Monday, March 19, 2007

Nestlé is not an ethical corporation

There is a magazine called Ethical Corporation. The company that produces it also runs conferences under the same name.

I was approached by them some time ago to write an article on how we campaign. Although subscriptions to the monthly magazine cost £295, no fee was offered. With or without a fee, we have to evaluate whether the interests of infant health are best served by putting time to preparing an article rather than the one hundred and one other activities we could be doing.

A look at Ethical Corporation quickly convinced me it is what is known as ‘greenwash’. More about how to appear ethical than to change to be 'ethical'. More about the industry tactic of approach voluntary codes of conduct than accepting independently monitored and enforced regulation.

It seemed to me the NGO (Non-Governmental Organisation) column in the magazine was more about intelligence gathering for corporate leaders than persuading them to change, though some NGOs had written for the column because they either take a different view or have been flattered by the offer. I refused and got on with something much more likely to achieve change.

We do, of course, ‘engage’ with corporations. I am often writing to Nestlé and other companies. Until Nestlé put a block on it, we participated in debates with the company and we are calling for Nestlé to participate in an independent, expert tribunal to go through the evidence and claims in depth – Nestlé refuses to even discuss its terms and conditions for participating. See:

I recently wrote to the Chief Executive of Novartis over its entry into the FTSE4Good ethical investment listing, which is conditional on it rolling out changes to its baby food marketing practices. While we welcomed the commitment, from the response, it appears no changes are planned, rather on-going malpractice is defended (more on this soon).

Nestlé claims to be responsible, accountable and transparent. But you only have to scratch the surface of its claims for the stink that lies beneath to escape. See, for example, its portrayal of its ranking in the recent Global Accountability Report 2006 and what the report actually says. See:

So it struck me as ironic when I received an email alert saying: “Join E.ON, BP, Nestle, TNT Worldwide and many more already attending the largest CR event of 2007!” This was publicising the Responsible Business Summit, being organised by Ethical Corporation for May 2007. CR stands for Corporate Responsibility. I responded:

I am not sure why you include Nestlé in the subject of a message about 'responsible business' - particularly as you are not highlighting its role as the world's 'least responsible company' and one of the most boycotted on the planet.

Nestlé uses 'Corporate Social Responsibility' to try to divert criticism of its aggressive baby food marketing, abuse of workers rights, failure to act on child slavery in its cocoa supply chain, environmental damage of its water bottling and so on, bringing the approach as a whole into disrepute. Perhaps Ethical Corporation views such PR strategies as 'success stories' to be shared with other 'ethically challenged' corporations. I would hope not.

If there is genuine interest in changing corporate practices for the better, Nestlé misuse of CSR and its appalling record in so many areas needs to be addressed and I hope you will consider doing so.

That would be an interesting event – unpicking one of Nestlé’s booklets for example, such as its recent “Nestlé vision of Corporate Social Responsibility as practised in Latin America”, a book so flawed and dishonest a whole conference could be spent examining its various themes. Nestlé would be unlikely to attend, of course. It not only refuses our invitation to an independent, expert tribunal, it refused a request to attend a public hearing organised by the European Parliament!

The response I received was ingenious. They are neither speakers at the conference on responsible business, nor invited. They are simply one of many attendees and “will hopefully learn something of benefit”.

If that is supposed to mean benefit to the wider world rather than just Nestlé, let us hope it will learn to accept criticism and abide by globally agreed standards instead of spending a fortune on trying to divert criticism so it can carry on with business as usual.

Nestlé is a guest speaker, however, at the next Ethical Corporation this week, 21 March, where a few boycott supporters intend turning out to deliver leaflets to participants to raise awareness that Nestlé is not an ethical corporation. Registration is from 8:00 am if you would like to come along. Click here for details.

The event is called Business-NGO-Government Partnerships. And it states: “How to build partnerships that strengthen your position...create opportunities...and help you achieve your long-term goals.”

It is our old friend and member of the anti-boycott team, Hilary Parsons, now going under the title of “Head of Corporate Responsibility”, who will be speaking on Nestlé and coffee. No doubt the token Nestlé Fairtrade product, Partners’ Blend, will be much to the fore. Remember this involves just 0.1% of the coffee farmers dependent on Nestlé. Over 3 million are outside the scheme and suffer from Nestlé’s trading practices and the way it encourages more farmers to enter into coffee production, so exacerbating the problem of over-supply. See:

There is a great deal that Nestlé could be doing if it was seriously concerned about business ethics. It could, for example, accept our four-point plan on the baby milk issue to save infant lives and ultimately end the boycott. It has not even got past step one: accepting the validity of the World Health Assembly marketing requirements for baby foods. See:

If Ethical Corporation wants to put Nestlé’s CSR claims on trial then there may be value in participating in one of these events. But while it is giving a platform for Nestlé to divert criticism of its malpractice, we are better placed using the event to expose Nestlé and the failing of the CSR movement as a whole to address institutionalised and systematic malpractice of such corporations.

We should perhaps not expect too much of the CSR movement, as it was largely an invention of Nestlé consultant, Raphael Pagan, as he developed strategies to undermine the first phase of the boycott in the 1970s. For an in-depth analysis of that see the book ‘Holding Corporations Accountable’ by Judith Richter (Zed Books) or the shorter Cornerhouse briefing paper:


Anonymous said...

It seems that they do not really want to argue with this issue. For them, as long as they provide a magazine subscription that offers help and information to their consumer, they can completely call it as a good service

Anonymous said...

I feel as though this article does not give enough back-up evidence. The author claims that Nestle demonstrates bad CSR, but how so?

Anonymous said...

I guess whoever posted the comment on 3 May couldn't be bothered to follow the links to the substantiation of the many points raised that demonstrate bad CSR...