Nestlé Corporate Social Responsibility Analysis Essay Sample
For a long time, corporate entities were known to be exploitative in their operations and needs. Through monopolistic practices, companies ensured that they could minimize costs as they maximized output. This entailed optimal utilization of both fiscal and human resources without regard for their renewability. These practices have however been gradually phased out with time. Today, corporate entities across the world have awakened to the fact that they are not only responsible for the stimulation the economic growth of the country but also for human and environmental improvement. From this reality, Corporate Social Responsibility (CSR) was conceived. This is a program which broadly focuses on the companies’ value to the employees, the environment in which they operate as well as the communities within their proximities. This means that whenever any company draws its objectives, mission and vision, it has to factor in the welfare of society. Employees play a significant role not just in the success of the company but also as it relates to the government and their own families as well. The government gets revenues from the income taxes of the workforce. The families also rely on these vary individuals for financial and moral support. As a result, company have to ensure that their employees are well treated and well remunerated so that they can make significant progress individually and contribute to society.
In addition, companies purchase materials and other pertinent resources from the larger community. These communities are also the immediate recipients of the companies’ waste output, which cause pollution in the air, water in addition to the loss of esthetic value through unscrupulous dumping procedures. The consequences that these communities suffer from as a result of the companies’ activities are often untold, yet there has been little or no effort on behalf of these companies to compensate for these awful practices. For this reason CSR has put all corporate entities to task in ensuring that the welfare of the communities in which they operate is taken into consideration in the course of their corporate activities. Some of the ways in which companies have ensured the welfare of their communities include improvement of the social amenities such as electricity, market building, road and bridge construction, water supply and sewerage systems, construction and improvement of learning institutions. In reciprocation, the communities offer labor to these industries, market to their products as well as demand and security. This kind of symbiotic relationship between corporate companies and communities is healthy and should be embraced by all corporate entities all over the world to make this world a better place for humanity.
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Finally, in recognition of the fact that industrial activities are exploitative in nature, especially to the environment, CSR programs have been launched all over to mitigate the effects and ensure that the environment is conserved for future generations. Unscrupulous industrial practices had for a long time been the cause for the depletion of the Stratospheric ozone layer, which has contributed to global warming. In fact, this has been behind the gradual and perpetual climate change which has already had adverse effects in contemporary society. Companies have therefore been obliged to ensure sustainable practices through CSR so that they operate in a safe and secure environment for the current and future wellbeing of the communities throughout the world. The majority of the world’s countries already enforce CSR policies and its benefits can be seen, especially through their concerted efforts in environmental conservation. However, CSR’s ideologies are not yet a reality in some countries, especially third world countries and even more advanced countries such as Russia, which is still grappling with the consequences of Soviet socialism.
It is through this initiative that Nestlé, the Switzerland-based food conglomerate, is a subject of in-depth analysis in this paper. First, the paper will focus on the company’s organization presentation in terms of specificities such as structure, characteristics of its products, Environmental Social and Governance (ESG) sectorial comparison as well as the stakeholders’ map. The paper also features the positive and negative aspects that have characterized Nestlé International Corporation, its scorecard in term of innovations since its inception, the critics, proposals for improvements in areas where it has underscored and possible solutions. The main part of the company’s analysis will be a depth acquainting with Nestlé Corporate Social Report, which seeks to address the main issues that have been considered by the company since its beginning. Furthermore, all problematic areas that Nestlé has been grappling with will be critiqued as well as delineating Nestlé’s relationship with other corporate entities in the entire world.
Structure of the Enterprise
Nestlé International Corporation is a global corporate organization which operates in eighty countries. It was founded 1866 by Henri Nestlé and has since recorded a steady upward trend in its operations, becoming one of the largest corporations in the world that is dedicated food products. Nestlé has offered direct employment to more than a quarter a million people across the eighty branches in the world while an estimated 3.4 million additional people are indirectly employed by Nestlé worldwide.
