Over the past several decades, significant progress has been achieved towards protecting the worlds environment. This objective remains a fundamental duty and a collective responsibility that must be shared between the public, governments and the private sector.
As the World Food Company, Nestlé is dedicated to providing consumers with the best food throughout life. Our Company’s primary function is the transformation of perishable raw materials into finished products that meet consumers’ expectations for safety, quality, convenience, and value. From our earliest days, we have recognized the need to protect the environment in our business activities. Exercising this commitment, which is part of our broader commitment towards the good of the community, remains central to our business today and tomorrow.
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The Nestlé Policy on the Environment was published in 1991 to define our world-wide strategy on environmental issues and to state our long-standing commitment to environmentally sound business practices. It is communicated internally within the Nestlé Group and externally to all interested parties and institutions. Following its publication, the Nestlé Environmental Management System (NEMS) was established to consolidate all environmental measures taken by the Nestlé Group. The NEMS is being implemented across our entire business.
Today, preserving natural resources and minimizing waste has become a part of day-to-day business for our employees and is an integral part of our strategy to achieve global competitiveness. The 1999 update of the Nestlé Policy on the Environment reiterates our strong environmental commitment and reflects our priorities as we move into the new millennium. It also recognises developments in the international environmental arena.
The application of the Nestlé Policy on the Environment at every level of our operation forms an essential part of the Nestlé Corporate Business Principles and enables us to contribute to sustainable development – meeting the needs of the present, without compromising the ability of future generations to meet their own needs.
Research & Development
Nestlé’s research and development centers have two primary objectives: to create new products and manufacturing processes and to improve those that already exist. Along with product quality and safety, the conservation of resources and the preservation of the environment form an integral part of the development criteria for new projects.
Research and development encompasses a wide range of environmentally-related activities with emphasis on:
environmentally sound production techniques and sourcing criteria for agricultural raw materials;
processing methods that minimize water and energy consumption, as well as waste g
eneration;
packaging designs that reduce total waste and enable environmentally sound disposal options while safeguarding product safety and quality; and
innovative ways to recover by-products and thus generate secondary raw materials and energy.
For important product or process innovation and renovation, Nestlé’s research and development centers prepare an environmental impact study. This covers significant aspects in the product life cycle, from the sourcing of raw materials, through processing, to the packaged consumer product and the end-life of the packaging material. This study is carefully evaluated, in conjunction with detailed information on the potential manufacturing site, to ensure that new projects meet Nestlé’s environmental standards.
Of the 807 million Swiss francs spent in 1998 on Nestlé R&D throughout the Group, a good part went towards enhancing the wholesomeness of our products. Additionally, these expenditures improved our production process, created better packaging, and avoided waste and unwanted residues.
R&D Is Making a Difference
As an example, significant progress has been made in recent years in energy and water intensive blanching and cooking operations. At the end of these processes water must be removed which resulted in wasted energy and raw materials – vegetables or pasta for example.
Now water is replaced by steam at low pressure. As a result, water consumption was reduced by 80% and product losses during cooking were more than halved. This means lower costs for energy and for wastewater treatment, while at the same time increasing the product yield by 6%. In another example, extraction residues from the production of chicory-based instant drinks, which were expensive to dispose of, have been turned into a valuable animal feed ingredient.
A recent processing improvement for french fries showed product quality can be significantly improved while also saving energy. One conclusion of R&D is that what is good for the environment is often synonymous with good industrial practice.
Preserving Species
The disappearance of many species and varieties of animals and plants is a reality. Over the past few years, this issue has attracted increasing recognition and much is being done today to preserve the earth’s biological diversity. Industry plays an important role in these efforts since many business sectors depend on nature’s diversity for their sustainable success. Nestlé, as the world’s largest single buyer of coffee and cocoa, lives up to its responsibility by developing the most advanced preservation techniques for many different coffee and cocoa varieties threatened by extinction. In addition, Nestlé collaborates with public research institutes to share its experience and makes its results freely available.
In the future, Nestlé R&D units are determined to build environmental protection into products and processes right from the start. High on the agenda are integrated farming techniques involving minimal use of fertilizers and chemicals, and recourse to biological pest control methods whenever possible.
