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CREATING SHARED VALUE REPORT 2016

Nestlé in Society Creating Shared Value Report of Nestlé Philippines

Nestlé MissionNestlé aims to continuously nurture future generations of Filipino families and to contribute to the development of a strong and prosperous nation.

Nestlé creates shared value by improving consumers’ understanding of nutrition, creating access to nutritious food, encouraging healthy habits, and promoting an active lifestyle. The Company also advocates sustainable water consumption, encourages environmental sustainability, and supports farmers in rural areas in the production of raw materials and encourages livelihood across the nation.

Nestlé’s Key CSV Areas

WaterNutrition

Rural Development

Nestlé CSV Report 2016

32

Nestlé Philippines, Inc. (NPI) is a leading food and beverage company that touches Filipino consumers throughout the different stages of their lives. With over 105 years of operational experience in the country, its products continue to be household staples from childhood to golden age, defining a tradition of quality and excellence.

Nestlé’s product range includes coffee, milk, beverages, non-dairy creamer, food, infant nutrition, ice cream, fresh dairy, breakfast cereals, confectionery, and pet care. Committed to Creating Shared Value for its shareholders and society, Nestlé adopts a corporate strategy rooted in long-term prosperity and mutual benefit for its business units and the communities these serve.

About Nestlé in the Philippines

About Nestlé in the Philippines

105 years of operational experience in the country.

Pulilan, Bulacan

Cagayan De Oro

Tanauan, Batangas

Cabuyao, LagunaLipa, Batangas

Makati City

Nestlé Sites in the PhilippinesG4-3, G4-8


54

Our BusinessN

estlé CSV Report 2016Our Business

Fueled by its mission to nurture generations of Filipino families, Nestlé’s history in the Philippines stretches as far back as 1895; however, it took 16 years for Nestlé and Anglo-Swiss Condensed Milk Company to take their roots in the oriental land of Calle Renta in Binondo, Manila.

Economic Value CreationG4-9, G4-EC1, G4-EC9

201620152014

116

Sales Turnover (in billion PHP)

121 126* BusinessWorld Top 100 Corporations in the Philippines

**As of taxable year 2014

Top 5 Philippine

Companies*

3rd Top tax payer in the Philippines**

Top 6 Market in the Nestlé

world

2016

1960 (NutriPro) was

formed – A

partnership

between Nestlé

S.A. and San Miguel

Corporation

1962

First Nestlé Factory

in Alabang

1964

MILO introduced in

the Philippines

1976

Cabuyao Factory

2007

Nestlé Business

Services

2011

100 years in the

Philippines

2012

Tanauan Factory

and Wyeth

Acquisition

2017

Malt Plant

1961

Nestlé and Anglo-

Swiss Condensed Milk

Company

First sales office in

Calle Renta, Binondo

G4-17

G4-17


76

Our Business

in 2016 amounted to Php 17.0 billion, a 16% increase over 2015’s Php 14.7 billion. This increase in payments to government is due to increase in sales and profit. Payments to employees Nestlé’s payments for salaries, wages, bonuses and benefits for both factories and head office was Php 5.2 billion in 2015 and Php 5.0 billion in 2016.

Nestlé delivers positive economic impact to society through its disbursements to key stakeholders. Below are the highlights of the Company’s economic value creation from 2015 to 2016: Economic value generated Nestlé’s total revenue increased by 3% from PHP 123.1 billion in 2015 to PHP 126.7 in 2016 driven primarily by sales growth volume. Nestlé

is one of the top five companies in the Philippines according to BusinessWorld and is the sixth biggest market of Nestlé globally. Payments to suppliers Raw materials and cost of production are the biggest components of the costs: 71.9% in 2015 and 68.1% in 2016. In addition, significant payments are made for advertising, promotions, and

distribution. Expenditures on raw materials decreased by 2.21% while expenditures in Advertising and Promotions increased by 6.92% due to support of new product launches. Payments to capital providers This refers to dividends paid and interest payments for deposits and borrowings.

The total dividends increased by 25% from 2015 to 2016, from Php 14.6 billion to Php 18.2 billion. Payments to governments Nestlé is one of the largest taxpayers in the country. The amounts paid are primarily for customs duties, income taxes, local business taxes, taxes paid on royalties and dividends, and includes net VAT payments. Taxes

Payments to communities Nestlé spent Php 188 million on donations, sponsorships, and CSV projects in 2016. This is more than double the amount spent in 2015. The most significant spend is on the NESCAFÉ Plan which helps coffee farmers by making available superior quality plantlets including technical assistance by Nestlé’s team of agronomists.

in thousand

pesos

%

a. Payments to

suppliers

88, 537, 060 71.9%

b. Payments to

employees

5, 180, 581 4.2%

c. Payments to

providers of capital

14, 619, 634 11.9%

d. Payments to

governments

14, 705, 429 11.9%

e. Payments to

communities*

74, 238 0.1 %

2016 126,730,968

ab

c

d

e

in thousand

pesos

%

a. Payments to

suppliers

86, 268, 473 68.1%

b. Payments to

employees

5, 013, 404 4.0%

c. Payments to

providers of capital

18, 248, 484 14.4%

d. Payments to

governments

17, 012, 528 13.4%

e. Payments to

communities*

188, 079 0.1 %

2015 123,116,942

ab

c

d

e

Economic Value CreationG4-EC1

*Some programs that adresses societal needs are not captured under payments

to communities but are part of operational expenses as programs are embedded

in business operations.


98

Nestlé ProductsBeverages MILO MILO Nutri Up NESTEA NESFRUTA

Breakfast Cereals FITNESSE Cereal FITNESSE Cereal Bar CORN FLAKES KOKO KRUNCH HONEY GOLD COOKIE CRISP HONEY STARS MILO CEREAL Coffee & Creamer Creations NESCAFÉ CLASSIC NESCAFÉ 3-in-1 NESCAFÉ DOLCE GUSTO NESCAFÉ DECAF NESCAFÉ GOLD NESTLÉ COFFEE-MATE NESCAFÉ Coco Mocha NESCAFÉ Berry Mocha NESCAFÉ Blend and Brew Confectionery CRUNCH KITKAT FOX’S POLO

Nestlé Products

Food NESTLÉ All-Purpose Cream MAGGI Soya Sauce Maggi Magic Isda MAGGI MAGIC SARAP MAGGI MAGIC SINIGANG MAGGI Savor MAGGI Oyster Sauce Dairy Health and Nutrition Solutions BEAR BRAND Powdered Milk Drink BEAR BRAND Busog Lusog BEAR BRAND Adult Plus BEAR BRAND Junior NIDO Fortigrow NIDO Forti-Choco NIDO Junior NIDO 3+ Protectus NIDO 5+ Protectus Infant Nutrition NESTLÉ CERELAC NESTLÉ CERELAC Nutri Puffs GERBER GERBER Apple Juice NAN OptiPro NAN Kid OptiPro NAN OptiPro HW NESTOGEN NESTOGEN Classic NESTOKID Four PreNAN NAN AL 110 NAN SENSITIVE

Healthcare Nutrition NUTREN ISOCAL PEPTAMEN ORAL IMPACT RESOURCE THICKEN UP Liquid Beverages NESTLÉ Fresh Milk NESTLÉ Low Fat Milk NESTLÉ Non Fat Milk NESTLÉ CHUCKIE NESTLÉ MILO RTD NESCAFÉ RTD BEAR BRAND Sterilized Fresh Dairy NESTLÉ Whipping Cream NESTLÉ Sour Cream NESTLÉ Yogurt Jelly NESTLÉ Yogurt NESTLÉ Yogurt 0% Fat NESTLÉ ACTI-V NESTLÉ Greek Yogurt Plain NESTLÉ Yogurt Drink Ice Cream NESTLÉ Kimy NESTLÉ Kitkat NESTLÉ Drumstick NESTLÉ Temptations NESTLÉ Twin Pops NESTLÉ Sorbetes

G4-4

10

Message from the Chairman and CEO

Dear friends, In 2016, Nestlé S.A. marked its 150th birthday. We celebrated this year, not only by reflecting on our past, but also by reaffirming our commitment to help build a better future. We express this in our Nestlé Purpose:

Enhancing quality of life and contributing to a healthier future.

Just as Henri Nestlé did 150 years ago with his life-saving cereal based milk food for babies called Farine-Lactee Nestlé, we reaffirm our commitment to positively impact the lives of individuals and families we serve, the communities we work with, and the planet we all share.

Here in the Philippines, Nestlé has been a kasambuhay of the Filipino people over a hundred years now. We have witnessed the triumphs, struggles and indomitable resilience of the Filipino people. Through good times and challenging times, we remain committed to growing with the Philippines through business strategies that embrace inclusive growth and create shared value.

11

Chairman and CEO Jacques Reber with coffee farmers

G4-1


1312

This report is a summary of our efforts over the last three years to contribute positively to Philippine society. In this report you will find many stories such as:

• How our agricultural interventions for coffee help farmers increase their productivity and income;

• How our employees tirelessly work to provide quality products while minimizing the use of water, reducing emissions, and preserving the environment;

• How we engage with communities and find ways to innovate our products to help solve the country’s malnutrition challenges.

By sharing these stories, we hope to inspire and drive further action, encourage collaboration, find opportunities to scale up initiatives that work, and to seek guidance for initiatives that could be improved even further. Creating shared value is one of the clearest ways that we live the Nestlé purpose,

a purpose that is taken to heart by all our employees across the nation. It is indeed an honor for me to lead this great Company, to see inspired employees, partners, and communities working together towards a common goal to uplift a nation.

I would like to thank my dear Nestlé colleagues, partners and stakeholders. It is with deep gratitude for walking with us on our journey that we present this Nestlé in Society Creating Shared Value Report. Thank you for being by our side and

supporting us through the years and for inspiring me and the Company to continue with the work that we do. It is because of your guidance, insight, and dedication to our values that we have been able to make a difference and continue to do so.

“It is indeed an honor for me to lead this

great Company, to see inspired employees,

partners, and communities working together

towards a common goal to uplift a nation. ” Jacques Reber

13

As you go through this report, you will discover how we continue to strive to introduce, deepen, and expand our positive impact on society, the environment, and our business. This is the story of our journey in Creating Shared Value.

Jacques Reber selfie-ing with the ladies of Cut & Sew

12


1514

CREATING SHARED VALUE

Nestlé Mission

About Nestlé Philippines

Message from the Chairman and CEO

GRI Content Index

External Assurance

CONTENTS

NUTRITION

WATER & ENVIRONMENT

RURAL DEVELOPMENT

HELPING SOCIETY

INVESTING IN HUMAN CAPITAL

GOVERNANCE

18

28

56

82

104

112

136

About this Report

The Nestlé Philippines CSV Report presents the Company’s initiatives aimed at making a positive difference in the key areas of Nutrition, Water and Environment, and Rural Development. These are initiatives that the Company calls Creating Shared Value (CSV), a strategy that allows Nestlé to grow its business while contributing to the advancement of the society where it operates.

G4-15


1716

UN Sustainable Development Goals and Shared Value Initiative This report provides details about Nestlé’s programs that contribute to the advancement of the 17 United Nations Sustainable Development Goals (UN SDGs) which encompass today’s sustainability challenges such as poverty, health, education, and climate

change, among others. In addition, Nestlé Philippines aligns with that of its parent company, Nestlé S.A., by reporting practices and progress in Creating Shared Value. The summary of the Company’s contributions to the UN SDGs are found on pages 28-29.

Reporting standards and frameworks

Global Reporting Initiative

This report has been prepared ‘in accordance’ to the Core option of the Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines. Details of how the Company has applied GRI’s principles and process in the publication of this report are found on pages 152-159.

Reporting period and scope

Assurance

Moreover, this report has successfully completed the GRI Materiality Disclosures Service which verifies that the General Standard Disclosures G4-17 to G4-27 were correctly located in both the GRI Content Index (see pages 162-171) and in the text of this report.

This report features stories on the Company’s three CSV areas of focus as well as performance on the social, environmental, economic, and

governance aspects from January 1, 2014 to December 31, 2016. All information comes from five operational sites across the country.

About this Report

The Company commissioned TÜV Rheinland, a third party organization, to validate the data that we presented in this report. The independent assurance was carried out in accordance to the AA1000 Accountability Principles Standard 2008 on inclusivity, materiality, and responsiveness principles and GRI G4 Guidelines.