Following the specificities and consumer demands, the structure of Nestlé has often been the subject to adjustment in order to meet the available market for its products. However, in the recent past, Nestlé focused on only three enterprises, which have been supervising and supporting the functioning of the entire company. Nestlé S.A has since its registration under Food and Beverage Act in Switzerland been a holding, which has been controlling profits and functions of Nestlé enterprises under its widespread activities as well as analyzing the profitability of the corporations entirely. Nestlé has been the next enterprise as the subject under Nestlé S.A. It mainly deals with conducting scientific developmental research alongside technical support for the Nestlé organization as a whole. Moreover, it delivers information which concerns the marketing zones as well as the organizing of the general management. It also provides information concerning the training of the corporation’ workforce tasked with the role of selling Nestlé products across the world.
On the other hand, Nestlé World Trade Corporation is structured to deal with all exports and imports of Nestlé products. Just as in every other organization, the organizational structure of Nestlé presents the framework in ways that are separated as well as assigned objectives in the whole company. Nestlé’s orders are divided into various tasks, which are then further clustered into relevant departments. Each of the departments contains personnel that are responsible for carrying out all the tasks in that section. The major tasks are often divided and stretched vertically. The brands within the umbrella of Nestlé often record over CHF1 billion sales annually. This is equivalent to $1.1 billion (The world’s most valuable brands: 43 Nestle, 2015). The Nestlé brands, which include Maggi, Nescafe, Nestea, Nespresso, among others are drawn from 447 factories, which operate in operate in one hundred and ninety four countries around the world (Franzen & Moriarty, 2008). The Nescafe brand alone is estimated to have created employment for over three hundred thousand people. As the biggest food company in the whole world, Nestlé’s market capitalization is approximately $247.3 Billion (The world’s most valuable brands: 43 Nestle, 2015).
Components of the Nestlé Corporate Strategy
The corporate strategy of Nestlé Company is based on several main principles that have existed in the company from its inception. However, a number of them occasionally undergo modifications with the purpose of influencing the dynamic specificity of the existing market. Times arose in the past when the company would receive negative publicity from erroneous activities that were taking place which resulted in production of faulty products (Hill & Jones, 2012). However, with consistent admission and correction of its anomalies, it still sustained its renowned status. The prime objectives of Nestlé are concerned with the idea of establishing long-term value for the products as entrenched in the understated mission and vision of the company (Hill & Jones, 2012).
Nestlé’s Mission Statement
In its mission statement, Nestlé aspires to be the world’s company that deals in health, nutrition and wellness. Its mission of “Good Food, Good Life” is meant to guide it in providing it esteemed consumers with the best tasting and most nutritious food and beverage choices in a wide range of categories as well as eating occasions, right from dawn to dusk (Nestle, 2013a).
Nestlé’s Vision and Values
Nestlé also aspires to be a leading and quite, competitive company, which manufactures products related with Nutrition, Health and Wellness, committed in delivering an improved shareholder value, striving to be a preferred employer, corporate citizen, supplier together with selling of preferred products (Nestle, 2013a).
Above all, Nestlé’s long-term strategy has always been based on the development of the business as well as conducting frequent examinations and analyzing the emerging changes among the consumers’ demands. In addition, this corporation often appreciates all relations with its esteemed employees and all functions of the management units.
Furthermore, the strategy building process takes into account the fact that the employees and the management fraternity, together with respect for diverse cultures and mentalities which appear in all countries are significant elements of the company’s success in the international and global market (Seth, 1994). The criteria which have since been the pillars of Nestlé include operating on the foundation of profitability of the company. Nestlé has aligned its functions and procedures in a manner that enhances and promotes maximum profitability through the services and commodities that it ventures into. This motive has led the management to invest into best practices, contemporary technologies and implementations that have jointly been the core propellant of its popularity.
In addition, the company has placed itself at a very competitive position on the global market. This has been possible through its unique brands. It is worth mentioning that Nestlé Corporation deals in several brands which are unique to it and have since distinguished Nestlé from other food industries. These brands include Nescafé, Friskies, Nestea, Maggi, Buttoni, which have helped make the corporation famous in the whole world (Franzen & Moriarty, 2008). The company has gained a competitive advantage because it pioneered the products sold under its brands well before other competing companies ventured into them. Since then it has maintained a steady supply of products in the right quantities and at affordable prices. Unlike its competitors, who emerge strongly on the global market and disappear after some time, Nestlé has been consistent in its operations and in the quality of its products.
