A new approach to building sustainable seafood systems
Breaking the feedback loop and empowering fisheries to regenerate the ocean
We need to pay more attention to the state of our seafood system. And in particular, wild caught seafood.
There are an estimated 4.6 million fishing vessels in the ocean providing 90 million tonnes of wild caught seafood to over 1 billion people (and counting). Many of those vessels are sustainable commercial operations: they maintain and rebuild healthy fish stocks (particularly those of endangered species) and minimize impacts on ecosystems and habitats.
However, the majority of fish is caught using unsustainable practices: overfishing, capturing bycatch, bottom trawling over sea beds (in most cases), and ghost fishing to name a few.
The consequences of unsustainable and often illegal methods vastly outweighs the efforts of sustainable fishing. This is especially the case with China, which dominates the seafood market (this New Yorker article is a must read). Global fish stocks are plummeting, carbon is being released, the ocean is warming from within, habitats are disappearing, and fisheries + their respective communities are suffering.
I’m not a professional fisherman and have not lived on the sea. But after digging a little deeper to understand “the why,” two things became apparent:
Our seafood system is subjected to a destructive feedback loop driven by elements of industrial fishing. If we don’t interfere, we are likely destined for catastrophe. We need to find new ways to dismantle the feedback loop in order to restore our marine life and ocean health, and reduce climate impacts.
While good policies remain an essential piece to the puzzle, we may need to introduce an additional and alternative option: new financing mechanisms that can incentivize sustainable practices.
Similar to the ecosystem service payments going to farmers for good stewardship of their soils, is there an opportunity to compensate fishermen for being good custodians of the ocean? And would that create enough incentive for historically unsustainable fisheries to take the right course of action? Let’s dive in.
The feedback loop
It should go without saying (but never really does) that fisheries don’t want to cause damage to the ocean and marine life. Many large-scale fleets are seemingly more apathetic than others, but still, the decision to adopt unsustainable practices comes from a place of economic “need.” The need to economically compete in the seafood market is the original impetus for unsustainable practices. From there, the effects are mutually reinforcing, so many fisheries (especially at the larger industrial level) likely find themselves relying on those same practices to continue competing, ultimately leading to more destruction.
This feedback loop and its consequences appears as follows:
1. Unsustainable fishing practices
The aforementioned practices of overfishing, bycatch, and others kickoff a flywheel of consequences in our oceans: they result in fish population decline, increased ocean warming, and habitat destruction, each of which has elements of causation within themselves.
2. Fish stocks decline
Half of the world’s 1,400+ assessed fish stocks are now overfished, and a tenth of fish stocks globally are on the brink of collapse, reduced to just 10 per cent of their original size. The percentage of stocks that are overfished varies greatly by geography and national waters, and there are numerous cases of healthy fish stocks that aren’t publicly realized. But the aggregate global situation is undoubtedly dismal.
The reduction in fish stocks is directly linked to overfishing and its suite of malpractices, not to mention the extreme amounts of plastic pollution left in the wake of fisheries. However, the impacts of ocean warming and ecosystem degradation also have compounding effects on the disappearance of fish.
2(a). Induced ocean warming
It was recently estimated that ~1.47 gigatons of CO2 are released annually into the ocean due to trawling’s disturbances of carbon-rich sediments and seagrasses on the ocean floor. This amount would be equivalent to the airline industry’s cumulative yearly emissions. Importantly, these emissions are exclusively from the unsustainable practices themselves, and are separate from the effects of atmospheric warming on ocean conditions (which cause plenty of seafood survival issues of their own).
Fish also play an important role in nutrient cycling and facilitating the carbon flux (see my post on the role of animals in carbon removal).
The loss of carbon-rich biomass from the fish sinking to the ocean floor and turning into that rich sediment means less carbon stored in the ocean. Less fish = less capacity for the ocean to serve as a carbon sink = further ocean warming.
In addition to the effects of warming, rising levels of CO2 engender greater acidification and further catalyze this feedback loop.
Lastly, beyond the fish being fished out of the water or dying off from poor ocean health, there are many fish migrating toward colder waters, ultimately reducing the stocks further. The perfect example being the disappearance of 8 billion snow crabs over the course of three years from the Bering Sea.
2(b). Marine ecosystem destruction
I don’t need to reiterate how important biodiversity and thereby a strong/healthy ecosystem is for its own sake and ours.
Due to unsustainable fishing tactics, our oceans have experienced extreme habitat degradation and biodiversity loss. An estimated 30 to 50 percent of vulnerable marine habitats have been lost. At the time of this writing, >1/3 of sharks and rays, and >1/4 of crustacean species are threatened with extinction, with the trend increasing.
