Nestlé
 | |
| |
| Formerly | List
|
|---|---|
| Type | Public (SA) |
| SIX: NESN | |
| ISIN | CH0038863350 |
| Industry | Food processing |
| Founded | 1866 (for the Anglo-Swiss Condensed Milk Company branch) |
| Founder | Henri Nestlé (for the Farine Lactée Henri Nestlé branch) |
| Headquarters | Vevey, Vaud, Switzerland |
Area served |
Worldwide |
Key people |
|
| Products | Baby food, coffee, dairy products, breakfast cereals, confectionery, bottled water, ice cream, pet foods (list...) |
| Revenue |
 CHF 94.424 billion (2022)
|
|
CHF 13.195 billion (2022)
|
|
 CHF 9.596 billion (2022)
|
|
| Total assets |
CHF 135.182 billion (2022)
|
| Total equity |
CHF 42.792 billion (2022)
|
Number of employees |
275,000 (2022) |
| Subsidiaries | Cereal Partners Worldwide (50%) |
| Website | nestle.com |
|
Footnotes / references | |
Nestlé S.A. ( NESS-lay, -lee, -əl, French: [nɛsle], German: [ˈnɛstlə] ) is a Swiss multinational food and drink processing conglomerate corporation headquartered in Vevey, Vaud, Switzerland. It has been the largest publicly held food company in the world, measured by revenue and other metrics, since 2014. It ranked No. 64 on the Fortune Global 500 in 2017 and No. 33 in the 2016 edition of the Forbes Global 2000 list of the largest public companies.
Nestlé's products include baby food (some including human milk oligosaccharides), medical food, bottled water, breakfast cereals, coffee and tea, confectionery, dairy products, ice cream, frozen food, pet foods, and snacks. Twenty-nine of Nestlé's brands have annual sales of over 1 billion CHF (about US$1.1 billion), including Nespresso, Nescafé, Kit Kat, Smarties, Nesquik, Stouffer's, Vittel, and Maggi. Nestlé has 447 factories, operates in 189 countries, and employs around 339,000 people. It is one of the main shareholders of L'Oreal, the world's largest cosmetics company.
Nestlé was formed in 1905 by the merger of the "Anglo-Swiss Milk Company", which was established in 1866 by brothers George and Charles Page, and "Farine Lactée Henri Nestlé" founded in 1867 by Henri Nestlé. The company grew significantly during World War I and again following World War II, expanding its offerings beyond its early condensed milk and infant formula products. The company has made a number of corporate acquisitions including Crosse & Blackwell in 1960, Findus in 1963, Libby's in 1971, Rowntree Mackintosh in 1988, Klim in 1998, and Gerber in 2007.
The company has been associated with various controversies, facing criticism and boycotts over its marketing of baby formula as an alternative to breastfeeding in developing countries (where clean water may be scarce), its reliance on child labour in cocoa production, and its production and promotion of bottled water.
Following the 2022 Russian invasion of Ukraine, the company continued doing business in Russia; therefore in November 2023, Ukraine listed Nestlé as an International Sponsor of War.
History
1866–1900: Founding and early years
Nestlé's origin dates back to the 1860s when two separate Swiss enterprises were founded that would later form Nestlé. In the following decades, the two competing enterprises expanded their businesses throughout Europe and the United States.
Timeline
- 1866: Charles Page (US consul to Switzerland) and George Page, brothers from Lee County, Illinois established the Anglo-Swiss Condensed Milk Company in Cham, Switzerland. The company's first British operation was opened at Chippenham, Wiltshire in 1873.
- 1867: In Vevey, Switzerland, Henri Nestlé developed milk-based baby food and soon began marketing it. The following year, Daniel Peter began seven years of work perfecting the milk chocolate manufacturing process. Nestlé had the solution Peter needed to fix his problem of removing all the water from the milk added to his chocolate, thus preventing the product from developing mildew.
- 1875: Henri Nestlé retired; the company, under new ownership, retained his name as Société Farine Lactée Henri Nestlé.
- 1877: Anglo-Swiss added milk-based baby foods to its products; in the following year, the Nestlé Company added condensed milk to its portfolio, which made the firms direct rivals.
