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Nestlé in society Creating Shared Value and meeting our commitments 2015

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<strong>Nestlé</strong> <strong>in</strong> <strong>society</strong>:<br />

Creat<strong>in</strong>g <strong>Shared</strong> <strong>Value</strong><br />

Nutrition, health<br />

<strong>and</strong> wellness<br />

Rural development<br />

Water<br />

Environmental<br />

susta<strong>in</strong>ability<br />

Human rights<br />

<strong>and</strong> compliance<br />

Our<br />

people<br />

G4-EC7, Procurement practices G4-DMA, FP2, Supplier environmental assessment G4-DMA, G4-EN33, Supplier assessment for labor practices G4-DMA,<br />

G4-LA15, G4-HR5, G4-HR10, G4-SO9, G4-SO10<br />

Our objectives<br />

By <strong>2015</strong> – S<strong>our</strong>ce 100 000 tonnes of cocoa through the<br />

<strong>Nestlé</strong> Cocoa Plan <strong>and</strong> complete <strong>our</strong> school build<strong>in</strong>g<br />

programme to build 40 schools <strong>in</strong> f<strong>our</strong> years.<br />

Volume of cocoa purchased under the <strong>Nestlé</strong><br />

Cocoa Plan (tonnes)<br />

Goal: 100 000 tonnes by <strong>2015</strong><br />

<strong>2015</strong> 121 481<br />

2014 91 801<br />

2013 62299<br />

By 2016 – S<strong>our</strong>ce 130 000 tonnes of cocoa through the<br />

Plan <strong>and</strong> complete the roll‐out of <strong>our</strong> Child Lab<strong>our</strong><br />

Monitor<strong>in</strong>g <strong>and</strong> Remediation System (CLMRS) to identify<br />

child lab<strong>our</strong> <strong>in</strong> all <strong>Nestlé</strong> Cocoa Plan co‐operatives <strong>in</strong> Côte<br />

d’Ivoire * . (See Human rights <strong>and</strong> compliance for more<br />

<strong>in</strong>formation.)<br />

By 2017 – S<strong>our</strong>ce 150 000 tonnes of cocoa through the<br />

<strong>Nestlé</strong> Cocoa Plan.<br />

By 2018 – S<strong>our</strong>ce 175 000 tonnes of cocoa through the<br />

<strong>Nestlé</strong> Cocoa Plan.<br />

*<br />

We have updated <strong>our</strong> s<strong>our</strong>c<strong>in</strong>g target for 2016.<br />

To ensure a susta<strong>in</strong>able supply of good-quality cocoa, we plan<br />

to cont<strong>in</strong>ue <strong>in</strong>creas<strong>in</strong>g the amount of cocoa purchased through<br />

the <strong>Nestlé</strong> Cocoa Plan. In <strong>2015</strong>, we purchased 121 481 tonnes<br />

of cocoa – 30% of <strong>our</strong> total – through the plan, <strong>and</strong> will <strong>in</strong>crease<br />

this annual figure to 130 000 tonnes <strong>in</strong> 2016 (an <strong>in</strong>crease to <strong>our</strong><br />

orig<strong>in</strong>al goal of 120 000 tonnes) <strong>and</strong> to 175 000 tonnes <strong>in</strong> 2018.<br />

A high proportion of this cocoa was s<strong>our</strong>ced from farms<br />

<strong>and</strong> plantations that meet the UTZ certification Code of<br />

Conduct for Cocoa st<strong>and</strong>ard, one of the largest susta<strong>in</strong>ability<br />

programmes for coffee, cocoa <strong>and</strong> tea, <strong>and</strong> the Fairtrade<br />

certification st<strong>and</strong>ard.<br />

As well as <strong>in</strong>creas<strong>in</strong>g the volume of cocoa procured through<br />

the <strong>Nestlé</strong> Cocoa Plan, we also aim to <strong>in</strong>crease the proportion<br />

of all <strong>our</strong> global cocoa supplies represented by it.<br />

Global cocoa supply s<strong>our</strong>ced via the <strong>Nestlé</strong> Cocoa Plan (%)<br />

