2013.06.17 Rural Development Investor call

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An investor call focusing on Rural Development, one of the cornerstones of our Nestlé in Society - Creating Shared Value programme

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2013.06.17 Rural Development Investor call

  1. 1. Rural DevelopmentDuncan PollardHead of StakeholdersEngagement in SustainabilityRuralDevelopment
  2. 2. Rural DevelopmentDisclaimerThis presentation contains forward looking statementswhich reflect Management’s current views andestimates. The forward looking statements involvecertain risks and uncertainties that could cause actualresults to differ materially from those contained in theforward looking statements. Potential risks anduncertainties include such factors as general economicconditions, foreign exchange fluctuations, competitiveproduct and pricing pressures and regulatorydevelopments.June 17, 20131
  3. 3. Rural DevelopmentRuralDevelopment“Nestlé has identified areas of focuswhere shareholders’ and society’sinterests intersect, and where valuecreation can be jointly optimised....Rural development: because the overallwellbeing of farmers, rural communities,small entrepreneurs and suppliers areintrinsic to the long-term success of ourbusiness.We aim to demonstrate and measuresystematic and continuous improvementin .....these areas”The CSV pyramid description January 2011June 17, 20132
  4. 4. Rural DevelopmentNestlé in SocietyJune 17, 20133CreatingShared ValueNutrition, Water,Rural DevelopmentSustainabilityCompliance
  5. 5. Rural DevelopmentAgricultural CommoditiesJune 17, 20134Procurement from 6-7 Million FarmersDirect Procurement from 690,000 farmers
  6. 6. Rural DevelopmentRural Population ChallengesCommercialfarmsBetter off familyfarmsIn-betweenfamily farmsMarginal familyfarmsRural landless524 620 666846903 917332328 321111108 1062010 2020 2025LDCs & IndiaRural Populations GrowSub Sahara Africa IndiaSE Asia C&S AmericaFarmers & Rural WorkersData from Latin America 2008Presented at Seas of Change WorkshopThe Hague 12/04/12UN Population DataJune 17, 20135
  7. 7. Rural DevelopmentBehind the BrandsJune 17, 20136
  8. 8. Rural DevelopmentJune 17, 20137
  9. 9. Rural DevelopmentJune 17, 20138Improving Performance in Dairy
  10. 10. Rural Development20102500farmers trained200,000plants propagated201119,000farmers trained824,000plants propagated201220,000farmers trained1,000,000plants propagatedRed Cross project3 schoolsFLA partnership40 schools in next 4 yearsFLA report8’000 tonnes(2% of Nestlé cocoa)27’000 tonnes(6% of Nestlé cocoa)40’000 tonnes(10% of Nestlé cocoa)Farm profitabilityChild laboureliminationSustainablesupply chainJune 17, 20139
  11. 11. Rural DevelopmentRural Development Framework0Alignment, Collaboration & AdvocacyJune 17, 201310Farm Workers CommunitiesFarmers
  12. 12. Rural DevelopmentPriorityCountriesSocialNeedGuineaSenegalCameroonEthiopiaGuatemalaHondurasKenyaMoroccoNicaraguaNigeriaPapua New GuineaZimbabweCote dIvoireGhanaIndiaIndonesiaPakistanVietnamEgyptJamaicaJordanLebanonTunisiaTurkeyCosta RicaDominican RepublicPanamaPeruPhilippinesThailandSri LankaBrazilChinaColombiaEcuadorMexicoSouth AfricaBusiness ImportanceJune 17, 201311
  13. 13. Rural DevelopmentSuccessful FarmersBusiness Value Societal ValueFarmers are business-oriented and farming by choiceFarmers Productivity is IncreasingFarmers are Resilient to External ShocksTransparency within Supply ChainsThe Farmer is a responsible steward of natural & human resources (incl. workers)Crop Supply is IncreasingCrop Quality is Increasing Farmer Net Incomes are IncreasingJune 17, 201312Provision of Elite Plants& Other MaterialsSupply Chain MappingStrengthen Farmer Groups &Women’s RepresentationCommitments on Water, HumanRights, Biodiversity, DeforestationTraining (technical & business) tofarmers & women on costs,quality, productivityFacilitate provision of services (egfinancial, insurance)Training on Water, Deforestation,Human Rights, Biodiversity, SoilAllocation of Price PremiumsActivitiesCSV GoalOutcome
  14. 14. Rural DevelopmentProductive and Respected WorkersCSV GoalOutcomeBusiness Value Societal ValueThe respect by employers for human rightsmakes rural based employment attractive for workersWorkers receive a living wageIncreasing labour productivityFarmers and factories are able to attractthe right workers at the right costsHuman rights & core ILO conventions arerespected in all farm & factory operationsFarm and factory workers work in a safeand healthy environmentJune 17, 201313Education & training of farmers, farmer groups & workers representativesDialogue with worker representativesAuditing of labour conditionsWork study & work methodWorkers skills and knowledge levels arecontinuously improvedActivities
  15. 15. Rural DevelopmentProspering CommunitiesCSV GoalOutcomeBusiness Value Societal ValueCommunities around Factories and within Sourcing DistrictsAre Progressing Economically, Environmentally & SociallyCommunities that are progressingeconomically, environmentally & sociallyStable & reliable communitiesJune 17, 201314Community Needs Assessment& Engagement ProgrammeStrengthen Farmer GroupsProgrammes to improve nutrition,water & sanitationProgrammes to improve quality of lifeProgrammes to diversifyfarm/non-farm incomeLandscape levelnatural resource stewardshipStrengthen land tenure & communal landActivitiesAuditing of labour conditions
  16. 16. Rural DevelopmentJune 17, 201315ImplementationDesigned to deliver upon Nescafé Plan, Cocoa Plan, Nespresso AAA, Dairy Sourcing etcIntegrate with existing programmes eg Coffee 4C, RISE, UTZ CertificationConsistent approach and ambition across NestléGlobal priorities & local flexibilityAlign activities with real business prioritiesIdentify and set priority issues at a market level based upon identified gapsProvides a credible process with partnersMeasure & communicate progress and activities
  17. 17. Rural DevelopmentDiscussion

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