- 1879: Nestlé merged with milk chocolate inventor Daniel Peter.
- 1890: Henri Nestlé dies.
1901–1989: Mergers
In the late 19th and early 20th century, Henri Nestlé and his successors participated in the development of the chocolate industry in Switzerland, together with the Peter, Kohler, and Cailler families. In 1904, Daniel Peter and Charles-Amédée Kohler (son of Charles-Amédée Kohler who founded a chocolate factory in 1830) became partners and founded the Société générale suisse des chocolats Peter et Kohler réunis. In 1911, the company created by Peter and Kohler merged with Cailler. Alexandre Cailler (grandson of François-Louis Cailler) had founded a chocolate factory in Broc in 1898, still used by Nestlé today; which enabled the production of milk chocolate on a large scale. In 1929, Peter, Cailler, Kohler, Chocolats Suisses finally merged with the Nestlé group. An earlier alliance in 1904 between Peter and Nestlé also allowed the production of milk chocolate in the United States, at the Fulton plant.
In 1905, Nestlé and Anglo-Swiss merged to become the Nestlé and Anglo-Swiss Condensed Milk Company, retaining that name until 1947 when the name 'Nestlé Alimentana SA' was taken as a result of the acquisition of Fabrique de Produits Maggi SA (founded 1884) and its holding company, Alimentana SA, of Kempttal, Switzerland. The company's current name was adopted in 1977. By the early 1900s, the company was operating factories in the United States, the United Kingdom, Germany, and Spain. The First World War created a demand for dairy products in the form of government contracts, and by the end of the war, Nestlé's production had more than doubled.
In January 1919, Nestlé bought two condensed milk plants in Oregon from the company Geibisch and Joplin for $250,000. One was in Bandon, while the other was in Milwaukie. They expanded them considerably, processing 250,000 pounds of condensed milk daily in the Bandon plant.
After the World War I, government contracts dried up, and consumers switched back to fresh milk. However, Nestlé's management responded quickly, streamlining operations and reducing debt. The 1920s saw Nestlé's first expansion into new products, with chocolate-manufacture becoming the company's second most important activity; white chocolate was created in the following decade. Louis Dapples was CEO till 1937 when succeeded by Édouard Muller till his death in 1948.
Nestlé felt the effects of the Second World War immediately. Profits dropped from US$20 million in 1938 to US$6 million in 1939. Factories were established in developing countries, particularly in South America. Ironically, the war helped with the introduction of the company's newest product, Nescafé ("Nestlé's Coffee"), which became a staple drink of the US military. Despite that, Nestlé actually supplied both sides in the war: the company had a contract to feed the German army. Nestlé's production and sales rose in the wartime economy.
The end of World War II was the beginning of a dynamic phase for Nestlé. Growth accelerated and numerous companies were acquired. In 1947 Nestlé merged with Maggi, a manufacturer of seasonings and soups. Crosse & Blackwell followed in 1950, as did Findus (1963), Libby's (1971), and Stouffer's (1973). Diversification came under chairman & CEO Pierre Liotard-Vogt with a shareholding in L'Oreal in 1974 and the acquisition of Alcon Laboratories Inc. in 1977 for $280 million.
In the 1980s, Nestlé's improved bottom line allowed the company to launch further acquisitions. Carnation was acquired for US$3 billion in 1984 and brought the evaporated milk brand, as well as Coffee-Mate and Friskies, to Nestlé. In 1986, the company founded Nestlé Nespresso S.A. The British confectionery company Rowntree Mackintosh was acquired in 1988 for $4.5 billion, which brought brands such as Kit Kat, Rolo, Smarties, and Aero.
1990–2011: Growth internationally
The first half of the 1990s proved to be favourable for Nestlé. Trade barriers crumbled, and world markets developed into more or less integrated trading areas. Since 1996, there have been various acquisitions, including San Pellegrino (1997), D'Onofrio (1997), Spillers Petfoods (1998), and Ralston Purina (2002). There were two major acquisitions in North America, both in 2002 – in June, Nestlé merged its US ice cream business into Dreyer's, and in August, a US$2.6 billion acquisition was announced of Chef America, the creator of Hot Pockets. In the same time-frame, Nestlé entered in a joint bid with Cadbury and came close to purchasing the American company Hershey's, one of its fiercest confectionery competitors, but the deal eventually fell through.