Another distinctive feature about Nestlé is that it is sensitive to the needs of its consumers. The satisfaction of consumers has always been its prime concern. To effect this concept, the company has long understood the diverse economic capabilities of is consumer coverage in its expansive market (Seth, 1994). These diversities necessitated the packaging of products in a manner that targets everybody across the economic classes in the world. This makes it possible for every consumer to purchase Nestlé products irrespective of their economic capability. In the same breath, the company has made sure that the prices of these various products correspond with the quantities and the corresponding quality in each package. This has ensured that consumer finds value for their money in Nestlé products and is the reason why Nestlé has remained stable in the world market. Moreover, the company has strict and consistent conformity to the National Bureau of Standards and has never been implicated in fraudulent activities that would put its reputation at jeopardy. It is therefore associated with honesty; an attribute that has been the sole factor of attraction from its customers. In fact, through this quality it has managed to outdo all its competitors who merge with selfish interests of maximizing profit as they limit input.
Apart from that, Nestlé has been commended for its pro-activeness in strategy making. This company is steadfast at reading the mood of the market and responding beforehand, especially when it comes to the dire need for baby formula in the developing nations (Boyd, 2012). It has never managed its affairs under crisis nor has it ever been caught off-guard. This has been possible because the company makes use of well-trained personnel who are greatly qualified in food and beverage technologies, and who are drawn from the complex society across the world. This blended mix of expertise has propelled Nestlé to greater heights and it is still showing signs of continued growth. Through this experience, the company has been emerging among the bests companies of the year and it has received innumerable honors for that matter. It dynamic innovations have been evident in not just in the quality of its products but also in the manner in which packaging is done, promotions and market strategies and responding to consumer feedback.
Characteristics of Nestlé’s Products
Nestlé Company has a wide range of food products ranging from cakes, bars, mineral water, chocolate, children’s food, breakfast cereals, frozen ice-cream, vegetable and powdered food and dairy products are but part of products which this renowned company offers (Boyd, 2012). There is also a new range of products expected soon owing to the changing customer needs and the surrounding. This state has made Nestlé a ‘one stop enterprise’ in matters pertaining to food. One major importance of this company is that it is cognizant of the nutrient content required by the average body and that is why its products are nutrient enriched to make them more nourishing rather than merely quantitative. For instance, it has comprehensive data about the average proportions of deficiencies found in the society of it given market. Based on this data, it produces food items that are additionally enriched with microelements such as iodine that are in most demand by the society.
Apart from this, it is worth noting that Nestlé has been famous for its sensitivity when it comes to the well-being of the environment. This has also been exhibited through the manner in which it recommends the disposal of its products’ casings. In fact, Nestlé is among the few companies that have specified the mode of disposal on each of its products’ package for consumers to follow. Together with that are the safety precautions that are conspicuously labeled on the packages to forewarn the consumers about the possible dangers that can result from erroneous usage of the particular packages especially those made with the nylon, which have the capability of suffocating young children (Seth, 1994). Furthermore the company embraces the manufacturing of biodegradables that are friendly to the environment when disposed since they easily decompose as opposed to the non-biodegradables such as polythene materials. This consideration has made Nestlé a champion in environmental conservation for which it has gained recognition for its enforcement of CSR programs. In general, Nestlé Company produces 22% of the total sales from beverages such as coffee, tea, cocoa and chocolate, 7% sales from water, and 19% sales from dairy and associated products alone (Nestle: The unrepentant chocolatier, 2009). It also makes 15% sales from already-prepared dishes as well as ready-cooked dishes, 13% sales constituting Nestlé products of Nutrition which includes health care products and infant food, pet products constitute 12% sales and finally 11% sales from candies of chocolate among other sweets. Geographically, it makes 44% of the total sales from Americas for which 25% is from US alone. Besides, 28% sales are from Europe and 28% sales from Asian, Oceanic and African states. Similarly, Nestlé’s reputation score is 70.4 on a scale of 1–100, as depicted by the Reputation Institute’s survey that was conducted in 2006 on consumers globally.
