Nestlé and Ethiopia. A Statement by Nestlé CEO Peter Brabeck

Back to Press releasesVevey,Dec 23, 2002

Last Wednesday morning, our Nestlé United Kingdom headquarters was confronted by a surprise demonstration at its front door. The demonstrators charged that Nestlé was pressuring the Ethiopian government for US$6 million in compensation for a business owned by Nestlé Germany that had been seized by a previous regime in Ethiopia (we are one of many companies involved in the case). The point of the demonstration was that this was a heartless act at a time when Ethiopia, a very poor country, is in a state of famine.

We in Switzerland were also taken by surprise, as the charges were simultaneously spread in a pre-planned media campaign before we were given any opportunity whatsoever to investigate and discuss the situation with the NGO involved. This made things especially difficult for us to respond immediately, as an external Ethiopian lawyer engaged by a small subsidiary of Nestlé Germany is handling the sporadic negotiations and with whom neither we in Switzerland nor in the UK have any direct contact.

In immediate response, our reaction was to issue statements that focused on the chronological history and legal aspects of the issue.

Now that we have had time to consider the issue more fully, I want to personally communicate the Company’s position so as to leave no doubt as to where we stand.

First, we do think it’s important for the long-term welfare of the people of Africa that their governments demonstrate a capacity to comply with international law, but we are not interested in taking money from the country of Ethiopia when it is in such a desperate state of human need.

We will therefore devote any money received from this settlement to both public and private efforts to relieve hunger in Ethiopia. This will take the form of both short-term relief aid and longer term food security.

As the Ethiopian government has already offered US$1.6 million, we will immediately make this sum available upon receipt for famine relief in Ethiopia. We will do the same with any additional sums resulting from a final settlement. We have recently initiated inquiries with the representatives of the International Federation of the Red Cross/Red Crescent Societies (IFRC) as to how best to direct these funds (Nestlé has a relationship with the IFRC through being the founding corporate sponsor of the IFRC Africa Health Initiative, aimed at fighting HIV and other life-threatening diseases in Africa).

We regret that this issue resulted in hasty communications and misperceptions about Nestlé, but a positive benefit may be that it has focused attention on Ethiopia.

Of course, we and our employees were shocked and stung by the surprise campaign, and believe that actions which blind-side others are not in keeping with the common good. This is especially relevant where companies, including Nestlé , have demonstrated that we are willing, at the senior level, to openly discuss issues concerning our operations around the world.

But at this Christmas time, our thoughts turn to the billions of the earth’s people who go to bed hungry.  This is especially true of the people of Ethiopia, and we hope our commitment will bring the possibility of helping a significant number of people there.

Peter Brabeck, CEO
Nestlé S.A.
December 23, 2002