SUPPLY CHAIN
Agricultural Raw Materials
In general, Nestlé is not directly involved in the production of raw materials. Wherever possible, locally available raw materials are used. They are either obtained directly from producers or purchased through trade channels. Nestlé applies the following principles when sourcing raw materials:
all raw materials must meet both legal and internal quality criteria, including limits on possible environmental contaminants;
whenever possible, preference is given to raw materials that are produced by environmentally sound farming methods (e.g. integrated crop management); and;
farmers are encouraged to apply sustainable farming methods and, where appropriate, are provided with assistance in crop production and dairy farming. Such assistance includes the provision of recommendations for the conservation of natural resources (soil, water, air, energy, bio-diversity) and techniques for reducing environmental impact.
Manufacturing
Manufacturing comprises all processes that are necessary to transform perishable raw materials into safe and convenient food products for consumers. Nestlé strives to achieve optimal performance in its manufacturing activities, including the environmental aspects. As such, the manufacturing practices of the Group:
respect natural resources by emphasizing the efficient use of raw materials, water and energy;
minimize the use of environmentally-hazardous substances;
continuously seek improvement in the efficiency of production facilities; and
reduce waste generation and emissions as much as possible, consider recycling of waste a priority and dispose of non-recyclable waste in an environmentally sound manner.
Regular environmental assessments of Nestlé’s manufacturing practices are conducted to:
evaluate factory performance;
review factory compliance with applicable legislation and Nestlé’s own standards;
fully investigate incidents that could affect the environment and take relevant measures; and
compare results with previous targets and set new improvement objectives.
In addition, Nestlé exchanges information on environmental protection technology and practices in order to ensure a wide use of best practices.
Nestlé encourages its contract manufacturers to use environmentally sound manufacturing practices.
Environmental Performance of Our Factories
Minimizing the environmental impact of our factories has always been a prime consideration. Therefore, we periodically review environmental performance of the entire Nestlé Group. The results are very encouraging:
Nestlé has no major environmental problems.
Nestlé complies with relevant regulations or, in a few exceptional cases, has initiated action to do so.
Measures taken are proactive and often anticipate future regulations. Many times, measures taken to improve the environment also reduce costs.
These surveys also allow us to put concrete figures to our efforts: Over the past years, Nestlé has invested an average of some 100 million Swiss francs per year in specific measures to protect the environment. This amounts to approximately 3% of total capital expenditure and includes only readily identifiable environmental investments. In addition, substantial amounts were expended as part of regular capital investment projects and factory environmental operating costs. Examples of these additional expenditures include environmental aspects related to factory construction and renovation, environmental training of personnel, and maintenance costs for wastewater treatment facilities.
Recent Environmental Investment
The factory environmental surveys are a valuable management tool which are periodically repeated as part of the Nestlé Environmental Management System (NEMS).
Water, Our Top Priority
Nestlé engineers and factory planners have pioneered wastewater treatment the world over. Whenever factories went up, often in remote locations of developing countries, where neither local expectations nor legislation required environmental safeguards of any kind, appropriate wastewater treatment was provided. Nearly 30 million Swiss francs have been invested annually over the past few years in wastewater treatment facilities. While we can be genuinely proud of these achievements around the world, we continue to upgrade existing plants and build new ones where necessary.
Examples of Nestlé’s substantial investments in this area are:
As early as 1920 Nestlé had constructed and started the operation of a wastewater treatment plant in Kempttal near Zurich. At that time it included a settling basin and trickling filter. 1932 saw the addition of a biological component which constituted Switzerland’s first wastewater treatment plant operating with activated sludge, a principle still used today.
An 80% reduction in water consumption of some cooking processes through an extensive R&D project.
A facility in Himeji, Japan, serving one of the largest instant coffee factories in the world, was rightly considered a model installation when it was built almost 30 years ago, and thousands of Japanese water treatment specialists have visited it over the years.
A facility in Dongguan, China has established itself as a model for wastewater treatment. It too is visited regularly by Chinese wastewater specialists.
