Businesses step up investment in protein diversification but seek stronger policy support

F&B companies are increasingly confident about the commercial opportunities presented by protein diversification. However, they say greater policy support and investment will be needed to accelerate progress, according to the latest Business Breakthrough Barometer from the World Business Council for Sustainable Development (WBCSD).

The findings come as consumer demand continues to shift toward healthier protein choices and away from ultra-processed foods, creating fresh opportunities for food and beverage manufacturers while reshaping investment priorities across global supply chains.

The barometer suggests that while momentum is building across key markets, including Europe, the US and China, companies believe further progress will depend on coordinated action to scale production and encourage consumer uptake. 

Respondents identified financial incentives for diverse protein supply chains, updated dietary guidance, and greater policy coherence among their top priorities over the next one to three years.

WBCSD’s members account for approximately 26% of global emissions and include major players like AB InBev, Google, and IKEA. The organization is observing a growing consumer interest in natural, minimally processed plant proteins, such as legumes, tofu, and tempeh. In response, companies are investing in ingredient innovation, cleaner labels, protein-enriched staples, and taste and texture R&D. 

Consumers drive change

Victoria Crawford, WBCSD agriculture and food director, says confidence in protein diversification is increasing, with major developments across China, the EU, and the US, although many challenges remain.

Speaking with Food Ingredients First, she explains how consumer demand is the strongest force behind protein diversification currently, although business strategy and investment are rapidly following suit.

“About a decade ago, we saw a boom for meat analogs, underlain by innovation and new technologies. The market slowed in the early 2020s, but over the last year or so demand for protein diversification has picked up again in an interesting way,” she says.

“As health and well-being have become more mainstream, consumers are increasingly interested in a wider range of affordable protein sources, like tofu and tempeh, as well as more hybrid products, such as blended mushroom and beef burgers.”

“Business strategy and investment are following these consumer signals, and we see leading businesses, especially manufacturers and retailers, investing in new crops and processing technologies, and repositioning their product portfolios.” 

Leading businesses, particularly manufacturers and retailers, are investing in new crops to support more sustainable, resilient and diversified supply chains.

Protein across global markets

The momentum behind protein diversification is taking shape differently across major global markets, but a common theme is emerging: where policy, investment, and innovation align, progress accelerates.

According to Crawford, China stands out as one of the world’s most significant investors in protein diversification, driven by a strategic view of food security as a pillar of economic resilience and national security. 

“The country’s approach suggests it is applying a familiar playbook — one that successfully accelerated the growth of the solar and electric vehicle sectors — by aligning policy, capital, and technology to reshape its food system.” 

“Across Europe, the EU continues to lead on advancing plant-based diets and next-generation food technologies, including precision fermentation. Denmark is a particularly compelling example. Its landmark national Action Plan for Plant-Based Foods, backed by approximately US$200 million in funding, aims to secure 1–3% of the global plant-based market while creating an estimated 27,000 jobs.” 

“Perhaps even more significant than the investment itself is the broad coalition supporting it, bringing together farmers, policymakers, and businesses around a shared vision for the future of food.” 

In the US, consumer demand for protein-diverse products continues to grow as health, nutrition, and affordability become increasingly important purchasing drivers. 

The US also benefits from a highly supportive innovation ecosystem, with hubs such as Silicon Valley helping to accelerate advances in biotechnology and alternative proteins. At the same time, businesses have expressed concern that the latest US dietary guidelines place greater emphasis on animal protein, creating a policy environment that is perceived as less supportive of protein-diverse diets despite strong market interest.

What’s driving investment?

According to the 2026 Business Breakthrough Barometer, businesses are increasing investment in protein diversification for three interconnected reasons. 

First, they are responding to changing consumer preferences, with growing demand for flexitarian and hybrid diets, provided products deliver on taste, affordability, and convenience. 

Second, companies are seeking to shape emerging markets by investing early in R&D, new crops, fermentation capacity, and consumer education, positioning themselves to capture future growth across a range of geographies and product categories. 

Finally, businesses increasingly view protein diversification as a resilience strategy, helping to reduce exposure to climate, biodiversity, and supply chain risks while strengthening their ability to navigate geopolitical uncertainty and price volatility.

Growing consumer interest in natural, minimally processed plant proteins, including legumes, tofu and tempeh, is accelerating innovation across the food industry.

Barriers remain

Crawford says that despite progress, there remain some significant barriers preventing faster adoption of diverse protein systems.

“Regulatory misalignment — and more broadly policy incoherence — is a huge barrier facing businesses trying to accelerate diverse protein systems. While we have seen progress in some areas, for example production incentives for legumes have increased in several geographies, in others misaligned policies are holding back progress. For example, approval pathways for new foods often remain slow, which limits commercialization,” she says.

“Affordability also continues to remain a critical barrier. We know there’s increasing consumer interest in healthier diets, and that there is a rising demand for lower-cost protein diverse alternatives. But many plant-based alternatives, including meat analogs, do not always benefit from the same subsidies or VAT treatment as animal-based products. Leveling this playing field could further unlock consumer demand.” 

Standout countries propelling protein diversification

Leading markets and businesses are demonstrating how coordinated investment, innovation, and collaboration can accelerate protein diversification, and provide a blueprint for others to follow.

Crawford says the report’s “countries to watch” are Denmark, China, and the US — chosen for favorable regulatory pathways, coordinated national strategies, and strong innovation/infrastructure investment. 

“Leading examples from companies include ingredient suppliers such as Griffith Foods, which helps enable protein diversification upstream. By developing ingredients, formulations, and culinary solutions that make plant-rich and hybrid products appealing, affordable, and scalable, they help food manufacturers and foodservice operators bring more diverse protein options to market.”

“An interesting example among manufacturers is Oatly, which has partnered with retailers to build the oat-milk category, showing the opportunity businesses have to build and grow the market size.” 

“Lidl is a leader among retailers with detailed climate roadmaps with protein reporting and targets across multiple markets.” 

The future of protein diversification

Looking ahead, Crawford says that one of the clearest signs of progress would be more countries putting in place coherent policy frameworks that make protein diversification easier to scale.

“Businesses can innovate and invest, but they need predictable signals, supportive infrastructure, and aligned policies,” she says.

“Over the next few years, we’d like to see protein diversification embedded in food, agriculture, and health strategies in the same way that energy transition policies have helped accelerate clean energy adoption. Businesses have solutions, but need clear direction, aligned incentives, supportive infrastructure, and coordinated policy frameworks to accelerate action.”

“Our policy report identifies several focus areas as practical early policy priorities that can provide momentum for action. These include updating dietary guidelines by integrating sustainability, climate, and health considerations, and supporting innovation and de-risk investment by taking visible early steps, such as fast-tracking regulatory approval for safe novel proteins, piloting transition support for farmers, and signaling change through fiscal incentives.” 

Businesses are also recommended to leverage public procurement as a pragmatic, visible, and scalable entry point already on many agendas — particularly through schools, hospitals and other institutions that can normalize diverse protein choices and create predictable demand. 

“They can also integrate clear protein diversification targets into national strategies and align across ministries, including health, agriculture and environment, and co-design and pilot solutions by building on models such as the Danish action plan. Pilot programs serve as valuable testbeds to co-create, evaluate, and refine approaches before scaling successful models,” Crawford concludes.