Why General Mills is tackling global warming

General Mills (GIS), the corporate parent of Cheerios cereal, Betty Crocker baked products and Yoplait yogurt, is ringing the alarm bell about potential food shortages caused by global warming.

Under a recently announced plan, the Minnesota-based company has vowed to reduce greenhouse gas emissions throughout its network of suppliers by 28 percent. It also plans to spend $100 million on energy efficiency and clean energy projects.

"For 150 years, General Mills has served the world by making food people love. Our aim is to be around for another 150 years," said Ken Powell, chairman and CEO of General Mills in a press release. "We recognize that we must do our part to protect and conserve natural resources. Our business depends on it and so does the planet."

Brooke Barton, senior director of the Water & Agriculture Program at Ceres, a nonprofit organization backed by business interests such as General Mills, told CBS MoneyWatch that Powell isn't exaggerating the significance of the issue.

"He is one of the first food sector CEOs to do that and to really come out on the record in an honest way about the level of risk we face at a societal level around climate," she said.

Scientists have linked rising levels of greenhouse gases from carbon dioxide generated by fossils fuels and other sources with increased global temperatures. The effects of global warming on the climate range from the droughts in California to the floods in the Midwest.

"We are seeing just in the past year or two a massive disruption of the U.S. beef industry," Barton said. "You have seen multiple companies from Tyson to Cargill to National Beef closing processing plants in places like Texas and Kansas. The grass was not growing. The cows were not thriving."

Water is becoming a focal point in the fight to combat global warming, especially in places like California where supplies are scarce. California, which is in the fourth year of a historic drought, has a $46.4 billion agriculture sector that's a major supplier of milk, almonds, grapes, strawberries and lettuce among other things.

Unless global warming is addressed, temperatures may rise so high that crops that have been in the region for decades might not grow there any longer, according to Jason Funk, a senior climate scientist at the Union for Concerned Scientists. He noted that declines in crop yields have been linked to global warming.

"So, then you have this question of will these crops be able to shift to be produced in new places," he told CBS MoneyWatch. "We don't know what the climate impacts will be in those new places. We also don't know what the variability will be in climate. What works in one year might end up getting trashed in the next year."

General Mills, though, argues that all stakeholders need to take bold action to protect both the bottom line and the environment.

"While it may not be our fault, it's our problem," said John Church, General Mills' executive vice president of global supply chain, in an interview with CBS MoneyWatch. "The facts are there. Climate change is real. The part that may be different is that we as a branded manufacturing company are taking responsibility for the entirety of the value chain as opposed just the portion that's in our control."

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    Jonathan Berr is an award-winning journalist and podcaster based in New Jersey whose main focus is on business and economic issues.