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-LA15, Investment G4-DMA, G4-HR1, G4-HR2, G4-HR4, G4-HR5, G4-HR6, Assessment G4-DMA, G4-HR9, G4-HR11, Human rights grievance mechanisms G4-DMA, G4-HR12 Internal governance structure showing groups with human rights as part of their scope of work Board of Directors Chairman and CEO Executive Board Nestlé in Society Board Chair: P. Bulcke Org: E. Simioni Operations Sustainability Council Chair: M. Batato Org: P. Greverath Nestlé Water Task Force Chair: M. Batato Org: C. Frutiger Issues Round Table Chairs: M. Batato, S. Catsicas Org: C. Frutiger Brands & CSV Advisory Team Chair: T. Buday Org: G. Mazzeo R&D Council for Sustainability and Nutrition Chair: S. Catsicas Org: A. Roulin Group Compliance Committee Chair: D. Frick Org: E. Rueda Seafood Task Force Chair: M. Batato Org: H. Parsons Operations Water Task Force Chair: C. Galli GMO Task Force Chair: M. Batato Org: H. Parsons WHO Code Compliance Committee Chair: P. Vogt Org: C. Frutiger Human Rights Working Group Chairs: C. Frutiger, P. Pires Child Labour & Women’s Empowerment Steering Group Chair: M. Batato Org: H. Parsons Creating Shared Value Human Rights Working Group Groups with human rights as part of their scope of work Pillar 7: Partnerships Our approach: we partner with leading organisations to improve our human rights performance on the ground and deliver on our commitments. The Danish Institute for Human Rights (DIHR), Denmark’s national human rights institution, has been our main partner in this area from the beginning of our journey in 2008. It plays a particularly important role as part of the HRIAs but is also actively involved in the development and implementation of the other pillars. The institute brings to our approach the external expertise and criticism that is needed for us to keep improving. The Fair Labor Association (FLA) has been a crucial element of our approach to child labour in the cocoa and hazelnut sectors. It is also actively contributing to the revision of our Supplier Code to align it with the FLA Code of Conduct. Our achievements in 2015 Together with the DIHR, we carried out two HRIAs, in Myanmar and China (see page 234). The FLA carried out seven independent external monitoring exercises (four in Côte d’Ivoire and three in Turkey) that have been made public on their website, together with our corrective action plans (see Child labour for more information). In addition, Verité carried out a comprehensive impact assessment of the labour conditions in the fish and seafood supply chain in Thailand, and produced recommendations that we are now addressing through an action plan. Pillar 8: Monitoring and reporting Our approach: we integrate human rights indicators into our management systems to monitor our progress and report on it annually. Monitoring is key to verifying whether our human rights activities (policies, training, action plans, etc.) have been effectively integrated across the different levels of the company and into our business activities. All our major monitoring mechanisms now include relevant indicators that help us make our human rights monitoring broader, more systematic and continual. The monitoring mechanisms we use for different areas of our operations and supply chain are summarised below: Nestlé in society – Creating Shared Value and meeting our commitments 2015 236
Nestlé in society: Creating Shared Value Nutrition, health and wellness Rural development Water Environmental sustainability Human rights and compliance Our people G4-LA15, Investment G4-DMA, G4-HR1, G4-HR2, G4-HR4, G4-HR5, G4-HR6, Assessment G4-DMA, G4-HR9, G4-HR11, Human rights grievance mechanisms G4-DMA, G4-HR12, G4-SO11 Our human rights monitoring mechanisms Nestlé facilities Tier 1 suppliers Upstream suppliers Policies Programme Monitoring mechanisms Partners The Nestlé Corporate Business Principles Human rights-related policies Nestlé Supplier Code Responsible Sourcing Guideline CARE programme Nestlé Group Audit (NGA) Programme Responsible Sourcing Audit Programme Responsible Sourcing Traceability Programme Audits/assessment CARE audits NGA audits Sedex Members Ethical Trade Audits (SMETA) 4 Pillar Responsible Sourcing Guideline Grievance mechanisms Integrity Reporting System Tell us SGS Intertek Bureau Veritas SGS Intertek Bureau Veritas FLA Verité Our achievements in 2015 We continued to scale up the Tell us external grievance mechanism as a pilot in 12 countries in 2015. In consultation with Linklaters and the DIHR, we amended the Nestlé Due Diligence Questionnaire. In 2015, the questionnaire, including strengthened human rights content, was made available to the relevant operational areas on the Mergers and Acquisitions system. HRDD In 2015, we… Since 2010, we have… 1 Policy commitments Released three new policy documents, on marketing communication to children, maternity protection and labour rights in agricultural supply chains. 2 Stakeholder engagement Organised human rights breakout training sessions as part of the Nestlé stakeholder convenings in London, UK, and Washington DC, USA. 3 Training Trained 8130 employees on human rights in 9 countries. 4 Risk assessment Identified 11 priorities (salient issues) that represented major risks to rights holders. 5 Impact assessment Carried out two HRIAs, in Myanmar and China. 6 Internal coordination Strengthened the role of the HRWG around the implementation of the action plans for the 11 salient issues. Identified Market Compliance Committees as key drivers for human rights at the local level. 7 Partnerships Released an action plan on forced labour in the seafood supply chain based on an assessment performed by Verité. 8 Monitoring and reporting Made available an amended version of our Mergers and Acquisitions Due Diligence Questionnaire that includes human rights elements. Reviewed 17 Nestlé policies and procedures to include relevant human rights elements. Engaged with hundreds of stakeholders on global and local human rights issues and dilemmas. Trained 72 778 employees on human rights in 66 countries. Identified 43 human rights risks as material for our business and included them as part of our ERM system. Carried out 11 HRIAs. Integrated eight Nestlé department or functional heads as part of our HRWG. Signed two major partnerships, with the DIHR and the FLA. Integrated human rights indicators into three of our monitoring systems: CARE audits, Responsible Sourcing Audits and the Integrity Reporting System. Nestlé in society – Creating Shared Value and meeting our commitments 2015 237
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