In December 2005, Nestlé bought the Greek company Delta Ice Cream for €240 million. In January 2006, it took full ownership of Dreyer's, thus becoming the world's largest ice cream maker, with a 17.5% market share. In June 2006, Nestlé purchased weight-loss company Jenny Craig for US$600 million. In July 2007, completing a deal announced the year before, Nestlé acquired the Medical Nutrition division of Novartis Pharmaceutical for US$2.5 billion and also acquiring the milk-flavoring product known as Ovaltine, the "Boost" and "Resource" lines of nutritional supplements, and Optifast dieting products.
In April 2007, returning to its roots, Nestlé bought US baby-food manufacturer Gerber for US$5.5 billion. In December 2007, Nestlé entered into a strategic partnership with a Belgian chocolate maker, Pierre Marcolini.
Nestlé agreed to sell its controlling stake in Alcon to Novartis on 4 January 2010. The sale was to form part of a broader US$39.3 billion offer by Novartis for full acquisition of the world's largest eye-care company. On 1 March 2010, Nestlé concluded the purchase of Kraft Foods's North American frozen pizza business for US$3.7 billion.
Since 2010, Nestlé has been working to transform itself into a nutrition, health and wellness company in an effort to combat declining confectionery sales and the threat of expanding government regulation of such foods. This effort is being led through the Nestlé Institute of Health Sciences under the direction of Ed Baetge. The institute aims to develop "a new industry between food and pharmaceuticals" by creating foodstuffs with preventive and corrective health properties that would replace pharmaceutical drugs from pill bottles. The Health Science branch has already produced several products, such as drinks and protein shakes meant to combat malnutrition, diabetes, digestive health, obesity, and other diseases.
In July 2011, Nestlé SA agreed to buy 60 percent of Hsu Fu Chi International Ltd. for about US$1.7 billion. On 23 April 2012, Nestlé agreed to acquire Pfizer Inc.'s infant-nutrition, formerly Wyeth Nutrition, unit for US$11.9 billion, topping a joint bid from Danone and Mead Johnson.
2012–present
In recent years, Nestlé Health Science has made several acquisitions. It acquired Vitaflo, which makes clinical nutritional products for people with genetic disorders; CM&D Pharma Ltd., a company that specialises in the development of products for patients with chronic conditions like kidney disease; and Prometheus Laboratories, a firm specialising in treatments for gastrointestinal diseases and cancer. It also holds a minority stake in Vital Foods, a New Zealand-based company that develops kiwifruit-based food products as of 2012.
Nestlé sold its Jenny Craig business unit to North Castle Partners in 2013. In February 2013, Nestlé Health Science bought Pamlab, which makes medical foods based on L-methylfolate targeting depression, diabetes, and memory loss. In February 2014, Nestlé sold its PowerBar sports nutrition business to Post Holdings, Inc. Later, in November 2014, Nestlé announced that it was exploring strategic options for its frozen food subsidiary, Davigel.
In December 2014, Nestlé announced that it was opening 10 skin care research centres worldwide, deepening its investment in a faster-growing market for healthcare products. That year, Nestlé spent about $350 million on dermatology research and development. The first of the research hubs, Nestlé Skin Health Investigation, Education and Longevity Development (SHIELD) centres, will open mid 2015 in New York, followed by Hong Kong and São Paulo, and later others in North America, Asia, and Europe. The initiative is being launched in partnership with the Global Coalition on Aging (GCOA), a consortium that includes companies such as Intel and Bank of America.
In January 2017, Nestlé announced that it was relocating its US headquarters from Glendale, California, to Rosslyn, Virginia, outside of Washington, DC.
In March 2017, Nestlé announced that they will lower the sugar content in Kit Kat, Yorkie and Aero chocolate bars by 10% by 2018. In July, a similar announcement followed concerning the reduction of sugar content in its breakfast cereals in the UK.
