Nestlé

Governance and accountability for sustainable development
The company provides evidence of linking performance criteria in senior executives’ remuneration policies to targets and objectives which cover nature, including biodiversity, and social issues.

Lobbying and advocacy
The company reports a list of trade associations of which it is a member wherever it operates and discloses an annual review of all the advocacy activities it has undertaken.

Stakeholder engagement
The company discloses the channels it uses to engage with stakeholders and the issues raised during such activities. It is one of the few companies that explain how it has responded to key issues raised by each stakeholder group and disclose specific outcomes implemented to respond to key issues for each stakeholder group, going beyond materiality assessment. Furthermore, its stakeholder engagement activities cover nature, nutrition, and social areas.

Sustainable development strategy
The company discloses its process for identifying and prioritising its most relevant sustainability impacts as well as the outcome of this process, in relation to its sustainability strategy. Furthermore, it has group-wide targets on key sustainability topics for the most material parts of its value chain and reports consistently against all its targets.

Scope 1, 2, and 3 greenhouse gas (GHG) emissions
The company discloses a time-bound target to reduce its scope 1 and 2 greenhouse gas (GHG) emissions by 20%, by 2025, based on 2018 levels. Similarly, it has set a time-bound target to reduce its scope 3 GHG emissions by 20% by 2025 and by 50% by 2050, also based on 2018 levels. The company shows leadership by aligning these targets with a 1.5-degree trajectory, showing its commitment to addressing climate change. Progress updates regarding these targets and emission reductions are regularly reported.

Ecosystem conversion
The company discloses that it has achieved 100% deforestation and conversion-free (DCF) certifications in supply chains for its relevant high-risk commodities

Food loss and waste
The company has set FLW reduction targets in line with SDG 12.3, aiming for a 50% reduction by 2030. Additionally, to prevent the generation of FLW, the company actively collaborates with partners throughout its value chain.

Plastic use and packaging waste
The company demonstrates commitments and partakes in activities related to plastic use reduction and transitioning towards sustainable packaging. It also discloses quantitative data with regards to plastic use reduction and use of sustainable packaging. Additionally, it has set a target to reduce the use of virgin plastic by one third versus its 2018 baseline by 2025, and reports progress against it.

Protein diversification
The company provides quantitative evidence of the growing presence of alternative proteins in its portfolio. Additionally, the company discloses the proportion of alternative proteins and animal proteins used.

Soil health and agrobiodiversity
The company discloses that it aims to source 20% of key ingredients through regenerative agriculture methods by 2025 and 50% by 2030, and reports progress against this target. Also, it describes activities to improve soil health or agrobiodiversity by committing to implementing best management practices for soil and supporting farmers to make the transition to regenerative agriculture.

Water withdrawal
The company has taken steps to reduce water withdrawal in its own operation. It has also set a target to reduce water use in its factories by 6 million m3 between 2021 and 2023, and reports its progress accordingly. Additionally, the company openly shares information on the amount of water it withdraws in water-stressed areas. To extend their efforts beyond their own operations, the company actively collaborates with suppliers to collectively reduce water withdrawal.

Accessibility and affordability of nutritious foods
The company has disclosed its Popularly Positioned Products (PPP) strategy, which focuses on broadening access to affordable and nutritious products to lower-income consumers. Currently, 82% of these products are fortified with at least one of the Big Four micronutrients. However, there is room for improvement in terms of accessibility, particularly for vulnerable groups.

Availability of nutritious foods
The company provides data on its ongoing efforts to reduce sugars, sodium, and saturated fats across its global portfolio over the years. It reports nutritional values for its global portfolio in 13 countries, utilizing locally endorsed government nutrient profiling systems. Furthermore, the company discloses that it uses a peer-reviewed nutrient profiling system to enhance the nutritional value of its products.

Clear and transparent labelling
The company has adopted both the Nutri-score and Health Star Rating systems. It also discloses the percentage of products or menus for which these front-of-pack labelling schemes have been implemented.

Food safety
The company provides evidence that 100% of its own operations are certified to a Global Food Safety Initiative (GFSI)-recognised food safety scheme.

