Monday, June 16, 2008

Ethical Corporation Magazine's analysis of Nestlé Shared Value report

Ethical Corporation Magazine, that most pro-company PR of publications, has taken rather surprising exception to Nestlé's Shared Value report in an article today. See:

There is good reason to do so, as our press release at the time of the report launch set out. See:

Ethical Corporation highlights to lack of objective targets regarding Nestlé's undertakings, ambiguity over whether it plans to develop them or is relying on historic performance and:

"Another gaping hole concerns transparency on Nestlé’s management of human rights and labour issues in its supply chain. While Nestlé claims a total of 3,400 supplier audits in 2007, it does not publish audit results or include any specifics on actions taken in the event of non-compliance. A search of Nestlé’s website yields no additional information. Given that Nestlé does not operate any of its own commercial farming activities, this seems a significant oversight."

We have repeatedly asked Nestlé for audits it claims to produce on its baby food marketing practices and have also written to the Nestlé Ombudsman on this issue, but received no reply. An overview of an audit does appear in the Shared Value report and is extremely flawed, for example using Nestlé Instructions as its starting point rather than the World Health Assembly marketing requirements. As we have exposed on our Campaign for Ethical Marketing action sheet, Nestlé violates its own weaker measures as well as the International Code of Marketing of Breastmilk Substitutes and subsequent, relevant Resolutions of the Assembly.

Yet Ethical Corporation is worryingly impressed by the baby food marketing audits and accepts at face value the claim the audits are against the Assembly measures stating: "As could be expected given past controversy, Nestlé rounds out the discussion with a nod to breastfeeding and a description of how the company is monitoring its compliance with the World Health Organisation International Code of Marketing of Breast-Milk Substitutes. Nestlé makes a portion of these audit results available online, showing a clear record with no violations."

Which does highlight the flaw with the whole voluntary Corporate Social Responsibility approach. When claims are not woolly, they may be bogus. This is why campaigns such as the UK CORE campaign are calling for obligatory reporting standards for which a named director is legally responsible, in the same way as financial reporting has to be rigorous.

Suggestions in my contribution to the book Global Obligations for the Right to Food examine how this can be achieved at a global level for when national safeguards are ineffective.

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