ESG Sectorial Comparison
Nestlé Swiss Corporation has instigated innumerable Environmental and Social Governance (ESG) programs in conjunction with other renowned corporate entities as well as non-profit entities for the purposes of adding value to the environment and the society at large. Notably Nestlé, in conjunction with Unilever International, Dadone and Chocolate companies have spearheaded the foundation of the World Cocoa Foundation in Brazil. The motive for the foundation of WCF was to help farmers improve their farming techniques which are advance and conform to the new technology. This initiative has proven to be a success as farmers have now acquired many skills and farming methods which have increased their produce for cocoa. Apart from that, the foundation helped fix many problems that cocoa farmers faced in the past ranging from low yields, cocoa diseases and market constraints. Through improved techniques of farming, the foundation introduced cocoa plantlets which are disease-resistant and can also withstand tough climatic conditions such as extreme cold and high temperatures. From the time these species were introduced, cocoa products have increased tremendously as farmers have not reported cases of recurrent coca ailments. The new species also produce high quality yields which have given Brazilian coca farmers an upper hand on the global cocoa market. The foundation has also been of great help to coca farmers in market chain which has eliminated unnecessary stumbling block that previously made it hard for market to access global market with ease. Through this significant initiative Nestlé has therefore helped improve the many lives of people who are dependent on cocoa for their livelihood. Some have revamped their stalled business after making sales, others can now easily support their families and educate their children without any hindrance. This has boosted the development of areas where cocoa is grown on a large scale and helped solved the problem of poor environmental management which previously caused untold degradation.
Apart from WCF, Nestlé was also instrumental in the creation of the sustainable Agriculture Initiative (SAI). This is an initiative that was started with the objective of ensuring production of high quality food products in areas that rely heavily on subsistence farming. Through SAI, the affected societies began experiencing food security and high nutritive value in their diets. In fact, a majority improved from mere subsistence farming to commercialized farming where they could access global market to sell their food products as well. Thanks to Nestlé, the farmers gained new techniques for farming as well as important tips on nutrition to eliminate malnutrition in their communities. Finally, they also benefited through the chain of food supply which improved their incomes.
In addition, Nestlé is credited for creating shared value in society. Nestlé has been on the front line for encouraging business enterprise to make a simultaneous creation of economic as well as social value simultaneously. Nestlé has long been a particular about social issues such as the improvement of nutrition, especially among women and children, ensuring an adequate supply of clean water among residents experiencing hardship as well as engineering for rural development. It should be noted that Nestlé has advanced aid in form food to many hunger stricken areas especially in developing countries. It has also organized for seminars to educate mothers on how to improve nutrition for their families and to maintain a clean and secure environment in which their children can grow. Furthermore, it has aided in the development of social amenities in numerous rural settings. These included water supply, rural electrification, establishment of health centers and schools, among others.
In the same breath, Nestlé has initiated the Coca Plan for the purposes of improving the quality of cocoa plants for farmers across the world. This was done hand in hand with the training of farmers, improving chain management, improving social circumstances and maintaining cooperation with its partners in CSR (Seth, 1994). Through these mobilization initiatives, Nestlé has managed to influence many corporate entities around the world to embrace the idea of Corporate Social Responsibility.
In addition, Nestlé Company has also turned its focus on tropical regions and entered into Ecolaboration pact together with the Rainforest Alliance. The aim of the Ecolaboration pact was to mitigate impacts of the environment that are caused by the industrial activities within the tropical regions. This was also used to provide social benefits through coffee cultivation through the establishment of Nespresso Coffee. This brand boosted the income of many coffee farmers thus subsequently improving their livelihoods. It also solved numerous problems that coffee farmers were previously experiencing such as coffee bean-related diseases, below market value coffee pricing and technicalities which marred the supply chain. It further initiated programs for conserving water and soil. Through these important programs, soil erosion and exhaustion which had been a perennial problem was completely solved as farmers learned new methods of conserving their soil. Alongside that, they also improved their skills of water conservation through the proper use and handling of all water sources. Subsequently the latter solved the problem of water borne ailments as well as water scarcity in areas that had previously been adversely affected by the problem. Similarly, Nestlé ensured the rights of farm workers were adequately respected by farm owners. It advocated for the proper remuneration of all field laborers on coffee farms as well as their humane treatment by their employers, together with ensuring good health for their children and women by supplying them with clean water for drinking, health care, easy accessibility to education and adequate security.