During the conduct of the engagement, the representative from TÜV Rheinland had the opportunity to meet senior executives and interview data owners. Pages 160-161 contain the independent assurance statement which outlines TÜV Rheinland’s observations and conclusion.

G4-28

G4-32

G4-33

1918

The Company believes in the immense power of business in paving the way to an inclusive and sustainable world. By embedding Shared Value into everything the Company does, many inclusive business models were born, which not only made Nestlé’s operations more efficient and environmentally sound, but also helped benefit thousands of people with new employment and better nutrition for the nation.

CreatingShared Value

G4-1, G4-12, G4-25

20

CSV in Nestlé’s Value ChainIn every aspect of Nestlé’s business, the Company ensures that there are benefits not only to the Company but to society as well. From sourcing to distribution, the CSV strategy ensures that the Company not only manages its negative impact, but creates positive ones as well.

165% increase in local coffee purchase (2015 vs. 2016) 10, 000 farmers trained per year (average) 21 million pesos worth of purchase orders through Cut & Sew program

Sourcing

4,000 million liters of oil saved 11% GHG intensity reduced from 2010 Over 6% reduction in water intensity (2015 vs. 2016) Zero waste to landfill in all sites achieved in 2016

474 BOWers earning above minimum wage, 2016 Over 23 million students and adults participated in nutrition education and physical activities Over 600,000 marathon runners

Manufacturing Distribution & Marketing

FINISH

SARI-SARI �STORE

SARI-SARI �STORE

SUPERMARKET

SUPERMARKET

CUT & SEW

*Data from 2014 to 2016

G4-25, G4-EC9

G4-25


2322 23

What is Creating Shared Value?

Creating Shared Value (CSV) is an approach which optimizes the interdependence between business and society. Through Nestlé’s global CSV business strategy, Nestlé grows its business further to reach new, often underserved markets with products and services which

ameliorate the living standards of the society where it operates. CSV goes much further than one-time donations by creating products, services and systems which will positively benefit society, and also the business for the long term.

Nestlé tackles social issues that intersect with its business, especially in areas where it is best equipped to provide solutions. Nestlé Philippines commits to Creating Shared Value in three distinct areas:

Nutrition

Nestlé aims to improve its consumers’ understanding on nutrition, create access to nutritious food, encourage healthy habits and promote an active lifestyle.

Water and Environment

Nestlé advocates sustainable water consumption and encourages environmental sustainability.

Rural Development

Nestlé supports farmers in rural areas in the production of raw materials and encourages other forms of livehood.


G4-25

G4-25


2524 25

To better implement and integrate CSV in every department, the Company formed the CSV Council in 2010 to drive, align and direct all CSV initiatives of Nestlé Philippines. The council also

The CSV Council

designs and monitors projects, partners with private, public and civil organizations, and communicates and promotes its CSV strategy both internally and to the public.

The Company complies with the highest standards in compliance to laws, business principles and codes of conduct. Secondly, Nestlé protects the future by implemementing sustainability measures in all areas of its business, to

make sure that the Company meets the needs of the present without compromising future generations. Lastly, beyond sustainability, Nestlé Creates Shared Value for its shareholders and society by

creating social solutions linked to its core business. Through the key areas of Nutrition, Water and Rural Development, Nestlé Philippines improves lives and grows it business with the future in mind.

CSV

Nutrition, Water, Rural Development

SustainabilityProtect the future

Compliance

Laws, business principles, codes of conduct

“...beyond sustainability, to create value for shareholders and society - integrally linked to our core business...”

“...meet the needs of the present without compromising future generations...”

“...comply with the highest standards...”


Some of the men and women who contribute to the CSV programs of Nestlé Philippines

G4-25 G4-25


2726 27

Nestlé Philippines and the SDGs

As a company with a global presence, Nestlé is committed to upholding the Sustainable Development Goals adopted by the United Nations (UN) in 2015. From eliminating hunger through supporting smallholder coffee growers by increasing yields and incomes, to providing decent

employment and economic opportunity through micro-distribution and responsible sourcing initiatives for Nestlé products, the Company is on track to utilize its business infrastructure to achieve inclusive and sustainable growth. Other programs in line with the UN mission focus

on well-being and education, which Nestlé contributes to achieving by working with communities to improve local road safety conditions through awareness, support for public schools and apprenticeship programs in the communities where Nestlé factories are located.


G4-1, G4-EC8

The overarching goal is to support the continued growth of the Company while also improving environmental performance, minimizing impacts, and embracing stewardship. The Company continues to do this by progressively

reducing Nestlé’s packaging requirements, implementing various recycling initiatives to comply with a “zero waste to landfill commitment,” and engaging consumers and communities through responsible water and solid waste management modules.

The Company is built on the cooperation and industry of a growing transnational community and, most especially, a desire to contribute positively to the development of the countries it operates in.


2928 29


p.58 Rainwater Harvesting p.58 Reuse of Water p.59 Recovery of Water p.59 Reverse Osmosis Technology p.59 Zero Industrial Wastewater Discharge Factories p.60 River and Coastal Cleanup Activities

p.65 Material Efficient Packaging and Waste Recovery p.66 EcodEx p.64 Zero Waste to Landfill p.67 Eco Bricks and Permeable Pavers p.69 Beverage Carton p.68 Upcycling Project p.70 Balik Baterya Program p.78 Greening the Supply Chain

p.124 Employee Diversity and Inclusion

p.30 Women Movers Awards

p.108 Nestlé GK Village

p.80 NESCAFÉ Plan p.90 Project CoFFEE p.92 Cut and Sew p.94 Farmville p.96 Business on Wheels p.110 Investing in Human Capital

p.77

Use of Renewable

Energy in

Lipa Factoryp.30 Reformulation

p.32 Micronutrient Fortification

p.49 MILO Marathon

p.50 MILO Little Olympics

p.51 MILO Sports Clinic

p.53 MILO Champ Moves

p.100 Massage from the Blind p.129 PWD-friendly Workplace

p.132 Reformulation

p.72 Energy Efficiency Program p.77 Use of Renewable Energy

p.80 NESCAFÉ Plan

p.90 Project CoFFEE

p.92 Cut and Sew

p.94 Farmville

p.96 Business on Wheels

p.101 Community Development

Framework

p51 Milo Marathon

p.78 Greening the

Supply Chain

p.105 Safety Skwela

p.106 Bloodletting

p.132 Life Saving Rules

p.64 Zero Waste to Landfill p.65 Material Efficient Packaging and Waste Recovery p.67 Eco Bricks and Permeable Pavers

p.108 Nestlé Good Life Village: Lipa Eco-village

p.134 Governance and Ethical Standards p.124 Employee Diversity and Inclusion

p.142 Membership to associations Partnership with government on various rural development projects

p.36 Nestle Healthy Kids

p.34 Nutrition Education

p.104 Brigada Eskwela

p.60 Water Leadership Award p.61 Project WET- Water Education for Teachers p.78 Greening the Supply Chain

Nutrition is at Nestlé’s core. Nestlé works with various sectors as the Company strives to make a difference in 3 key areas of nutrition. Nestlé provides access to affordable and nutritious food to meet the needs of vulnerable populations. Moreover, Nestlé educates people of all ages on nutrition to encourage healthy habits and promote the merits of a wellness lifestyle. Lastly, the Company provides opportunities for physical activities and sports.

NutritionG4-EC8


3332

Access to nutritious food

Reformulation

Sodium, Sugar, Transfat, and Saturated Fat Reduction

The reformulation of Nestlé products forms part of its ongoing efforts to improve nutrition in the country. By reducing sugars, sodium and saturated fat in Nestlé’s food and beverages, and removing all trans fats originating from partially hydrogenated oils (PHOs) through science-based renovation, Nestlé can help improve the health of its consumers and decrease the risks to acquire non-communicable diseases. To assess and improve the nutritional value of Nestlé products, The Company uses the Nestlé Nutritional Profiling

System, which is based on local and international nutrition recommendations including that from World Health Organization. Currently, 86.4% of the Company’s products meet the criteria of Nestlé Nutritional Profiling System. Moreover, all products are compliant with the sodium limits set by Nestlé and all locally produced Nestlé products do not contain PHOs. Nestlé has set goals to reduce sugar, sodium, and saturated fats by 10% in products that do not currently meet the Nestlé Nutritional Foundation (NF) criteria and to remove trans

fats originating from PHOs from all Nestlé food and beverages. Globally in 2016, the Company has reduced added sugar by 8% which is equivalent to 39,000 tons, reduced sodium by 10.5% equivalent to 2,700 tons of salt and a 6.5% reduction for saturated fat which is equivalent to 6,200 tons. In the past 3 years, 27 local products have undergone reformulation for nutrition considerations. A key example of Nestlé’s sugar reduction efforts over the years is through the brand NESTLÉ CHUCKIE, a chocolate milk drink enriched with Calci-N.

Nestlé has consistently reduced the amount of added sugar over time from 16.15 grams (3 teaspoons) per serve in 2005 to now 6.48 grams (1.5 teaspoons) per serve of added sugar in 2016. Some categories have also made great strides in reducing sugar and saturated fat in the Company’s products. The Ice Cream business has reduced sugar by 13% from total volume since 2014.

Good to talkNESTLÉ CONSUMER

SERVICES898-0061

www.nestle.com.phwww.facebook.com

/CHUCKIE.phTOLL FREE NUMBER:

N E S T L É

1-800-100-637853

Good to knowKids’ bones can

only absorb 50-60% of the calcium

taken from food. That’s why

NESTLÉ CHUCKIE®

has CALCI-N®,a natural mineral

concentrate from milk, which helps bones

absorb more calcium to help them

build stronger bones!

Serving size: 180ml

NUTRITION FACTS

No. of Servings per container: 1

per servingAmount % RENI*

EnergyFat

Saturated FatTrans Fat

Dietary FiberSugar

CholesterolSodiumCarbohydrates

ProteinCalciumPhosphorusVitamin AVitamin D

kcalggg

mgmggggg

mgmgIUIU

119 74.412.740.0423.77

112.2414.830.5714.904.98 12

39442424

273.47219.12321.4449.05

* Percent RENI val ues are based on FNRI reference child requirement

of 7-9 years old (RENI 2002).

NUTRITIONAL COMPASS®

®Registered Trademark of Socié té des Pro duits Nestlé S.A.

Ingredients:Water, Milk Powder(Skimmed Milk and Buttermilk), Sugar,

Vegetable Oil (may contain Coconut Oil,

Palm Oil or Palm Kernel Oil), Cocoa Powder,

Milk Fat, Stabilizers (Microcrystalline

Cellulose, Mono- and Di-glycerides, Cellulose

Gum, Carrageenan,Sodium Alginate, Soya

Lecithin), CALCI-N® (Calcium Phosphatefrom Milk), Thickener

(Starch), Nature-Identical and Natural Flavors, Minerals (Disodium

Phosphate, Zinc Sulfate), Sweetener (Sucralose),

Vitamins (Niacin, Vitamin B2, Vitamin B6, Vitamin A,

Vitamin B1, Vitamin E, Vitamin B12,

Pantothenic Acid,Vitamin D,

Folic Acid, Biotin)

Contains food allergen: Milk, Soya

Keep cool and dry.Shake well

and serve chilled.Consume immediately

upon opening.

This milk drinkis not suitable

for infant feedingand is not a

breastmilk substitute.

Manufactured by:Nestlé Philippines Inc.,

Cabuyao, Laguna, Philippines

Under License ofSociété des Produits

Nestlé S.A.,Vevey Switzerland,Trademark Owners.

TM

Each 180mLserving contains

Energy119kcal

7% OF RENI180 ml180 ml

CHOCOLATE MILK DRINKCHOCOLATE MILK DRINKCHOCOLATE MILK DRINKCHOCOLATE MILK DRINKCHOCOLATE MILK DRINK


SERVICES898-0061



N E S T L É

1-800-100-637853




NESTLÉ CHUCKIE®





Serving size: 180mlNo. of Servings per container: 1


EnergyFat


Dietary FiberSugar



kcalggg

mgmggggg

mgmgIUIU

119 74.412.740.0423.77

112.2416.900.5714.904.98 12

39442424

273.47219.12321.4449.05




®Registered Trademark of Société des Pro duits Nestlé S.A.