The company announced a $20.8 billion share buyback in June 2017, following the publication of a letter written by Third Point Management founder Daniel S. Loeb, Nestlé's fourth-largest stakeholder with a $3.5 billion stake, explaining how the firm should change its business structure. Consequently, the firm will reportedly focus investment on sectors such as coffee and pet care and will seek acquisitions in the consumer health-care industry.
In 2016, Nestlé and PAI Partners establish a joint venture, Froneri, to combine the two companies' ice cream activities throughout Europe and other international countries.
In July 2017, Nestlé introduced a new type of infant formula in Spain, containing two human milk oligosaccharides. Oligosaccharides are the third most abundant components of breast milk with various health benefits, but previously were not part of infant formula.
In September 2017, Nestlé S.A. acquired a majority stake of Blue Bottle Coffee. While the deal's financial details were not disclosed, the Financial Times reported "Nestlé is understood to be paying up to $500m for the 68 per cent stake in Blue Bottle".
In September 2017, Nestlé USA agreed to acquire Sweet Earth, a California-based producer of plant-based foods, for an undisclosed sum.
In January 2018, Nestlé USA announced it was selling its US confectionary business to Ferrara Candy Company, an Italian chocolate and candy maker. The company was sold for a total of an estimated $2.8 billion.
In May 2018, it was announced that Nestlé and Starbucks struck a $7.15 billion distribution deal, which allows Nestlé to market, sell and distribute Starbucks coffee globally and to incorporate the brand's coffee varieties into Nestlé's proprietary single-serve system, expanding the overseas markets for both companies.
Nestlé set a new profit target in September 2017 and agreed to offload over 20 of its US candy brands in January 2018. However, sales grew only 2.4% in 2017, and as of July 2018, the share price declined more than 8%. While some suggestions were adopted, Loeb said in a July 2018 letter that the shifts are too small and too slow. In a statement, Nestlé wrote that it was "delivering results" and listed actions it had taken, including investing in key brands and its global coffee partnership with Starbucks. However, activist investors disagreed, leading Third Point Management to launch NestleNOW, a website to push its case with recommendations calling for change, accusing Nestlé of not being as fast, aggressive, or strategic as it needs to be. Activist investors called for Nestlé to divide into three units with distinct CEOs, regional structures, and marketing heads - beverage, nutrition, and grocery; spin off more businesses that do not fit its model such as ice cream, frozen foods, and confectionery; and add an outsider with expertise in the food and beverage industry to the board.
In September 2018, Nestlé announced that it would sell Gerber Life Insurance for $1.55 billion.
In October 2018, Nestlé announced the launch of the Nestlé Alumni Network, through a strategic partnership with SAP & EnterpriseAlumni, to engage with their over 1 million alumni globally.
In 2019, the company announced that it would publish Nutri-Score on all of its products sold in the European countries that supported the nutritional label.
In 2020, Nestlé USA's and Nestlé Canada's ice cream divisions were acquired by Froneri. Also during that year, Nestlé announced that the company wants to invest in plant-based food, starting with a "tuna salad" and meat-free products to engage and reach younger and vegan consumers.
On 16 February 2021, Nestlé announced that it had agreed to sell its water brands in the US and Canada to One Rock Capital Partners and Metropoulos & Co. The sale would include the spring water and mountain brands, the purified water brand and the delivery service. The plan did not include the Perrier, S.Pellegrino and Acqua Panna brands. In early April 2021, the sale was concluded.
The COVID-19 pandemic did not affect Nestlé negatively. Due to lockdowns, people bought more packaged foods, not only coffee and dairy products, but also pet products, which increased the company's sales. Nestlé is recording its strongest quarterly sales growth in 10 years.
In April 2021, Nestlé agreed to purchase the vitamin manufacturing Bountiful Company, formerly known as The Nature's Bounty Co., for $5.75 billion, noting as well that much of the company's growth that quarter came from "vitamins, minerals, and supplements that support health and the immune system". The deal acquires various assets from Bountiful, including Nature's Bounty, Solgar, Osteo Bi-Flex, and Puritan's Pride.
In January 2022, Nestlé will pay cocoa farmers cash if they send their children to school.
In May 2022, it was announced Nestlé's Health Science unit had acquired the Brazilian organic, natural, plant-based food maker Puravida.