Furthermore, Nestlé has been particular about expanding its business in nutrition and health care. It achieved this by investing heavily in developing the products meant to enhance wellness and health, which have been instrumental in treating and preventing ailments such as diabetes, obesity, Cardio-vascular diseases and Alzheimer’s. In addition to this, Nestlé wholly owns a robust health science and research body together with the Nestlé’s special institute for Health Science. Through these facilities, Nestlé conducts thorough research that results in the improvement of the quality of its products. It also trains a number of volunteers who wish to make improvement in terms of nutrition and health for themselves.
To augment its impact to the society through SCR, Nestlé sought membership into FLA (Fair Labor Association). The FLA has been of great help to Nestlé especially when it comes to improving the working conditions of workers in its supply chains. Nestlé has complied with all provisions set out by the FLA pertaining to the terms and conditions of service of all it employees, including better remuneration pacts and subsequent compensation schemes. This has seen the cultivation of a motivated staff of Nestlé together with the improved living standards of their dependents. As it pertains to the chronic problem of child labor in cocoa growing zones, the FLA helped Nestlé eradicate the problem and rehabilitate the children in specially location where they could be helped to access schools and amenities for improved lives. It also improved the conditions of service which made the jobs attractive for more adults who had earlier avoided farm work. Finally, the FLA was also very instrumental to Nestlé in terms of good advice necessary for tackling challenges in a sustainable ways.
Finally, Nestlé Corporation has touched the society through innumerable programs of sponsorship that it facilitates in various organizations around the world. First, Nestlé, has massively sponsored Good food and Good life programs in France, Russia and United Kingdom. These programs were instigated with the prime aim of helping children adopt healthy nutrition habits for healthy lifestyles. It is noted that since the establishment of these programs the health of the beneficiaries of this program have improved tremendously and they have become more happy and hopeful for a bright future. Apart from that, Nestlé has sponsored many international events of music festivals especially in Beijing and Salzburg in Australia. This has helped many young people cultivate their talents in music, elocution, and dance among other, which thy can use later to boost their lives socially and economically. Some can also develop careers in the field of music which can become their major source of livelihood. In the world of sports, Nestlé has also been very contributory. Through its four key brands; Powerbar, Nesquick, Vittel and Ricore, Nestlé has extended its sponsorship to Tour de France club. It also sponsors Great Britain Lionesses Women’s rugby league team through Munchines products. It also extends the same gesture to International Association of Athlete’s Association (IAAF) Kids’ athletics program through which children all over the world are enabled to congregate in one place to have fun and share their talents and experiences with each other. Another beneficiary of Nestlé sponsorship programs has been the Australian Institute of sports.
Main Stakeholders and Their Role
As a company of this magnitude, Nestlé comprises a wide range of stakeholders who have been behind the thriving state of the company since inception. Among these are shareholders and investors from various corporate entities, some of which are nonprofits. A number of food-related companies such as Unilever are key shareholders in Nestlé. Through this diverse shareholders and investors, the company derives capital for expansion through its widespread branches worldwide.
Another category of stakeholders of Nestlé are state and self-government authorities. These entities help ensure that the company is operating on a conventional code of business ethics to avoid being exploitative to the employees, communities and the environment. Through the respective bureau of standards in each country where Nestlé operates, the agencies conduct the consumer protection practices by ensuring the quality of associated products that Nestlé deals in. This that has put the corporation to task in making sure that the products sold to the public are suitable and safe for consumption by humans as well as their pets.
In addition, another lot of Nestlé’s stakeholder involves the staff and the trade unions. The staff has been behind the production and supply of the company’s products to all market channels. They are the ones who have been charged with the responsibility of ensuring that the products reach consumers in the right quantities, qualities and the right prices. On the other hand, trade unions such as FLA, IWW and ILO have been very particular about the welfare of employees in all the branches, in countries where Nestlé operates. They have stipulated provisions that the corporation has to adhere to when handling its employees in a manner that fosters their individual improvement as well as their families. Some of the concerns include proper remuneration which matches the standards capsulated in the ILO provisions, proper working conditions and an environment which enables recreation and relaxation. In addition, they are concerned about the general safety and security of workers as well as their compensation packages upon retirement.