CONSUME BEFORE DATE: / LOT ID:

NUTRITION FACTS

PH43539311/F35P70/011

C M Y K 1685 C 116 C

THIS PRODUCT IS A SOURCE OF:

2005

16.15 g

2016

Added sugar (grams per serving)

6.48 g

The same business has also reduced saturated fat by 13% from total volume since 2014. Coffee has also made progress on sugar, with a reduction of 8% from total volume since 2014. The Company acknowledges that further reduction is needed for saturated fat in coffee mixes and therefore Nestlé is currently working with the global Research and Development team to find

2010

10.4 g

2012

6.96 g

solutions for reformulation. In the last year, Nestlé S.A. has set out new objectives that will help the Company further reduce the amount of sugar, sodium, and saturated fat content in Nestlé food and beverages by 2020. More details about this initiative are available on this site: http://www.nestle.com/csv

Access to Nutritious Food

G4-PR1

http://www.nestle.com/csv


3534

Access to Nutritious Food

of 10 lack Vitamin C. Nestlé Philippines, cognizant of its role in providing meaningful solutions to meet these nutrition-related challenges, saw the opportunity to improve the nutrition status of consumers by adding micronutrients to food and beverages consumed regularly by vulnerable populations.

These are available in small pack sizes to ensure affordability for those who need it most. A study conducted by the DOST - FNRI, found that BEAR BRAND fortified with zinc, iron, and Vitamin C can help fight micronutrient deficiency in growing children. School-age children who took part in

the study who had 2 glasses of fortified milk for 120 days had increased levels of zinc and hemoglobin as a result of increased iron in their body. Zinc contributes to normal growth and function of the immune system. Increased hemoglobin ensures healthy blood critical for normal oxygen transport in the body, resulting to reduction in


SERVICES898-0061



N E S T L É

1-800-100-637853




NESTLÉ CHUCKIE®





Serving size: 180ml

NUTRITION FACTS

No. of Servings per container: 1


EnergyFat


Dietary FiberSugar



kcalggg

mgmggggg

mgmgIUIU

119 74.412.740.0423.77

112.2414.830.5714.904.98 12

39442424

273.47219.12321.4449.05




®Registered Trademark of Socié té des Pro duits Nestlé S.A.

Ingredients:Water, Milk Powder(Skimmed Milk and Buttermilk), Sugar,

Vegetable Oil (may contain Coconut Oil,

Palm Oil or Palm Kernel Oil), Cocoa Powder,

Milk Fat, Stabilizers (Microcrystalline

Cellulose, Mono- and Di-glycerides, Cellulose

Gum, Carrageenan,Sodium Alginate, Soya

Lecithin), CALCI-N® (Calcium Phosphatefrom Milk), Thickener

(Starch), Nature-Identical and Natural Flavors, Minerals (Disodium

Phosphate, Zinc Sulfate), Sweetener (Sucralose),

Vitamins (Niacin, Vitamin B2, Vitamin B6, Vitamin A,

Vitamin B1, Vitamin E, Vitamin B12,

Pantothenic Acid,Vitamin D,

Folic Acid, Biotin)

Contains food allergen: Milk, Soya

Keep cool and dry.Shake well

and serve chilled.Consume immediately

upon opening.

This milk drinkis not suitable

for infant feedingand is not a

breastmilk substitute.

Manufactured by:Nestlé Philippines Inc.,

Cabuyao, Laguna, Philippines

Under License ofSociété des Produits

Nestlé S.A.,Vevey Switzerland,Trademark Owners.

TM

Each 180mLserving contains

Energy119kcal

7% OF RENI180 ml180 ml

CHOCOLATE MILK DRINKCHOCOLATE MILK DRINKCHOCOLATE MILK DRINKCHOCOLATE MILK DRINKCHOCOLATE MILK DRINK


SERVICES898-0061



N E S T L É

1-800-100-637853




NESTLÉ CHUCKIE®





Serving size: 180mlNo. of Servings per container: 1


EnergyFat


Dietary FiberSugar



kcalggg

mgmggggg

mgmgIUIU

119 74.412.740.0423.77

112.2416.900.5714.904.98 12

39442424

273.47219.12321.4449.05




®Registered Trademark of Société des Pro duits Nestlé S.A.

CONSUME BEFORE DATE: / LOT ID:

NUTRITION FACTS

PH43539311/F35P70/011

C M Y K 1685 C 116 C

THIS PRODUCT IS A SOURCE OF:

Micronutrient deficiency is a pressing national health issue, with many Filipinos unable to meet minimum nutrient requirements. According to the 2013 National Nutrition Survey of Food and Nutrition Research Institute of the Department of Science and Technology (DOST-FNRI), 4 out of 5 kids lack Iron, 3 out of 10 lack Zinc and 7 out

Micronutrient Fortification

®

®

FORTIFIED POWDEREDMILK DRINK

160g

Each 29g servingcontainsENERGY

10% of RENIkcal136

®

BR

AIN SUPPORT

NUTRIENTSBR

AIN SUPPORT

NUTRIENTS

NU

TRIEN

TS

PR

OTEC

T ION

NU

TRIEN

TS

PR

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DHA & Selenium!with mind and body nutrients* like

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FORTIFIED POWDERED MILK DRINK®4 800 361 392907

Good Food, Good Life®

NUTRITIONAL COMPASS ®® Reg. Trademark of Société des

Produits Nestlé S.A.

Good QuestionHow do I help ensure that my child

achieves proper development?

Good To KnowNIDO® FORTIGROW® is fortified with

vitamins and minerals that can help your child’s proper development so he can be mind and body ready for school!

These nutrients help contribute to the normal physical and mental development

of your school-age child while keeping his immune system strong.

INGREDIENTS: Milk Powder (may contain Skimmed Milk, Whole Milk Powder or Buttermilk, Lactose), Milkfat, Glucose Syrup, Sugar, Minerals (Calcium Carbonate, Calcium Citrate, Ferrous Sulphate, Zinc Sulphate, Sodium Selenate), Emulsifier (Soya Lecithin), Maltodextrin, Vitamins (Vitamin C, E, Niacin, B6, B1, B2, A, Folic Acid, Biotin, D, B12), Fish Oil, Taurine, Natural Flavor

Contains Food Allergen: Milk and Milk Products (includes Lactose), Soya Lecithin, Fish Oil

Manufactured by:NESTLÉ PHILIPPINES, INC.Cabuyao, Laguna, Philippines. Under License of Société des Produits Nestlé S.A. Vevey, Switzerland, Trademark Owners.

*Percent RENI values are based on FNRI reference child requirement of 4 - 6 years old (RENI 2002).

PROVINCIALTOLL FREE No. : NESTLE1-800-100-637853

NESTLE

NESTLÉ CONSUMER SERVICESMetro Manila : 898-0061

www.nestle.com.ph

Good To Talk

Good To RememberFor overall development and school readiness

that includes physical growth, brain developmentand a strong immune system, give your child

the proper nutrition everyday!

Per serving(29g + 180ml

water)% RENI*Per 100g

powderNutrition Facts

Serving Size: 29g No. of Servings per Container (or Pack): 5-6

Energy kcal 469 136 10%Fat g 20.0 5.80 Saturated Fat g 12.4 3.60 Trans Fat g 1.40 0.41Cholesterol mg 67.0 19.4Sodium mg 240 69.6Carbohydrates g 54.0 15.7 Dietary Fiber g 0 0 Sugar g 40.0 11.6Protein g 18.0 5.22 14%Vitamins and Minerals:Calcium mg 940 273 49%Iron mg 10.0 2.90 32% Zinc mg 7.00 2.03 37%Selenium mcg 15.0 4.35 20%Vitamin A IU 1466 425 mcg RE 440 128 32%Vitamin D IU 260 75.4 mcg 6.50 1.89 37%Vitamin E IU 5.25 1.52 mg TE 3.50 1.02 17%Vitamin C mg 34.5 10.0 33%Vitamin B1 mg 0.70 0.20 33%Vitamin B2 mg 1.40 0.41 68%Vitamin B6 mg 0.80 0.23 38%Niacin B3 mg 5.30 1.54 22%Biotin mcg 40.0 11.6Folic Acid mcg 150 43.5 21%Vitamin B12 mcg 1.30 0.38 31%Choline mg 70.0 20.3 Taurine mg 40.0 11.6 DHA mg 10 .0 2.90

Contribute to your child’s normal brain function that can

help him be mind ready for his learning activities. NIDO® FORTIGROW® contains essential Brain Support Nutrients like DHA, Iron and B Vitamins such as B1, B6 and B12.

BRAINSUPPOR

T

NUTRIENTS

Help maintain the proper functioning of your child’s

immune system to help him be body ready. NIDO® FORTIGROW® is a source of Protection Nutrients like Vitamin A, Zinc, Vitamin C and Selenium.

PROTECTION

NUTRIENTS

Support your child’s normal growth to help him be body ready for school

activities. NIDO® FORTIGROW® is a source of Growth Building Nutrients like Protein, Calcium and Vitamin D.

GROWTHBUILDER

S

*NIDO® FORTIGROW® is forti�edwith vitamins and minerals

for normal growth of children.It contains the 3D NUTRITION SYSTEM®

which is a combination of the followingmind and body nutrients that helps

your child be ready for school:

®

20QXVZ001

Just add 3 heaping tablespoons of powder to 1 glassof safe drinking water and stir.

How To Prepare:

NIDO® FORTIGROW®

Forti�ed Powdered Milk Drinkis not suitable for infant feeding and is not a breastmilk substitute.

Recommended servings:2 glasses per day.

®

160gNET WEIGHT

FORTIFIED POWDERED MILK DRINK

USE-BY DATE : LOT ID:

12mm 125mm 45mm

351.5mm

125mm 44.5mm

25.5mm

176mm

242mm

25.5mm

35mm

31mm

28.5

mm

PH43759076/F05P30/011

NIDO Fortigrow 160g box cyan magenta yellow black

PANTONE357

PANTONE108

Iron Zinc

Vitamin A

Iron Vitamin A Iodine

2015

18.8 billion

2016

Servings of fortified product (fortified with at least one of the following or a combination of the following: Vitamin A, Iron, Zinc and Iodine)

2014

22 billion16.96 billion

Iron Zinc

Vitamin A tiredness and fatigue. Through various Nestlé products, the Company has distributed over 16.96 billion servings of fortified products (Fortified with at least one of the following or a combination of the following: Vitamin A, Iron, Zinc and Iodine) in 2014, 18.8 billion in 2015 and 22 billion in 2016.


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Nutrition EducationGDA In its continued effort to deliver more transparent nutritional information to consumers, Nestlé voluntarily adopts GDA (Guideline Daily Amount) on Nestlé products*. The GDA based labels on front of pack are used to inform consumers about the nutritional content of the product, which makes it

Product Labelling

*Products out of scope of GDA include pure soluble coffee, savor, food service products and food service ice cream.

easier for consumers to see on shelf. In 2014, 85% of adults’ products and 86% of children’s products had GDA labels. In 2015, this jumped up to 98% of adults’ and 99.5% of children’s products with GDA labels. In 2016, 100% of adults’ products and 99.9% of children’s products had GDA labels.

Nutritional Compass On top of the Nutrition Facts table, at the Back of Pack (BOP), products also have the Nestlé NUTRITIONAL COMPASS®. It is an illustrative and easy-to-understand presentation of the product contents, highlighting its nutritional values and the benefits it offers to consumers, contact details and additional lifestyle and nutrition information. The NUTRITIONAL COMPASS® allows consumers to understand and appreciate products for its nutritional content and to inculcate in them the importance of reading nutrition labels.

Nutrition Edication

®

®


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NUTRIENTS



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12mm 125mm 45mm

351.5mm

125mm 44.5mm

25.5mm

176mm

242mm

25.5mm

35mm

31mm

28.5

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PH43759076/F05P30/011


PANTONE357

PANTONE108

Portion Guidance Nestlé also promotes healthy portion consumption through the Portion Guidance Program. This program guides consumers to consume healthy portions through recommending quantity and frequency. 100%

of adult products and 99.9% of child products have GDA labels

Using illustrations to show the right portions for consumption on back of pack

GDA labelling

®

®


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BRAINSUPPOR

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®

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NIDO® FORTIGROW®



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12mm 125mm 45mm

351.5mm

125mm 44.5mm

25.5mm

176mm

242mm

25.5mm

35mm

31mm

28.5

mm

PH43759076/F05P30/011


PANTONE357

PANTONE108

Additional information on back of pack

Portion guidance is facilitated through product form, packaging design, and illustrations. It is also taught through recipes in websites and nutrition education programs.