In May 2022, Nestlé was sending baby formula supplies to the U.S. from European air bases to ease the 2022 United States infant formula shortage. These relief shipments included products from the Gerber baby food formula brand from the Netherlands and Alfamino baby formula from Switzerland.
In September 2023, it was announced Nestlé had acquired a majority stake in the Extrema, Minas Gerais-headquartered premium chocolate manufacturer, Grupo CRM for an undisclosed amount.
Corporate affairs and governance
Capital ownership of Nestlé by country of origin as of 2014:
Nestlé is the biggest food company in the world, with a market capitalisation of roughly 231 billion Swiss francs, which is more than US$247 billion as of May 2015. Nestlé has a primary listing on the SIX Swiss Exchange and is a constituent of the Swiss Market Index. It previously had a secondary listing on Euronext.
In 2014, consolidated sales were CHF 91.61 billion and net profit was CHF 14.46 billion. Research and development investment was CHF 1.63 billion.
-
Sales per category in CHF
- 20.3 billion powdered and liquid beverages
- 16.7 billion milk products and ice cream
- 13.5 billion prepared dishes and cooking aids
- 13.1 billion nutrition and health science
- 11.3 billion pet care
- 9.6 billion confectionery
- 6.9 billion water
-
Percentage of sales by geographic area breakdown
- 43% from Americas
- 28% from Europe
- 29% from Asia, Oceania and Africa
According to a 2015 global survey of online consumers by the Reputation Institute, Nestlé has a reputation score of 74.5 on a scale of 1 to 100.
Financial data
| Year | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 83.642 | 92.186 | 92.158 | 91.612 | 88.785 | 89.469 | 89.791 | 91.439 | 92.568 | 84.343 | 87.088 |
| Net income | 9.487 | 10.611 | 10.015 | 14.456 | 9.066 | 8.531 | 7.183 | 10.135 | 12.609 | 12.232 | 17.196 |
| Assets | 114.091 | 126.229 | 120.442 | 133.450 | 123.992 | 131.901 | 130.380 | 137.015 | 127.940 | 124.028 | 139.142 |
| Employees | 328,000 | 339,000 | 333,000 | 339,000 | 335,000 | 328,000 | 323,000 | 308,000 | 291,000 | 273,000 | 276,000 |
Joint ventures
Joint ventures include:
- Cereal Partners Worldwide with General Mills (50%/50%)
- Beverage Partners Worldwide with The Coca-Cola Company (50%/50%), closed in 2018.
- Froneri with PAI Partners (50%/50%)
- Lactalis Nestlé Produits Frais with Lactalis (40%/60%)
- Nestlé Colgate-Palmolive with Colgate-Palmolive (50%/50%)
- Nestlé Indofood Citarasa Indonesia with Indofood (50%/50%)
- Nestlé Snow with Snow Brand Milk Products (50%/50%)
- Nestlé Modelo with Grupo Modelo
- Dairy Partners America Brasil with Fonterra (51%/49%)
Board of directors
As of 2017, the board is composed of:
- Paul Bulcke, chairman and former CEO of Nestlé
- Andreas Koopmann, former CEO of Bobst
- Beat Hess, former legal director/general counsel for ABB Group and Royal Dutch Shell
- Renato Fassbind, former CEO of DKSH and former CFO of Credit Suisse
- Steven George Hoch, founder of Highmount Capital
- Naina Lal Kidwai, former CEO of HSBC Bank India, country head for HSBC in India
- Jean-Pierre Roth, former chairman of the Swiss National Bank
- Ann Veneman, former United States Secretary of Agriculture and director of UNICEF
- Henri de Castries, former CEO and chairman of AXA
- Eva Cheng, former executive vice president of China and Southeast Asia for Amway
- Ruth Khasaya Oniang’o, former member of the Parliament of Kenya, current professor at Friedman School of Nutrition Science and Policy
- Patrick Aebischer, former president of École Polytechnique Fédérale de Lausanne
Lobbying
The company engages third party lobbying firms to engage with parliaments and governments in various jurisdictions. For example, in South Australia the company engages Etched Communications. In the US, Nestlé has a strong influence in Washington, D.C. From 2015 to 2020 their average spend on lobbying was $1,951,667 each year.