Reducing Air Emissions
Another important investment area is for air protection. The biggest environmental investments over the past few years went into the conversion of heating units from heavy fuel to natural gas. When these conversions can be used to install combined steam and power generation systems; impressive energy savings are achieved in addition to environmental benefits. Therefore, we favor these co-generation plants wherever feasible.
Co-generation processes are much more efficient than conventional power plants and therefore usually lead to a significant, global reduction in both energy consumption and release of “greenhouse” gases. Nestlé currently operates over 10 co-generation facilities throughout the world.
Co-generation examples are:
At the Nestlé Gerona plant in Spain, the co-generation system, commissioned in 1991, reduced gas consumption by 3600 tons of oil, equivalent per year, and decreased overall carbon dioxide emissions by 8000 tons annually.
The savings at the York factory in Britain, where a coal-fired boiler house has been replaced by a gas turbine co-generation plant, are very impressive. Carbon dioxide output was reduced from 131,000 tons per year to 59,000 tons per year. Additionally, sulfur dioxide emissions are completely avoided at the factory level (650 tons per year) and cut by more than half, from 1059 to 436 tons, at the level of the supplying national power station.
Phasing Out Ozone-Damaging CFCs
The characteristics of chlorofluorocarbons (CFCs) make them suitable for a wide range of refrigeration and air conditioning applications necessary for many of Nestlé’s manufacturing processes. However, there is evidence that they contribute to the depletion of the stratospheric ozone layer. This has led to several inter-governmental agreements to phase out the use of CFC’s. Nestlé anticipated this phase out early and has established a detailed CFC phase-out program to replace CFCs used in industrial refrigeration systems with non-CFC alternatives. To date, Nestlé has reduced it’s CFC emissions by more than 80% of 1986 levels. We are committed to continuing to address the issue of ozone-depleting substances and further improve these dramatic results.
Recovering Solid Waste
Landfills in many countries are rapidly approaching their limits, thus becoming a costly and cumbersome problem. However, Nestlé has stopped looking at solid waste as part of the problem, but as part of the solution. Solid waste has become a valuable raw material when recycled, composted or used for fuel in energy recovery processes.
Coffee grounds, which are a by-product of instant coffee manufacturing, is a case in point: Much of the investment related to solid waste is earmarked to build coffee ground energy-recovery systems that use the coffee grounds’ energy value to produce steam for our factories.
In Raja Muda, Malaysia we installed this state-of-the-art machinery, the first of its kind in Asia, outside Japan. Now coffee grounds are used as fuel. Thus, for every 100 tons of coffee grounds we save the equivalent of about 40 tons of fossil fuel. The decision to develop and install this energy-recovery system is typical for how Nestlé anticipates problems and pioneers solutions.
Additionally, in some markets factory solid wastes are composted to produce a high quality soil amendment product. In some cases this product is packaged and sold for use as a 1natural fertilizer.
In New Milford Connecticut, USA Nestlé built a state of the art composting facility that processes both solid and liquid wastes, sludges, and by-products from its local factories, co-packers, and distribution centers. Additionally, the composting facility provides a solution to the local community for disposal of landscaping and gardening wastes, which are banned from landfills in that area. This facility recycles more than 50,000 tons of waste materials annually, preventing them from going to landfills.
Packaging
Packaging serves a major role in our daily lives. It protects food products from spoilage and ensures safety from manufacture through storage, distribution and consumption. Packaging may also provide tamper-evidence features. It communicates information, including nutritional information and serving instructions, and provides the convenience demanded by today’s consumers.
Nestlé is committed to reducing the environmental impact of packaging, without jeopardizing the safety, quality or consumer acceptance of its products. It is Nestlé’s objective to develop safe and wholesome packaged foods using the most efficient and appropriate packaging materials available, while, at the same time, satisfying consumer requirements and expectations.
Nestlé seeks packaging solutions that:
result in the lowest possible weight and volume of packages;
take into account new packaging materials and processes that reduce the impact on the environment;
avoid the use of substances that can adversely impact the environment during packaging production and disposal;
decrease packaging waste at all stages, including package manufacturing, use and disposal;
increase the use of recycled materials wherever possible; and
increase the recyclability and compatibility of its packages with existing packaging waste management schemes.
