Nestlé in society Creating Shared Value and meeting our commitments 2015

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Nestlé in society: Creating Shared Value Nutrition, health and wellness Rural development Water Environmental sustainability Human rights and compliance Our people G4-EN28 Extracting value from plastic waste Processing plastic waste can be a challenge. We have been working with a specialised consulting company for three years to understand the different technologies available, or potentially available, for recovering value from mixed-plastic waste. Together, we have identified a number of technologies, focusing on pyrolysis and gasification – processes that turn plastics into liquid fuels and gas – and reviewed how different plastics found in the waste stream influence the performance, quality and yield of the fuel produced. For example, Nestlé India sends plastic laminate waste for use as a fuel substitute in cement kilns; it has also installed a small-scale pyrolysis plant, converting plastic to oil in one of its noodle factories. This is currently being trialled on production waste, with the aim of accepting post-consumer plastic that has been collected in the surrounding community. Nestlé is exploring this same plastics-to-oil technology in the Philippines and Côte d’Ivoire. In addition, Nestlé UK & Ireland is partnering with other companies and waste partners to explore the options for collecting flexible laminate packaging containing aluminium, so that the plastics can be recovered and converted into fuel, and the aluminium recycled. Trials began in 2015. Developing a consistent approach A variety of initiatives have been undertaken to generate and disseminate guidance on design for recycling Nestlé packaging, and to ensure we remain at the forefront of best practice. Our Packaging Environmental Sustainability Network, comprising 14 core team members and 220 affiliates, provides scientific support, information and training related to packaging environmental sustainability. In 2015, they helped train 1000 Nestlé employees on one or more of the focus areas covered by The Nestlé Policy on Environmental Sustainability. The network reviewed and integrated the ISO Packaging and Environment standards, as well as incorporating guidance on the use of recycled content and biobased materials into our internal guidelines for ecodesign. A guidance note on waste management and extended producer responsibility was produced to support Nestlé markets in ensuring that efficient packaging recovery systems are put in place. Nestlé in society – Creating Shared Value and meeting our commitments 2015 192
Nestlé in society: Creating Shared Value Nutrition, health and wellness Rural development Water Environmental sustainability Human rights and compliance Our people G4-EN19, Transport G4-DMA, G4-EN30 Transport and distribution Every day, we transport more than 140 000 tonnes of products from 1600 warehouses to our customers. Travelling the equivalent of 269 times around the world every day, much of this distribution relies on partnerships with third-party logistics providers. They help us monitor our environmental performance and improve the efficiency of our network by reducing mileage, fuel consumption, greenhouse gas (GHG) emissions, noise and congestion. Our reporting spans the transportation of goods from factory to distribution centre to customer, covering 63% of the total product volume we distribute. All figures in this section are for 2014 – the latest data available – with the exception of the ISO certified data on page 196. Reducing emissions from transport and distribution Our commitment Provide climate change leadership Our objective By 2020 – Reduce GHG emissions per tonne of product by 10% in our distribution operations versus 2014. Our approach As outlined in The Nestlé Policy on Environmental Sustainability, our approach is to: • Optimise distribution networks and route planning across our operations; • Explore opportunities to improve transportation by switching modes of transport and trialling alternative fuels; and • Expand driver training to address both safety and environmental efficiency (see Our people for information on road safety). To further optimise our performance, we are focusing on increasing vehicle utilisation, reducing empty transport journeys and constantly reviewing our strategic distribution networks. For our own fleet operations, we are working to optimise route planning on an ongoing basis. Moving from traditional road transport to rail or short-sea freight, as well as switching to natural gas trucks, has the potential to further reduce our environmental impact in transportation. And in our warehouses, we are concentrating on reducing energy consumption and switching to renewable energy. New technologies are crucial in every case, so we invest in innovations that will provide environmental and efficiency improvements. We have set ourselves three new objectives to reinforce our efforts in reducing GHG emissions in our distribution operations and in our major warehouses, and using natural refrigerants in our new refrigerated trucks. GHG emissions from our transport and distribution operations – specifically carbon dioxide (CO 2 ), methane (CH4) and nitrous oxide (N2O) – exceeded 3.1 million tonnes in 2014. We work to continuously improve our general environmental performance and, in particular, our GHG emissions. We are working to cut fuel consumption and GHG emissions by improving the efficiency of our distribution networks – making better use of space in our vehicles, avoiding unnecessary miles and using more efficient modes of transport. Our new objective is to cut GHG emissions per tonne of product by 10% by 2020, using 2014 data as our baseline, and will report on initial progress in our next report. Emissions from transport (estimated million tonnes of CO 2 eq) 2014 3.1 2013 3.1 * 2012 3.2 * The 2013 figures have been restated due to a refined reporting approach. The 2014 figures are the latest available at the time of publication. Optimising vehicle capacity utilisation Delivery vehicles that travel empty or with limited loads are inefficient and costly, so we are making a considerable effort to optimise vehicle capacity utilisation. Although the maximum load of a truck or container can be limited by the maximum weight or the maximum available volume, even a 1% improvement in load utilisation would reduce distribution costs by around CHF 50 million and reduce CO 2 emissions by 29 000 tonnes. Nestlé in society – Creating Shared Value and meeting our commitments 2015 193
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