of soya traceable* in 2019
Soya is one of the world’s most important crops as it has a wide range of uses. We source it from suppliers in different countries in two main forms: direct soya (soybean oil, soybean meal and their derivatives) and indirect soya (embedded in animal protein ingredients). Although usually not labor intensive, soya production can be linked to the degradation of natural habitats and land rights abuses.
* Traceability has focused on soybean meal. We started tracing soybean oil in 2019, but this is currently excluded from the reporting as it would change the baseline
Our soya supply chain
We source soya products from hundreds of suppliers in many different countries, including Argentina, Brazil, Serbia and the US. Supply chains vary in length and complexity: they can be upstream, when the soya is sourced directly from producers, or mid-stream, when producers source soya products and further process them. As a result, knowing where soya was produced is not straightforward.
Our approach to sourcing soya sustainably
To better understand the issues in our supply chain, our partner Proforest undertakes site assessments based on the requirements laid out in our Responsible Sourcing Standard. Proforest also provides technical assistance and guidance to our suppliers to help support them to make improvements in their supply bases. We are now going further, developing a Theory of Change model to help take us toward our 2025 vision.
Nestlé accepts certification against approved sustainability schemes and initiatives that are consistent with our requirements, such as the Round Table on Responsible Soy (RTRS). We also accept traceable soya from smallholders and growers who can show they have an action plan and timeline in place for meeting our requirements.
We engage continuously with suppliers, aiming to raise awareness among them to gradually comply with our Responsible Sourcing Standard and constantly improve soya traceability. Our capacity-building activities in 2019 focused on sharing our Standard, basic aspects of responsible sourcing and production of soya, and highlighting human rights issues among key suppliers, through both webinars and person-to-person workshops.
Developing our Theory of Change
In 2019, with the support of our implementation partner Proforest, we developed our Theory of Change for soya. This consolidates the progress we made during six years of active engagement with suppliers and other stakeholders and embeds our 2025 vision.
Our Theory of Change model for soya
The main strategies adopted for both direct and indirect soya sourcing between 2020 and 2025 are:
- Focus policy implementation in priority origins, where positive change is needed and achievable. Priority regions are identified by considering volumes sourced and needs in Nestlé’s different focus areas. The regions identified were the Brazilian Cerrado and the Argentinian Chaco biomes for natural capital, and India for livelihoods and responsible employment. More priority regions can be added as supply chain mapping evolves.
- Cover sourced volumes with certification credits and financial mechanisms as an interim solution and move to physical volumes. Recognizing that our soya supply chain is complex, and aiming at achieving our 2020 deforestation commitment, we will use credits and other mechanisms to offset our footprint and progressively replace them by physical volumes that have verified compliance with our commitments.
- Engage priority suppliers to build capacity, improve policies, cascade implementation and demonstrate compliance. We source soya from hundreds of suppliers, so prioritization is key to driving change. Our priority suppliers are engaged in a continuous improvement program that involves awareness raising and capacity building, supply chain mapping, gap assessments, development of action plans and monitoring of progress.
- Foster collaboration between Nestlé programs and landscape initiatives in soya-producing regions to create shared value.
- Promote and participate in soya sectoral initiatives to address main supply chain challenges and leverage solutions.
As a result, we will be able to report on progress toward delivering the following:
- Soya volume sourced by Nestlé in priority regions is conversion-free and compliant with Nestlé’s Responsible Sourcing Standard (pdf, 2.4Mb).
- Nestlé’s key soya suppliers progress and leverage effective and transparent implementation of better responsible sourcing commitments.
- Collaborative initiatives supported by Nestlé promote and enable responsible production in soya-producing regions.
By delivering compliant volumes, progressing suppliers and through effective initiatives, we expect to contribute to the change toward:
- Soya expansion being decoupled from the conversion or destruction of natural habitats.
- Soya production adopting best agricultural practices.
- Workers involved in soya production having equal, safe and decent conditions.
- Local communities living in soya-producing landscapes having improved access to land and resources.
These changes are to be part of lasting, positive impact that delivers on our vision for the soya sector:
- Soya production coexists with natural habitats and preserves ecosystem services.
- Human rights are respected in soya supply and production chains.
- Soya production creates shared value and develops thriving and resilient communities.
To hold our suppliers and ourselves accountable as well as driving industry-wide transparency, we have published the list of our soya suppliers and their crush sites in our supply chain (pdf, 0.4Mb), along with the country of origin.
One of the key actions to continuously increase transparency within our own soya supply chain and in the soya sector generally is engagement with suppliers to gradually map where the soya we source comes from. This is particularly important for two reasons:
- To understand what our exposure is to issues that imply some level of noncompliance to our sustainability commitments, including the Nestlé Nestlé’s Responsible Sourcing Standard (pdf, 2.4Mb).
- To promote and raise awareness among our suppliers that improved traceability in the soya sector is absolutely critical.