G4-PR3


3938

Nestlé Healthy Kids is an unbranded program that has been in place since 2012. It teaches children in schools the value of healthy eating habits, balanced and nutritious meals, physical activity, food safety, and understanding food labels. The program is strategically located in communities close to Nestlé’s operations. The Nestlé Healthy Kids program enables teachers to use interactive methods, such as games and role-playing to teach nutrition education to Grade 4 students aged 9-10 across the nation. The teachers undergo 2 days of training to learn how to deliver the lessons.

Nestlé Healthy Kids

Nutrition Education

Over the course of a quarter, students learn 10 unbranded interactive lessons:

Malu Malunggay

Glow Foods

NikNok Manok

Grow Foods

Kornik

Go Foods

Characters created to educate students on three food groups

• Go, Grow, and Glow • Go foods • Grow foods • Glow foods • A Balanced Meal • Healthy Breakfast

• Healthy Baon/ Healthy School Snack • Food Safety Habits • Good Nutritional Habits • Reading Labels

Lesson plan


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2014 2015 2016

24 403

27

51

1, 265

1, 145

743

2, 279

2, 267

6

13

16

Teachers Parents Kids Schools

Nutrition Education

These modules are taught through visual aids that are fun and colorful, and are available in tarpaulin format. These visual aids are made out of strong material so that teachers can reuse these visual aids every year. On top of the nutrition education sessions, two sessions are also dedicated to parents and canteen personnel in order to teach them the importance of promoting nutrition education at home and in school.

A Department of Science and Technology- Food and Nutrition Research Institute study was conducted to measure the effectiveness of the program in enhancing nutrition knowledge, attitude, and behavior. To ensure access to healthy food in school, the program also provides teachers with a school garden manual, training modules and seedlings to start their own school garden. Produce from the gardens are then used in the school feeding program.

Student taught how to read product labels

Interactive nutrition education session

Total 102 2, 813 5, 289Students harvest from their school garden


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Laki sa Tibay Campaign

In order to increase awareness on micronutrient deficiency, BEAR BRAND rolled out the Laki sa Tibay, formerly Laki sa Gatas campaign, which goes to public schools to instill in parents, teachers and school children the importance of proper nutrition to enable children to reach their ambitions.

Laki sa Tibay underlines that with the right lifestyle and proper nutrition, Filipino children will have strength both in mind and body to overcome life’s biggest challenges. Since 2014, the campaign has reached 3,909 public schools, training 746,070

Nutrition Education

3, 909 public schools reached

746, 070 school children trained

759, 843 parents trained

58, 434 teachers trained

school children, 759,843 parents, and 58,434 public school teachers with the knowledge and tools to achieve proper nutrition both in school and at home.


4544

201620152014

2, 150 3, 884 10, 821Schools

4 7 4Regions

Nutrition Education

Nutrition modules are embedded in the Music Arts Physical Education and Health (MAPEH) classes in coordination with the Department of Education. In 2016, the program reached almost 50% of the total public high schools and grade schools nationwide.

Students (GS Students) 0 0 4.68 M

Total 2.4 M 3.3 M 6.94 M

The Wellness Campus program is an unbranded program geared towards educating public school students on how to live a healthy life by choosing nutritious food and drink options and engaging in physical activity.

Wellness Campus

Students (HS Students) 2.4 M 3.3 M 2.26 M

Students engage in physical exercise

Students learning about a balanced meal


4746

Sarap SustanyaN

utrition Education

MAGGI’s Sarap Sustansya brings education on proper nutrition to communities across the country. Starting in 2014, MAGGI visited barangays (communities) to train community leaders on how to prepare nutritious food at the right portions. The five-day program teaches participants about proper nutrition, food safety, and cooking methods. MAGGI transforms them to be Taste

and Balance champions through extensive training on culinary techniques and nutrition know-how so they will be enabled to delight their families with tasty and nutritious meals everyday. The program was launched in 2014 with 63 participants in 2 barangays. In 2015, this expanded to 4 barangays with 627 participants. The program expanded

Wellness in Trade

Nestlé deploys registered nutritionists nationwide to supermarkets and groceries, engaging shoppers and consumers and teaching them about health and wellness. Nutrition consultation is free and nutritionists provide nutrition assessment (Body

Mass Index and Wellness Plate Assessment) and personalized nutrition advice, based on the shoppers’ nutrition status. In the last three years, the program has reached nearly 2.5 million consumers in 1,867 stores.

2. 5 million consumers participated in free nutrition consultation

Consumers measuring their body fat Community leaders learning how to cook healthy food

3, 825 people trained*

78 barangays*

brgy

*In the last three years


4948

BEAR BRAND Micronutrient Deficiency Campaign

To raise awareness about micronutrient deficiency or hidden hunger, BEAR BRAND created an Edu-tainment (Education + Entertainment) Campaign, which has been helping mothers understand how micronutrient deficiency can affect their children.

In a research study conducted by Millward Brown, it was found that before the campaign was launched, only 2 out of 10 mothers knew what micronutrient deficiency was. After the campaign, the results jumped to 7 out of 10 mothers who now understand the definition of micronutrient deficiency. This program is a great example of how a company can leverage its marketing efforts to promote nutrition knowledge among consumers.

Canteen Operators WorkshopNestlé Professional launched Canteen Operators Workshops across various sites. In partnership with registered nutritionists, the program advocates canteen operators to prepare quality, balanced, and nutritious meals for students. The event was participated in by 550 participants from 275 school canteen operators nationwide.

further in 2016 to 3,135 moms in 72 barangays across 5 cities. Moving forward, MAGGI plans to influence more community leaders all over the country by increasing its reach and putting digital at the core of the program. This is to ensure that they get easy access to information and become part of a community of cooks who are united by one objective - promoting a healthy and sustainable lifestyle for their families and the community.

Nutrition Education

2/ 10moms

7/ 10moms

Part of a digital campaign on micronutrient deficiency

Before the campaign

After the campaign

Awareness on Micronutrient Deficiency


5150

Physical ActivityOver the years, Nestlé has played an active role in promoting sports development in the country through the long-running sports activities of MILO.

The MILO Sports program aims to engage generations of Filipino families towards a shared vision of a stronger nation of champions through sports. Implemented together with the Department of Education, One Child, One Sport is the umbrella program of Nestlé.

The National MILO Marathon is the country’s biggest running event and has been building champions for over 40 years. Held in 16 cities around the Philippines, the race is divided into five categories: the 3km family run, the 5km fun run, the 10km run, the 21km half marathon, and the 42.135km full marathon. From 2014 to 2016, the National MILO Marathon had approximately 613,974 participants.

MILO Marathon

36, 000 pairs of rubber shoes distributed*

Physical ActivityA portion of participants’ registration fees is applied to MILO’s Help Give Shoes advocacy, which gives deserving public school students a pair of running shoes. In 2014, 16,000 shoes were distributed to the typhoon-stricken kids of Tacloban to help them get back on their feet. In 2015, 10,000 pairs were distributed and another 10,000 in 2016.

Runners in the MILO Marathon Students with their MILO shoes

*in the last three years


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The MILO Little Olympics is an annual, nationwide, inter-school junior sports competition which has allowed student athletes to realize their sports dreams since 1988. A total of 15 sports are made available: Arnis, Athletics, Badminton, Basketball, Chess,

MILO Little Olympics

Football, Gymnastics, Karate do, Scrabble, Sepak Takraw, Swimming, Table Tennis, Taekwondo, Tennis, and Volleyball. Instilling discipline, determination, and hard work, the program is participated by more than 24,000 student athletes annually.

24, 000 student athletes participate annually

During the months of April and May, the MILO Sports Clinics teach kids the fundamentals of various sports. For the past three years, the program has provided an avenue for 107,801 kids to have a fun, exciting, and healthy summer experience while learning to develop essential values in life.

The summer program consists

MILO Sports Clinic

2, 000 MILO Champion Bands distributed

Physical Activity

Students with their MILO Champion Bands that can measure their physical activity


5554

107, 801 kids engaged for the past three years

of experienced coaches providing hands-on training using the latest training equipment. Currently, the program offers 21 sports: Badminton, Basketball, Bowling, Chess, Cross Fit, Fencing, Football, Futsal, Golf, Gymnastics, Ice Skating, Karatedo, Parkour, Swimming, Table Tennis, Taekwondo, Tennis, Touch Rugby, Triathlon, Volleyball and Yoga.

MILO Champ Moves is a school-based program that aims to encourage a more active and healthy lifestyle among public elementary school children through lectures on energy and movement by adding an element of fun through sports-themed dance steps every flag ceremony. Under its partnership with the Department of Education, MILO Champ Moves has engaged 17.6 million public school children nationwide from 2014 to 2016.

MILO Champ Moves

17.6 million public school children engaged nationwide from 2014-2016

Physical ActivityStarting 2015, MILO has been able to distribute more than 2,000 MILO Champion Bands, a wearable device for kids that tracks activities, steps taken, calories burned, and distance and time of the participants of the MILO Sports Clinic. Syncing the MILO Champion Bands with the MILO Champions PH App allows parents to monitor their kids’ progress from their mobile device and track energy input and expenditure.

As the world’s largest food and beverage company, Nestlé is in a position to shape sustainable consumption and steward resources for future generations. In the Philippines, the Company focuses its efforts on reducing water use across its operations, using sustainably managed and renewable resources, and working towards solid waste management and zero waste.

Water and Environment


58 59

Data from the Japan International Cooperation Agency (JICA) Master Plan on Water Resource Management shows that the Philippines has the second to the lowest ground water availability among Southeast Asian countries. Operating a business that relies heavily

Water Management In Nestlé’s Operations

on water in a country facing water scarcity underpins the business case for water conservation in Nestlé. The Company considers water stewardship as a priority of the business and embeds its responsible use across its units and facilities.

Globally, Nestlé is committed to reduce its water withdrawal per ton of product by 35% from 2010 to 2020. The Company implements programs to reduce water withdrawal by reusing water and utilizing alternative sources like rainwater.

Water M

anagement in

Nestlé’s Operations

201620152014

5.74 6.56 6.36

Water Intensity (water withdrawal rate in m3/ metric tonne product)

Nestlé Philippines has made progress in its effort to reduce water intensity despite the steady increase in its production volume from 2010 to 2016; the water intensity or the volume of

water withdrawn over metric tons of product manufactured was maintained within the same range, 6.56 in 2015 and 6.36 in 2016.

Despite increase in production volume, water intensity was maintained

5.755.866.286.95

2013201220112010

G4-EN22

G4-EN8


60 61

Nestlé invests in “beyond compliance” water management systems in treating wastewater and reusing treated industrial wastewater. The following programs were implemented to increase Nestlé’s water efficiency:

Water M

anagement in

Nestlé’s Operations

Rainwater Harvesting The Rainwater Harvesting system collects rainwater for later use from relatively clean surfaces and then stores the water in tanks for use in refrigeration.

Reuse of Water Nestlé reuses final rinsing water of cleaning equipment for the next cleaning cycle. All Nestlé factories use a closed- loop system that recycles water for cooling vacuum pumps.

Reverse Osmosis Technology Nestlé uses reverse osmosis to clean water from the ground. This process yields reject water which is collected and used to flush toilets and urinals.

Recovery of Water In Nestlé’s Lipa factory, condensates are recovered from the band dryer and used again as feed water for the boiler resulting to 7,305 cubic meters of water conserved.

Zero Industrial Wastewater Discharge Factories Nestlé began recycling 100% of its processed industrial wastewater in its Pulilan Factory in 2010 and its Lipa Factory in 2016.

7, 305 cubic meters of water conserved from condensate recovery project in Lipa factory

=3 Olympic-sized swimming pools

100% recycling of processed industrial wastewater


62 63

Nestlé Water Leadership Award was launched in 2013 as a special category of the National Search for Sustainable and Eco-friendly Schools. It aims to encourage and recognize schools with initiatives on water conservation and management.

Advocating Water Stewardship

Nestlé Water Leadership Award

To promote water stewardship, Nestlé has initiated the following programs:

Advocating Water Stew

ardship

Project WET - Water Education for Teachers

An interactive training program on water education, Project WET educates students and teachers, employees, communities, and barangay leaders about water conservation and the importance of water.

