Responsible sourcing at Nestlé – BSL students learn first-hand about key elements of corporate sustainability

As all of us working in this field know, sustainability is highly complex, requiring an understanding of multiple disciplines, many of which rather technical. Additionally, there’s a big gap between theory and practice, especially when attempting to transform existing companies and systems that were not built with sustainability in mind.

In our case, after 5 classes of “Business Responsibility & Sustainability”, covering principles, natural and planetary boundaries, human dimensions, major programs like SDGs and MDGs, the role of businesses, stakeholder models and management, including role plays on how companies create conflict and how to resolve them – it was time to see how it all works in practice.

Early January, we were fortunate to be received by Dionys Forster (Sourcing specialist, department of corporate agriculture) and Diarmuid O’Connor (Global manager, agricultural raw materials) at the Nestlé HQ in Vevey.

Given the size and complexity of Nestlé (over 300k employees, 190 countries, thousand of brands and many more products), we had to focus, in the case of our visit on rural development and responsible sourcing of agricultural products, especially milk, cocoa, coffee. This of course means that many other topics with high sustainability relevance, such as processed food, added sugars, bottled water, palm oil, pesticides and many others, were not discussed during this visit.

What we saw and discussed was highly sophisticated, well designed and effectively implemented. Here are a few highlights:

  • Planetary boundaries and Terrestrial biodiversity were used to introduce the subject, similarly to how we started our own class two months ago.
  • Nestlé, with 1.7% world market share, is the biggest player in a highly distributed market, top 20 companies collectively accounting for only 9%. This means, to make a big difference, working with competitors is required.
  • Social media analysis reveals that people are concerned about food quality, climate change, packaging, animal welfare.
  • To make sourcing more responsible, Nestlé implemented Farmer Connect, directly sourcing from 760’000 farmers, ensuring almost total product traceability, offering training (400’000 farmers trained) and limiting price volatility (a major benefit for farmers, allowing them to better plan ahead).
  • A broad sustainable agriculture initiative (SAIN) aims to reduce waste and pollution, better use water, reduce greenhouse gases through technology dissemination, financial support for farmers, buying clubs, price stability, education, training, and advocacy.
  • RISE (Response-Inducing Sustainability Evaluation) is a questionnaire-based tool developed at the Bern University of Applied Sciences, rapidly identifying problem areas, allowing to better focus improvement efforts.
  • “Dairy for you” is an education program offering differentiated training for workers, specialists, managers, and graduates, by setting up a local institute or working with a local university.
  • At Nestlé Nutrition, baby food requires much lower limits of pesticide, lead, cadmium, mercury etc. residues – Nestlé applies the same (strictest) standards around the world, even in countries where not legally required.
  • In Ghana, to reach the majority of farmers who don’t read or write, a local theater play with characters representing good farmer / bad farmer is used to develop local community knowledge – and at the same time improve raw material quality and safety
  • A key issue in agriculture is succession – worldwide, the average farmer age is 60, in the US 65, in Japan 77; and specifically making farming attractive for the young generation. Nestlé has been working with many farmers for 2 or 3 generations, but the issue remains.

This reminds me of an excellent article published in the NYTimes “Don’t Let Your Children Grow Up to Be Farmers”, showing how the design of our food system, among many other issues, also makes farming unattractive for young generations.

Therefore we thank again Dionys Forster and Diarmuid O’Connor, not only for receiving us so well, but for doing so much to make sourcing more responsible.

Author: Sascha Nick, Associate Professor at BSL

CSR – the Swiss government takes it to the next level

Swiss Plan of Action for CSR -(2015-2019) The Swiss Federal Council has just adopted a document which defines their position with regards to the corporate social responsibility concerning Swiss business (CSR).

It is clear from this document that the Swiss government expects their economic actors to assume their responsibilities towards society. The government wants to reinforce the positioning of Swiss enterprises in terms not only of their competitiveness but also with regards to the role they play in society. Being responsible with regards to sustainable development and helping resolve social challenges is expected by the government according to this action plan. Continue reading

Good for Business, Good for the Community – The Irish Vision for CSR and the Economy

The Irish National Plan on Corporate Social Responsibility 2014-2016  is an extremely important step for the Irish business community both locally and globally according to the Irish Government. With this plan, they wish to ensure that Ireland “be recognized as a modern, fair, socially inclusive and equal society supported by a productive and prosperous economy” and they feel that “this objective can be supported by embedding CSR more widely in organisations.”

Ireland wishes to be “a Centre of Excellence for responsible and sustainable business practices through the adoption and implementation of best practices in CSR in enterprises and organisations.“ Continue reading

Closing the circle – from research to reality

Many years ago in another life, in another career, I became passionate about ethnoveterinary medicine (EVM). This arcane subject, also known as traditional veterinary knowledge, received my undivided attention for a number of years. I first learnt about this area of indigenous knowledge from Professor Denis Fielding of Edinburgh University’s Centre for Tropical Veterinary Medicine where I was studying for my Masters in Tropical Animal Production and Health. It appeared that in every culture, in every civilisation the world over where animals were being raised for meat, milk and fibre, people had discovered plants with medicinal properties to treat a multitude of livestock ailments. Continue reading

Human Rights are inalienable and indivisible!

I was happy to present my views on Business and Human Rights and corporate governance to Professor Marina Curran’s Masters Class on “Business Responsibility and Sustainability” this week.

For me it was important to tell students about the current debate on the importance of Human Rights to Business and in the Education of Business students – Financial Times: Human Rights should be on the MBA curriculum. This knowledge and understanding is so relevant and important for their future careers! Continue reading

Social Impact Assessment, Risk and CSR

I thought I would continue on the theme of my previous post where I mentioned the glazing of the eyes of students when faced with theory of Corporate Social Responsibility (CSR) versus the reality of applying CSR in the business context, especially in emerging markets with its specific challenges.

CSR has to be above all things practical, achievable, measurable and in many ways the practice of Social Impact Assessments (SIA) when embarking on new projects embodies this. Continue reading

Is there a business case for CSR?

News-banner-Michael-Hopkins

Business School Lausanne received a visit from Michael Hopkins [1] in September 2013.  Professor Hopkins is a well-known expert on Corporate Social Responsibility (CSR) and was recently named as one of the world’s 100 thought leaders on trustworthy business behavior in 2013. Hopkins gave his listeners a comprehensive explanation of how he has lived and seen the process and thinking relating to CSR over a 20 year period. Different influences such as economist Wassily Leontief and development gurus Arthur Lewis and AK Sen [2] and Michael’s own  work on human development,  his interest in seeing what business was doing in terms of development were all part of his personal journey in this subject. Continue reading