Some of the key interventions that form part of our Commitment on Natural Capital include: acting as a responsible steward of Natural Capital, reporting on risks and responses, supporting consumers to make better-informed choices and working with stakeholders.
Assessing the status of biodiversity
Understanding our dependency on biodiversity helps us decide where best to focus our biodiversity activities:
||Deforestation; forest degradation
||Packaging, paper, timber pallets, shea, nuts, colorants
||A comprehensive commitment to eliminate deforestation and programmes across the relevant commodities (see also Deforestation)
||Overfishing; acidification; warming; nutrients/Dead Zones; plastics
||Responsible Sourcing Guidelines (RSGs) on seafood (see also Responsible sourcing)
||Water scarcity/over-extraction; water pollution
||Every stage of our value chain depends upon access to freshwater
||A comprehensive set of commitments and KPIs on water across supply chains, factories and public policy (see also Water)
||Loss of high value grasslands/biodiversity
||Agriculture, grazing (milk, meat)
||Application of the HCV concept, plus restoration through silvopasture programmes at dairy farm level
||Increasing temperature; pollutants; ozone layer depletion
||Stable climate, reliable precipitation, temperature
||Emission reductions initiatives at factories and use of natural refrigeration units (see also Manufacturing), tackling deforestation/high carbon soils, and facilitating the investing in biogas digesters by dairy farmers
||Soil loss and degradation; increasing salinity
||All our agricultural crops rely upon soil with adequate structure and nutrients
||Included as part of Responsible Sourcing Guidelines (RSGs) on palm oil, soya, sugar, plus UTZ certification of cocoa
In compiling these priorities and deciding where to focus our efforts, we drew from a wide range of research from recognised organisations such as: the International Union for Conservation of Nature (IUCN), Food and Agriculture Organization (FAO), Convention on Biological Diversity (CBD), United Nations Environment Programme (UNEP) and the World Wildlife Fund (WWF).
Consequently, we believe we can make the most improvements in three key ways:
- Raw material procurement
- Improvements at our factories, and
- Supporting public policy.
Raw material procurement
We continue to implement Responsible Sourcing Guidelines (RSGs) in our palm oil, paper, soya, sugar, vanilla, seafood supply chains as well as continuing our work on the responsible sourcing of milk, coffee and cocoa. Each commodity has been identified as having a potential threat to biodiversity.
While the suppliers of these materials are already subject to our Corporate Business Principles and Supplier Code, through the RSGs we are now incorporating performance requirements on the use and management of water and soil, and elimination of deforestation in the entire upstream value chain back to origin.
Raw materials and deforestation
We have further advanced on no-deforestation by carrying out a global level analysis of where deforestation is occurring to match that against our known sourcing areas. This will allow us to better focus our efforts to eliminate deforestation through our procurement programmes and the work of the implementation of the RSGs.
We expect to refine our work in 2013 to better target current and newly emerging occurrences of deforestation. Recognising the need for collaborative action to tackle deforestation, we have also taken an active role in the Consumer Goods Forum programme on deforestation and in the Round Table for Sustainable Palm Oil (RSPO) (see also Memberships and partnerships for more detail on our work with RSPO).
Raw materials and water
We have produced detailed requirements for water use in agriculture that are now being used in our RSGs to guide better water stewardship at the farm level. These requirements are based on the SAI Platform’s water guidelines, but also include current thinking from the major agricultural commodity certification schemes and the Alliance for Water Stewardship draft standard.
We have further analysed our factories in water-stressed areas to look at water stewardship aspects. We have identified 21 factories to focus on in 2013, to further develop their approach to water stewardship.
Traceability of raw materials
The assessment of actual impacts of the production of raw materials is being evaluated through our work to map our supply chains back to the primary producer. With traceability established back to the farm or feedstock level, we will be able to work with suppliers to improve their performance and meet our Responsible Sourcing Guidelines (RSGs) (see also Responsible sourcing for more details on our RSGs).
Based upon the assessment of the state of biodiversity, we are currently focusing on a shortlist of countries where biodiversity values are highest and where, through our interventions, we believe that we can bring about significant improvement in performance. For example, with paper packaging, we are focusing on fibre sourcing from, Brazil Canada, Chile, Russia, USA and south-east Asian countries (including China, India, Indonesia, and Malaysia). For sugar, we are concentrating on, Brazil, India and Mexico, whille with soya our focus is on Argentina and Brazil. As we advance on this journey, we will expand this to further countries in the future (See Raw materials for further details on these initiatives).