3. Regulations put in place
As fish stocks decline due to all the reasons above, the natural reaction is to design and enforce policies to resolve the issue and restore sustainable fish populations. For the most part, this is a good thing; particularly when they are properly enforced. There have been successes in the recovery of fish populations and marine ecosystems through implementing marine protected areas (MPAs), catch limits, and harvesting methods.
However, the results are definitely mixed. Policies don’t always produce the outcomes they plan for (e.g., issues with the $35B in global subsidies for fisheries). And oftentimes, the outcomes they were designed to produce – reducing catch – have direct negative impacts on the livelihoods of fishermen.
4. Well-being of fisheries decreases
Many of the policies being put in place for conservation purposes are achieving their primary goal, but occasionally produce unintended consequences that negatively impact fisheries. This is playing out in various ways, such as:
Federal regulations reducing the amount of haddock landings by 80% in New England, resulting in some fisheries going out of business
Maine’s lobstermen being forced to remove up to 50% of their fishing gear from the water during peak times of the year due to a supposedly overhyped injury risk to endangered right whales
Mandated overhaul of the fishing equipment to catch swordfish in California, paid for by the fishermen, which has led to 84% of swordfish now being imported from countries that often have fewer protections for sensitive species
In an effort to adapt, there are examples of lobstermen switching to kelp farming, some fishermen selling their boats & business (leading to consolidation of fleets), and others being paid six-figures to stop fishing altogether.
However, not everyone is willing to do those things. Naturally, if both fish populations are declining and regulations are preventing fishermen from doing what they can to put food on the table, there will be issues. In the second example, the executive director of the Maine Lobstermen's Association (MLA), puts it clearly:
"A lot of guys are already talking about potentially selling their boats and moving elsewhere. The economy is so rural here that it's, you couldn't overstate how much losing the lobster dollars coming into the communities will debilitate everything. It is just such a special and unique situation that we have here in Maine. That's why we're all fighting so hard. We're going to do everything in our power to keep this industry going and to keep these families here and to have lobstermen be able to proudly raise their children and see another generation of lobstermen come through because we need that."
A similar situation happened on land in Netherlands when the government mandated farmers to use less fertilizer and reduce livestock, and ultimately protests unfolded. I’m not suggesting that’s what will happen in the US, but the parallels are worth noting.
5. Resort to more unsustainable fishing practices…and so on
Unfortunately, as fisheries (and their respective communities) push back, many will likely decide they need to continue fishing in ways that have worked for them in the past, but go out further to new waters in search of more fish. Other large fleets around the world will simply side step regulation altogether in some manner and maintain status quo.
This cycle seems primed to continued through an ongoing race to the bottom, both for fishery profits and marine populations.
Legacy of the system
As with everything in life, there are tradeoffs and myriad nuances at play. We’ve optimized for seafood yield and economic gains for decades at the severe detriment of ocean health, and that mindset has been entrenched into our system. Efforts to flip that relationship are essential to our future, but that needs to come through solutions that provide varying degrees of benefits to all stakeholders.
One study tried to envision just that, and found that “if countries were to value biodiversity and fish stocks equally, the ideal optimization would be to protect 45% of the ocean, which would lead to 71% of the maximum biodiversity benefits, 92 percent of the possible food benefits, and 29% of the carbon benefits.”
Or better yet, if we want to optimize for biodiversity and carbon benefits while maintaining today’s current annual catch yield, we could protect as much as 71% of the ocean, obtaining 91% of the biodiversity and 48% of the carbon benefits.
These are theoretical numbers, of course. But the point is we can design solutions that achieve these collective outcomes.
A shift in thinking
So, what is the array of options that can successfully incentivize the use of sustainable fishing practices and simultaneously support ocean health and fisheries?
Many point to aquaculture as the solution, which is on pace to top wild caught supply and provide more than 1/2 of all seafood globally. I’m confident sustainable aquaculture will increasingly play a significant role in feeding people. However, despite many examples of sustainable aquaculture (particularly through land-based RAS), we’ve come to learn that farm-raised fish operations are mired with mixed results and unintended consequences.
Others say cell-based fish is a panacea to regenerating our oceans, which I do hope will play a part in some capacity. But that reality has many question marks in terms of techno-economic feasibility, and is far away from having any material impact on our ocean health in the near future.
The point is, even with the addition of alternative forms of seafood production, our global population will continue to rely heavily on wild caught seafood in the short and long-term. Perhaps we need to think outside the box. In comes alternative financing, and in particular, the use of transitionary finance and crediting systems.
Opportunities for finance
*Full disclosure: there are more questions here than answers. But it’s important to bring these concepts into the foreground to explore what’s genuinely possible.
Transitionary Finance
Mechanisms for effective transitionary finance – such as the various forms of grants and debt being offered to help conventional farmers pay for infrastructure and decrease the risk in adopting regenerative agriculture practices – could theoretically be applied to seafood.