23 Project WET trainings

793 individuals participated

River and Coastal Clean-up Activities

In 2016, Nestlé employees volunteered to participate in DENR’s simultaneous nationwide clean-up activities of rivers, esteros, and creeks. Train the trainers session

Interactive modules on water education


64 65

Managing Solid Waste

Nestlé finds opportunities for reducing waste in its entire value chain and is committed to eliminating waste at every level of its operations. The Company defines waste as any material that arises during the manufacturing or distribution stage of a product that is destined for

Managing Solid W

aste

final disposal at offsite landfill or incineration without energy recovery. Ultimately, Nestlé aims to produce zero waste and achieve full recovery of unavoidable by-products. In 2014, the Company was able to drastically reduce its solid waste disposed to landfill by

83.6% through improvements in its Materials Recovery Facility and training personnel on proper waste segregation. Last August 2016, Nestlé achieved a milestone when it achieved Zero Waste to Landfill for solid wastes in its factories.

G4-EN23First full year of Zero Waste to Landfill

Achieved Zero Waste to Landfill for Factories starting August

Zero Waste to Landfill achieved in August 2016

5, 140 MT of waste to landfill

840 MT of waste to landfill Completed waste characterization of all factories Facilities improvement (MRFs)

Worked with existing Waste Management contractors for capacity increase Accreditation of new treaters

2013

2014

2015

2016

2017

Timeline of Zero Waste to Landfill


66 67

Material Efficient Packaging and Waste Recovery

Nestlé gives importance to product branding as it relays the Company’s key product attributes to its consumers on pack. Nestlé’s packaging designs provide convenience in usage and supports efficient handling as the product goes through the value chain. While Nestlé protects and preserves the quality of its products through appropriate packaging, the Company continually optimizes packaging designs to save material and avoid food wastage.

Nestlé uses eco-design tools to assess the overall performance of products and packaging throughout its life cycle. The Company lessens the impact of packaging using a systematic approach such as the reduction of weight and volume by using lighter materials, optimized dimensions, and material substitution while still meeting consumer needs, food safety standards, and product quality requirements. In 2016, Nestlé managed to reduce its packaging material use by 1,004 MT.

1, 004 MT of packaging material reduced in 2016

Managing Solid W

aste

2, 400 MT of laminates sent for co-processing

To ensure proper waste disposal, Nestlé sends waste laminates to cement manufacturers to be used as alternative fuel. About 2,400 MT of laminates are sent over for co-processing.

201620152014

46.63% 62.62% 76.13%Composting

Co-processing with energy recovery

Landfill

Other Disposal Methods

Other Recovery Processes

Recycling

Reuse

0.24% 0.03% 3.58%

3.88% 0.53% 0.94%

0.00% 0.01% 0.02%

16.99% 4.84% 5.73%

32.03% 26.37% 43.41%

0.22% 0.23% 6.64%

Disposal methods of Non-hazardous Waste generated

G4-EN23

G4-EN2


68 69

EcodEx

To assess the environmental performance of a product faster and much earlier in the design process, all new products of Nestlé undergo an environmental sustainability assessment where relevant, using its Life Cycle Analysis or LCA-based ecodesign tool EcodEx (Ecodesign for Sustainable Product Development and Introduction).

Using data specific to the food and beverage industry, EcodEx allows different scenarios to be compared using five environmental impact indicators. This tool can be used to assess the overall environmental impact of a packed food product along its journey through the value chain.

Eco Bricks and Permeable Pavers

Nestlé has teamed up with Green Antz Builders to create eco-bricks, composed of 10% shredded used post-consumer laminate wastes. Compared to ordinary concrete hollow blocks, eco-bricks are five times better in terms of compressive strength and allow for faster construction with less materials due to their interlocking shape. The eco-brick hub is both a manufacturing and a training facilitiy where

Green Antz trains members of the community on the importance of waste segregation and how to manufacture eco-bricks with used sachets and laminates. Nestlé and Green Antz also partnered with schools to expand and improve source material collection.

Collection

Incentive

Eco-Brick Hub

Segregation

Value for Sachet

Eco-Brick and Livelihood Generation

Managing Solid W

aste

All new products of Nestlé undergo an environmental sustainability assessment

Life cycle of products

Ingredient Supply

Manufacturing

Packaging

End of life

Consumption

Distribution & Storage


70 71

Managing Solid W

aste

Upcycling project for BEAR BRAND School Chairs

Sachets collected from a BEAR BRAND raffle promo were mixed with plastic resins in order to be converted to school chairs and tables. These school chairs and tables were donated to selected Laki sa Tibay public elementary schools. The first grand raffle draw activity resulted in 150 school chairs donated to Sibul Elementary

School in San Miguel, Bulacan and the second raffle draw yielded 2,500 pieces of school chairs. The project was capped off with an environmental forum held on December 14, 2016 with stakeholders focusing on solid waste management, participated by the local community of Barangay Tablon, CDO City.

2, 600 chairs from 5, 400 kg of laminates

Beverage Carton Recycling Project

Project GIVEPACK is a campaign run by the liquid beverages unit that encourages community members to properly dispose and collect their used beverage carton (UBC) packs which can be transformed into reusable materials. The project is implemented in partnership

with the Local Government Unit of Quezon City’s Barangay Greater Lagro which has over 30,000 community members. The campaign launched its 1st post-consumer UBC collection last August 2016 and collected 5,082 UBCs from the barangay and 8,256 collected from four schools.


72 73

Lead Acid Batteries contain hazardous components as classified under Philippine law. When improperly disposed, these toxic materials could leach into soil and water bodies. Nestlé ensures that used batteries from its transportation distribution operations are properly managed. Since 2010, the Company’s Supply Chain Management Transport Operations has been working with Nestlé Transport-Partners, Philippine Business for Social Progress (PBSP), and the Department of Environment and Natural Resources to implement the Company’s Balik-Baterya Program.

The program aims to promote the responsible treatment of used batteries through recycling lead components and plastic cases and by treating properly the residuals, like sulfuric acid, inside the used batteries. To sustain this program, Nestlé and its program partners regularly conduct awareness campaigns and organize collection events with the Company’s transport partners. Over the past three years, the Company has collected a total of 26, 800 kg of batteries and earned Php 545, 000 from its sales.

Balik-Baterya Program

Managing Solid W

aste

12, 860Used Batteries (in kilos) 6, 260 7, 680

Total income earned (in PHP) 258, 245 166, 053 120, 800

201620152014 Commulative total

26, 800

545, 098

26, 800 kg of batteries collected

The proceeds of the sales of used batteries have been donated to schools since 2014. Moving forward, Nestlé intends to expand the scope and

type of waste to be collected. Employees will be encouraged to donate their used lead acid batteries as well.

19

842, 000kg of Used Lead Acid Batteries (ULABs) donated

partner truckers

public schools assisted

Used batteries donated and cash donations earned

G4-EN23


74 75

Energy Efficiency

Apart from Nestlé’s efforts to conserve water and reduce water pollution, the Company monitors and manages other environmental impacts as part of its overall sustainability strategy. Towards this end, the Company has invested in technologies that optimize and reduce energy consumption, converted by-products into energy, and explored the use of alternative energy sources.

Energy Efficiency

6.356.60 5.97

2014 2015 2016

Intensity

Beyond operational efficiency, Nestlé puts a premium on the personal responsibility of employees to conserve energy through various training modules. Departments in all worksites look for opportunities to avoid wasteful use of energy and develop energy-efficient practices. These energy management initiatives are subject to regular audit. Nestlé’s energy conservation initiatives have been

Energy Intensity

Despite the increase in Nestlé’s total energy consumption brought by an increase in its production volume, there is a continuous decrease in energy intensity which shows Nestlé’s dedication to proper energy utilization. Nestlé uses its organic waste that would otherwise be disposed in landfills as an alternative energy source. In manufacturing coffee

products, Nestlé produces waste such as spent coffee grounds, roasted chaffs, green coffee residue, and coffee wash. Nestlé collects these by-products for its biomass plant that transforms the waste into energy. The spent coffee grounds and other waste is processed and fed into an atmospheric fluidized bed boiler.

The biomass plant built in the Company’s Cagayan de Oro factory, gathers saw dust, scarp wood, coco shell and bagasse as additional biomass fuel for the fluidized bed boiler. The factory uses almost 150,000 kg of spent coffee grounds every day as fuel for producing 20-ton per hour of steam energy.

recognized by the Department of Energy. The Company received the Don Emilio Abello Energy Efficiency Award in its Canlubang, Lipa, and Tanuan factories in 2015, and its Cabuyao and Cagayan de Oro factories in 2016. Nestlé’s goal is to continually reduce its energy intensity even as the Company’s levels of production increases.

G4-EN5, G4-EN6

Energy Intensity (Gigajoules energy/metric tonnes product)


76 77

Greenhouse Gas Intensity

As part of Nestlé’s effort to reduce its contribution to climate change, Nestlé tracks and manages its GHG emissions. These emissions are primarily attributed from the Company’s use of direct and indirect energy.

Energy Efficiency

This translates to annual savings of more than 4,000 million liters of oil, in addition to reduced sulfur oxide (SOx) emissions by nearly 300 tons and prevention of 70,000 tons of waste.

6, 100 kg of biogas a day produced from anaerobic digester

Despite the increase in the total greenhouse gas emission of Nestlé due to increased energy usage from increased production, the Company managed to reduce its GHG intensity by 11% from 2010. GHG intensity constantly decreased from 481 kg CO

2e

to 458 kg CO2e over the past

three years.

At Nestlé’s Tanauan factory, which produces Coffee-Mate and BEAR BRAND, the Company invested P155 million in an anaerobic digester to treat the organic waste. The digester produces 6,100 kg of biogas a day, providing a source of energy for the factory, reducing expenditure on fossil fuels and reducing emissions by 1,885 tonnes of CO

2 equivalent a year. 201620152014

481 468 458

Total GHG Intensity (kg CO2e/metric tonnes product)

482473505519

2013201220112010

11% GHG intensity reduced from 2010

4, 000 million liters of oil saved

G4-EN18

Waste Preparation

The upgrade will save Nestlé P25 million a year. Nestlé is now looking at replicating the approach in other factories with high levels of organic waste.

Anaerobic Digestion

Organic WastesBiogass

(rich in methane)

Stabilization/Curing/ Dewatering

Organic Compost

Heat & Electricity

Digestate

Anaerobic Digestion


78 79

Nestlé seeks to make its industrial processes more efficient. Here are few examples of projects the Company has implemented in its factory sites:

Renewable Energy Aside from Nestlé’s energy efficiency projects in its facilities, Nestlé finds other ways to reduce its GHG emissions. At Nestlé Lipa Integrated Coffee Center,

Factory Site Project Energy and GHG Savings

Equivalent to

Cagayan de Oro

Installation of 4 Liquid ring vacuum pumps

Energy Savings: 25, 913 GJ

GHG Savings: 1, 935 tCO2

e

Cagayan de Oro

Optimization of Air Heaters


GHG Savings: 740 tCO2

e

Cabuyao Improvement of Primary Air Fan Performance


GHG Savings: 1, 139 tCO2

e

Energy Efficiency

409

286

156

109

241

168

Legend Passenger vehicle driven for one year

Homes’ electricity use for one year

solar powered pumps are used for irrigation. The Company is also working to obtain electricity from renewable sources in its Lipa Factory.

Solar panels in Lipa Integrated Coffee Center


80 81

Greening the Supply Chain

Nestlé puts a premium on sustainability – not only on its products, but also on the processes required to manufacture them. Some of the pre-manufacturing processes are supplied by business partners. To ensure their manufacturing practice adheres to Nestlé’s standards of quality, efficiency, and social responsibility, the Company does more than just supplier audits. For almost two decades, Nestlé’s “Greening the Supply Chain Program” has evolved to include knowledge sharing and concern for the environment. This has led to raised awareness and identifiable action in its core operations and the operation of its business partners. Launched and instituted in 2000, the initiative guides

the Company’s stakeholders throughout the supply chain in establishing and improving their level of environmental performance and management system ratings. The program includes a three-day training for Nestlé’s business partners where they share best practices. The CEOs of the companies commit to implement

environmental programs. Nestlé tracks the programs’ performance and hosts events to recognize their success. To date, the program has assisted more than 240 Nestlé business partners and has helped the Company achieve “beyond compliance” environmental performance.