Direct sourcing of raw materials
For our direct sourcing programmes that cover more than half a million farmers – primarily milk and coffee – we take a more hands-on approach to assessing impacts and influencing behaviours to protect biodiversity at the farm level.
Our strategy for managing biodiversity impacts of these two key commodities is shown in the table below:
||Our survey of our factories’ proximity to protected areas and areas of high biodiversity in 2011, revealed that dairy factories and their associated sourcing districts are often close to areas of high biodiversity. This is applicable to some of our operations in Brazil, China, Ecuador, Nicaragua, Peru, Philippines and South Africa.
Using RISE (Response-Inducing Sustainability Evaluation), our assessment and action planning tool, we are working with dairy farmers to review their methods and develop action plans for economic, social and environmental improvements at their sites. RISE studies have been completed in nine countries to date (with information pending for a further three countries, and work is due to commence late 2012 and in 2013 on the remaining ones).
See Raw materials for more information.
||Biodiversity issues are managed primarily through the use of the 4C Coffee Code and the Nespresso AAA Sustainability Quality™ Program for coffee sourcing. Both of these include safeguards against sourcing from protected areas, restrictions on pesticide use, soil conservation and water course protection.
Silvopasture is the practice of combining forestry and grazing of domesticated animals in a mutually beneficial way. Advantages of a properly managed silvopasture operation are enhanced soil protection and increased long-term income due to the simultaneous production of trees and grazing animals. We continue to implement silvopastoral systems to improve biodiversity. This involves planting different species of trees, hedges and shrubs on the same pasture land to improve biodiversity and yields. For example, Nestlé Nicaragua has recently helped ten pilot farms to implement a silvopastoral system.
Improvements in our factories
Some of our rural factories are also in areas of high biodiversity and located close to important water areas. It is important therefore that we manage our facilities to safeguard these areas, and work with local authorities to safeguard those areas that we are dependent upon.
All factories operate according to our Environmental Management System and 440 factories are certified to ISO 14001:2004 standard on environmental management (2011: 413). This gives us a solid foundation on which to develop local and business sector approaches to improve our impacts, and work with stakeholders to enhance biodiversity. Where our factories are located in legally protected areas, we take special measures to manage our operations.
We planted butterfly meadows at our Fawdon, Buxton and Girvan sites in the UK to increase biodiversity.
Nestlé factories and biodiversity status
To find out which of our factories were in areas of high biodiversity/protected areas, we embarked on a project with the UN Environment Programme World Conservation Monitoring Centre (UNEP-WCMC). This process produced a searchable database of factories where we will focus our future actions, notably on 60 factories where high biodiversity risk has been identified.
The data reported on factories in/adjacent to protected areas and areas of high biodiversity relates to assessments carried out in 2011. We have not updated the data for new factories built or acquired during 2012. It is our intention to update this data every three years. In the meantime, we will use proximity to protected areas as a ‘filter’ in selecting new factory sites. See the assessment of factory locations and biodiversity (pdf, 176 Kb).
Supporting public policy
It is vital that we work in collaboration with other parties to take effective action where necessary.
In 2012, the Cambridge Programme for Sustainability Leadership published its Natural Capital Leadership Compact. We are a signatory to this and we have been active in publicising it, speaking at events at the Rio Sustainability Conference and explaining our approach. As part of our commitment on Natural Capital, we are collaborating with other companies on the valuation of externalities and in 2013, we expect to report more formally on the valuation of natural capital.
We work in collaboration with other parties where possible to maximise the effectiveness of our activities. We are keen to develop a balance sheet approach to Natural Capital. In other words, we see the necessity to safeguard biodiversity and ecosystem services at the same time as we rely upon them. A key element of this is to develop a better understanding of how to value the consequences of our activities throughout the value chain.
We continue to be an active member of the Cambridge Natural Capital Leaders Platform, a major business-led programme focusing on practical evidence, action and policy influence. The cross-sectoral platform, set up in 2010 as part of the Cambridge Natural Capital programme, addresses the impacts of ecosystems and Natural Capital loss and degradation on business, their customers and wider society.
Improving protected areas
We do not have responsibility for management of protected areas. Typically, national park authorities or relevant government authorities take responsibility for management matters. However, we do assist the management of some areas such as the national park at Viladrau in Spain. See also the Agrivair case study in Water – Collective action for an example of proactive land management in an area which is not protected, to lower the impact of farming and by implication restore ecological functions.