Corporate Governance

In 2020, Nestlé remained a dependable company. We responded to COVID-19 based on three clear priorities: Safeguarding people's health, ensuring business continuity and supporting communities.

Our value creation model continued to balance the pursuit of top-line and bottom-line growth with capital efficiency. We bring relevance to consumers through science- and consumer-driven innovation and develop solutions to meet fast-changing consumer needs.

We refreshed our company purpose statement to reflect our strategy: We unlock the power of food to enhance quality of life for everyone, today and for generations to come.

We continued to engage on environmental, social and governance (ESG) issues which are material to our business and impactful on society. We use our scale, resources and influence to be a force for good, creating shared value through ESG.

We engaged on climate action, aiming to achieve net zero greenhouse gas emissions in our value chain by 2050. We focused on sustainable packaging pursuing our vision that none of our packaging ends up in a landfill or as litter. We managed our human and social capital based on our values of respect, openness and inclusiveness.

Our diverse Board of Directors was engaged to effectively oversee the direction of our company. Since 2015, we have strengthened the Board through ten new independent directors with diverse experience and expertise directly relevant to Nestlé including e.g. additional digital, strategic and food & beverages expertise. We already meet the gender quota which Swiss law requires as from 2026.

We listened to our shareholders through our roadshows, investor meetings and analyst calls. Our Chairman's Roundtables took place in Singapore, New York, Zurich, Amsterdam, Frankfurt, London and Paris. Through virtual meetings, we continued to listen to all our shareholders and other stakeholders despite the pandemic.

In 2020 our Board of Directors reviewed our Board Regulations and Committee Charters to reflect all aspects of its ESG responsibilities and make our risk management framework more explicit.

Our Chair's and Corporate Governance Committee regularly reviews aspects of our governance, as well as our asset and liability management. Additionally, it receives regular reports on quality, cyber risk as well as significant legal matters. In 2020 it reviewed our governance structure and internal reporting.

Our Nomination and Sustainability Committee, chaired by our Lead Independent Director, evaluates Board composition, structure and succession planning. It assesses candidates for nomination to the Board. Additionally, it reviews all aspects of our environmental and social sustainability. It oversees our response to climate change, our human rights due diligence program and our human capital management at Board level including our strategies for diversity and inclusion. In 2020 it helped develop our new Commitments framework, which will be rolled out in 2021. As from the AGM 2021, the Company is splitting this Committee into a separate Nomination Committee and a focused Sustainability Committee. This reflects the importance of sustainability in Nestlé’s corporate governance and allows Board members to dedicate more time, focus and action on each of these important topics.

Our Compensation Committee sets our remuneration principles and submits the proposals for remuneration to the Board and the AGM. It ensures the alignment of our values, strategies and performance. Our compensation proposals and our compensation report are submitted to annual votes by our shareholders. In 2020 it helped develop a set of ESG-related KPIs.

Our Audit Committee oversees internal and external audit, financial reporting, internal controls, compliance and risk management. It reviews reports regarding compliance, fraud, enterprise risk management and the Group's annual risk assessment. Last year, it oversaw the rotation of our external auditors.

We recognize that for our company to be successful over time and create sustainable value for shareholders, we must also create value for society. We see state-of-the-art governance as a driver of long-term value creation and broad-based prosperity.

Download our Corporate Governance Report 2020 in English (pdf, 2Mb) | Français (pdf, 2Mb) | Deutsch (pdf, 2Mb).