Greening the Supply Chain Aw

ards and RecognitionAwards and Recognition

ASEAN Corporate Sustainability and Summit Awards: • Winner in Supply Chain Sustainability • Runner-up in Resource Efficiency

Sustainable Business Awards Philippines: • Winner in Water Management • Winner in Waste Management • Special Recognition on Supply Chain Management

Don Emilio Abello Energy Efficiency Awards: • 2015 Canlubang, Lipa, and Tanuan Factory • 2016 Cabuyao and Cagayan de Oro Factory

DENR-EMB’s World Water Day 2015 Award for: • Project Water Education for Teachers (Project WET) • Nestlé Water Leadership Award (National Search for Sustainable and Eco-friendly Schools)

Nestlé’s success in environmental protection is validated by the awards the Company received from award-giving bodies both here and abroad. In 2015 and 2016, we have received the following:

G4-12, G4-EN32, G4-LA14

Rural development forms part of Nestlé’s initiatives to support and improve the socio-economic conditions of communities where it operates. The Company assists in developing rural areas and communities by aiding farmers, facilitating indirect and direct employment and continuing infrastructure development.

Rural Development

G4-EC8, G4-EC9,, G4-SO1


8584

Each cup of NESCAFÉ is part of a visionary initiative that has, over many years, been a manifestation of Nestlé’s core commitment of creating shared value in the coffee sector. Launched in 2010, the NESCAFÉ Plan is a global initiative with a goal to ensure a sustainable supply of quality green coffee. In the Philippines, the Company aims to increase supply of local robusta coffee and in doing so, help local farmers increase their yield and their income from coffee. Nestlé assists farmers by propagating high yielding plantlets and selling them at cost, enabling technology transfer through training across the country, providing a support network of agronomists, and strategically locating buying stations close to coffee areas so farmers can sell directly to Nestlé.

The NESCAFÉ Plan is a synthesis of years of collaboration with farmers, stakeholder groups, and the government. Nestlé partners with government through the National Convergence Initiative (NCI) consisting of the Department of Agriculture (DA), Department of Agrarian Reform (DAR), Department of Environment and Natural Resources (DENR) and the

NESCAFÉ PlanN

ESCAFÉ Plan

Department of Interior and Local Government (DILG). The NCI partnership with Nestlé, which started in 2011, is a joint technical and commercial cooperation for the further development of the Philippine coffee industry. The NESCAFÉ Plan in the Philippines helps farmers through the following:

1. High yielding plantlet production and distribution Nestlé adopts technology from the Nestlé Research and Development Center in Tours, France. These Robusta selections are of excellent quality and have been

certified by the Philippine Bureau of Plant Industry (DA-BPI). Nestlé grows these plantlets in Nestlé and DA facilities across the country.

Tagum, Davao del Norte (Nestlé site) Nestlé Coffee Plantlet Production and Training Center (NCPPTC)

Malaybalay, Bukidnon (DA Facility) Bukidnon Integrated Coffee Center (BICC)

Lipa, Batangas

(Nestlé site) Lipa Integrated Coffee

Center (LICC)

Aglipay, Quirino (DA Facility) Quirino Integrated Coffee Center (QICC)

Carmen, South Cotobato

(DA Facility) Carmen Integrated Coffee Center (CICC)

Nestle sells these plantlets at cost and a majority of these are distributed by government partners.


86 87

2. Capacity building and technical training for farmers Nestlé conducts the Coffee Production Technology Training (CPTT) which is a three-day training course covering basic coffee growing skills. The course includes topics on coffee propagation, nursery & farm establishment, fertilization, care and maintenance, harvesting and post-harvest operations, quality control and marketing, coffee rejuvenation and regeneration. The training also covers coffee farming

sustainability following the NESCAFÉ Better Farming Practices (NBFP) and the Common Code for the Coffee Community (4C). The NESCAFÉ Better Farming Practices (NBFP) is a set of coffee farm practices designed to increase productivity while assisting farmers to meet basic social and environmental criteria, as defined by the 4C and Sustainable Agriculture Network (SAN) standards. The

4C Code of Conduct is a set of codes which includes the 10 unacceptable practices and 28 principles covering social, environmental, and economic aspects of sustainable coffee production. The 4C orientation includes farm management and productivity, environmental conservation, health and safety, quality, traceability, and profitability modules. 4C verified farmers and suppliers are provided incentives for them to comply with sustainable agricultural practices as well as seek and maintain verification. Nestlé conducts the Coffee Production Technology Training (CPTT) in three sites: Tagum, Davao del Norte (Nestlé site) Nestlé Coffee Plantlet Production and Training Center (NCPPTC), Lipa, Batangas (Nestlé site) Lipa Integrated Coffee Center (LICC) and Malaybalay, Bukidnon (DA Facility) Bukidnon Integrated Coffee Center (BICC). Nestlé conducts 4C trainings on site.

3. Buying Stations Nationwide Seasonal buying stations are opened across the country to make it easier for farmers to sell to Nestlé. The buying station in the Nestlé Cagayan de Oro factory is open year-round. Partners are regularly informed of current coffee buying prices with Text Connect.

NESCAFÉ Plan

Through this system, green coffee suppliers, potential investors and other stakeholders receive text messages indicating the buying price per kilo for the different grades of coffee. Nestlé purchases at competitive world market prices. The Company also established the Farmer Connect program which is a direct sourcing

program that ensures traceability up to farmer level by buying either directly from farmers, cooperatives or selected traders applying Nestlé good agricultural and suppliership standards, principles and practices, with engagement in capacity building and training.


88 89

Results to date

Over the years, the Company has increased the number of farmers trained. In the last 3 years, Nestlé has trained 33,676 farmers. Through partners, mainly government agencies, Nestlé has distributed 6,848,708 plantlets from 2014-2016. The volumes of sustainably-sourced coffee has increased through the years. 4C volumes have grown from 1,490 Metric Tons (MT) in 2014, to 3,248 MT in 2015 and

7,136 MT in 2016, representing a 379% increase in 4C volumes in the last 3 years. Of the 14,000 farmers covered directly by Nestlé agronomists and technicians, 9,129 are now 4C farmers. The last 3 years saw a steady increase in the Company’s local purchase of robusta coffee. In 2016 alone, Nestlé purchased 165% more local coffee compared to its purchase in 2015.

NESCAFÉ Plan

1, 490 MT

2014 2015

3, 248 MT

2016

7, 136 MT

Volume of 4C coffee

Farmers bring their produce to the buying station where a sample is collected upon delivery to assess the quality of beans. This will go through a moisture, triage and cup taste test.

Tuguegarao City/Solano/Bayombong,

Nueva Vizcaya

Tagum, Davao del Norte

Maramag/Valencia, Bukidnon

Silang, CaviteLipa, Batangas

Tagbina, Surigao del Sur

Iloilo City, Iloilo

6, 848, 708 plantlets distributed

from 2014-2016

33, 676 farmers trained

The results of the test will be the basis for determining the grade of the coffee beans which in turn will establish the buying price per kilo of the coffee delivery. Incentives are applied to batches that

meet the moisture standard. A premium is also given for 4C coffee. Suppliers get paid within eight banking hours.

Location of buying stations nationwide


90 91

In partnership with the office of Senator Francis “Kiko” Pangilinan through the Sagip Saka program, three communities in Bukidnon, Sultan Kudarat, and Surigao del Sur received 1 million pesos each to boost their coffee farming productivity.

Nestlé assisted farmers through the provision of 83,000 high yielding coffee plantlets, establishment of a nursery in Bukidnon with a capacity to produce 20,000 seedlings, provision of all-weather driers, post-harvest facilities, fertilizers and farmer training.

Sagip Saka

As proof that Nestlé is making a difference in the lives of the coffee farmers we assist, we are highlighting 2 projects by which specific interventions were given to small coffee communities that resulted in increased yield and improved farmer incomes.

Success Stories

140% improvement on farmer yield

Sagip Saka farmer beneficiaries in Tagbina, Surigao del Sur initially earned PHP 7, 350 in 2014, before the program started. After the implementation of the interventions provided by the program, farmers started to earn PHP 14, 224 from the new trees they planted and

NESCAFÉ Plan

another PHP 6, 829 from the old trees. In 2016, these farmers earned PHP 28, 500 from the new trees planted. Farmer yield improved by 140% compared to the old trees they had.

Farmer income more than doubled in 2015 while in 2016 farmers earned more than three times more from the new trees compared to existing old trees prior to the program.


92 93

NESCAFÉ PlanNestlé partnered with

Deutsche Investitions-und Entwicklungsgesellschaft (DEG) and Asia Society for Social Improvement and Sustainable Transformation (ASSIST) to implement a program called Project CoFFEE (Coffee Technologies and Funds to Fuel Economic Empowerment). The program provided technology transfer and training and included the provision of high-yielding plantlets, establishment of a mother plant garden and a nursery, fertilizers, flat bed

Project CoFFEE

dryer, and a mini truck to improve the cooperative’s operations through various income streams. A two-day training program on business management skills enhancement was also conducted for the Board of Directors and officers of the cooperative. The beneficiary of the project is the Mabuhay Kahayagan Coffee Growers Cooperative (MKCGC) of the Municipal Government of Tagbina in Surigao del Sur, a town of

38,000 citizens located on the eastern coast of Mindanao. Specifically, this Public-Private Partnership (PPP) established a model for sustainable small-scale coffee communities in the Philippines. The cooperative earned PHP 67,500 alone from sales of vertical stems (harvested from the mother plant garden) in 2015. They earned PHP 624,000 pesos in 2015 and 2016 from sales of robusta plantlets (produced from the cooperative’s nursery) and PHP1,172,199 in 2014 to 2016 from green coffee beans sold to Nestlé. The cooperative had a 54% increase in green coffee sales to Nestlé after the first year of Project CoFFEE implementation.

54% increase in green coffee sales

Coffee farming as livelihood for Indigenous People

Mr. Renanto Obamus is a coffee farmer from Sitio Meyor, Barangay Ketodac, Lebak, Sultan Kudarat and a Manobo, one of the major Indigenous People (IP) tribes in Mindanao. He started coffee farming when he was young with only one hectare of land which eventually expanded to 20 hectares after his training with Nestlé and years of hard work. He learned techniques and practices through continued participation in Nestlé’s 4C trainings over four

years and has experienced significant increase in his yield. Mr. Obamus has become a ‘one-tonner yield farmer’ by applying the NBFP such as pruning, rejuvenation, right timing, and proper fertilizer application. He has since reaped the benefits of improved farming methods with significantly higher income that has helped both his business and household. One of his major acquisitions is a 6-wheeler truck which has further enhanced

his agricultural operations. He has also earned enough to send all of his four children to school. Mr. Obamus remains a partner of Nestlé and continues to supply the Company with his produce, a testament to the lasting mutual benefit the 4C trainings and the NESCAFÉ Plan can bring to local farmers.


94 95

Cut and Sew

Tanauan City in Batangas, Pulilan in Bulacan, and Cabuyao in Laguna. The Tanauan site started operations in 2015 and both revenue and garment production doubled within just one year. Meanwhile, the Cabuyao site has also seen a sustained increase in income over the past three years, indicating much potential for alternative livelihood projects in these areas.

Cut and Sew

The Cut and Sew program is a livelihood project in Lipa City, Batangas where unemployed women from the area were taught needle-and-thread work under the government’s Technical Education and Skills Development Authority (TESDA) livelihood program. Two decades later, it is now a major revenue source for locals. In Barangay Bagong Pook where Nestlé’s Lipa

factory is located, the ladies of Cut and Sew supply the factory’s requirements for uniforms (pants, shirts and jackets), laboratory gowns, hairnets, shoe covers, and rags. Since 2014, the women entrepreneurs have been receiving increasing orders every year. By 2016, they received a purchase order of over P14 million.

52Number of Sewers 57 58

201620152014

Purchase Orders for all sites (in PHP)

973, 994 5, 695, 199 14, 697, 486

Results of the Cut and Sew program

By engaging the locals for their sewing services, Nestlé has expanded its economic footprint beyond providing direct factory employment and continues to provide opportunities for growth in the community. The successful enterprise, which started in 1997, has also expanded in recent years to sites close to Nestlé’s other factories:


96 97

Pulilan is also home to the Farmville program, through which local housewives were trained, supplied with material and seed capital to grow vegetables on an allotment of land within the Nestlé Pulilan Factory.

