Nestlé opened nominations for its Creating Shared Value prize this February 2011. The company could improve its public image by accepting Baby Milk Action's four-point plan for saving infant lives and ultimately ending the boycott - but instead it is opening its cheque book to try to buy itself some good publicity by co-opting the good reputation of others. However, there is a risk that anyone supporting Nestlé's Creating Shared Value award will find they are dragged down by association with one of the world's four most boycotted companies. And as news breaks in the UK about companies infiltrating environmental groups, we should remember that Nestlé is being pursued through the courts in Switzerland after spying on campaigners there.
Nestlé is 'widely boycotted' according to its Global Public Affairs Manager and ranks poorly in public polls of corporate responsibility (for example, receiving a 'positivity' score in social media of just 12 out of 100 in an audit by Yomego Social Media Reputation, according to PR week). So the company launched the Nestlé Prize in Creating Shared Value in 2009 which "seeks to encourage and reward innovative approaches to the problems of nutrition, water, and rural development." A request for nominations is being publicised currently with a prize of CHF 500,000 (approximately US$ 480,000).
Mike Brady, Campaigns and Networking Coordinator at Baby Milk Action said: "Nestlé seems to think this PR stunt is a good investment to try to improve its abysmal image. It does not want to change the marketing practices that boost its profits while contributing to the problems of nutrition, water and rural development and lead to its poor reputation. It falls to members of the public to show they are not taken in. The more people support the Nestlé boycott - and tell Nestlé they are doing so - the more success we have in forcing it to change its practices."
Nestlé whole concept of Creating Shared Value is a Public Relations (PR) strategy to divert criticism of its business practices. Baby Milk Action and other Nestlé Critics have registered complaints about the misleading nature of the company's Creating Shared Value reports with the United Nations Global Compact Office, which posts the reports on its website. While refusing to investigate the complaints, the UN Global Compact Office continues to highlight Nestlé reports and accepted it as a Patron Sponsor of its 10th birthday conference in New York last year.
So in calling for nominations from initiatives that are no doubt doing good work, Nestlé is trying to cover itself with their reputation and convince people that it is somehow driving forward good practice in tackling problems of nutrition, water and rural development. Make no mistake, at the same time as violating international human rights and environmental standards, Nestlé is also trying to set the agenda on how corporations should be regulated at international fora, such as the World Economic Forum, and nation by nation. Nestlé opposes binding regulations as a 'straitjacket' on the 'engineers of wealth' and demands to be trusted to do the right thing because of its 'values'.
Nestlé has demonstrated time and again that it is not worthy of trust. While claiming to abide by the marketing requirements for baby foods, it is continue to systematically violate those standards. Its current global marketing strategy is to claim that its formula 'protects' babies when, in reality, babies fed on formula are more likely to become sick than breastfed babies and, in conditions of poverty, more likely to die. After receiving thousands of emails from campaign supporters, Nestlé has admitted that there is 'no proven benefit' from adding ingredients such as DHA to formula, but refuses to end the marketing campaign based upon these ingredients, which mislead parents and health workers. More emails are needed - click here.
Nestlé only changes its practices when forced to do so by regulations or the pressure of public campaigns. Although still defending its logos, Nestlé has said it has discontinued a leaflet Baby Milk Action exposed that claims its formula is 'The new "Gold Standard" in infant nutrition' - a leaflet that should never have been produced in the first place. Campaigning does work - and with enough pressure Nestlé will be persuaded to drop its logos and other misleading claims, such as the claim its formula reduces diarrhoea (left - in reality, babies fed on formula are more likely to suffer from diarrhoea than breastfed babies).
For Nestlé it is a cost/benefit analysis: how much does its malpractice fuel the boycott versus how much extra sales these methods generate. To try to improve the ratio in its favour, executives invests heavily in PR stunts such as the Creating Shared Value prize and sponsorship of good causes. For example, it has entered into a secret deal with the Virgin London Marathon to promote its Pure Life bottled water - the organisers have refused to reveal their criteria for accepting sponsors, in breach of Charity Commission guidance. Nestlé's marketing of Pure Life bottled water has been criticised from Pakistan to Brazil for its impact on municipal water supplies and local communities - it had to stop pumping in Brazil under the threat of daily fines after a ten-year battle by the community affected by its bottling plant (famously Nestlé claimed its so-called independent auditors, Bureau Veritas, cleared it of any wrong-doing in Brazil, but Bureau Veritas admitted to Baby Milk Action they weren't even aware Nestlé had been taken to court by the public prosecutor and their work was not a legal audit).
Nestlé hopes to gain kudos from its support of the London Marathon with the Pure Life brand - and as no alternative water is on offer, boycott supporters entering the event either have to break their personal boycotts or endanger their health. Nestlé's Chairman has ridiculed the idea of giving back to society stating to business leaders in Boston, according to the Boston Herald: "companies should only pursue charitable endeavors with an underlying intention of making money for investors."
While those who are working on the ground to have a positive impact may be tempted by Nestlé's prize money, they should be aware of how they are being used by Nestlé and if they allow their reputations to be co-opted are, willingly or not, helping the company to deflect criticism.
In a less obvious way, Nestlé tries to improve its image through activity on the internet, reportedly recruiting PR companies to defend its reputation in social media and paying celebrities to post positive tweet about it. It has taken parenting bloggers on all-expenses-paid trips to luxury hotels and offered all-expenses-paid trips to Switzerland to health journalists.
In the UK it is being reported today that companies have infiltrated environmental groups. In so many areas, Nestlé has been there first: it employed a former MI6 officer to run a spying network in Switzerland that infiltrated Attac Switzerland, gathering information not only on the baby milk campaign, but on water campaigners in Brazil and trade unionists in Colombia whose members had been targeted by paramilitary death squads after organising at Nestlé factories.
Nestlé likes to talk of Creating Shared Value - and wants the media and public to do so to as it tries to associate Nestlé with positive stories. But Nestlé's real concern is Creating Shareholder Value, putting its own profits before health, human rights and the truth.