Responsible marketing
The company has a responsible marketing policy specifically designed for children, which includes restrictions on marketing to children and teenagers below the age of 16. Additionally, the company provides evidence of compliance with its responsible marketing policy for children through third-party auditing.

Workforce nutrition
The company has implemented a workforce nutrition programme that includes nutrition education through a global training programme, breastfeeding support (e.g., at least six months of parental leave, breastfeeding rooms), and provision of healthy options in cafeterias. In 2022, 95% of its canteens offered a healthy meal. Nestlé is one of the few companies that has extended its nutrition programme to supply chain workers through its Farmer Family Nutrition (FFN) initiative, aimed at improving smallholders’ nutrition via education and kitchen gardens.

Child labour
The company has strict policies in place to ensure that suppliers prohibit child labour and verify the age of recruited workers. Additionally, it supports various tools and programs to assess and address child labour risks in our supply chain. These efforts include the implementation of a Child Labor Monitoring and Remediation System (CLMRS) in the cocoa supply chain in Côte d’Ivoire and Ghana and of the Income Accelerator Program, the provision of training to coffee farmers and mills and palm oil companies in Malaysia and Indonesia on child labour. Furthermore, the company demonstrates interim progress of its Income Accelerator Program, particularly regarding improved school enrollment rates.

Farmer and fisher livelihoods
The company has identified a living income benchmark and assessed the living income gap for cocoa farmers in Côte d’Ivoire as part of its Income Accelerator programme. In addition, it reports on the progress of the programmes activities against the targets it has set.

Forced labour
The company has a strict policy against paying any recruitment fees and retaining personal documents of workers or restricting their freedom of movement within the supply chain. In addition to working with direct suppliers, the company also engages and supports indirect or upstream suppliers in order to ensure respect for responsible recruitment at the production level. Some examples of these efforts include expanding training on forced labour indicators for coffee farmers and mills that supply Nescafé. The company also supports its palm oil suppliers by helping them strengthen their own management systems to address forced labour risks.

Health and safety of vulnerable groups
The company recognises several groups as vulnerable in terms of health and safety, including migrant workers, seasonal workers, indigenous workers, women, child and young workers, and smallholders. It also discloses the risks associated with these groups.

Land rights
The company has a commitment to respect ownership and use of land and natural resources and related legitimate tenure rights. Furthrmore, it requires its business relationships to have a process to identify legitimate tenure rights holders paying particular attention to vulnerable or marginalised tenure rights holders, and to negotiate with them to provide adequate compensation.

Living wage
The company indicates that it ensures that all its employees worldwide, including temporary workers, earn a living wage. Also, it works with BSR to define living wage thresholds to identify and address cases where its lowest level of compensation and legal minimum wages are not sufficient for workers to fulfill basic needs.

Act ethically
The company discloses a public commitment to protect personal data and has a global tax strategy. Furthermore, the company has a policy prohibiting bribery and corruption and discloses its approach to lobbying and political engagement in a policy statement. Also, it has a grievance mechanism for stakeholders to raise concerns and complaints regarding bribery and corruption. Additionally, it requires third-party lobbyists to comply with its lobbying engagement policy, and contracted third parties are required to sign a written agreement stating clear objectives and the desired outcome.

Provide and promote decent work
The company publicly commits to respecting the health and safety of workers and expects its business relationships to do so. The company states that it takes actions to improve and promote OHS practices in its supply chain.

Furthermore, the company discloses that its employees worldwide, including temporary workers, earn a living wage and works with the Business for Social Responsibility (BSR) to define the living wage threshold in each country where it operates. Additionally, it describes how it works to support the payment of a living wage by its suppliers.

Moreover, it expects its business relationship to prohibit overtime. Also, it reports that 56.3% of ts total employees are covered by collective bargaining agreements. It also discloses the proportion of women in its total direct operations workforce for each employee category and has been a signatory of Women’s Empowerment Principles since 17 May 2013, with 33.33 percentage of women on the board.

Respect human rights
The company has a publicly available policy statement committing its operations and supply chain to respect human rights and the ILO core labour rights.

