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 G4-10, G4-11, Market presence G4-DMA, G4-LA2, G4-LA4, FP3, Non-discrimination G4-DMA, G4-HR3, Freedom of association and collective bargaining G4-DMA, G4-HR4 Collective bargaining and freedom of association We support the freedom of association of our employees and the effective recognition of the right to collective bargaining. We operate in some countries where these rights are not upheld. Despite the inherent difficulties and the limits of local laws, Nestlé respects, at all times and in all places, the right of employees to meaningful and constructive dialogue over issues that relate to working conditions and the workplace environment. Our people and employee representatives are expected to make all necessary efforts to develop fair and constructive negotiations, overcome the difficulties that they might encounter, reach sustainable agreements and implement them. In 2015, around 54% of our employees worldwide were covered by collective bargaining agreements. Percentage of employees covered by collective bargaining agreements (%) 2015 54 2014 51 2013 51 Fostering positive relations with trade unions We ensure that direct and frequent communication is established in the workplace and we respect the right of our employees to engage in union activities. We continuously seek areas of dialogue, discussion and mutual understanding at all levels of our operations. This includes communities and authorities, as well as local and international stakeholders representing employees and unions, such as the IUF and the Nestlé European Council for Information and Consultation (NECIC). In doing so, we enrich our knowledge of social realities, we share our vision and efforts for sustainable growth and we constantly aim to find opportunities to improve our practices. At a local level, we seek a sustained dialogue with external experts, such as the local ILO office, OECD National Contact Point, employer organisations and business associations, to be informed about relevant market trends and exchange views on labour issues. It is inevitable that some disputes will occur but, through our policies, principles and values, we seek to ensure that these are settled openly and transparently. In 2015, 31 industrial actions took place around the world. The average percentage of working time lost due to labour disputes, strikes and/or lock-outs was 0.024%. We continue to work closely with the IUF, developing a more open relationship and a willingness to work together to tackle labour-related issues around the world. The relationship is based around Joint Operating Principles and bi-annual meetings that take place between the leadership teams, as well as trade union representatives. The relationship is supported by two working groups that focus on gender equality for non-managerial employees and working conditions. Both groups have analysed data from different markets and we are currently analysing the way forward. Number of labour disputes 2015 31 2014 29 2013 25 Number of labour disputes by region (2015) EMENA 13 AMS 13 AOA 5 Working time lost due to industrial disputes, strikes and/or lock-outs (%) Group 2013 2014 2015 Total working time lost 0.004 0.016 0.024 EMENA* n/a 0.01 0.0038 AMS* n/a 0.04 0.056 AOA* n/a 0.001 0.0089 Covers 314 366 Nestlé employees. * Excludes temporary employees. Zero tolerance for discrimination Nestlé respects the personal dignity, privacy and rights of every employee. We are committed to maintaining a workplace free from discrimination and harassment. Our Human Resources Policy and our Code of Business Conduct state that employees must not discriminate on the basis of origin, nationality, religion, race, gender, age or sexual orientation, or engage in any kind of verbal or physical harassment based on any of the above or any other reason. It is each employee’s responsibility to ensure full compliance with all provisions of our policy and code and to seek guidance where necessary from their line manager, or from the HR, Legal or Compliance functions. Failure to comply may result in disciplinary action, including the possibility of dismissal and, if warranted, legal proceedings or criminal sanctions. Employees who feel that their workplace does not comply with the above principles are encouraged to raise their concerns with the HR department. In 2015, 139 alleged incidents of discrimination in our operations were reported. Nestlé in society – Creating Shared Value and meeting our commitments 2015 276
Nestlé in society: Creating Shared Value Nutrition, health and wellness Rural development Water Environmental sustainability Human rights and compliance Our people G4-10, G4-LA1, G4-LA12, G4-LA16, Non-discrimination G4-DMA, G4-HR3 Update on the legal action by a Colombian trade union In our 2012 report, we reported that a Colombian trade union, represented by the European Center for Constitutional and Human Rights (ECCHR), was taking legal action in Switzerland against Nestlé, linking us with the murder of a former employee. In May 2013, the Attorney-General of the Canton of Vaud in Switzerland decided not to proceed in the case against Nestlé. The plaintiffs appealed this decision in the Court of Appeal of the Canton of Vaud, which in December 2013 rejected the case. The plaintiffs subsequently appealed to the Swiss Federal Supreme Court, which in July 2014 also rejected the case. In May 2015, the European Court of Human Rights confirmed the decision of the Swiss judicial system by dismissing the complaint filed against Switzerland by the ECCHR. The ECCHR had submitted this complaint on behalf of Mr Luciano Romero’s widow in January 2015. Nestlé condemns all forms of violence and we emphatically reject the accusations made by the plaintiffs, which are contrary to the facts. We have no responsibility whatsoever, directly or indirectly, neither by action nor omission for the murder of Luciano Romero. Status of alleged incidents of discrimination in 2015 • Incidents reviewed: 50; • Remediation plan implemented and results reviewed through internal management processes: 4; • Incident no longer subject to action (i.e. resolved, case completed, no further action by company, etc.) 75; and • Remediation plan being implemented: 10. Covers 314 336 Nestlé employees. Grievances about labour practices In 2015, there were 300 grievances about labour practices filed through the Nestlé Integrity Reporting System during the reporting period. Of the substantiated and unsubstantiated cases received, 242 (81%) were closed, of which 48 (16%) grievances were substantiated and corrective action implemented. Nestlé in society – Creating Shared Value and meeting our commitments 2015 277
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Nestlé in society Creating Shared Value and meeting our commitments 2015

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