Rural development is a focus area for our business. We contribute to improvements in agricultural production, the social and economic status of farmers, rural communities and in production systems to make them more environmentally sustainable.
Strategic responsibility for Nestlé’s rural development activities and procurement lies with Magdi Batato, the Executive Vice-President of Operations, while final accountability rests with the Executive Board and the CEO.
The operational strategy for rural development is chiefly delivered by the Corporate Agriculture Team through a network of sourcing staff and extension workers in the supply chain. Responsible Sourcing, including farm animal welfare, is jointly delivered by Corporate Procurement and Corporate Agriculture.
Farmer Connect and direct sourcing operations
Each business unit takes overall responsibility for local rural development activities. As appropriate, the Rural Development Framework may be used to help inform where interventions are needed.
As well as our in-house expertise, we also call on the advice and capabilities of partners at different stages of the supply chain, to assist us with tracing, assessing and monitoring activities. This includes a website and toll-free helpline that suppliers and farmers can use for reporting violations of regulations, laws and the Nestlé Supplier Code anonymously and confidentially.
Responsible sourcing through our procurement activities
The Nestlé Supplier Code (pdf, 1.7Mb) sits at the heart of every business relationship with our suppliers. It reflects our commitment to conducting our business activities in full compliance with applicable laws, and with integrity and honesty. It sets out the non-negotiable minimum standards and best practices that we require our suppliers and their suppliers –down to the individual farm level – to respect and adhere to when doing business with us. Simple pictorial versions of the code are made available to overcome variations in language and literacy levels.
Implementation of the Code’s requirements is embedded into our internal procurement procedures and objectives, using approaches that are tailored to the nature of the supply chain, the type of supplier and our commercial relationship with them.
However, as each supply chain has its own characteristics and issues, we have also developed the Nestlé Responsible Sourcing Guideline (RSG (pdf, 1.6Mb)), along with category-specific requirements for our priority ingredients and materials. The RSG helps our suppliers improve practices at farm or plantation level, where necessary, with Nestlé’s requirements often going beyond legal or international requirements.
The guideline follows four general principles:
- Suppliers are expected to engage in a process of continuous improvement;
- Suppliers should conduct their business with Nestlé in an open and transparent way;
- Nestlé will support suppliers not yet able to comply with all aspects of the RSG, but who are committed to becoming compliant over time and demonstrate continuous, tangible progress; and
- Suppliers are to continuously monitor and verify their performance and progress, complying with independent assessment where necessary.
Our policies and standards
Our ambitions to support rural development, set out in the Nestlé Commitment on Rural Development (pdf, 214Kb), are consistent with the UN Sustainable Development Goals on poverty and hunger, nutrition, education, gender equality and environmental sustainability.
In addition, the Nestlé Commitment on the Responsible Use of Materials from Agricultural Origin (pdf, 1.4Mb) applies to the upstream value chain back to the primary production level. As part of our drive to ‘remove the worst, promote the best and improve the rest’, its principles span continuous improvement, transparency along the value chain, supplier accountability and support, and credible verification.
To maintain best practice, all our teams are guided by a series of other policies, procedures and documents, including: