EQ Investors, Castlefield Investment Partners and Legal & General Investment Management are among 26 investors responsible for just over $3trn of assets who have written to Nestlé ahead of its AGM in Switzerland today calling on it to commit to setting targets to improve its impact on population health.
In a statement coordinated by responsible investment NGO ShareAction, investors have urged the food and drinks company “to grasp the opportunity to stay ahead of food-related regulation and evolving consumer expectations”.
The investors are part of ShareAction’s Healthy Markets Initiative, which engaged the world’s largest food manufacturers seeking shifts in their strategy away from over-reliance on sales of less healthy products. Recent research published by the World Obesity Federation showed that more than half of the world’s population will be living with overweight or obesity by 2035 unless serious and immediate action is taken.
In response to engagement from the initiative last year, Nestlé agreed to report on the healthiness of sales globally and to also report this for 13 key markets using recognised, government-endorsed nutrient profiling models, which it did in March of this year.
Nestlé also announced it will set a target to grow sales of healthy products. During the company’s recent full-year results conference, its CEO Mark Schneider stated that the company wanted to increase the share of its sales associated with healthier products.
Today’s statement welcomes this progress but said it doesn’t go far enough. “While we welcome Nestlé’s progress, the current proposed target, however, is based on actual sales of healthier products, rather than a proportion of these sales relative to less healthy product sales. In order for Nestlé to fully demonstrate its strategic shift towards a healthier portfolio, which will improve public health and mitigate the associated regulatory risks, Nestlé needs to rebalance its sales towards healthier products,” it said.
Simon Rawson, deputy CEO of ShareAction, added: “Nestlé has said it wants to sell healthier food, but it hasn’t given assurances that it will also address its less healthy food sales, which is essential to turn the tide against the harmful effects of diet related ill health.
“Nestlé has an opportunity to stay ahead of food-related regulation and evolving stakeholder expectations. Nestlé, as the world’s largest food and drink manufacturer, could do so much more to support population health.”