<strong>2015</strong> 30.0<br />

2014 23.0<br />

2013 14.5<br />

0%<br />

50%<br />

100%<br />

Number of high-yield, disease-resistant plantlets distributed<br />

(million)<br />

<strong>2015</strong> 1.71<br />

2014 1.60<br />

2013 1.06<br />

KitKat cocoa becomes<br />

susta<strong>in</strong>ably s<strong>our</strong>ced<br />

KitKat has become the first global confectionery br<strong>and</strong> s<strong>our</strong>ced<br />

from 100% certified susta<strong>in</strong>able cocoa, supplied through the<br />

<strong>Nestlé</strong> Cocoa Plan. The <strong>in</strong>itiative, which co<strong>in</strong>cided with KitKat’s<br />

80 th birthday, will take place from the first quarter of 2016.<br />

KitKat already used only susta<strong>in</strong>ably s<strong>our</strong>ced cocoa <strong>in</strong><br />

certa<strong>in</strong> markets, but will now extend this worldwide, <strong>in</strong>clud<strong>in</strong>g<br />

to the United States.<br />

The achievement of 100% susta<strong>in</strong>able cocoa is <strong>in</strong> l<strong>in</strong>e with<br />

what the UTZ <strong>and</strong> Fairtrade schemes allow <strong>in</strong> manag<strong>in</strong>g a<br />

mass balance approach.<br />

Tra<strong>in</strong><strong>in</strong>g farmers<br />

We tra<strong>in</strong>ed 66 320 cocoa farmers <strong>in</strong> better agricultural<br />

practices <strong>in</strong> <strong>2015</strong>. A variety of methods, <strong>in</strong>clud<strong>in</strong>g farmer field<br />

schools <strong>and</strong> farmer bus<strong>in</strong>ess tra<strong>in</strong><strong>in</strong>g, were used to help<br />

improve farm profitability. Subjects <strong>in</strong>cluded good agricultural<br />

practices, such as prun<strong>in</strong>g, which enc<strong>our</strong>ages greater fruit<br />

growth <strong>and</strong> helps control plant disease.<br />

Number of cocoa farmers tra<strong>in</strong>ed<br />

<strong>2015</strong> 66320<br />

2014 45833<br />

2013 33885<br />

Cocoa Plan takes root <strong>in</strong><br />

Ecuador<br />

Ecuador exports about 65% of the f<strong>in</strong>e cocoa produced<br />

worldwide. However, its unique floral cocoa is under threat, due<br />

to farm<strong>in</strong>g practices that are substitut<strong>in</strong>g local trees with other<br />

varieties that have better yields. The majority of the floral variety,<br />

known as nacional, are controlled by smallholders, who have<br />

reacted to decreased crop yields by plant<strong>in</strong>g the new breeds.<br />

As part of the <strong>Nestlé</strong> Cocoa Plan, <strong>our</strong> objective is to ensure<br />

the long-term, responsible supply of cocoa beans from<br />

Ecuador to <strong>Nestlé</strong>, while improv<strong>in</strong>g social <strong>and</strong> environmental<br />

conditions for farmers, their families <strong>and</strong> communities.<br />

Through the plan, we improve farmers’ technical skills, us<strong>in</strong>g<br />

workshops, classroom <strong>and</strong> field tra<strong>in</strong><strong>in</strong>g, <strong>and</strong> certification<br />

programmes. We also enc<strong>our</strong>age the plant<strong>in</strong>g of nacional <strong>and</strong><br />

other cocoa trees to reforest <strong>and</strong> improve biodiversity, <strong>and</strong><br />

have distributed approximately 700 000 nacional plants to<br />

farms s<strong>in</strong>ce 2009.<br />

The <strong>Nestlé</strong> Cocoa Plan has had a direct impact on farmers.<br />

In 2014, 2930 farmers <strong>and</strong> their families benefited. By the end<br />

of the year, 699 farms were UTZ certified for social <strong>and</strong><br />

responsible farm<strong>in</strong>g.<br />

<strong>Nestlé</strong> <strong>in</strong> <strong>society</strong> – Creat<strong>in</strong>g <strong>Shared</strong> <strong>Value</strong> <strong>and</strong> meet<strong>in</strong>g <strong>our</strong> <strong>commitments</strong> <strong>2015</strong> 122

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