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Nestlé satisfies its audience's appetite for data
Nestlé’s Creating Shared Value (CSV) report is not for the faint-hearted. It has 284 pages, each packed with (tiny) text, in monochrome, except for a few sprinklings of graphs and low-res images.
As sustainability practitioners, we love a dense but well-conceived and readable report. It provides an invaluable insight into company programmes, inspires ideas and validates our assumptions on what works, and what doesn’t.
Most companies try to engage multiple audiences in their report – and end up appealing to none. Nestlé has a clear idea of its audience: raters of indices like DJSI, looking for detail; NGOs such as Oxfam, looking for transparency; and practitioners like us, looking for a clear discussion of strategy and performance. Nestlé’s report is a methodical reflection of its audiences’ needs, and this is where it succeeds.
The company organises its sustainability strategy around six pillars: nutrition, rural development, water, environment sustainability, human rights compliance, and people. The first 40 pages are a lengthy discussion of Nestlé’s business and CSV agenda. A layperson may question the level of detail – are the bios of the company’s 24 advisory experts and a list of all their partnerships and memberships really necessary here?
This misses the point. This level of detail, all available in one place, eases the job of an external analyst looking to benchmark Nestlé against its peers on these issues. The detail reflects a strategic decision to focus on the needs of the company’s primary audience.
Take another example. When assessing corporate programmes, investors and NGOs look for a complete integration of sustainability into the business value chain. In its materiality discussion, Nestlé uses an easy-to-read table to categorise its issues in terms of their impact on every step of the company’s value chain. For example, food and nutrition security have a high impact on agriculture, Nestlé’s business and its consumers, and only a moderate impact on first tier suppliers and retail channels. This goes beyond the standard materiality graph and helps readers quickly grasp which of Nestlé’s material issues are important for its diverse stakeholders.
In its most recent report, Nestlé has included a new section to describe its work to assess the commercial value of its CSV strategy. This follows a broader trend, as more companies seek to quantify the value that sustainability brings to their business. While they get bonus points for talking about this, the discussion is frustratingly vague and generic – and it is not entirely clear what Nestlé learned that was new. Also, did this analysis measure the suitability of the Shared Value concept in providing clear value analysis for Nestlé’s partners? This is relatively uncharted territory, but a more strategic analysis would have been welcome.
Nevertheless, by the time we get to the pillars, the reader has developed a good sense of the scope and breadth of the company’s CSV strategy. The sections on the pillars are structured in a similar format – challenges, materiality, stakeholders, governance, strategy and a detailed performance review.
Did Nestlé have to repeat the same materiality value chain table and partnership list in each section? Presumably, the company wanted to treat each pillar as its own sub-report – but this seems unnecessary, given there is little added detail.
As multiple surveys have revealed, sustainability reports are becoming less useful because they try to be all things to all people. Consumers and laypeople interested in sustainability do not seek out this information in a report – they want it delivered to them through other channels. The “sustainerati”, on the other hand, are eager and interested in the so-called boring details. Nestlé’s unwavering clarity on its audience has helped it develop a report that caters to this need. It backs this up with more engaging and layperson-friendly elements on its website through the use of images, case studies and attractive graphics.
Certainly, the writing in the report could be less clunky. In some instances, it takes a while to get to the point. There are too many instances of corporate speak. But overall, it is a clear and rigorous attempt to explain Nestlé’s sustainability programme to those most interested in it.
Boring? Sometimes. Useful? Incredibly.
Aarti Ramachandran is client director at Context Group
Follows GRI? In accordance with G4 Guidelines
Assured? Yes, by Bureau Veritas
Materiality analysis? Yes, extensive
Goals? Yes, extensive
Stakeholder input? Yes, extensive
Seeks feedback? Yes
Key strengths? Clarity on audience needs
Chief weakness? Dense and clunky copy
Pleasant surprise? Discussion on commercial value added through sustainability