To better understand our supply chain exposure, together with our partner Proforest, we have developed an approach merging geographical risk analyses with the design of a scorecard for suppliers. For the spatial analysis, we focused on Brazil to develop risk maps at municipality scale, considering publicly available information about deforestation, protected areas, land and water conflicts, legal compliance and forced labor.
The scorecard aims to provide us with some key comparable information on our large numbers of suppliers, as some might not follow our sustainability commitments and we need to understand what and where the gaps are. The scorecards are going to be used as our main engagement tool, and we will report on suppliers’ performance from 2020 onward.
Reducing deforestation and biodiversity loss
In 2010, we made a ‘deforestation-free’ commitment for our supply chains, stating that all of our products, globally, will not be associated with deforestation by 2020. Since 2010, we have been using a combination of tools, including supply chain mapping, certification and on-the-ground verification, to ensure that the soya that we buy is not linked to deforestation. As of March 2020, 76% of the soya that we buy was verified deforestation-free (pdf, 200 Kb). We will continue to work with smallholder farmers and large suppliers alike to close the gap.
Deforestation is a major challenge within soya supply chains in certain parts of Brazil, Argentina and Paraguay, especially given the difficulties of physical traceability of soya beans. Our objective is to source products only from land that has not been converted from forest or other high-conservation-value (HCV) areas to other use. We continue to work to improve our traceability and support the maintenance and management of these highly valuable regions.
Better soil for better farming
In the US, Nestlé Purina is providing USD 1 million (CHF 1.01 million) over five years to support The Nature Conservancy’s (TNC) reThink Soil initiative to help soya and other farmers improve the health of their soil. Adopting better soil health practices, such as cover crops, conservation tillage and crop rotation, could bring huge economic benefits for farmers, as well as long-term conservation benefits. The project includes soya as well as cereal producers.
The project currently has a number of trial programs in place. The Soil Health Institute, another soil collaborator, endorsed 19 measurements farmers can use to chart progress toward achieving healthy soil, and further progress was made in addressing nutrient loss in the Upper Mississippi River Basin. In addition, the healthy soil collaboration, which includes the Conservancy, the Soil Health Institute and the Soil Health Partnership, received a matching grant of USD 9.4 million (CHF 9.53 million) from a nonprofit organization established by Congress, the Foundation for Food and Agricultural Research. Nestlé Purina was one of the organizations whose contribution was matched. Read more about reThink in our cereals and grains supply chain.
Healthy Agriculture Systems in Latin America
The next decade will see an urgent need to implement international global commitments to protect biodiversity, combat the climate crisis and pursue the UN Sustainable Development Goals (SDGs). Latin America’s nature-based solutions for sustainable food and water are ready to be taken to scale in response to this shift.
Nestlé is an early champion of TNC’s Healthy Agricultural Systems (HAS) strategy, which will be vital to the future of agricultural production and food security in Latin America and the world.
The HAS approach seeks to keep agricultural assets at their full productive potential by emphasizing the need to boost productivity and improve profitability both at farm level and further up the value chain. HAS does this by pursuing environmental goals such as soil regeneration and enrichment, carbon capture, biodiversity, habitat conservation and watershed improvement.
The approach aims to increase production by using existing farmland rather than by creating more, as the expansion of agricultural production over recent decades has had a dramatic impact on soil health and surrounding habitats.
In 2019, Stanford University held ChangeLabs systems innovation workshops in core action landscapes identified by the TNC as highly suitable for the HAS approach. These locations included Argentina’s Gran Chaco, Colombia’s Orinoquía (Llanos) region and Brazil’s Cerrado region – each of which presents opportunities to increase production by restoring degraded soils, a win-win for food security and the environment.
Local Nestlé agricultural experts attended and contributed to the workshops and development of the workplans in Colombia and Brazil. Each workshop convened over 30 relevant stakeholders from different sectors and identified systems-level interventions. The workshops generated ideas on agricultural norms, business models and public policy to facilitate the future development of these action landscapes through sustainable interventions. Based on these, TNC created three-year workplans for the landscapes. These plans are currently being refined and will be launched in 2020.
Working toward net-zero emissions
Our recent climate pledge to commit to net-zero emissions by 2050 will also push us to seek new innovations to offset and inset our emissions through restoration, conservation and reforestation activities at the forest source with our palm oil suppliers.
- Rural Development Framework (pdf, 2Mb)
- Commitment on Child Labour in Agricultural Supply Chains (pdf, 200Kb)
- Corporate Business Principles (pdf, 1Mb)
- Responsible Sourcing Standard (pdf, 2Mb)
- Commitment on Farm Animal Welfare (pdf, 1Mb)
- Natural Capital: Water in Agriculture (pdf, 6Mb)
- Natural Capital: Biodiversity (pdf, 4Mb)
- Nestlé Cocoa & Forests Initiative Action Plan (pdf, 860Kb)