The Sustainable Agriculture Initiative of Nestlé

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Presentation transcript:

The Sustainable Agriculture Initiative of Nestlé S A I N The Sustainable Agriculture Initiative of Nestlé SWISSCAM Comité de Meio Ambiente e Sustentabilidade Sao Paulo - August 13, 2004

CT-Agriculture Tasks Support sourcing of agricultural raw materials at qualities & safety, quantities and timing needed Elaborate corporate agricultural policies and ensure their implementation Identify opportunities for competitive sourcing of agricultural raw materials Secure the required agricultural knowledge and competence within the Group Provide technical assistance to NOCs and their suppliers (milk, coffee, cocoa, fruit, vegetables etc.)

Challenges Evolving towards Nutrition, Health and Wellness Company Changing business environment manufacturing strategies Consumer concerns food safety issues Consumer expectations manufacturer liability new quality thinking Increasing food requirements growing population limited natural resources

Consumer needs & expectations ethics, fair trade labor issues, rural life, politics ... Social Responsibility & Personal Values ??? perceived quality environment, technologies (GMOs), animal health & welfare ... tangible quality Function Conscience Convenient Safety Access / Affordability

Challenges Help ensuring tangible quality & safety and Identify relevant perceived quality criteria linked with agricultural raw materials optimize related sourcing support sustainable agricultural production methods (ecological - economical - social criteria) elaborate with Markets, SBUs, CT-Units specific SAIN strategies with strict business focus, e.g. Mexico, B-C&B, B-CCB, CT-QM

Challenges in supply chain Transparency, traceability from farm to table needed to avoid negative effects on: NEMS ... SAIN Input Providers Farmer Trade Processor Food Industry Trade Retail Consumer quality & safety efficiency & productivity consumer perception company image branded products ??? ethics, fair trade labor issues, rural life, politics ... environment, technologies (GMOs), animal health & welfare, ...

Food Industry Initiative mainstream agriculture Integrated strategy SAIN Nestlé Key raw materials Direct sourcing Preferred suppliers Company internal Network Countries Agr. supply chain Food Industry Initiative support sustainable agriculture in general mainstream agriculture pre-competitive

SAI Platform members Campina Danisco Dole Ecom Efico Findus Fonterra Friesland Coberco Groupe Danone Kraft McCain Europe McDonald’s Nestlé Neumann Kaffee Gruppe Sara Lee Tchibo Unilever VOLCAFE

SAIN - Milk Achievements SAI - working group promoted GAP programs Australia, China, France, Holland, UK, Pakistan ... CT-IP target setting projects US, Chile, Panama, Peru, Spain, France ... SAI - working group elaborate position paper, good agricultural practices

SAIN - Coffee Assist in production where direct sourcing China Vietnam Mexico Philippines Colombia Malaysia Brazil Ivory Coast Indonesia India Thailand Purchasing on the market : Direct procurement (partly) :

Example coffee Thailand Key elements: Quality assurance • Knowledge sharing Traceability • Public Private Partnership; communication of needs i.e. quantities & qualities • train local producers • PPP program • plant genetic • government program • good agr. practices • financing (third party) • income diversified • quality control • quality payment • Nestlé managed • final quality control • Third parties Farm Input Farmer Buying Station Transport

SAIN / SAI in coffee SAI-Coffee working group Ecom, Efico, Kraft, NKG, Sara Lee, Tchibo, Volcafé elaborate position paper, guidelines pilot projects Common Code for the Coffee Community (4C) started via the DKV and GTZ create code on sustainability and indicators - all stakeholders 4C and SAI objectives are complementary UNCTAD & IISD - Coffee Sustainable Partnership (SCP) open discussion forum - all stakeholders complementary to SAI and 4C - collaborate; supported by International Coffee Organization

Nestlé Road Map Understand what enables sustainability Set up tools to make sustainable performance tangible KPIs for supply chain Joint studies with Universities and R&D Implement measurement & management system in supply chain Collaborate in SAI working groups (Coffee, Milk, Cereals ...)

Elaborate sustainability indicators Lead by University Bern - study indicators at farm level collaboration of: SHL Example: milk supply in N.E. China (smallholders <1ha) Actual Optimised

Conclusions Practices / Processes Indicators "There is no reason to prophesy the future, except in order to be very well prepared to face the future" (Pericles) Practices / Processes standards Indicators trends Performance Measurement System competitiveness