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 Child labor G4-DMA, G4-HR5, G4-HR11 Monitoring and remediation in the cocoa supply chain In 2015, we continued to implement our action plans to focus specifically on commodities and countries where there is a higher risk of child labour issues. For our cocoa supply chain, working with the ICI, we created a CLMRS to operate in the Nestlé Cocoa Plan supply chain in Côte d’Ivoire, where we currently work with 79 cooperatives. The CLMRS covers awareness raising in local communities, data gathering about the circumstances of children in our supply chain, and providing cocoa farmers with the practical support and means to get their children back into school. It complements other aspects of the Nestlé Cocoa Plan, which are designed to increase farmer productivity and income and so help them out of poverty. In 2015, the CLMRS was extended to a further 18 co-operatives, taking the total to 40, and will cover all 79 co-operatives by 2016. The main actors of the CLMRS • Community Liaison People: the initial, and integral, step of the CLMRS is active work with the communities where the farmers live. By the end of 2015, Nestlé had recruited 687 Community Liaison People (CLP). Their role is to engage with local community households to gather all the data that is required better to understand the environment in which they live and to identify issues related to child labour risks. In 2015, CLPs had interviewed 14 582 producers among the 24 470 registered cocoa farmers in 40 co-operatives; 26 679 children were included within these assessments. This data is collected through specific templates that the CLPs can access via cell phones provided by Nestlé and ICI. Once gathered, the information is consolidated by the Co-op Child Labour Agent (see below). The CLPs report situations in which children are at risk, and organise awareness-raising activities in the communities to prevent child labour. As a result of the CLMRS, by the end of 2015, 120 067 farmers and community members had attended 7044 community awareness sessions. • Co-op Child Labour Agents: as part of the CLMRS, each farming co-operative that works with Nestlé appoints a Child Labour Agent. The agent is responsible for consolidating the information provided by the communities and passing this information along the chain. Furthermore, the agent proposes child labour prevention and remediation efforts based on the information and data collected in each community, and is responsible for ensuring that these activities are followed through. The CLMRS in Côte d’Ivoire currently involves 40 Child Labour Agents, and a total of 2019 agents, co-op managers, suppliers’ staff members and Nestlé staff members were trained in child labour issues by ICI in 2015. • Suppliers: suppliers are the next stage in the system. Nestlé currently works with six main suppliers in Côte d’Ivoire. Raising their awareness on child labour and building their capacities in this area is a key success factor of the CLMRS. So far, 158 suppliers’ staff members, including agronomists, have received child labour training from ICI. Suppliers play a key role in the engagement process with the co-operative managers, explaining how the system works and what is expected from them as part of it. • Nestlé: the last link in the chain is Nestlé. Nestlé Côte d’Ivoire has a dedicated child labour manager who coordinates the overall implementation and functioning of the CLMRS. In close collaboration with ICI, we seek to: – Ensure that the CLMRS is rolled out to all the Nestlé Cocoa Plan co-operatives by the end of 2016, and engage with individual co-operatives to secure their buy-in along this journey; – Participate in the recruitment process of the CLP and the Co-op Child Labour Agents; – Consolidate the data and information gathered through the system; – Make sure that each child labour case identified is remediated in a timely manner and in the best interest of the child or children involved; and – Develop a funding model for the system that is financially sustainable over the long term. Enabling organisations The CLMRS would not function properly without the support provided by the ICI and the FLA, both of which play complementary roles as part of the system. ICI is involved in work at a ground level, and has increased staff members to extend the roll-out of the system by: • Recruiting CLP and Child Labour Agents; • Designing, collating and coordinating the child labour database; • Training all the different actors of the system on child labour but also on their role as part of the system; • Conducting awareness-raising sessions on child labour for farmers and local communities; • Designing and implementing remediation activities; and • Collecting KPIs for the purpose of reporting on the overall performance of the system. The FLA plays a different role, ensuring that Nestlé as a company becomes progressively compliant with its own Code of Conduct. The FLA’s role is based on auditing rather than implementation. Each year, the FLA organises its own external audits, selecting co-operatives at random and sending auditors to them to ensure that we meet the FLA Code of Conduct, as well as the Nestlé action plan. Following each assessment, the FLA publishes the results along with our response to each finding and any corrective actions taken. In 2015, the FLA conducted five such audits at six co-operatives in Côte d’Ivoire that supply us with cocoa via the Nestlé Cocoa Plan. Nestlé in society – Creating Shared Value and meeting our commitments 2015 240
Nestlé in society: Creating Shared Value Nutrition, health and wellness Rural development Water Environmental sustainability Human rights and compliance Our people Child labor G4-DMA, G4-HR5, G4-HR11 Child Labour Monitoring and Remediation System The system is built into our supply chain and works from the ground up The International Cocoa Initiative is our main partner in the system, helping to implement it at every level... The Fair Labor Association independently audits a selection of co-ops taking part in the system and publicly reports on findings Trained to improve their productivity and income and to avoid child labour Farmers Sell the cocoa they produce to a farming co-operative (co-op) In Côte d’Ivoire we buy cocoa from about 79 co-ops and farmer groups Gather data about whether the children of farmers are working and, if so, if it is child labour, or non-hazardous work that doesn’t interfere with schooling Help to devise and organise the specific intervention efforts needed to help each child Community Liaison People Chosen by their local community Co-op Child Labour Agents Coordinate the Community Liaison People in their co-op Responsible for educating communities about the dangers children face on farms. These sessions are open to everyone, not only farmers supplying Nestlé Suppliers Help to recruit child labour agents Support data gathering process Nestlé Ensures data is collected and intervention efforts are taking place Funds the system through direct payments and by paying farmers a premium for good quality cocoa Helps farmers improve their productivity to increase their income by providing higher-yielding plantlets, and by training them in good agricultural practices Nestlé in society – Creating Shared Value and meeting our commitments 2015 241
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Nestlé in society Creating Shared Value and meeting our commitments 2015

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