Nestle

RATING

SECTOR

Consumer Packaged Goods

WEBSITE

CONTACT

Nestlé S.A.,
avenue Nestlé 55,
1800 Vevey,
Switzerland
Tel: +41 21 924 1111

STOCK EXCHANGE

LISTING

  • FTSE4Good responsible investment index since 2011
  • 1st out of 22 global food and beverage manufacturers in the 2018 Access to Nutrition Index (ATNI).
  • AA by MSCI ESG Research for its performance on environmental, social and governance (ESG) issues
  • CDP’s Climate A list and rejoined CDP’s Water A list.

EMPLOYEES

291,000

CHIEF SUSTAINABILITY OFFICER

 David Tulauskas

AWARDS

N/A

CONTENT SOURCE

FURTHER READING

Report created by Sagarika Deshmukh 

Nestle

SECTIONS :  Sustainability    Evaluation  •  Progress  •  Watch  •  Overview

Company Activity

As the world’s largest food and beverage company Nestle is driven by a simple aim: enhancing quality of life and contributing to a healthier future.

Nestlé SA is a nutrition, health and wellness company, which engages in the manufacture, supply and production of prepared dishes and cooking aids, milk-based products, pharmaceuticals and ophthalmic goods, baby foods and cereals. The company’s product portfolio includes powdered and liquid beverages, water, milk products and ice cream, nutrition and health science, prepared dishes and cooking aids, confectionery, and pet care.

It operates through the following segments: Zone EMENA, Zone Americas, Zone Asia, Oceania & Africa, Nestlé Waters, Nestlé Nutrition. The other business segment comprises Nespresso, Nestle Health Science and Nestle Skin Health.

The company was founded by Henri Nestlé in 1866 and is headquartered in Vevey, Switzerland.

Company Sustainability Activity

Nestle is reducing greenhouse gas emissions across their network by increasing the use of renewable electricity and working towards reductions in food loss and waste. The company is also working on developing the following: plant-based foods and beverages, more climate-friendly or carbon neutral products, sustainable packaging, and more sustainable crops developed through plant science research.

Highlights

  • Completed the 10% commitment taken in 2014, to reduce saturated fat by 10% in all relevant products that do not meet the Nestlé Nutritional Foundation (NF) criteria with respect to saturated fat
  • Achieved an overall reduction of water withdrawal per tonne of product of 31% since 2010, with a total withdrawal of 121 million m3
  • Provided access to WASH to 600,000 beneficiaries in 2017, three years ahead of time

Targets

REDUCING ENVIRONMENTAL FOOTPRINT 

MINIMIZING WASTE AND LITTERING 

  • Nestle’s goals is to have 100% recyclable or reusable packaging by 2025 

MANAGING WATER 

  • Nestle set a target to reduce direct water withdrawals per tonne of product in every product category to achieve an overall reduction of 35% since 2010 by 2020
  • Nestle will continue to build the 2030 Water Resources Group public-private partnership by adding one more state or country per year
  • Nestle will continue supporting the Alliance for Water Stewardship Standard by implementing it in five new locations.

Progress

REDUCING ENVIRONMENTAL FOOTPRINT 

  • In 2019, 70% of the volume of Nestle’s 15 priority categories of raw materials was responsibly sourced. 
  • In 2019, Nestle identified five key commodities upstream in the supply chain where losses were most significant: palm oil, cereals, dairy, fruit and vegetables.
  • Nestle can locate hotspots for food waste and loss and work with farmers to devise solutions.
  • Nestle has been reducing their carbon footprint but still have greenhouse gas emissions that amounted to 3.3 million metric tons of carbon dioxide equivalents

MINIMIZING WASTE AND LITTERING 

  • Nestle’s packaging institute achieving their 2025 aim of 100% recyclable or reusable packaging
  • In 2019, 26% of packaging used in Nestle’s operations contained recycled materials. For plastic packaging, Nestle used 2% recycled plastic. Of packaging materials, 37% were renewable. Nestle has exceeded their commitment to eliminate 140000 tonnes of packaging by 2020. 
  • In 2019, 87% of Nestle’s packaging was recyclable or reusable. They used 4.6 million tonnes of packaging material in 2019 compared to 4.7 million tonnes in 2018.
  • Nestle is on track to achieve zero waste for disposal in all Nestlé sites, achieving absolute reductions of 96% since 2009. 
  • As of 2018, food waste per tray decreased from 70.32 g per day to 47.25 g, amounting to 838.67 tonnes less food waste annually.

