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Nestlé CEO on plans to address sustainability concerns of young consumers

Consumer goods giant Nestlé told CNBC Thursday that concerns about the sustainability of young customers were “off the charts” and had a major impact on purchasing decisions.

“If you win their hearts, that is, this is the future growth of your business,” said Mark Schneider, a founding member of the CNBCESG Council. “The No. 1 basic rule of consumer goods marketing and food and beverage marketing never loses the younger generation.”

Schneider, who was talking to CNBC’s Jeff Cutmore in the suburbs of Lausanne, Switzerland, cited two reasons for this. “They are not only the years of highest income and consumption, but also the role model of other generations on what to do.”

Nestlé, the largest food and beverage company on the planet, has a large environmental footprint. In 2018, its total emissions reached 113 million metric tons of carbon dioxide, of which just under 95% came from the supply chain, which is part of “Scope 3” emissions.

By 2030, Nestlé wants to reduce greenhouse gas emissions by 50%. We are aiming for net zero emissions by 2050 “at the latest”.

This goal includes most Scope 3 emissions, such as raw material procurement and logistics management, but there are some exclusions from this category.

At this time, Nestle’s goals do not cover emissions from what is described as “consumer use of sold products” and “purchased services, leased assets, capital goods, investments”. ..

These explained Nestlé’s carbon dioxide equivalent emissions in 2018 were 12.7 million tonnes and 8.6 million tonnes, respectively.

Supply chain issues

Schneider further emphasized that he felt that it would be an important focus of future business. “If last year was all about Covid, safety, and keeping shelves in stock, this year is obviously all about the supply chain,” he said.

He explained that the global shipping industry is “extremely stressed” and pointed out that rising energy prices led to higher truck costs.

“During Covid’s period, there was so much demand for packaging that packaging costs went up and then a lot of produce surged,” he said.

“Clearly, there is strong inflationary pressure in 2009, as evidenced by forward contracts. [that] … Many of them will reach ’22. Therefore, it is a safe bet to assume that there will be significant inflation in ’21 / ’22 due to these supply shocks. ”

Schneider said the “$ 64,000 problem” was whether this was a one- or two-year blip or the beginning of a new inflation cycle leading to the next year. “Both methods we have to prepare.”

COP26

Schneider’s comments come as the world prepares for the COP26 Climate Change Summit in Glasgow, Scotland, from October 31st to November 12th.

Many are on COP26. The official website of the UK Summit states that “we will mobilize political parties to accelerate action towards the goals of the Paris Agreement and the United Nations Framework Convention on Climate Change.”

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The Paris Agreement, described by the United Nations as a legally binding international treaty on climate change, was adopted in late 2015 and said, “Global warming is less than 2 degrees Celsius, preferably less than pre-industrial levels. The purpose is to limit it to 1.5 degrees Celsius.

Whatever the latest findings from the Intergovernmental Panel on Climate Change, there are major issues regarding climate change countermeasures.

The report, released last month, said that limiting global warming to nearly 1.5 degrees Celsius, or even 2 degrees Celsius, below pre-industrial levels would be possible without an immediate, rapid and massive reduction in greenhouse gases. Warned that it would be “unreachable” in the next 20 years. Emissions.

Nestlé’s CEO was asked what he expected of the summit. “We hope that the convergence of global regulations will be reaffirmed and that governments and businesses will see a tighter commitment that we are all heading in the same direction,” he said.

Work that has already been done should be recognized and rewarded, Schneider said. “So, for example, in our case, the peak carbon is behind us, it was 2019,” he said. “We’re on the road, it’s no longer a plan, it’s about getting things done.”

— CNBC’s Sam Meredith contributed to this report

Nestlé CEO on plans to address sustainability concerns of young consumers

Source link Nestlé CEO on plans to address sustainability concerns of young consumers

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