Regular assessments of Nestlé’s packaging are carried out and action plans are implemented.
Nestlé supports industrial and governmental efforts to promote integrated waste management that takes into consideration matters such as source reduction, reuse, recycling, composting, energy recovery, and landfill.
Nestlé encourages suppliers of its packaging materials to adopt sound environmental practices.
Packaging Source Reduction
Packaging waste is one environmental issue that affects the entire consumer goods industry. However, the gap is wide between reality and perception: While food packaging accounts for less than 1% of total solid waste in most countries, it is highly visible to consumers. Even if the problem of food packaging is small in relation to overall environmental problems, it is nevertheless an important issue for Nestlé.
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The most direct opportunity to reduce the scale of the problem is to use as little material as possible. This is not a recent effort by the food industry. Over the last four decades, between the 1950s and 1990s, the weight of a glass milk bottle has been reduced by 36%, a steel food can by 66%, and an aluminium beer can by 81%.
Even though packaging source reduction has always been a consideration, we decided to reinforce these efforts in a more systematic way. The first world-wide environmental packaging survey was completed in 1991 for the Nestlé Group and has been repeated annually ever since.
The last survey revealed that by the end of 1998, Nestlé, without compromising product quality, reduced our use of packaging materials by nearly 150,000 tons compared to 1990. These reductions resulted in savings of approximately 250 million Swiss francs.
Cumulative Reductions in Packaging Materials
Examples of Packaging Source Reduction
A few recent examples that underline Nestlé’s efforts:
In Australia the Easter Egg Novelty cartons were reduced in size by altering the design to provide support for the egg. The new design resulted in a 31% reduction in use of paper board.
In Pakistan the Nestlé NIDO package, which consisted of 4 bags in a display box, was replaced by an aluminium stand-up pouch. This resulted in a 39% reduction, or 47 tons, and saves 290,000 Swiss francs per year.
In Indonesia the Nestlé Dancow 200 and 400g display boxes were reduced in size by 18 and 25%, respectively. This resulted in a waste reduction of 38 tons and saved nearly 100,000 Swiss francs per year.
In Columbia the display box for Maggi bouillon tablets was eliminated. This resulted in a reduction of 303 tons of packaging material and represented a savings of over one million Swiss francs per year.
While important progress has already been achieved, we strive to continuously identify opportunities for further reduction.
Distribution
Distribution of products from the factory to the customer involves transport and storage. Efficient management of the distribution system is essential to preserve the safety and quality of Nestlé’s products, to ensure a high level of customer service, and to meet its commitment to environmentally sound business practices.
To this end, Nestlé:
selects appropriate transportation modes, with particular attention given to optimum unit loads (pallets), vehicle-capacity utilization, route planning, and consolidation with outside partners, scheduling, and fuel conservation;
optimises warehouse and distribution center locations and environmentally efficient operational systems; and
identifies and implements measures to reduce energy consumption and waste.
Nestlé encourages its distribution service providers to use environmentally sound practices.
Distributing our goods from factory to retail centers consumes some 400 million liters of fuel each year. While we undertake every effort to reduce this, it is useful to put this figure into perspective: the distribution of 10 kg of our products from factories to retail outlets in Europe requires an average of 0.25 liters of fuel. To transport the same amount from the supermarket to home, consumers burn, on average, one to two liters of fuel.
Efficient Container Loading
Improving transport efficiency benefits the environment, but it also makes economic sense. Seemingly simple measures, such as replacing bulky wooden pallets by thin, carton-type slip-sheets, have the potential to save more than 600 international truck journeys a year in our European operations alone. Optimizing shipping cases to fill transport vehicles without leaving gaps between differently shaped containers, together with optimal route planning, Nestlé has already achieved substantial savings.
Pioneering Rail Transport
In countries with competitive railways, moving goods from road to rail is an effective option to reduce road congestion. For example:
Vittel has developed a specially adapted block train concept to supply its regional terminals in France. Vittel transports nearly half of its production, or over 930 million bottles per year, by rail.