MANAGING WATER 

  • By the end of 2019, Nestle achieved an overall reduction of water withdrawal per tonne of product of 31% since 2010, with a total withdrawal of 121 million m3
  • In 2019 Nestle implemented 371 water-saving projects at their factories, saving 3.5 million m3 of water.
  • Nestlé participates in several  Multi-stakeholder platforms MSPs, including the 2030 Water Resources Group (WRG), the UN CEO Water Mandate and the Alliance for Water Stewardship (AWS). These platforms provide a strong support network for local stakeholder engagement.

Certificates

  • 100% manufacturing facilities certified ISO 14001

UN Sustainable Development Goals

UN SDGs Compliance

The Impakter Index team aligns current company-wide sustainability initiatives with the UN Sustainable Development Goals in the following section. 

SDG 3 

  • By removing artificial colors and adding micronutrients and whole grains, as well as reducing sugars, sodium and saturated fat in existing products, Nestle is improving the nutritional profile across its portfolio. Simplifying ingredient lists also makes it easier for consumers to understand the content of their food and make better informed choices.

SDG 4

  • Nestle has programs and training in place to help farmers and their families learn more about ways to improve their nutrition. 

SDG 5 

  • Gender Balance Acceleration Plan in March 2019. The plan aims to increase the proportion of women in the group’s top 200 senior executive positions to 30% by 2022.

SDG 6

  • Nestle is driving change within its operations by investing in technologies to improve the water efficiency of our manufacturing processes. Nestle engages actively with suppliers, stakeholders and local communities to develop and implement collective actions to address water scarcity.

SDG 8

  • Through Farmer Connect, Nestle works directly with more than 550,000 farmers, helping them to grow and thrive. Nestle places a special focus on entrepreneurship, to identify and develop the most talented, progressive farmers.  

SDG 9 

  • In 2019, Nestle developed plans to help connect farmers with local markets and reduce waste and improve food availability through better food preservation methods. 

SDG  12

  • Nestle’s policies and activities are intended to ensure that Nestle sources ingredients only where workers’ rights are protected and children have not been exploited. They also aim to ensure all animals in the supply chain are healthy and stress-free. 

Evaluation

The demands on Nestle and other corporations are growing as consumers pay more attention to the environmental effect of what they eat. 

Nestle’s commitment to the environment and public nutrition seems to be sincere and longstanding. This is clear based on the great progress they have made towards their goals and their commitment to nice of the seventeen UN SDGs.

In addition to their targets and progress, Nestle has been listed on the FTSE4Good Index, MSCI ESG Index and CDP’s Climate A list. The only certification Nestle has is the ISO 14001.

Despite Nestle’s efforts to be sustainable, the company has been caught in deforestation and water usage scandals. This cannot be overlooked and therefor Nestle has been rated a C.

Analyst Outlook: Negative

Nestle has many solid goals toward becoming more sustainable, however, the company has been involved in damaging scandals in its lifetime.

The company was also responsible for a large portion of deforestation activity in Ghana for cocoa production. Reports documented that in several national parks and other protected areas, 90% or more of the land mass has been converted to cocoa. To tackle this issue, Nestle declared that in 2019 they distributed over 420,000 shade trees globally and completed the mapping of all Nestlé Cocoa Plan farmers in Côte d’Ivoire and Ghana.

Another issue that occurred in 2018 was that Nestlé extracted millions of liters of water daily from a First Nations community near Toronto, leading the land and the community to lack access to clean water.

Furthermore, it was stated that Nestle was extracting up to 3.6m liters of water daily from nearby Six Nations treaty land disregarding their wishes for them to stop.

These issues are hard to look past and they need to be addressed by Nestle.

Key Points

  • Nestle has been involved in controversial affairs over the years which puts them in a questionable position in terms of sustainability and governance.
  • Nestle committed to achieve zero net greenhouse gas (GHG) emissions by 2050.
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