FarmvilleNumber of volunteers

(beneficiaries in Pulilan)

2016

2015

2014 131313

Revenue of beneficiaries in PHP (Pulilan)

75, 811 80, 695 78, 222

Farmville

The produce is sold in the factory canteen and to employees and sometimes to village residents - offering both economic and health benefits for the community. The program, named Farmville in Pulilan, started in 2011 but originated from Lipa Factory’s Yard and Garden program

which is set to be renovated due to damage caused by a typhoon in 2014. Before the typhoon hit, there was a total of 48 women in Lipa and Pulilan tending to the garden. Currently, there are 13 women tending to the garden in Pulilan.


98 99

Across the nation, Nestlé reaches out to individuals to distribute Nestlé products to canteens, carinderias, and other small food establishments. Dubbed “Business on Wheels” (BOW), this door-to-door sales program provides individuals with the opportunity to augment their incomes by earning as much as triple the minimum wage. The average daily income of a BOWer is between P 600 to P 1,000 per

Business on WheelsBusiness on W

heelsday and average daily sales hits P 8,000 to P 12,000. The said income is 24% to 67% higher than the minimum wage in Metro Manila and 57% to 163% more than the average provincial daily rate. Many who used to be tricycle drivers earning minimum wage are now, through their own entrepreneurial spirit, owners of their own businesses.

So important is their role in the Company that as much as 20% of the total Nestlé Professional* business in the Philippines is generated by BOWers.

Number of BOWers

525

2014

484

2013

480

2015 2016

474

BOWers earn

24% to 67% higher than the minimum wage in Metro Manila *Nestlé Professional is the business unit of NPI that caters to restaurants, vending, and other out-of-home dining services.


100 101

PHP 600 - PHP 1, 000 average daily income of a BOWer

The BOWer activation process includes consultations and the development of a Coverage Plan to ensure the viability of a given route. This study indicates a significant number of accounts for the BOWer to supply. Afterwards, Business Development Officers (BDO) are tasked to select potential

Ryan Pelino

Before joining the BOW program, he used to be a janitor and not earning enough to support his family. He has been with the BOW program for more than five years covering the Intramuros, Manila route.

Business on Wheels

BOWers who are then trained in sales and familiarized with the assigned area and sales operations. One BDO handles six BOWers and the program is focused on developing productive entrepreneurs taking on sustainable routes.

As a BOWer, his daily income averages P 1,000, which has allowed him to raise a family including sending his two children to school, renting a more comfortable apartment, and affording simple household joys such as toys, gadgets, and appliances.


102 103

The Massage from the Blind program is an initiative by the Pulilan Factory in Bulacan which offers their factory employees the opportunity to get a massage every Wednesday at their wellness center. Set-up as a livelihood program for a group of visually-impaired massage therapists,

Massage from the Blindthey are paid for the massages on top of a subsidy and frequently contacted to do home service. The group has earned PHP 364,000* since the start of the initiative in subsidies alone. This program serves as additional income for the 4 massage therapists.

* excluding the amount the therapists charge for the actual massage (Php100+), tips, and meals.

Nestlé aims to actively participate in ensuring the communities around their sites are progressing economically and socially. This is core to the Company’s rural development policy. Nestlé also believes that for community development to succeed, a bottom up approach must be taken, which is why in 2015, the Company established

Community Development Framework

the community development framework, a simple approach to identifying community needs via a formally structured meeting and planning session with the local government and barangay officials of each of their sites. The meeting resulted in a detailed heatmap that both Nestlé and the local

Massage from

the Blind Com

munity Developm

ent Framew

ork

4 Massage therapists

364, 000 Subsidy for the group (in PHP)

stakeholders agreed on as their top priorities in the coming year. This ensures that programs are jointly established and address relevant pressing community needs.

Nestlé with barangay officials running the Community Development Framework workshop

Beyond core Shared Value initiatives, Nestlé also assists communities through various charitable programs with its employee-volunteers. Nestlé endeavors to help society through donations and contributions to disaster relief, youth empowerment and volunteerism efforts among others. Following are some philanthropic activities of the Company over the last three years.

Helping SocietyG4-EC8, G4-SO1


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As one of the most successful projects of the Department of Education (DepEd), Brigada Eskwela (School Brigade) invites the private sector, local government and the community to join hands in helping improve the conditions of schools across the country.

In partnership with the DepEd, employee-volunteers from Nestlé Factories annually refurbish and contribute to the upkeep of classrooms of nearby public schools. Every summer, employees clean, paint, repair and beautify the classrooms and campus grounds in preparation for the start of the new school year. In the past three years, more than 350

more than

350 Nestlé employees

Brigada Eskwela

and Safety Skwela

Brigada Eskwela Safety Skwela

There is currently a gap in the school system on lessons in safety. Responding to this, Nestlé created modules in 2016 to help teach safety in a fun and interactive manner. The modules covered concepts on how to be safe in school, at home, and on the road. Throughout 2016, five trainer trainings were conducted,

benefiting a total of 186 participants. The trainings were attended by teachers, Nestlé employees and Safety Health and Environment officers. The Safety Skwela (Safety School) project also includes visiting schools and conducting risk assessments. Once the risks are determined, Nestlé helps manage the risks

5 safety trainings with 186 participants

employees have volunteered a total of 1,720 hours of their time for Brigada Eskwela. Beyond manpower, contributions have also been made to enhance the school environment in the form of computers, school maintenance, safety training, trash bins and fire extinguishers.

either through engineering control or administrative recommendations. Nestlé also recommends school specific life-saving rules to be adopted at the discretion of the school administrators. To date, two schools have already undergone the training and site assessment program.

Nestlé employees participate in Brigada Eskwela Interactive training with teachers on safety

1, 720 hours volunteered


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Blood Letting and supertyphoon Law

in Donation

Nestlé sites participate in bloodletting activities organized by the Philippine Red Cross at least once a year to contribute to the growing demand for safe and quality blood in the country. For the past three years, a total of 882.1 liters of blood have been collected from at least 811 Nestlé employee donors in Nestlé’s worksites.

882.1 liters of blood donated

811

Nestlé donors

Bloodletting Supertyphoon Lawin Donation

Nestlé reinforces its role in community development and provides assistance to government and NGOs during times of disaster. The Company provided P11.9

million worth of stocks to the province of Cagayan after the onslaught of the supertyphoon Lawin, which affected more than 40,000 individuals in Northern Luzon.

Delivery of Nestlé goods to Cagayan

PHP 11.9 million of productsdonated


111110

Christmas Donation

Nestlé Eco-Village

LP4Y - Life Project For Youth

Christmas Donation

In lieu of Christmas gifts to stakeholders, Nestlé donated PHP 1 million in 2015 to the Assisi Foundation for its Hapag-Asa feeding program. The beneficiaries of this donation are in Laguna and the donation reached over 1,500 malnourished children as of early 2016. By the end of the same year, the donation to Assisi targetted Nestlé coffee communities in Mindanao.

Nestlé Eco-Village

Nestlé continues to support its Gawad Kalinga (GK) Eco-village in Lipa City, Batangas, providing about 40 families with housing and an eco-friendly community. Established in 2011, the eco-village is equipped with a rainwater catchment system that allows recycling of rainwater and is designed to make use of reed bed technology that processes sewage through a natural reed system without the use of chemicals.

LP4Y - Life Project For Youth

Nestlé partnered with Life Project for Youth (LP4Y), an organization dedicated to the transformation of disadvantaged youth into skilled and well-rounded individuals. Nestlé’s Executive Committee spent their afternoon with youth entrepreneurs from LP4Y.

They provided training on preparing for work (writing a resumé, preparing for a job interview), and how to sell and market their products. The Executive Committee also provided inspiration and advice on personal and career development for the 33 youth beneficiaries.

33 youth trained

In partnership with the Philippine Toy Library, Nestlé gathered employee donations of toys and school items to build a toy library for the Company’s adopted community in GK Lipa during Christmas of 2015. Moreover, the Channel Activation Team of the Nestlé Sales Department helped repaint houses and taught the kids safety in schools through the Safety Skwela module in 2016.

Sales Department volunteers in GK Lipa

Nestlé Execom volunteers time for LP4Y

1, 500 malnourished children reached

Nestlé employees are empowered and are considered valuable contributors to the Company’s success. They are offered competitive compensation and benefit packages, rewards, opportunities for professional growth and development, and work-life balance. Nestlé measures its performance as an employer through its ability to ensure workers are engaged and gainfully employed.

Investing in Human Capital


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Engagement Survey

In its drive to keep employees engaged, Nestlé enlisted the help of leading global service provider Willis Towers Watson. The Company assessed itself across 16 categories: strategy and alignment, culture and recognition, senior leadership, consumer focus,

innovation, efficiency, line management, empowerment, communication and collaboration, rewards, personal growth and development, work-life environment, engagement, enablement, retention, and other supplementary questions (includes questions

Engagement Survey

on quality of performance review discussions, organization pace of change, and use of non-monetary recognition, among others). The 2016 Nestlé and I Philippines results show improvement in 15 out of 16 categories versus 2014

Category Item Percentage Favorable

Response (Nestlé in the Philippines

2016)

Consumer Focus and Quality

How does Nestlé compare with its competitors on quality of products and services?

92%

Culture and Recognition

I am treated with respect as an individual. 92%

Culture and Recognition

My company is socially responsible in the community.

92%

Consumer Focus and Quality

Nestlé's commitment to quality is apparent in what the Company does on a day-to-day basis.

94%

Strategy and Alignment

I have a clear understanding of Nestlé's strategy and goals.

95%

Key Strengths

survey results, with Retention, Supplementary Questions, and Rewards registering the highest increase in percentage points at +5, +4, and +3, respectively. It also increased by 2 points in Enablement, Leadership Effectiveness, and Diversity and Inclusion. Engagement, where Nestlé

in the Philippines already enjoyed a high 88 in 2014, also increased by 1 point. The Company also scored higher than Global High Performance Norm in 10 out of the 16 categories, particularly in Efficiency, Senior Leadership, and Consumer Focus and Quality.

These were based on several factors, such as absolute scores (percentage favorable response, differences from benchmarks, and impact on engagement).


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Training and DevelopmentAs the Company’s greatest resource, Nestlé is determined to develop its employees through learning and instill this in the company culture. Nestlé anchors its learning and development program on the 70-20-10 principle where employees acquire knowledge, skills, and behavior

through: Experience (70%), Relationship (20%), and Education (10%).

Experience comes with training on the job, relationships are developed through coaching and feedback, and education is formal training via classroom seminars and workshops.

This 70-20-10 mix effectively conditions Nestlé’s employees, weaving together hands-on learning experience with theoretical instructions.

The 70-20-10 principle is a result of evaluation and strategizing and shifts the weight of importance from classroom training to hands-

on training. Giving great value to mentoring and coaching has enhanced relationships between line managers and employees, building rapport and trust. Although classroom training makes up 10% of the Company’s learning activities, Nestlé carefully plans out annual programs to build employee capabilities.

Training and Development

Nestlé’s training programs are categorized as Core (basic and fundamental, required for all employees); Leadership Skills and Personal Effectiveness (required for leaders and management staff); and Elective (optional courses that employees may find useful in their respective functions).


119118

Employees logged in an average of 14.77 hours of training throughout the year. Nestlé furthers its employees’ learning and development through annual Performance Evaluations (PEs), which

measure their individual objectives against Nestlé’s business targets. A short-term bonus awaits employees who are found to have achieved and exceeded their individual objectives

Total Training Hours by Gender

201620152014

6,352 10,760 10,616

5,964 11,000 10, 212

as well as the standards specified in their Performance Evaluation. Employees who are not able to meet their objectives

12,316 21,760 20,828


Total

are given a Performance Improvement Plan, which is agreed upon by both the employee and line manager. This plan covers a six-month period and addresses

14.77 average training hours thoughout the year

G4-LA9


121120

32 47

Number of people that were sent abroad on mission assignment or expatriation

37

2015 20162014

significant performance or behavioral issues through learning and development interventions.

Another tool Nestlé Philippines uses in tracking the performance of each of its employees is the Progress and Development Guide (PDG),


Total Training Hours by Position

201620152014

160 388 284

12, 316 21, 760 20, 828Total

Rank and File

Associate

Supervisor

Executive

- 272 252

6, 168 10, 084 9, 984

5, 988 11, 016 10, 308

which is a life-long document following the employee’s strengths and weaknesses against the Nestlé Leadership Framework. Through the PDG, employees are able to share career aspirations and align expectations, as it monitors career and development plans.

