Nestlé the infant formular controversy


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Most of the charges against infant formulas focus on the issue of discouraged breast feeding among Third World mothers and have led to misuse of the products, thus contributing to infant malnutrition and death....

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  • CODE: continued to promote breast feeding and ensure its marketing practices do not discourage breast feeding anywhere. Our company intends to maintain a constructive dialogue with governments and health professionals in the countries it serves with the sole purpose of servicing mothers and the health o f babies.
  • Nestlé the infant formular controversy

    2. 2. CONTENT • Case summary. • Answer the questions 1. Responsibilities of companies in this situation. 2. What Nestlé have done to have avoided the accusations of “killing third world baby” and market its product. 3. Suggesting to protect company in the future. 4. Situation resolving. 5. Advices for Nestlé in lights of new problem of HIV infection being spread via mother`s milk.
    3. 3. Case summary
    4. 4. For over 20 years, Nestlé has been directly and indirectly charged with involvement in the death of Third World infants In 1974, A report with a pamphlet entitled “ Nestlé kill babies” is published.
    5. 5. The charges Most of the charges against infant formulas focus on the issue of discouraged breast feeding among Third World mothers and have led to misuse of the products, thus contributing to infant malnutrition and death.  In northern Peru where water come from a highly contaminated river.  Throughout the Third World, many parents dilute the formula to stretch their supply.  The children had never been breast fed, and since birth their diets were basically bottle feeding.  In rural Mexico, the Philippines, Central America, and the whole of Africa, there has been a dramatic decrease in the incidence of breast feeding.
    6. 6. The defense After some criticism, Nestle still said that they believe breast feeding is still the best for infant. However, for some reason, mothers cant feed their baby with their own milk so they should use nutrition milk or mixed food instead. However, in third world countries, material and water are really contaminated so it might be harmful for infants.
    7. 7. The Resolution In 1974, Nestle, aware of changing social patterns in the developing world and the increased access to radio and television there, reviewed its marketing practices on a region-by-region basis. CODE
    8. 8. In 1977, the Interfaith Center on Corporate Responsibility in New York compiled a case against formula feeding in developing nations, and the 3rd World Institute launched a boycott against many Nestle products.
    9. 9. …regulate the advertising and marketing of infant formula in the 3rd world. The INFACT (The Infant Formula Action Coalition) lobbied the WHO to draft a „code‟ to regulate the advertising and marketing of infant formula in the 3rd world. May 1981
    10. 10. In May 1982, Nestle formed the Nestle Infant Formula Audit Commission (NIFAC) NIFAC recommended several clarification for the instructions of the code. In October 1982, Nestle accepted those recommendation. Other issues within the code, such as the question of a warning statement, were still open to debate.
    11. 11. Nestlé supports WHO codes Nestlé implements WHO codes: Immediately support the WHO codes Issue instructions to employees, agents, distributors Establish an audit commission Consult with WHO, UNICEF, and NIFAC Etc.
    12. 12. Nestlé policies • Adopting articles of the WHO code as Nestlé Policy • Nestlé and other manufacturers are accused of violating WHO codes- • Nestlé rejected the accusations
    13. 13. • In 2001, it was believed that some 3.8m children around the world has contracted the HIV virus at their mother‟s breasts. • Majority of women in developing countries don‟t know whether they are HIV infected or not. Healthy mothers make their child safer by bottle feeding. The new twists
    14. 14. The new twists • The mothers may continue breast feeding to avoid being stigmatized once bottle feeding becomes a badge of HIV infection. • In Thailand, pregnant woman are given free milk powder after founding HIV positive. • Demand for infant formula in South Africa grew 20% in 2004, and the Government investigated the shortages as Nestlé scrambled to catch up with demand.
    16. 16. Question 1: responsibilities of company in this situation • Find a way to become involved with the Baby-Friendly Hospital Initiative, like sending in donations or even working with the organization to help. • Remain a member of Infant Food Manufactures (IFM). • Keep its internal Nestlé instructions to Nestlé employees updated and up to standards to avoid any more problems. • Continue their efforts on social responsibility by sponsoring events at international medical and nutrition conferences, and events like celebrating the Vietnam Year of the Family, and funding research on infant feeding.
    17. 17. • Be careful with their pricing strategy and make sure they are selling their products in third world countries for reasonable and affordable prices for the people, and they should maybe consider selling the products for even less in these places. • Nestlé also needs to learn from its mistakes and not be so neglectful and they should respond to issues in a reasonable amount of time, because when they do not, they look irresponsible and careless. • Do what ever it can to reposition itself as a force of good.
    18. 18. Question 2: Avoiding the accusations • Learn about countries‟ culture they market • Support breastfeeding and its benefits • Encourage using formula for special situations • Offer testing HIV
    19. 19. Question 3: Suggesting to protect company on the future Before nestle or any enterprise enter to the new market, they have to understand well about the tradition, life style, economic status, natural conditions…they should do more study about medical effects of their product and services because they provide such an important for human beings. When they do business, they should not only care about making profit but also their consumer. For people in third country, these company should do promoting in healthy eating habit for mothers during her pregnancy and then baby. Doctors is really needed for some urgent situations.
    20. 20. Question 4: situation Assume you are the one who had to make the final decision on whether or not to promote and market Nestlé's baby formula in the Third World countries. Read the section titled “Ethical and Socially Responsible Decision” in Chapter 5 as a guide to examine the social responsibility and ethical issues regarding the marketing approach and the promotion used. Were the decisions socially responsible? Were they ethical?
    21. 21. ETHICAL AND SOCIALLY RESPONSIBLE DECISIONS • Difficulties arise in making decisions, establishing policies, and engaging in business operations in five broad areas – Employment practices and policies – Consumer protection – Environmental protection – Political payments and involvement in political affairs of the country – Basic human rights and fundamental freedoms 
 • Laws are the markers of past behavior that society has deemed unethical or socially irresponsible • 
Ethical principles to help the marketer distinguish between right and wrong, determine what ought to be done, and justify actions – Utilitarian Ethics – Rights of the Parties – Justice or Fairness
    22. 22. • unqualified sales girls • the distribution of free samples • marketed to people who were incapable to fulfill the minimum requirements for giving formula safely to the baby • the association of bottle-feeding with healthy babies to promote the use of infant formula to mothers who would have been better off breast-feeding their babies. Global Marketing (MKT 690) Professor Godwin Ariguzo Presented by: Jillian DeSousa Kerri Levesque Aziza Akilah Williams August 6th, 2008
    24. 24. Cost 1/3 weekly income of their family in the third world countries. PRICE In Nigeria in 1974 0% 10% 20% 30% 40% 50% 30% 47% Feedingcost Feeding cost percentage in minimum urban wage 3 month old infant 6 month old infant
    25. 25. Advertisements and posters used idealistic imagery, often showing white children rather than the ethnicity of that country, suggesting that bottle-feeding is the modern, western way, therefore the right way of doing things.
    26. 26. … “Wash your hands thoroughly with soap each time you have to prepare a meal for baby”….
    27. 27. • Continue to show support towards breast feeding. • Contribute towards programs that provide education and empowerment for women, especially in Third World countries. • Contribute towards research on how to reduce the risk of mother-to-child transmission. Question 5: Advice for Nestlé