Creating Shared Value - Foundation for Nestlé's Sustainability Strategy

Nestlé's priorities include areas of business that are consistent with social interests aligned with its core business principle of “Creating Shared Value”. Vietnam Business Forum’s reporter Giang Tran has an interview with Mr. Binu Jacob, CEO of Nestlé Vietnam, on this matter on the sidelines of the Vietnam Corporate sustainable development forum organized by Vietnam Chamber of Commerce and Industry (VCCI) on December 10.

What drives your company to pursue the sustainable development strategy?

Nestlé Vietnam, established in 1995, has continuously expanded its investment and diversified products to meet food and nutrition needs and optimize food roles to improve quality of life for people, today and tomorrow. After 25 years of development, Nestlé Vietnam is committed to long-term investment and sustainable development in Vietnam with the mindset of “A global company with a local nature".

Every activity of Nestlé is closely engaged with partners in Vietnam to “Create Shared Value”: Contributing to social development while ensuring long-term business success and if we want those goals to be sustainable, we must align them to a vision to the future. That is how we maintain and develop our relationships with distributors, suppliers, farmers and other stakeholders to share our success with the viewpoint that we only really grow when our partners grow together.

Nestlé Vietnam has been among the Top 10 sustainable companies in Vietnam for many years. This year we are honored to be elected Co-Chair of the Vietnam Business Council for Sustainable Development (VBCSD), established by the Vietnam Chamber of Commerce and Industry (VCCI). As a prestigious agency in Vietnam, VCCI-VBCSD has been promoting an active role in supporting the business community to engage in the Vietnam Sustainability Strategy.

Among 17 sustainable development goals, which one has Nestlé selected to achieve? How does the pursuit of these goals have an impact on your business development?

"Creating Shared Value" is the foundation for Nestlé’s sustainable development strategy, to bring long-term benefits to both the company and the community where we operate. Individuals and families, communities and the planet are three impact groups the company aims for, based on efforts that are linked together through shared commitments that help Nestlé achieve its goals by 2030, in line with the roadmap of the United Nations Sustainable Development Goals (SDGs).

Nestlé Vietnam has awarded among the Top 10 sustainable companies in Vietnam by Vice President of Socialist Republic of Vietnam Dang Thi Ngoc Thinh

In partnership with all relevant partners, we have been working hard to achieve the SDGs targets in all markets where Nestlé operates, including in Vietnam. Through our annual sustainability reporting, we will measure and assess how much progress is being made and achieved on these SDGs.

To maximize resources and ensure the progress achieved, we now focus on addressing goals that both Vietnam and the world are prioritizing, specifically:

Joining hands to respond to climate change: Reducing CO2 emissions throughout our operations and supply chain; protecting sustainable water resources.

Building and shaping a zero-waste future: Taking the lead in research and development so as to recycle and reuse all of our product packages by 2025.

Promoting gender equality, women’s empowerment in both the workplace and throughout the value chain.

What are Nestlé’s typical initiatives on sustainable business in recent years?

Nestlé's priorities include areas of business that benefit the society, evolved around the core business principle of “Creating Shared Value”.

Recently, the United Nations Entity for Gender Equality and the Empowerment of Women (UN Women) presented the Women's Empowerment Principles (WEPs) Award to Nestlé Vietnam for its commitments and achievements, affirming its commitment to women’s empowerment and gender equality as one of top priorities of Nestlé.

The most typical “Creating Shared Value” initiatives include the NESCAFÉ Plan - linking farmers to sustainable coffee development. Since its launch in 2011, NESCAFÉ Plan has brought many technical innovations and applied new know-how to generate positive impacts on Vietnam’s sustainable coffee development, such as improving farmers’ livelihoods, contributing enhanced development of chain links, increasing the quality and value for Vietnamese coffee beans to make Vietnam a reference for world Robusta coffee.

After 10 years, the program has distributed over 46 million high-yield disease resistant seedlings to farmers and improved 46,000 hectares of aging coffee trees in the Central Highlands by replanting new trees. More than 260,000 farmers attended sustainable farming techniques and training programs organized by Nestlé and assisted by agricultural engineers. As a result, more than 21,000 farmers achieved 4C International Coffee Certification. In addition, the NESCAFÉ Plan also helps save 40% of irrigation water, reduce chemical fertilizers and pesticides by 20%, and increase income for farmers by over 30%.

In our commitment to building and shaping a zero-waste future, all of our factories in Vietnam have achieved the goal of having no solid waste landfilled into the environment. We are looking for more environmentally friendly alternatives, Nestlé Vietnam is the first food business in Vietnam to use FSC-certified paper straws for instant nutritional products. We are actively communicating to change awareness and working with partners and businesses in the community to make a greater impact. Nestlé Vietnam and Lavie Vietnam, members of the Nestlé Group, are two founding members of the Packaging Recycling Organization Vietnam (PRO Vietnam).

In response to the COVID-19 pandemic, we put human health and life on top with a “5+1” priority: Firstly, ensuring the safety of our employees; Secondly, optimizing supply chain to ensure smooth business operations; Thirdly, optimizing distribution and retail channels to ensure that goods are still being distributed to consumers through daily inventory and stock tracking; fourthly flexibly approaching consumers with advertising initiatives aimed at connecting, inspiring and encouraging people to experience life at home, strictly implementing the social physical distancing; and the fifth joining hands to support government and community and, finally, managing financial capabilities.

How do you assess the effect of the Corporate Sustainability Index (CSI) on corporate governance?

The Vietnam Business Council for Sustainable Development introduces the CSI Index with sustainable development criteria based on three economic, social and environmental pillars of international standards adapted to Vietnamese context to the Vietnamese business community. CSI functions as a measure and guide for businesses to improve their governance, business performance and pro-environment development for more humanistic values.

Nestlé Vietnam also has a sustainability committee which meets every month to discuss sustainable development with other working groups. We accompany stakeholders in a comprehensive and sustainable development strategy to overcome the crisis, especially amid the COVID-19 pandemic that causes many far-reaching impacts on economic and social life. I believe that, if only focusing on immediate benefits, it is difficult for us to go far, but if we want to grow high and go far, sustainable development is the only way.

Do you have any recommendations to the business community for better sustainable development?

As Co-Chair of the Vietnam Business Council for Sustainable Development (VBCSD), our goal is to inspire and help the business community to realize and fulfill the role of an SDG-pursuing company.

We believe that, by sharing experiences and practical lessons, businesses can thrive together toward their set goals. The business community can and should be part of solutions to sustainability.

Public-private partnerships in sustainable development are no longer a trend but a necessity for achieving the best results. Each party should actively give opinions and cooperate for sustainable development under 17 SDGs. The formation of VBCSD aims to better promote the role of the business community and bring stakeholders closer together. The Vietnam Corporate Sustainability Forum is a place where international and domestic organizations and policymakers come together to make decisions to this effect.

Giang Tran (Vietnam Business Forum)