Similarly, Nestlé acknowledges a number of business partners as stakeholders and who play a significant role in ensuring steady progress of the company. Some of these partners are financial institutions such as banks which advance credit services to the Nestlé Company as well as its employees all over the world. Through these banks, the company can also facilitate its salary payments to all it workers in an efficient manner. It is therefore notable that these partners play a crucial role in the progress of the company.
Consumers of Nestlé products are also stakeholders in this noble business enterprise. They determine the continuity of the company by valuing and purchasing its products. It also important to note that from its feedback, the company can make necessary adjustment regarding the quality of the products as well as its prices. It is self-evident that when they are not satisfied with a certain product, consumers will not purchase it. It is therefore important to note that the satisfaction of consumers is what keeps production companies going.
The final group of stakeholders is the Non-Governmental Organizations (NGOs). Owing to the nature of products that it manufactures, Nestlé attracts a number of NGOs around the world; some of which are concerned with the well-being of the products in terms of nutrition. Some may partner up with the company in order to educate on certain health and nutritional principles to cultivate and sustain a healthy society (Biswas et el., 2013). Others are concerned with advocating for environmental principles with the aim of ensuring that besides what the company already does, it also keeps the environment safe and secure for the present and future generations. Such NGOs also train employees on proper measure of waste dumping as well as methods of recycling products to avoid emission of harmful pollutants (Thwaits & Bouwer, 2013). Related with these NGOs are the UN agencies such as WHO, WFP, UNICEF, among others, which also have interest in Nestlé because it deals in products that are directly linked to their areas of interest (Thwaits & Bouwer, 2013).
Good and Bad Practices
The NESTLE Concept of Corporate Social Responsibility
Based on the reputation of Nestlé, the world at large has expressed numerous gestures in recognition of its widespread brands of products as well as its hospitality. Among the many ways through which Nestlé has been recognized are the awards of ISO 14001 from the Environmental Management system and from the system of Occupational Health and Safety Management which it received in acknowledgment for its full conformity with international standards (Nestlé, 2013b). Furthermore, the Nestlé Waters division was also honored with a sixth LEED certification by the U.S. Green Building Council. It became the first company ever to receive such an honor for its consciousness about prevailing environmental elements. Nestlé Purina also received the Malcolm Baldrige National Quality Award, which was given in recognition for their performance in the area of process management, leadership, market and customer focus, strategic planning, measurement, focus on workforce and results (Nestlé, 2013b).
Furthermore, Nestlé was recognized for its being the best employer to work for Switzerland in September, 2011. This was an award advanced by the Universum’s ranking of exemplary employers Worldwide. Not only that, Nestlé has appeared in the Fortune Magazine for more than twelve time for featuring among the world’s most admired ten companies. Similarly, it was also honored by the IUoFST, it won a gold medal from the World Environment Center (WEC) following its impressive effort in ensuring environmental sustainability. In the same breath, Nestlé was also mentioned as being among the fifty best multinational places to work all over in Canada. Finally, Nestlé was also awarded by the Switzerland’s International Coaching Federation’s prism Award for emerging prominently in organizational coaching. Not all these gesture can come on a silver platter but rather through diligence, consistence, innovativeness, and a daring and relentless spirit that has been exhibited by Nestlé fraternity across all its branches in the world.
Legal Issues and Consumer Reservations
Nestlé, just like virtually all companies, is not without its flaws. For example, Nestlé once introduced a brand of breast milk substitute which it deemed suitable for women in countries which are economically disadvantaged. However, human rights organizations including CARE international, World Vision, Save the Children, Oxfam, and Plan International took issue with Nestlé for what it saw as unethical marketing of infant formula (Biswas et el., 2013). Naturally, breast milk is proven to be the most suitable meal of the suckling baby owing to its rich nutrients and the ability to boost the immunity of the baby against opportunistic diseases of infancy. Similarly, through suckling, the mother is believed to bond with her child and improves the mental and emotional growth of the child. The human rights organizations therefore saw it as unethical for Nestlé Company to discourage lactation of babies by introducing a substitute product. Apart from that, the corporation was also accused by certain NGOs in Laos for failing to put appropriate labels on the product as well as providing incentives to nurses and doctors to advocate for increased use of the product of infant formula (Biswas et el., 2013).
