three major BMS companies that tracks an index supposedly focused on companies in emerging markets with high ESG ratings relative to their peers (BlackRock, 2023a). At the time of analysis, it appeared that none of these three companies had published BMS marketing policies or other related documents (Access to Nutrition Initiative, 2021).

Regulating ESG funds and indices to ensure that their marketing comprehensively depicts all the companies of which they are constituted could potentially incentivise Code compliance, largely through facilitating the flow of ESG capital away from companies that do not comply with the Code to those that do (Fichtner et al., 2023). In this respect, the European Union's Sustainable Finance Disclosure Regulation, which, among other things, seeks to increase transparency around the sustainability claims made by investment funds, is arguably a step in the right direction (Official Journal of the European Union, 2019). However, some scholars have claimed that transparency and disclosure requirements alone will likely be insufficient and that regulatory measures that focus on actual sustainability impacts will also need to be considered (Fichtner et al., 2023). The case of FTSE4Good supports this argument. FTSE4Good is one of the only stock market indices that includes BMS‐related criteria, which are based on the alignment of their policies with the Code and are publicly accessible (Russell, 2017). Yet, in spite of these criteria, FTSE4Good still includes a number of major BMS companies that are reportedly not compliant with the Code (FTSE Russell, 2024; Nestlé, 2023), and their BMS marketing criteria may have been watered‐down to align with Nestlé's own corporate policy rather than the Code (Baker et al., 2023; Wagner‐Rizvi, 2020).

4.3. Strengths and limitations

A strength of this paper was that it used multiple methods and data sources to develop a novel approach to identify and describe key investors in the global BMS industry. This approach could be applied to identify and describe key investors in other industries of public health concern as part of research and advocacy efforts seeking to leverage the influence of investors to help address multiple commercial determinants of ill health and inequity (Friel et al., 2023; Lee & Freudenberg, 2022; Robinson et al., 2022).

A key limitation of this study was that it focused only on equity investments in a set of major publicly listed BMS companies. In this respect, future work could seek to explore the potential of leveraging other financial actors, such as creditors, and investors in private BMS companies, to improve company compliance with the Code. Companies in related industries subject to the Code, such as the feeding bottle and teat industry, could also be considered. Another key limitation of this study was that it was primarily descriptive. Future work could build on this landscape analysis by, inter alia, analysing the investment behaviour of potential BMS investor targets for advocacy, as well as developing a range of public health advocacy strategies to leverage the influence of BMS investors in multiple contexts. More broadly, future work could also seek to examine the feasibility of implementing and enforcing government regulations requiring ESG investors to be fully transparent in their engagements and evaluating the extent to which such engagements contribute to socially meaningful outcomes.

5. CONCLUSION

This study identified that at least three investors have reported engaging with BMS companies on Code‐related issues, as well as a range of potential investor targets for future advocacy efforts. More broadly, the study has highlighted the need for increased transparency and disclosure by investors as part of their BMS and other ESG‐related strategies, along with the implementation and enforcement of accountability mechanisms to ensure that their engagements with companies contribute to socially meaningful outcomes.

AUTHOR CONTRIBUTIONS

Benjamin Wood, Ella Robinson, David McCoy, Phillip Baker, and Gary Sacks conceptualised the study. Benjamin Wood and Ella Robinson collected and analysed the data. Benjamin Wood drafted the paper. Ella Robinson, David McCoy, Phillip Baker and Gary Sacks edited the paper and contributed key intellectual content. All authors approved the final version of the paper. Gary Sacks supervised the process.

CONFLICT OF INTEREST STATEMENT

This work was supported by funding from Save the Children U.S., Norway, and U.K. At the time of initial submission, Ella Robinson was employed with investment firm Australian Ethical Investment. At the time of conceptualisation, analysis, drafting, and editing, Ella Robinson was employed as a Research Fellow with the Global Centre for Preventive Health and Nutrition, Institute for Health Transformation, Deakin University, Australia.

Supporting information

Supporting information.

Wood, B. , Robinson, E. , McCoy, D. , Baker, P. , & Sacks, G. (2025). A landscape analysis of investors in the global breast milk substitute industry to target for advocacy. Maternal & Child Nutrition, 21, e13721. 10.1111/mcn.13721

DATA AVAILABILITY STATEMENT

Data cannot be shared for privacy (third‐party) reasons.