Products
Nestlé currently has over 2,000 brands with a wide range of products across a number of markets, including coffee, bottled water, milkshakes and other beverages, breakfast cereals, infant foods, performance and healthcare nutrition, seasonings, soups and sauces, frozen and refrigerated foods, and pet food. In 2019, the company entered the plant-based food production business with its Incredible and Awesome Burgers (under the Garden Gourmet and Sweet Earth brands). In 2020, Nestlé announced additional plant-based products including soy-based bratwurst and chorizo-like sausages.
Sponsorships
Music and entertainment
In 1993, plans were made to update and modernise the overall tone of Walt Disney's EPCOT Center, including a major refurbishment of The Land pavilion. Kraft Foods withdrew its sponsorship on 26 September 1993, with Nestlé taking its place. Co-financed by Nestlé and the Walt Disney World Resort, a gradual refurbishment of the pavilion began on 27 September 1993. In 2003, Nestlé renewed its sponsorship of The Land; however, it was under agreement that Nestlé would oversee its own refurbishment to both the interior and exterior of the pavilion. Between 2004 and 2005, the pavilion underwent its second major refurbishment. Nestlé stopped sponsoring The Land in 2009.
On 5 August 2010, Nestlé and the Beijing Music Festival signed an agreement to extend by three years Nestlé's sponsorship of this international music festival. Nestlé has been an extended sponsor of the Beijing Music Festival for 11 years since 2000. The new agreement will continue the partnership through 2013.
Nestlé has partnered the Salzburg Festival in Austria for 20 years. In 2011, Nestlé renewed its sponsorship of the Salzburg Festival until 2015.
Together, they have created the "Nestlé and Salzburg Festival Young Conductors Award", an initiative that aims to discover young conductors globally and to contribute to the development of their careers.
Sports
Nestlé's sponsorship of the Tour de France began in 2001 and the agreement was extended in 2004, a move which demonstrated the company's interest in the Tour. In July 2009, Nestlé Waters and the organisers of the Tour de France announced that their partnership will continue until 2013. The main promotional benefits of this partnership will spread on four key brands from Nestlé's product portfolio: Vittel, Powerbar, Nesquik, or Ricore.
On 27 January 2012, the International Association of Athletics Federations announced that Nestlé will be the main sponsor for the further development of IAAF's Kids' Athletics Programme, which is one of the biggest grassroots development programmes in the world of sports. The five-year sponsorship started in January 2012. On 11 February 2016, Nestlé decided to withdraw its sponsorship of the IAAF's Kids' Athletics Programmes because of doping and corruption allegations against the IAAF. Nestlé followed suit after other large sponsors, including Adidas, also stopped supporting the IAAF.
In 2014, Nestlé Waters sponsored the UK leg of the Tour de France through its Buxton Natural Mineral Water brand. In 2002, Nestlé announced it was main sponsor for the Great Britain Lionesses Women's rugby league team for the team's second tour of Australia with its Munchies product.
Nestlé supports the Australian Institute of Sport (AIS) on a number of nutrition and fitness fronts, funding a Fellowship position in AIS Sports Nutrition; nutrition activities in the AIS Dining Hall; research activities; and the development of education resources for use at the AIS and in the public domain.
Controversies and criticisms
Baby formula marketing
Concern about Nestlé's "aggressive marketing" of their breast milk substitutes, particularly in less economically developed countries (LEDCs), first arose in the 1970s. Critics have accused Nestlé of discouraging mothers from breastfeeding and suggesting that their baby formula is healthier than breastfeeding, despite there being no evidence for this. This led to a boycott in the United States and Europe.
Slavery and child labour
Multiple reports have documented the widespread use of child labour in cocoa production, as well as slavery and child trafficking, throughout West African plantations, on which Nestlé and other major chocolate companies rely.
Food safety
In late September 2008, the Hong Kong government found melamine in a Chinese-made Nestlé milk product. Six infants died from kidney damage, and a further 860 babies were hospitalised.
In June 2009, an outbreak of E. coli O157:H7 was linked to Nestlé's refrigerated cookie dough originating in a plant in Danville, Virginia.
