Slide 1: SRI Forum, Spring 2005: The Nestlé commitment to Africa
SRI Forum, Spring 2005: The Nestlé commitment to Africa Michael Garrett, Executive Vice President, Head of Asia, Oceania, Africa and Middle East 1 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 2: This presentation contains forward looking statements which reflect Management’s current views and estimates. The
This presentation contains forward looking statements which reflect Management’s current views and estimates. The forward looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward looking statements. Potential
Slide 3: Agenda
Agenda • Africa: Basic Facts • Nestlé in Africa • Social and Economic impact through the value chain • Conclusions 3 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 4: Africa: Basic facts
Africa: Basic facts • 54 countries • 832m people • 13% of the world's population, growing at around 2.4% p.a. • Life expectancy at birth is ca. 50 years • 1.9% of the world's GDP 4 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 5: Africa: The popular view
Africa: The popular view • Health problems: 25m AIDS sufferers, malaria • Political / Social Turmoil: Côte d'Ivoire, Democratic Republic of Congo, Zimbabwe • Poverty: ¾320 million of Africa's 832 million people living on less than $1 per day, ¾24 nations had food shortages in 2004 5 SRI Forum, Sprin
Slide 6: Untold story: Africa's growth profile is improving
Untold story: Africa's growth profile is improving 6.0% 6.0% Real GDP Growth Real GDP Growth 5.0% 5.0% 4.0% 4.0% 3.0% 3.0% 2.0% 2.0% 1.0% 1.0% 0.0% 0.0% 2001 2002 2003 2004 est. 2005 est. Africa World Source: International Monetary Fund 6 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name
Slide 7: Agenda
Agenda • Africa: Basic Facts • Nestlé in Africa • Social and Economic impact through the value chain • Conclusions 7 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 8: Nestlé in Africa: An early commitment
Nestlé in Africa: An early commitment Tunisia Morocco 1928 1927 Egypt 1941 Senegal 1961 Côte d'Ivoire Ghana Nigeria 1957 1961 Kenya 1959 Cameroon 1965 1965 Madagascar 1962 Zimbabwe 1959 South Africa 1916 8 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 9: A successful business in Africa built over decades
A successful business in Africa built over decades • 2004 sales: CHF 2.4 bn • 27 factories, plus distribution centres and corporate offices • 11,500 employees • 4 Regions • An est. 50,000 jobs created through the supply chain 9 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 10: Nestlé sales growth in Africa
Nestlé sales growth in Africa 14 Organic Growth (%) 12 13.2% Africa Total Nestlé 10 8 6 7.2% 4 5.1% 4.5% 2 0 2003 2004 The African The African continent continent is is aa positive positive contributor to contributor to Nestlé's Nestlé's overall overall growth. growth. 10 SRI Forum, Spring 2005: The
Slide 11: Nestlé's sales in Africa: 15 product categories in 54 countries
Nestlé's sales in Africa: 15 product categories in 54 countries Main Markets: Business split* by product group: South Africa PetCare Confectionery Beverages Egypt Nigeria Prepared dishes Ghana & Cooking aids Morocco Milk Products, Nutrition and Ice cream * based on tonnage 11 SRI Forum, Spring 2005:
Slide 12: Case Study: Nestlé Nigeria
Case Study: Nestlé Nigeria Nestlé's Business: Sales (NGN mio) Profit after tax (NGN mio) 30'000 5'000 • Present since 1961 25'000 4'000 • Ca. 1500 staff 20'000 3'000 • One factory 15'000 2'000 10'000 • One main distribution centre 5'000 1'000 • 3 regional warehouses 0 0 • 5 regional sales offices 19
Slide 13: Independent socio-economic analysis: Nestlé and Nigeria
Independent socio-economic analysis: Nestlé and Nigeria • High job satisfaction among Nestlé employees • 84% of natural raw materials procured locally • Local job creation and positive impact on communities • 40% of distributors worked with Nestlé for 21 to 35 years; another 32% for 11 to 20 years •
Slide 14: Agenda
Agenda • Africa: Basic Facts • Nestlé in Africa • Social and Economic impact through the value chain • Conclusions 14 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 15: Social and economic impact through the value chain
Social and economic impact through the value chain AGRICULTURAL MANUFACTURING PRODUCTS AND RAW MATERIALS AND MANAGEMENT CONSUMERS •Sustainable •Technology transfer •Building nutritional agriculture •Employee literacy value •Coffee farmers •Technical training •Consumer education •Cocoa farmers •Marke
Slide 16: Working with farmers
Working with farmers • Improving farmers' incomes 9 Direct buying of coffee 9 Improved productivity and quality • Helping farmers to meet global standards 9 International standards on quality including pesticide use in Côte d'Ivoire and Ghana • Progress on labour practices in cocoa 9 International C
Slide 17: Environmental Stewardship
Environmental Stewardship Nestlé's African factories improved 20-57% in: • water consumption • emissions • other areas (2000-2003) 17 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 18: Developing People
Developing People Literacy training: Adult Based Education Training in South Africa From construction worker to industrial services team leader From accounting to management From laboratory development analyst to factory manager 18 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chai
Slide 19: Nutrition research and consumer education
Nutrition research and consumer education Funding nutrition research in Africa: Nestlé Foundation for the Study of Problems of Nutrition in the World and the Nestlé Nutrition Duchess Club: Nutrition education in Institute Africa markets in Nigeria and Ghana Milo in Motion: Promoting good nutrition a
Slide 20: Independent Audit of WHO Code compliance
Independent Audit of WHO Code compliance "Based on a total of five weeks of observation and interview within South Africa, Mozambique, and Nigeria, we found no communication of any kind to the public about infant formula or follow-on formula" Bureau Veritas Audit Opinion "We are pleased that the Bur
Slide 21: Independent survey of African consumers: Social Responsibility
Independent survey of African consumers: Social Responsibility “Nestlé continues to be viewed as one of the leading companies in corporate social responsibility... African consumers are among the most likely to rate Nestlé positively.” Chris Coulter, GlobeScan 21 SRI Forum, Spring 2005: The Nestlé C
Slide 22: 50 projects supporting UN Millennium Development Goals
50 projects supporting UN Millennium Development Goals Nestlé actively works with its partners to improve framework conditions. For example: 210,000 people in Eastern Ethiopia get clean drinking water, with UNHCR 100,000 South African families improve their food supply, with EcoLink 800,000 youth le
Slide 23: Expert views on impacting framework conditions
Expert views on impacting framework conditions African economist: IFRC: Invest Work for good in health governance UNHCR: Help through financial and technical support Nestlé: Promote free trade Investor: Use sustainable business practices 23 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Nam
Slide 24: Agenda
Agenda • Africa: Basic Facts • Nestlé in Africa • Social and Economic impact through the value chain • Conclusions 24 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman
Slide 25: Conclusions
Conclusions • Despite its problems Africa is improving and has good potential for future growth • Nestlé has been present in Africa for a long time, contributing to social and economic progress • Nestlé has developed a profitable business with strong market positions, including product categories wi
Slide 26: Decades of commitment, and a vision of future growth
Decades of commitment, and a vision of future growth "By making wise, long term investments, in people, productivity, and purchasing power, we can build a future for Africa based on sustainable businesses which benefit all stakeholders." 26 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Nam
Slide 27: SRI Forum, Spring 2005: The Nestlé commitment to Africa
SRI Forum, Spring 2005: The Nestlé commitment to Africa Michael Garrett, Executive Vice President, Head of Asia, Oceania, Africa and Middle East 27 SRI Forum, Spring 2005: The Nestlé Commitment to Africa Name of chairman