Wednesday, March 12, 2008

EthicsWorld: The Challenges of Corporate CSR Reporting: Nestle’s Creating Shared Value – True CSR or Just Good PR?

It is often the way that Nestlé PR offensives draw attention to both its malpractice and its dishonest presentation of its practices. There are many past and recent examples, but one of my favourites is Nestlé's anti-boycott advertisement that blew up when all our complaints against it were upheld by the UK Advertising Standards Authority (ASA). Mr. Brabeck, Chief Executive Officer, flew in to quell the storm, but instead generated headlines like: "Mr. Nestlé gets angry". See:

The same is happening with its 'Shared Value' report launched last week. Peter Brabeck-Letmathé is retiring as Chief Executive, but will continue as Chairman and is currently on tour with the report, boasting of the positive impact Nestlé has on millions of people. Yet the report is incomplete and dishonest in its portrayal of the Nestlé activities with which I am familiar.

It was audited by Bureau Veritas, who famously cleared Nestlé of any wrong doing in water extraction in Brazil, but failed to report the fact - and were apparently unaware - that Nestlé was being pursued through the courts by the Public Prosecutor which resulted in out-of-court settlement requiring Nestlé to stop pumping water or face significant daily fines. The audits Bureau Veritas has conducted on the baby milk issue have been as flawed, missing practices such as Nestlé's supermarket promotion for 'new formula' in South Africa which breaches the weak Nestlé Instructions Bureau Veritas uses its benchmark as well as the World Health Assembly measures it should be using. See:

These concerns about the process and the weight to put on such reports and counter criticism are gaining attention. The website EthicsWorld leads on Nestlé's 'Shared Value' report today:

It asks: "The Challenges of Corporate CSR Reporting: Nestle’s Creating Shared Value – True CSR or Just Good PR?”

The article states:

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The report takes on a wide variety of issues developed by a company that works with leading organizations like SustainAbility and AccountAbility. Nestle was one of the first food companies to help the Global Reporting Initiative develop a global reporting standard and indicators on sustainability in the food sector. It participates in such initiatives as the UN framework to tackle climate change and the International Cocoa Initiative. But despite Nestle’s positive credentials, advocacy groups like Baby Milk Action and Corporate Watch continue to be critics and challenge the credibility of the company’s reporting.


Nestle’s accomplishments in its key CSR areas are detailed in the report, but the text falls short when it comes to admitting problems and difficulties in meeting goals. Articles from outside sources, notably advocacy NGOs, highlight the shortcomings, but these too raise questions about objectivity at times and so makes the challenge of determining the reliability of corporate reports all the more complex.

An article from Baby Milk Action, for example, criticizes Nestle for aggressively marketing baby foods, trade union busting, failing to act on child slavery in its cocoa supply chain, depleting water resources, among other concerns. The group’s primary allegation is that Nestle has violated the baby food marketing requirements adopted by the World Health Assembly and conducts faulty audits. It has been critical of Nestle for many years.

An article in the Sydney Morning Herald expressed the same concerns over Nestle’s “aggressive marketing tactics.” According to the article, “under an agreement by the Manufacturers of Australian Infant Formula, companies may not advertise formula for children under 12 months as it has been shown to reduce breastfeeding rates.”

Corporate Watch has highlighted Nestle’s questionable marketing schemes in promoting its bottled water and the company’s impact on public water sources.

EthicsWorld seeks to assist companies and organizations to better understand the challenges of CSR reporting and continues to highlight reports by major firms and comments by leading NGOs. Keep monitoring our site for analysis on how companies are addressing this sticky issue.

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Read the full article and find out more about EthicsWorld at:

Baby Milk Action prides itself on the objectivity of its information and provides documentary substantiation, not just allegations. You can find some of this by exploring the links from our press release concerning the report at:

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