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Will this program finally make organics accessible to everyone?

By
Marianne Hayes
June 26, 2017
8 min read
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The biggest draw of impact investing is that it aligns your portfolio with your values. If you're passionate about clean eating, you may want to perk up; a number of companies in the Swell portfolio are committed to bringing better food to the masses.

Hain Celestial, a leading natural and organic food company, is one of them. Their team recently announced its support of a new check-off program designed to make organic food more accessible—and ultimately more affordable—to consumers.

The GRO Organic Check-off proposal1 is an in-the-works USDA initiative that's projected to raise $30 million annually in support of the organic farming industry. The idea is to get organic farmers, processors, and handlers to all kick in money and help support the industry. It's a three-pronged approach that would fund promotional, educational, and research activities. 

How does the program work?

"The way it works is similar to other check-off programs out there," Jared Simon, a Hain Celestial spokesperson, tells Swell. "The most famous one for most Americans is the American Egg Board, which does a lot of marketing around eggs; 'The Incredible Edible Egg' was one of their campaigns. The beef industry has one as well, so a number of key commodity industries have used check-off programs in the past as a means for the industry to come together, educate consumers on different uses for the product in the industry, and also, on the back end, work on research and development."

As Civil Eats2 points out, the organic check-off program is unique in that instead of being defined by what the food is, it's defined by how the food is produced. Hain Celestial is behind it, hoping it'll cultivate a more sustainable organic food supply. This, in turn, could make organic foods less expensive—a boon for consumers indeed.

Knowledge is power

Of course, educating consumers about the benefits of organic is another key piece of the puzzle here. Simon hopes an organic check-off program would help to demystify the process for the average shopper, who's often bombarded with confusing marketing messages.

For sure, deciphering between organic, all natural, grass-fed, and non-GMO labels can be a dizzying process for even a seasoned customer.

"It's a very difficult, crowded landscape to navigate as a consumer," he says, pointing to the check-off program as a potential way of closing this knowledge gap." If there's a marketing and communications vehicle in the industry that we can put forth to spread the message and explain that to consumers, they'll eventually have a richer knowledge and a deeper understanding of the organic sector. 

This, paired with potentially lower prices, could be a game changer for the US organic food supply.

According to the Organic Trade Association, the funds raised through the program would be split between three main focus areas: consumer education, research to support farmers (50 to 75 percent of funds would be allocated here), and technical services to make organic practices easier to adopt. The latter would also include creating initiatives to nurture new organic farmers.

Hain Celestial, a leading natural and organic food company
Hain Celestial, a leading natural and organic food company

Where will the money come from?

According to Simon, anyone who holds an organic certificate—so farmers, producers, handlers, and the like—with gross organic revenue of $250,000 or higher would be charged an assessment of one-tenth of 1 percent of net organic sales. Anyone who's below this threshold could decide for themselves whether to opt into the program or not.

The initiative still has a ways to go before being approved. The draft proposal for the check-off program was released last year, followed by a public comment period that opened at the beginning of 2017. This served as an opportunity for stakeholders to share their views with the USDA around the formation of the program. 

"All of those comments will be made public and reviewed, and then ultimately a final draft of what the organic check-off will look like will be released and voted upon by all certificate holders hopefully sometime later this year," adds Simon.

In the meantime, Hain Celestial isn't the only company in Swell's Health Living portfolio making strides on the clean eating front. Sprouts Farmers Market is a thought leader here, adhering to what it calls "responsible retailing." The foundation all comes down to partnering with suppliers that value the environment, human rights, and animal welfare. The big-picture goal is to advance responsible sourcing practices.

Swell makes it easy to play a direct role, seamlessly connecting investors with forward-thinking companies that are changing the world for the better. And you can rest easy knowing that the companies in the Swell Healthy Living portfolio have been well vetted and are positioned for growth; our impact requirements are rigorous. In other words, impact investing has never been easier.

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