Moreover, the company describes the process for identifying its human rights risks and impacts in specific locations or activities covering its own operations and supply chain. Additionally, it describes its process for assessing its human rights risks and discloses what it considers to be its salient human rights issues and has a global system to take action to prevent, mitigate or remediate salient human rights issues. It also describes how its global system applies to its supply chain.

Furthermore, it discloses the categories of stakeholders whose human rights have been or may be affected by its activities and has a human rights grievance mechanism accessible to all workers and all external stakeholders who may be adversely impacted by the company.

Governance and accountability for sustainable development
While the company states that the board of directors has expertise in nutrition, it has an opportunity to disclose whether its highest governance body has expertise, or alternatively, access to expertise with respect to the company’s most material sustainability topics including climate, water, soil health, social inclusion, ecosystem conversion and biodiversity.

Lobbying and advocacy
The company has an opportunity to disclose a clear and detailed framework for assessing alignment of its trade associations with its sustainability targets. Additionally, it can report any (potential) misalignments between the lobbying activities of its trade associations and its sustainability targets.

Antibiotic use and growth promoting substances
The company has an opportunity to disclose targets to phase out the prophylactic use of antibiotics across all species, geographies and products, and report against the targets.

Ecosystem conversion
While the company has a target to achieve conversion-free supply chains, it could specify the certification models used to guarantee that it is DCF-aligned.

Food loss and waste
Although the company discloses its FLW reduction targets, it does not track its progress towards achieving them.

Protein diversification
The company has an opportunity to set a sales-based target to increase alternative proteins across its portfolio, as well as report progress against this target.

Accessibility and affordability of nutritious foods
The company has an opportunity to set targets to improve the accessibility and affordability of nutritious foods, particularly for vulnerable groups, through its commercial activities.

Availability of nutritious foods
The company discloses that in 2022, 37% of its net sales (excluding PetCare) came from products with a Health Star Rating score of 3.5 or above. Nevertheless, the company has an opportunity to establish a sales-based target to further increase the percentage of more nutritious products.

Responsible marketing
The company has an opportunity to provide evidence of marketing activities to promote heathier and more nutritious food options (in accordance with a government-endorsed or externally validated nutritional guidelines).

Child labour
The company has an opportunity to disclose examples of remediation programmes when a case of child labour is found in its operations.

Farmer and fisher livelihoods
The company has set up initiatives to improve the sustainability and productivity of the farms through its Income Accelerator Programme but it has an opportunity to demonstrate activities to improve farmers’ income resilience through its procurement practices and supply chain relationships for some commodities and/or regions

Forced labour
The company has an opportunity to disclose a prohibition to pay recruitment fees or related costs to secure a job, to retain workers’ personal documents or restrict workers’ freedom of movement. Moreoever, it discloses an action plan for forced labour and recruitment fees to be implemented by 2025 but could demonstrate a quantitative analysis of trends demonstraing progress in relation to eliminating these practices.

Living wage
The company has developed a Living Wage action plan 2023-2025 to understand and address living wage risks across its operations and direct suppliers but could describe how it determines a living wage for the regions where it sources. Also, it states that suppliers should make progress to close any gaps between current wages and living wages, and discloses a goal to regularly share living wage benchmark analysis and hold conversations on progress with its suppliers. However, it has an opportunity to strengthen this approach by setting a time-bound target for paying a living wage across its direct suppliers.

Act ethically
Although the company has bribery and corruption prevention and training in place, it could describe the process to identify its bribery and corruption risks and impacts in specific locations or activities covering its own operations. The company expects its supplier to conduct the business without bribery, corruption but could include related anti-bribery and anti-corruption clauses in its contracts.

Furthermore, the company has a policy prohibiting its affiliates from making political contributions to political parties or candidates. Moreover, it discloses some information regarding its lobbying expenditures but it could disclose its expenditures in all locations where it carries out lobbying activities or specify it only does so in specific countries or regions.

Provide and promote decent work
The company has an opportunity to disclose time-bound targets on gender equality and women’s empowerment. Furthermore, it discloses that it has been committed to providing equal pay for equal work since 2019 and that no systemic equal pay gap was found within the group according to the global equal pay review results. However, it could disclose the ratio of the basic salary and remuneration of women to men in its total direct operations workforce for each employee category, by significant locations of operation.