We’re seeing this unfold in agriculture through the likes of Farmers Business Network, Steward, Mad Agriculture, and Fractal, some of which couple finance with technical assistance. There are seafood-based organizations doing a version of the same, such as GreenWave (whom I’m a huge fan of) and Oceanfarmr, though their focus is currently on aquaculture versus wild caught.
These are highly encouraging solutions for individual fishermen. I could see these financing opportunities also helping larger fisheries pay for capital expenditures like equipment, infrastructure, and on-boat technology systems to fish more sustainably.
Alternatively, there may be an opportunity to bring the USDA’s analogous Conservation Reserve Program, which pays farmers for leaving fields fallow, to the fishery space. As I eluded to earlier, there are existing programs in California that are paying fishermen to not fish anymore. However, since continuous payment for complete stoppage is unrealistic, the goal of the initiative could be approached slightly differently – focused on a temporary stoppage, combined with transitionary capital, to enable the fishery to re-enter the market in a position to deploy more sustainable practices.
Credits
The second financing option could be to take a page from the movement around conservation financing and ecosystem service payments for forestry and soil projects. There are a couple ways this could manifest:
Adopt a version of REDD+ credits1 that directly compensates fisheries for each ton of fish they avoid harvesting (but would’ve otherwise caught). Perhaps they can be named “Marine Abundance” or “Sustainable Seafood” credits and borrow from the other nascent biodiversity credits being developed.
Similar to the Ecosystem Services Market Consortium’s program for farmers, implement practice-based (versus outcome-based) financing that rewards fishermen for the choices they’re making at sea.2
The obvious follow-up questions are a) seriously, more credits? b) who would pay for this and why? c) would it be enough capital to incentivize a change and d) how would you even measure and monitor these things?
A - Credits are more likely to quickly mobilize capital relative to the transitionary finance outlined above. These credits are not tied to any corporate carbon neutrality claims, so they shouldn’t illicit the same eye-rolls that carbon offset credits are garnering these days. To be sure, there are many issues and complexities with credits that present significant barriers, but just because it’s a headache to figure out all the intricacies of governance, standardization, monitoring, accounting, etc. doesn’t mean credits can’t play a meaningful role in incentivizing more sustainable behavior.
B - The natural players to finance this would be private seafood corporations who are sourcing in mass from fisheries. The Scope 3 emission parallel works well here: ideal companies will want to be market leaders in sustainability and/or need to report on their sustainability impacts (ideally with tighter requirements in the future). These “Marine Abundance Credits” would be a fantastic way to simultaneously improve supply chain impact, strengthen relationships with suppliers by paying a premium, improve fishermen livelihoods, and of course, tell a great story to potential consumers. And if the whole market-leader thing isn’t enough incentive, hopefully policy would come in and put stricter reporting regulations on the table, similar to what the SEC, TCFD, and SBTi is proposing with corporate carbon accounting.
Moreover, if private sector wouldn’t come to the rescue here, there is indeed the federal and/or state governments. Much like how the government is warming up to directly paying for tons of carbon dioxide to be removed from the atmosphere (via 45Q tax credits and the DOE’s new $35M carbon purchasing prize), perhaps a similar program can come into affect to pay for sustainable fishing and species saved.
C - This is the golden question. Even if everything else can be figured out (which is a big IF), the money would need to be enough to warrant a practice change. I don’t know what that amount would be, and if players would be willing to pay it. But barring any regulatory changes, it’s crucial to incorporate the marginal willingness to pay/accept into any planning.
D - Thankfully there are a number of emerging companies aiming to make monitoring and verification a reality, such as FlyWire’s electronic monitoring systems, SafetyNet Technologies’ bycatch reduction products, and Blue Ocean Gear’s tracking services. Not to mention the number of exciting companies monitoring ocean health and the seafloor, such as PlanBlue, Sofar, and Bedrock. The best part is, more will come if the market creates a case for them to exist.
Concluding thoughts
If we want to avoid a future of no fish, such as that painted by the dystopian and gripping novel Migrations, we need to act quickly. But we need to be creative in how we build the right incentives for sustainable fishing and ultimately break the feedback loops, be that through policy, markets, and technology. It will be very difficult to find and implement the best antidotes here, but given all the momentum, newfound focus, and burgeoning resources for biodiversity, food systems, and climate action, I believe we’re on our way.
*A special thank you to Jacob Isaac-Lowry, CEO of Flywire Cameras and my brother, Danny Rubin, for their insights while writing this.
Yes, I’m aware REDD+ credits have gone through the ringer lately via press coverage from the Guardian and others. And rightly so. However, there are good analyzes that show they can make a difference in preventing deforestation.
I have plenty of concern about paying farmers with soil carbon credits when those credits are being used as offsets for accounting purposes, which you can read all about in my analysis here. That said, there are valid use-cases for issuing certain credits: beyond value-chain mitigation (BVCM) or Scope 3 insets.