Another scandal which put Nestlé in bad light was the advocating of the description of water as a need but not a right. This began in the World Water Forum in which Nestlé had opposed efforts to declare water an individual’s right that was not to be traded. Today, Nestlé continues to take control of significant aquifers which it exploits and bottle its water for profit.
Similarly, the outbreak of E. coli in 2009 in the US was directly linked to Nestlé’s refrigerated cookie dough that originated in a certain plant in Danville, Virginia (Turker, 2009). This was reported to have caused sickness among more than fifty people in thirty states. Half of these victims were to be hospitalization following the outbreak. As a result of this incident, Nestlé recalled all of its cookie dough voluntarily as a remedy to the problem. The source of the outbreak was later established to have been contaminated flour that had been obtained from a certain supplier of raw material. To provide a lasting solution to the problem, Nestlé resolved that the flour used was to be heat-treated as a way of killing all the bacteria.
In another isolated case in the Uttah Pradesh state in India, Maggi noodles samples were tested for lead content and it was discovered that the amount found within exceeded health safety limits (Ware, 2015). The permissible levels of lead in any food material should not exceed 0.01 ppm, but the Maggi noodles samples contained 17 ppm as per the FSDA, which is highly detrimental to the consumers’ health (Ware, 2015). Consequently, Delhi resolved to place an embargo on Maggi sales in all government stores. Similarly, Kerala followed suit by imposing a temporary ban on the noodles until their quality was cleared by the centers responsible for testing.
Although these isolated incidences subjected Nestlé to ridicule, the fact remains that the company made the necessary efforts to correct the mistakes and forged ahead with its corporate affairs uninterrupted. Perhaps the cause of such irregularities can partly be attributed to a wide range of products that the company deals in but with consistent corrections and its swift action will no doubt contribute to the company’s optimal stability.
Key Initiatives and Priorities of CSR
To find solutions to the aforementioned shortcomings and its relevance in the corporate world, Nestlé has committed itself to respecting human rights by ensuring that all the products that it manufactures are free from potential harm on consumers. This is done through frequent testing exercises done by the Nestlé Institute of Health Science to ascertain their suitability before they are dispatched to consumers. However, Nestlé is also committed to responding to consumer reservations through their feedback or lobby groups in bid to correct any emerging hitches in products and sustain its consumer market (Turker, 2009).
Furthermore, the company is highly committed to improving the situation of the local communities as a way of compensation for some of the irregularities that it has been associated with in the past. This way it has embraced diversified cultures in order to promote social integration and cohesion. In the same breath, it is committed to creating employment opportunities in the communities where it operates. Finally, Nestlé has stuck to its declaration as a corruption-free company and pledges to always promote honesty in its operations by eliminating chances of fraudulent transactions across all its branches worldwide.
Corporate Social Report Review and Analysis
Nestlé has been evaluated by corporate analysts all over the world as one among the few companies that will continue to succeed in the world of business based on its effort in contributing to the general economy of the society be focusing on virtually all aspects of life (Boyd, 2012). Furthermore it has embraced a symbiotic style of existence in the community where it depends on its raw materials, labor and eventual market of its products as it commits itself in providing employment opportunities to the people from all walks of life, improvement of the welfare of communities through CSR programs as well as focusing on improving the state of the environment. Furthermore, analysts say that the strength of Nestlé is largely attributed to its agility in addressing the concerns from customers including their reservations about faulty products. Accepting and learning from its own mistakes and shortcoming has perhaps been the major propelling factors toward its renown status.
Corporate Social Responsibility (CSR) programs have largely modified the image of many corporate entities which had earlier been tainted by persistent exploitative tendencies. The consistency in applying these programs is the only way that will see companies rise to the occasion to add value to the environment as well as the communities within which their operations are based. Nestlé has emerged as the leading company in applying these CSR programs and proving to the world that the initiative was worth implementing. Although it has been associated with a number of irregularities in the recent past, the good that the company contributes to society surpasses the negatives significantly. The company has generally corrected their mistakes that arose in their operations and that is also a spirit that has attracted and sustained customer confidence. Nestlé is a model corporate entity worthy emulating by all other exiting and upcoming business entities.