Monday, 20 April 2015

IBFAN-GIFA raises lack of compliance with the International Code and informs shareholders about the release of the movie Tigers at Nestlé's AGM

At Nestlé's latest Annual General Meeting, the Geneva Infant Feeding Association (IBFAN-GIFA) raised attention about the movie Tigers, based on the true story of a former Nestlé's sales representative for baby foods, Mr. Aamir Raza, who resigned after becoming aware of the adverse impact of infant formula on child's health. IBFAN-GIFA noted that the stand taken by Mr. Raza, was officially acknowledged and supported by Canada's Minister of Citizenship, Immigration and Multiculturalism. GIFA further recalled that Nestlé's advertising is deceiving many mothers and urged the company to finally bring its policies and practices into line with the International Code of Breastmilk Substitutes.

Baby Milk Action/IBFAN UK was also present and asked Nestlé Chairman, Peter Brabeck-Letmathé, to drop the public relations approach and address people’s concerns before he retires. He has attempted to rebrand the company as a Nutrition, Health and Wellness company, but many people see Nestlé as a Malnutrition, Death and Water Stealing company. Last year a survey found it to be the least ethical company of the past 25 years, which will otherwise be his legacy. (R
ead the text of Baby Milk Action's intervention)

There were 2,446 shareholders present to hear the intervention, representing 73.5% of voting rights. IBFAN was the only campaign group raising concerns about Nestlé’s business practices.

Text of GIFA's intervention and the response from Mr Brabeck (Nestlé Chairman), Mr Schipper (Head of Nestlé Nutrition) and Mr Bulcke (Nestlé Chief Executive Officer) are given below.

Intervention of Ms Camille Selleger (IBFAN-GIFA):

Dear Mr. President, dear shareholders,

My name is Camille Selleger, and I speak on behalf of the Geneva Association for Infant Feeding, Swiss member of IBFAN.

Company’s managers just told you about Nutrition, Health and Well-Being, but the story I will now tell you is rather different.

Last February, at the Geneva’s International Film Festival on Human Rights, a movie was screened to sold-out packed rooms. This movie, Tiger, is based on the true story of Syed Aamir Raza, who worked as a Nestlé sales representative in Pakistan in charge of promoting baby foods to hospitals and doctors. During one of his visits to a hospital, he discovers a room full of babies dying because they were not breastfed, but rather fed with infant formula. Alarmed by the effects of the products he promotes on child’s health, he resigns and sends a legal notice to Nestlé calling on it to stop the practices he had been part of. The film then tells how Nestlé tried to keep him to tell his story and how he came to IBFAN for help. It finally became impossible for him to return to Pakistan and he remained separated from his wife and children for seven years.

On the occasion of the film's premiere in Canada, the Minister of Citizenship, Immigration and Multiculturalism declared: 'The account of Mr. Raza’s principled stand in defence of the health of babies and their families is one that deserves to be told, and one which reflects the best of Canadian values.'

Ancient history, will say the leaders of the company ... actually not that old! The dying babies who appear in the film are real babies filmed in 2013 in Pakistan. Indeed, babies fed formula milk are more likely to get sick than breastfed and in areas affected by poverty, they even run the risk of dying from diseases. Despite this, many mothers, seduced by brands’ advertising discourse, sincerely believe they are giving their child good nutrition by feeding them with infant formula.

We welcome Nestlé’s recent commitment to renounce the logo 'Natural Start'. However, this is a very small step following years of campaign and monitoring by IBFAN. In fact, the whole business strategy of the company must be revised to comply with the International Code of Marketing of Breastmilk Substitutes.

Mr Bulcke, earlier on you spoke about respect. My question is a very simple one indeed. When is Nestlé going to put its money where its mouth is and adhere to the International Code [of Marketing of Breastmilk Substitutes] instead of just paying lip service to it?

Response of Mr Peter Brabeck-Letmathé, Nestlé Chairman

Thank you very much Ms Selleger. I think what we are going to try and do is to see if we can convince you by calling on another speaker to try to explain what we’re about. So we are going to ask Mr Schipper, who’s in charge of nutrition, and he’s a newcomer. He has a lot of energy and perhaps he will be more successful than we have been Heiko to convince Ms Selleger.