Our Swiss, and later the Austrian subsidiary, convinced the railways to offer overnight trains to bring goods from the national distribution centers to terminal stations for local deliveries by road.
Marketing
Marketing is based on the principle of satisfying consumers’ needs. The overall trust of consumers in Nestlé’s brands and products comes from a quality image that has been continuously strengthened for over 130 years. Nestlé strives to increase this trust through its commitment to environmentally sound business practices.
For this reason, Nestlé:
opposes short-term, opportunistic “green marketing” that can mislead the consumer;
bases environmental claims in advertising, promotional material, labelling, and corporate communications on solid scientific evidence; and
selects materials and printing methods for merchandising materials such as consumer offers, in-store promotions, display materials, leaflet, and printed materials in light of environmental considerations.
No “Green Marketing”
Nestlé adheres to the Code on Environmental Advertising established by the International Chamber of Commerce. This Code is based on the principle of self-regulation and self-discipline and is intended to assist companies in making responsible use of environmental claims in advertising.
Sustainable Development
For Nestlé, respect for the environment is part of a broader perspective on sustainable development. Nestlé has adhered to The Business Charter for Sustainable Development of the International Chamber of Commerce (ICC) since its publication in 1991. Measures for environmental protection often trigger beneficial economic and social effects, and vice-versa. Since the Rio Summit in 1992, all of society, be it governments, industry, NGOs or others, have tried to translate the sustainable development concept into reality. As part of this effort, we participate in the work of several organizations dealing with this subject: For example, we are a founding member of the World Business Council for Sustainable Development (WBCSD) in Geneva, and we contribute actively in the Working Group Sustainable Development in the City of Vevey.
Nestlé Working with Communities –
South Africa
Nestlé is supporting several community-based organizations in putting sustainable development into practice. Recently, in South Africa, we have given support to Eco Link and LEAP to finance and help manage programs which clean up the environment and improve hygiene in rural areas.
The Eco Link project is aimed at providing assistance through education. People are taught to collect litter such as paper, cardboard and cans, which when put in a trench and covered with a compost can then be used to plant vegetables. The litter provides the necessary drainage and moisture retention. The project has dual advantages: it cleans up the environment and provides fresh vegetables for the family, as well as providing an income when surplus food is grown. This program is now being presented to school children who are encouraged to grow small gardens at school.
In rural areas water supply is a major problem. Women can spend almost 5 hours a day collecting water for the home. In addition, the springs from which they take the water are often used by animals and can be polluted. Nestlé is taking part in a project to help villagers establish a supply of clean water near to home.
People were taught how to identify sources of underground springs and to channel rain water and store it in reasonably hygienic conditions. The team taught villagers how to construct a tank to catch the rain water using corrugated iron and wire mesh as a “mould” which is then plastered with a cement, stone and sand mixture. With a wooden cover on top and a tap at the base the villagers have the means to store clean, drinkable water.
Information, Communication & Training
Nestlé provides information on its activities, including those related to the protection of the environment. Within this context, Nestlé:
communicates its environmental efforts, both inside and outside the Company, to build understanding concerning its environmental commitment;
fosters strong environmental awareness and responsibility among its employees through training programs; and
shares environmental information with governments, local communities, industry, consumers and other interested stakeholders.
We do this through a wide variety of means. For example, our factory environmental surveys involve thousands of people at all levels, from top management to the factory floor. These practical exercises are reinforced by in-house magazines, specialized newsletters, and videos.
To help educate the public, Nestlé works with organizations that produce films on environmental issues, sponsor re-forestation programs, or create educational materials for the public. These activities are also important to our role in sustainable development.
At our international training center in Switzerland, environmental issues are now a regular part of courses attended by Nestlé’s international executives. These efforts are multiplied by countless training sessions organized by our Group companies.
Internal communication and training are a priority for Nestlé. As a people-driven company, employees are our most important asset. Thus, we emphasize all measures that help them act in an environmentally responsible manner.
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