Nestlé in society Creating Shared Value and meeting our commitments 2015

Nestlé in society:
Creating Shared Value
Nutrition, health
and wellness
Rural development
Water
Environmental
sustainability
Human rights
and compliance
Our
people
G4-EC7, Procurement practices G4-DMA, Supplier environmental assessment G4-DMA, G4-EN33, Supplier assessment for labor practices G4-DMA,
G4-LA15, G4-HR5, G4-HR10, G4-SO9, G4-SO10
Our commitment to eradicating child labour from our supply
chain requires garden owners in countries with production
facilities to work towards full compliance against best ethical
and sustainability practices as a means of eliminating child
labour from the hazelnut industry. As with other categories of
ingredients and materials, suppliers unable to meet our
requirements but demonstrating measurable progress towards
them receive help from Nestlé and our delivery partners to
make the necessary changes.
Read our latest Progress Report on Responsible
Sourcing of Hazelnuts.
Vanilla
Madagascar is one of the world’s leading producers of
vanilla, including the 700 tonnes of natural vanilla flavour
Nestlé purchased in 2015 for our ice cream and
confectionery products.
The vanilla spice comes mainly from the Sambava,
Antalaha, Vohemar and Andap (SAVA) regions, where it is
produced by small growers in rural, sometimes remote,
villages, where social and educational infrastructures are
underdeveloped.
Because there are no bees on Madagascar, each orchid
flower has to be pollinated by hand. In addition, each flower
lasts for only one day so has to be pollinated immediately,
meaning crops must be checked daily. Combined with harvest
and curing, this makes vanilla a labour-intensive and timeconsuming
crop to grow in Madagascar, making it best suited
to small-scale farms.
Low income can also be a major factor in the vanilla supply
chain. Most of Nestlé’s vanilla supplies come from Madagascar,
where about 80 000 farmers rely almost exclusively on vanilla
for their income. Sometimes, farmers harvest their vanilla too
early because they need cash to buy food, or because of a lack
of access to resources and expertise.
Tackling child labour in the vanilla supply chain
While child labour remains an issue in a number of our priority
categories’ supply chains, we have a particular objective to
work towards eliminating it from our vanilla supply chain. In
2015, we continued to work towards this in various ways,
including working with our supplier Givaudan, which has
extended and improved access to educational facilities for
farmers’ children. Givaudan is now working to develop child
labour remediation activities, and we are beginning work with a
second supplier to help take more children out of farm labour.
Traceability in the supply chain
Given their importance to global supplies, vanilla farmers in
Madagascar need to have both sustainable resources and the
necessary education and skills to produce high-quality,
high-value crops.
Although we don’t have category-specific requirements for
natural vanilla flavour, our RSG requirements cover compliance
with local and national regulations and laws, labour practices,
environmental impacts and the creation of shared value.
After carrying out an in-depth field investigation to evaluate
the responsible sourcing risks and opportunities in our
Malagasy vanilla supply chain, we created our Responsible
Sourcing strategy for the category. It seeks to establish
traceability through the complex supply chain of exporters,
processors and collectors back to the gardens or plantations,
and seeks to ensure Responsibly Sourced vanilla volume
through the implementation of best practices.
Vanilla supply chain traceability results
700 tonnes
95%
40%
*
Volume sourced for Ice Cream and Confectionery business.
Total volume in scope:
700 tonnes*
Percentage of volume
traceable (back to
plantation): 95%*
(2015 target: 90%)
Percentage of volume
Responsibly Sourced (RSG
improvement projects, i.e.
fund suppliers’ initiatives):
40% (2015 target: 40%)
To date, our Tier 1 supplier Givaudan has benefited 3337
schoolchildren and supported almost 2200 families through its
sustainable development programme for 2013–2015. Givaudan
and one of its suppliers, Henri Fraise Fils, have achieved this by:
• Improving vanilla bean quality through the provision of
technical assistance to farmers;
• Promoting the System of Rice Intensification to increase the
yield of locally grown, pesticide-free rice, strengthening
food security;
• Supporting the development of alternative sources of
revenue, such as beekeeping, fisheries, keeping small
livestock and handicrafts;
• Improving access to water by building wells and irrigation
dams; and
• Supporting the building, extension and repair of schools,
health centres and access roads.
In 2015, Givaudan commenced remediation activities with the
co-operatives established through the Community Vanilla
Initiative and previously audited. This work will further develop
the traceability, quality and availability of vanilla and build a
sustainable partnership with the farmers.
In addition, Nestlé directed resources and funding to
sponsor the building of two additional schools close to our
sourcing locations, and support the development of
infrastructure for a health centre. We will also make a video
film of our vanilla sourcing activities to better educate both
employees and consumers.
Read our latest Progress Report on Responsible
Sourcing of Vanilla.
Nestlé in society – Creating Shared Value and meeting our commitments 2015 134