In May 2015, food safety regulators from the state of Uttar Pradesh, India, found that samples of Nestlé India's Magginoodles had up to 17 times more than the permissible safe amount of lead, in addition to monosodium glutamate.
Water
At the second World Water Forum in 2000, Nestlé and other corporations persuaded the World Water Council to change its statement so as to reduce access to drinking water from a "right" to a "need". Nestlé continues to take control of aquifers and bottle their water for profit.
A coalition of environmental groups filed a complaint against Nestlé to the Advertising Standards of Canada after Nestlé took out full-page advertisements in October 2008 with messages claiming, "Most water bottles avoid landfill sites and are recycled", "Nestlé Pure Life is a healthy, eco-friendly choice", and, "Bottled water is the most environmentally responsible consumer product in the world."
Corporate social responsibility and recognition
In March 2011, Nestlé became the first infant formula company to meet the FTSE4Good Index criteria in full.
Sustainability
In 2000, Nestlé and other chocolate companies formed the World Cocoa Foundation (WCF). The WCF is an international membership organization representing more than 100 member companies across the cocoa value chain. Its goal is to form a sustainable cocoa economy by prioritizing farmers, promoting agricultural and environmental stewardship, and strengthening development in cocoa-growing communities.
In 2002, Nestlé, Unilever, and Danone created the Sustainable Agriculture Initiative (SAI) Platform, a non-profit organization for sharing knowledge and initiatives for the development and implementation of sustainable agriculture practices involving the different stakeholders of the food chain. The SAI Platform has more than 60 members, which actively share the same view on sustainable agriculture seen as "the efficient production of safe, high-quality agricultural products, in a way that protects and improves the natural environment, the social and economic conditions of farmers, their employees and local communities, and safeguards the health and welfare of all farmed species." The SAI Platform developed (or co-developed) Principles and Practices for sustainable water management at the farm level; recommendations for Sustainability Performance Assessment (SPA); a standardised methodology for the dairy sector to assess green house gas emissions; an Executives Training on Sustainable Sourcing; and many more. One instance of Nestlé's impact on sustainable agricultural practices has been documented in academic literature.
In May 2006, Nestlé's executive board adapted the existing Nestlé management systems to full conformity with the international standards ISO 14001 (Environmental Management Systems) and OHSAS 18001 (Occupational Health and Safety Management Systems) and to certify all Nestlé factories against these standards by 2010.
On 22 June 2009, Nestlé Nespresso and Rainforest Alliance signed a pact called "Ecolaboration". One of the shared goals is to reduce the environmental impacts and increase the social benefits of coffee cultivation in enough tropical regions so that 80 percent of Nespresso's coffee comes from Rainforest Alliance Certified farms by 2013. Certified farms comply with comprehensive standards covering all aspects of sustainable farming, including soil and water conservation, protection of wildlife and forests, and ensuring that farm workers, women and children have all the proper rights and benefits, such as good wages, clean drinking water, access to schools, and health care and security.
In October 2009, Nestlé announced "The Cocoa Plan" to get 100 percent of its chocolate portfolio using certified sustainable cocoa. For third-party certification, Nestlé has partnered with UTZ Certified. Many of Nestlé's efforts are focused on the Ivory Coast, where 40 percent of the world's cocoa comes from. The company has developed a higher-yielding, more drought- and disease-resistant cocoa tree; and they have given 3 million of these trees to farmers thus far and plan to give away 12 million of them in total. They are also training farmers in efficient and sustainable growing techniques, which focuses on better farming practices, including pruning trees, pest control (with an emphasis on integrated pest management) and harvesting, as well as caring for the environment. In addition, they have built 23 new schools so far and plan to build 40 in total by 2015. Another part of the plan has been to address child labor. Nestlé says that according to US statistics, there are about 800,000 children who work the cocoa supply chain. Nestlé approached the Fair Labor Association to map out strategies to help curb child labor in the cocoa sector, and these efforts – including community education and the building of schools – have become a focus of the Cocoa Plan.