Mr Heiko Schipper, Head of Nestlé Nutrition

Thank you Mr Brabeck and thank you for the question, Ms Selleger. First I would like to start to talk about our Nestlé Nutrition business. Our mission is to nurture a healthier generation and we do this by focusing on the first 1000 days of life. Both through our products that are safe and science-based. 

[Note: In a presentation to investors in September 2013, Mr Schipper highlighted the ‘product solutions it promotes during the first 1000 days – including follow-on milks and toddler milks’, which the World Health Organisations says are ‘unnecessary’].

We also market our breastmilk substitutes responsibly in line with OUR commitments to the WHO Code. I think you are also familiar that our policy is the strictest in the industry.

[Note: Nestlé refers to its own policies, whereas it should ensure its activities at every level comply with the International Code of Marketing of Breastmilk Substitutes and subsequent, relevant Resolutions adopted by the World Health Assembly. By Nestlé's own assessment of the violations of the Code and subsequent relevant WHA resolutions documented by IBFAN, 90% are permitted by Nestlé’s narrower policies].

Our compliance is the most strict within the entire industry.

[Note: Nestlé is a greater source of violations in IBFAN’s monitoring than any other company, with the possible exception of its main rival, Danone, the second biggest company – see who is the worst]

We are training our employees. We have internal and external auditors in place. In fact, last year, we increased our level of audits to 43, which is an increase of 25%. And also our compliance policies towards our WHO Code commitments are also recognised through our inclusion in the FTSE4Good Index where since 2011 only Nestlé has been present. So for the last four years we are the only player in the industry who is recognised to have strict compliance policies in place. We are in fact audited every year on 104 points when it comes to our commitments and we have passed them in the past four years.

[Note: FTSE has warned Nestlé several times not to suggest that inclusion in the FTSE4Good investment index signifies compliance with the WHO Code. Companies are assessed on their own policies, not the Code and Resolutions and Nestlé was only included after the criteria were weakened – and it weakened its own policies shortly before being included, knowing it would be assessed against those. IBFAN, Save the Children, UNICEF Lao and others have called on FTSE to strengthen its criteria].

So I believe that we have a very industry leading and strict policy in place.
When it comes to the movie you are referring to, we are aware of this movie. This is a movie that is set, I believe at the end of the ’90s, but these allegations made are highly questionable and certainly are not consistent at all with our policies that we execute in the markets.

[Note: Tigers is based on the true story of former Nestlé salesman, Syed Aamir Raza. Internal company documents provided by him show that he was performing the duties required of him. Indeed, a job description for the equivalent post in Canada in 2014 states the main responsibility is to ‘[s]timulate retail sales through the promotion of infant formulas and cereals to gain Healthcare Professionals recommendations.’]

Mr Peter Brabeck-Letmathé, Nestlé Chairman

Perhaps Paul you would like to come in.

Mr Paul Bulcke, Nestlé Chief Executive Officer

Ms Selleger, you said that we are very cynical. I find that you are very cynical in your speech. Respect for the truth. The truth, Madam, the events that are described in the film took place decades ago, based on the allegations of one person. And they are entirely false and wrong. There is nothing to be added. There is nothing more to say. These are false.

[Note: In addition to the documentary evidence substantiating the allegations by Syed Aamir Raza, there were contemporary surveys conducted in 33 cities in Pakistan and published as the report Feeding Fiasco, which found evidence from health workers of the activities of company representatives. A Save the Children survey in 2012 found health workers continued to report being targeted by company reps. with Nestlé most prominent]

Camille Selleger, IBFAN-GIFA

Well, I suggest that your shareholders make up their own minds.

Mr Peter Brabeck-Letmathé, Nestlé Chairman

Thank you for that, Madam.

Camille Selleger, IBFAN-GIFA

I invite shareholders to view the film that will be shown in Switzerland in the Autumn 2015 and perhaps they will be able to make up their own minds.

[Note: As Camille Selleger said in her opening comments, the film includes actual babies, malnourished after being formula fed, who were filmed in 2013. Mike Brady spoke to shareholders next, showing a picture from a Bangladesh report from 2014 ‘Tragedies of infant formula and sub-optimalbreastfeeding’. Despite knowing babies die from unsafe formula feeding, Nestlé promotes its infant formula in Bangladesh as the ‘gentle start’ for babies. Mr Schipper told investors in 2013 that this marketing campaign is a‘growth engine’. See Mike Brady’s intervention and Mr Brabeck’s response.]