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-EC1, Indirect economic impacts G4-DMA, G4-EC7, G4-EC8, Procurement practices G4-DMA, G4-EC9, Supplier assessment for labor practices G4-DMA,
Local communities G4-DMA, G4-SO1, G4-SO2, Supplier assessment for impacts on society G4-DMA
Rural development
Rural development is one of the areas of focus for Nestlé in Creating Shared Value. The reason is simple: Nestlé
has a large presence in rural areas. Four hundred of our factories – 80% – are located in rural areas 1 . Together they
employ 205 000 people and make significant contributions to rural communities through employment
opportunities and greater access to our products for local consumers, as well as other indirect economic benefits.
Many factories also contribute to local educational facilities, offer formal apprenticeships and training, run literacy
and numeracy programmes, provide clean drinking water to local communities and invest in other local
infrastructure. We source materials from 4.1 million farmers, including directly from 760 000 across more than
50 countries; most of these are family farmers. Therefore, it is important for Nestlé that rural areas are attractive
places to live, work and invest in; the overall wellbeing of farmers and their families, rural communities, small
entrepreneurs and suppliers are intrinsic to the long-term success of our business.
The Rural Development Framework
Our commitment
Roll out the Rural Development Framework
to understand the needs of farmers
Our Rural Development Framework aims to help us deliver a
consistent approach to rural development, ensuring that our
activities address real issues on the ground. We focus on
global priorities while retaining the flexibility to address
specific local challenges.
The framework was designed with the assistance of the
Danish Institute for Human Rights, the Fair Labor Association
(FLA), the Rainforest Alliance and Solidaridad. It combines
development and societal approaches to the challenges faced
in rural areas, focusing on three distinct but connected groups:
• Successful farmers: farmers are business oriented and
farming by choice;
• Productive and respected workers: rural-based employment
is attractive for workers; and
• Prospering communities: rural areas are attractive places to
live, work and invest in.
The framework is designed to:
• Deliver a consistent approach and ambition to our rural
development activities, ensuring that we address global
development priorities but retain the flexibility to address
locally relevant issues;
• Align activities on the ground with business and societal
priorities;
• Create shared value at a country level based upon identified
gaps; and
• Provide a credible process that can enable us to measure
progress, and align and collaborate with governments and
other organisations.
The Rural Development Framework complements existing
rural development activities, within the Farmer Connect
programme, by further identifying areas for interventions.
This has enabled us to introduce a series of new objectives
to progress the roll-out of the Rural Development Framework.
Although the framework initially focused on the direct
suppliers within Farmer Connect, it now recognises the
significant role of our trade partners, through whom Nestlé
buys the majority of its agricultural raw materials, and can be
implemented by them.
Delivering the Rural Development Framework
Our objective
By 2015 – Continue to establish baseline assessments in
the countries of key importance to our business that show
pronounced social need to guide us in aligning our own
activities with the priorities of local communities.
In 2015, we continued to carry out baseline assessments in
countries where we have Farmer Connect operations, to
ascertain how our activities align with the priorities of local
communities in those countries. The assessments enable us
to understand current conditions and design appropriate
interventions. From these assessments, it is evident that there
are a great many challenges and issues to address.
For programmes such as the Nescafé Plan, the Nestlé
Cocoa Plan, the Nespresso AAA Sustainable Quality
Program and our other Farmer Connect (direct procurement)
work with dairy farmers and producers of other crops, our
focus has historically focused on supply chain interventions.
These include the provision of better inputs (e.g. higheryielding
plantlets), farmer training on agronomy, animal
husbandry and business practices. Farmers who have received
this support have improved yields and incomes, and better
livelihood outcomes compared to those who have not (as
demonstrated by the results of surveys carried out by
Solidaridad and TechnoServe).
We have also long recognised a need to tackle wider
contextual issues, such as the empowerment of women
farmers and investing in clean water and sanitation. The
results of our assessments enable us to identify these issues
clearly and develop targeted responses.
1 We define rural areas as being ‘less than 30% artificial land cover within 5 km radius of the
factory.’ The figures were calculated for us by UNEP-WCMC in December 2014 using data
from the European Space Agency’s GlobCover 2009 data set.
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