In 2010, Nestlé launched the Nescafé Plan, an initiative to increase sustainable coffee production and make sustainable coffee farming more accessible to farmers. The plan aims to increase the company's supply of coffee beans without clearing rainforests, as well as using less water and fewer agrochemicals. According to Nestlé, Nescafé will invest 350 million Swiss francs (about $336 million) over the next ten years to expand the company's agricultural research and training capacity to help benefit many of the 25 million people who make their living growing and trading coffee. The Rainforest Alliance and the other NGOs in the Sustainable Agriculture Network will support Nestlé in meeting the objectives of the plan.
In 2013, Nestlé retained its number one position in charity Oxfam's sustainability scorecard.
In March 2015, Nestlé ranked second in Oxfam's Behind the Brands scorecard, where the NGO ranks the world's 'Big 10' consumer food and beverage companies on their policies and commitments to improve food security and sustainability. Publications
In 2020, Nestlé Waters joined a consortium to boost PET plastic recyclability.
Economy and Development
Creating Shared Value (CSV) is a business concept intended to encourage businesses to create economic and social value simultaneously by focusing on the social issues that they are capable of addressing. In 2006, Nestlé adopted the CSV approach, focusing on three areas – nutrition, water and rural development – as these are core to their business activities. Nestlé now publishes an annual progress report on its goals. Nestlé also established the Creating Shared Value Prize, which is awarded every other year with the aim of rewarding the best examples of CSV initiatives worldwide and to encourage other companies to adopt a shared value approach. These initiatives should take a business-oriented approach in addressing challenges in nutrition, water or rural development. The winner can win up to CHF 500,000. Nestlé was an early mover in the shared value space and hosts a global forum, the Creating Shared Value Global Forum.
Rural Development Framework program: In 2012, Nestlé developed the Rural Development Framework, which supports farmers and cocoa growing communities. It is an investment program aimed at improving infrastructure, increasing access to safe water, address financing and market efficiency gaps, and improving labor conditions.
Labour practices
In 2011, Nestlé started to work with the Fair Labor Association (FLA), a non-profit, multi-stakeholder association that works with major companies to improve working conditions in developing countries, to assess labor conditions and compliance risks throughout Nestlé's supply chain of hazelnuts and cocoa. On 29 February 2012, Nestlé became the first company in the food industry to join the FLA. Building on Nestlé's efforts under the Cocoa Plan, the FLA will send independent experts to Ivory Coast in 2012 and where evidence of child labour is found, the FLA will identify root causes and advise Nestlé how to address them in sustainable and lasting ways. As a Participating Company, Nestlé has committed to ten Principles of Fair Labor and Responsible Sourcing, and to upholding the FLA Workplace Code of Conduct throughout their supply chains, starting with farms.
In September 2011, Nestlé occupied 19th position in the Universum's global ranking of Best Employers Worldwide.
On 19 April 2012, The Great Place to Work Institute Canada mentioned Nestlé Canada Inc. as one of the '50 Best Large and Multinational Workplaces' in Canada (with more than 1,000 employees working in Canada and/or worldwide).
Humanitarian and International aid
Partnership with IFRC: Nestlé has had a long-standing partnership with the International Federation of Red Cross and Red Crescent Societies (IFRC) to increase access to safe water and sanitation in rural communities. In recent years, the partnership has brought clean drinking water and sanitation facilities to 100,000 people in Ivory Coast's cocoa communities. Nestlé committed to contributing five million Swiss francs during 2014–2019 to the IFRC.
Public health
Health care and nutrition product development: In September 2010, Nestlé said that it would invest more than $500 million between 2011 and 2020 to develop health and wellness products to help prevent and treat major ailments like diabetes, obesity, cardiovascular disease, and Alzheimer's. Nestlé created a wholly owned subsidiary, Nestlé Health Science, as well as a research body, the Nestlé Institute of Health Sciences.
Awards
| Year | Brand | Award | Result |
|---|---|---|---|
| 2010 | Nestlé Purina | Malcolm Baldrige National Quality Award | Won |
| 2010 | — | IUoFST Gold Food Industry Award | Won |
| 2011 | — | World Environment Center Gold Medal Award | Won |
| 2014 | — | Henry Spira Corporate Progress Award | Won |
See also
Competitors