Nestlé Philippines is one of the biggest exporters of talents in the Nestlé world

G4-LA9


123122

Employee Compensation and Benefits

Nestlé employees receive compensation and benefits comparable with industry standards, which are achieved through regular review of their needs and benchmarking them with other Nestlé markets and other industries. Nestlé also participates in an annual community survey on compensation and benefits,

allowing comparisons with other companies. With these measures, Nestlé hopes to continue offering its employees with competitive compensation and benefit packages. Nestlé Philippines ensures a Corporate Total Rewards Policy, giving employees

compensation and benefits that align with Nestlé principles and meet the aspirations of both current and potential new employees. The five facets of Total Rewards are ensuring competitive Base Pay; motivating and engaging Variable Pay; a comprehensive

set of Employee Benefits; Work-Life Environment for the best working experience; and empowerment through Personal Growth and Development initiatives. Nestlé Philippines’ employee benefits package is guided by the Total Rewards model, ensuring it encompasses the total well-being of an employee. Nestlé Philippines takes pride in having one of the most comprehensive and competitive employee benefits packages in the Fast

Moving Consumer Goods (FMCG) industry, with more than 60 benefits to address evolving physical, mental, and emotional needs as well as the social well-being of an employee. Employees of Nestlé Philippines have access to cash benefits, product-related benefits, loans, paid leaves, medical insurance , life insurance, transfer benefits, scholarships, day

Employee Com

pensation and Benefits

Nestlé has one of the most comprehensive and competitive employee benefits package.

G4-LA2

care center, and more, which can also be enjoyed by their dependents. Based on the most recent benchmarking versus comparator and competitor companies, Nestlé Philippines is competitive versus market median when it comes to total compensation.


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Maternity and Paternity Leaves

Nestlé launched the Maternity Protection Policy, one of the most progressive programs in the country, for expecting mothers. The policy, which is based on the ILO Maternity Protection Convention, establishes minimum standards that must be implemented at Nestlé workplaces across the world by 2018.

Employee Com

pensation and Benefits

10-day paternity leave

Maternity leave 2 weeks before delivery date + 3 months after delivery. Additional 3 months unpaid maternity leave

The maternity leave for Nestlé Philippines employees is a total of 10 weeks--two weeks before expected delivery and three months after delivery, and mothers can also be extended up to three additional (unpaid) months. A 2-month paid postnatal

maternity leave is given in cases of abnormal deliveries involving miscarriage or fetal death. Meanwhile, Nestlé Philippines offers a 10-day paternity leave, superior to the government mandated 7 days.

Day 1 Day 2 Day 3 Day 4 Day 5

Day 6 Day 7 Day 8 Day 9 Day 10

2016

Jan Feb

Oct Nov Dec


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Employee Diversity and Inclusion

Diversity and inclusion are an integral part of Nestlé culture, and the Company ranks 13th in Thomson Reuters Diversity and Inclusion Index of 2016. The “Leading Together” conferences will bring women and men of all generations to discuss how Nestlé can

accelerate diversity and inclusion in its workplace. Of the 3,672 total employees in 2016, there were more men than women, but the latter take up a greater number of position distribution.

27% increase in new hires for 2016

2014 2015 2016

3, 828

3, 849

3, 672

Distribution by GenderEm

ployee Diversity and Inclusion

Total

Executive

Associate

Supervisor

Distribution by Position

Total

1, 198

1, 223

1, 170

2, 630

2, 626

2, 502

201620152014

925 977 939

859 836 796

2, 046 2, 036 1, 937

3, 830 3, 849 3, 672

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201620152014

3, 828 3, 849 3, 672

Age Distribution

Total

50

30 49

30 1, 223 1, 130

2, 127

478

2, 219

500

979

2, 219

474

265 236 300

Age Distribution of New Hires

Total

Nestlé’s employee age distribution also has a fair mix of both men and women. While Nestlé had more men than women as new hires for 2016, women had greater age distribution. The Company’s new hires also increased by 27% in 2016, when Nestlé took on 303 new employees.

270

239

303

New Hires by Gender

Total

Attrition Rate

4.14% 3.88% 4.10%


252 147 156

2014 2015 2016

98

111

115

172

128

188

201620152014 201620152014

56 250

30 49

30

207 50 3183 86 2212


131130

Nestlé Philippines recognizes women’s contribution to its business with the launch of the Women Movers Award in 2014. This recognition program highlights women influencers and the inspiration they offer others across levels, roles, and backgrounds in the Company. Each year, managers or peers nominate women colleagues who they believe are positive and encouraging role models. The first year attracted 12

nominees from its head office in Makati, but in 2015, the nominations grew to 49 from the other sites. In 2016, Nestlé had 56 nominees, the largest number since the program’s inception. Through Women Movers, Nestlé Philippines recognizes the leadership and competency contributed by its female employees. This initiative reflects Nestlé’s commitment to gender balance in the workforce.

Nestlé also ensures an accessible environment for its employees with disabilities. Adhering to local legislation, the Company provides them designated ramps, toilets, parking spaces, access audits, among others. In July 2016, in observance of the Persons with Disability (PWD) Month, the Company collaborated with the National Council on Disability

Affairs (NCDA) to conduct “NesTalk: Understanding #ThisAbility.” The session was the pilot run of the newly launched NesTalk, a platform for sharing powerful stories and ideas among Nestlé employees and meant to be a channel for learning, engagement, and inspiration. This first ever NesTalk helped raise awareness

Women Movers Award

PWD-Friendly Workplace


and understanding of the needs and potential of the PWDs in Nestlé’s valued workforce. In addition, Nestlé has reached out to relevant institutions which can potentially be partners in employing differently-abled individuals.

RESERVED PARKING


133132

Health and SafetyThe culture of safety is inculcated in every employee of Nestlé. The Nestlé Safety Management System based on OHSAS 18001 ensures its practice is in place. Programs such as LSR (Life-Saving Rules), One Minute to Save a Life, BBFS (Behaviour Based Feedback System),

Fire Safety programs, Safety, Health and Environment Alerts, and Safety Awareness campaigns are conducted regularly. Nestlé does weekly and monthly performance reviews on site and at market level for safety.

Health and SafetySite audits are done on an

annual basis to validate performance. Nestlé uses measures such as total injury rate. In 2016, the Company reduced its injury rate from previous year by 19%. In 2017, the Company aims to reduce it further by 50% and achieve zero by 2018.

The graph below shows Nestlé’s actual Total Injury Rate (including first aid incidents for the market). It shows that in most of the injuries that the Company has had, Nestlé was able to reduce the injury rates for first aid cases, beyond first aid cases, restricted work and lost time through the years.

Injury Rate

2013 2014 2015 2016

*Recordable Injury Rate does not include first aid; Injury rate = (number of injuries/man hours) x 1,000,000

0.19

Beyond First Aid

Restricted Work

Lost Time

20162015

First Aid

0.31

0.52

2.19

0.3

0.21

1.48

0.26

0.17

1.53

0.27 0.2

2014

Total Injury Rate (First Aid +Lost Time-Beyond First Aid-Restricted Work)

Total Injury Rate (Lost Time+Beyond First Aid+Restricted Work)

4.71 1.48 3.21 1.02 2.26 0.78 2.15 0.62

54.2% Reduction

57.94% Reduction

First Aid Minor injury cases where treatment could be self-administered or provided by a first-aider or licensed health professional.

Beyond first-aid Treatment can only be provided by a licensed health professional. Lost Time The affected person is away from work to rest, recover, or be treated for one or more calendar days after the incident. Restricted-work The affected person is unable to fully function but can still perform some tasks for one or more calendar days after the incident.

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Life Saving Rules

Life Saving Rules (LSR) were launched market wide in 2012 to protect Nestlé’s most valuable asset-the Company’s people. LSR are identified set of rules that are all linked to the main causes of injury across the Company, further solidifying

the Nestlé global commitment to health and safety at the workplace. The program has been instrumental in sustaining double digit reduction in total injury rate year on year. LSR training and orientation is done through the LSR Playroom-an interactive training

Health and Safety

platform to eliminate ambiguities on how to comply with the rules. In 2016, the new LSR Playroom version 2 was launched in the Cabuyao factory featuring more interactive and focused learning modules and activities.

For the second year in a row, Nestlé Philippines has won 1st place in the Safe by Choice category of the Nestlé Global Safety and Health Awards for its One Minute to Save a Life initiative. The award is given by Nestlé S.A. to the market that shows the best initiative in safety management.

67% Decrease in the number of injuries from 2012 to 2015

The Philippines is the first ever market to win back to back gold in the Global Safety and Health Awards. With the implementation of the initiative, NPI was able to see a 67% decrease in the number of injuries from 2012 to 2015.

A strong sense of ethics is what drives Nestlé as an organization. It is upon this foundation, strengthened by high standards of corporate governance policies and management practices, that the Company can sustain doing good for its stakeholders.

Governance and Ethical Standards


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Board Structure and Process

The members of the Board of Directors (BOD) of Nestlé Philippines, Inc. are an elected set of people who possess outstanding qualifications, embody the corporate values, and are well-equipped to perform their duties and responsibilities to ensure that the Company operates and functions at its best in a fast-paced and competitive environment. Nestlé implements certain regulations governing the conduct of its employees, management staff, and members of the Board.

Board Functions, Rights, and Duties

Nestlé’s Board of Directors has the sole authority to determine, police, and conduct the ordinary business of the corporation as it exercises discretion and judgment on these matters within the bounds of the law. The Board appoints officers of the corporation and delegates authority of management. All actions must be collegial, agreed upon in a meeting duly convened for the purpose. Every Nestlé Board Director has the right and duty to:

• Determine policy, set strategy, and approve budget, business plans and performance measurements (e.g. MBS, OPL, CAPEX); • Ensure integrity of accounting and financial reports; • Appoint/select and replace key managers and determine their remuneration; • Act as guardian of business, assets and property; • Submit annual reports to the shareholders; and • Create and delegate some of its authority to one or more Executive Committees

Board Structure and ProcessQualifications of a Board Director

The Board of Nestlé Philippines, Inc. must be able to meet all legal requirements such as: • Ownership of at least one (1) share • Registration of share in his/her name during his/her term • Majority of the board should be residents of the Philippines

Furthermore, NPI Board Directors must be: • Committed to the common objective of the Company; • Committed to the Nestlé Corporate Business Principles, Nestlé Code of Business Conduct, and all other policy documents of the Company; • Holder of a university degree in a discipline in arts and science, law, engineering, economics, finance, medicine, philosophy, or other equivalent fields of learning; • Constantly abreast with the latest developments in his field of engagement; • Of strong moral conviction and subscribes to the core values of the Company; • Assertive but open to engage in healthy debate in conflict resolution; and • Of proven integrity and good standing in the business community

Election of Directors

The election of Directors to the Board is held during the Annual Stockholders’ Meeting of the Company, which takes place every fourth Monday of May. All Directors must formally accept their election upon being elected. They serve for a term of one (1) year, or until the next Annual Stockholder’s Meeting. In

case of any vacancy in the Board due to resignation or other causes, the remaining directors shall elect a new director whose term expires on the next Annual Stockholders’ meeting. The role of an NPI Board Director is fiduciary in nature. He/she therefore must act with diligence, loyalty, and obedience.

G4-34

G4-40


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Mandeep Chhatwal Chief Finance Officer

Juan Jose Aranols Finance and Control and Portfolio Strategy for Zone Asia Oceania and Africa

Carmen Melissa Antonio Human Resources Director

Joseph Eugene David Country Business Manager for Wyeth Nutrition

Peter Winter Technical Director

Alfredo Jojo Dela Cruz Sales Director

Dennis Austriaco Business Executive Officer of Coffee and Creamer Creations

Ernesto Mascenon Head of Corporate Affairs

Jacques Reber Chairman and CEO

All Board Members of Nestlé Philippines, Inc. are Executive Directors.

Board of Directors

The Chairman

The Chairman has distinct duties from the Board of Directors. He/ she is mandated to:

• Organize the frequency, time, and priority matters to be covered by the BOD in the ensuing year; • Lead the BOD in ensuring the practice and guardianship of a culture of good governance in the Company; • Encourage open discussions to inspire a pro-active approach to adopting policies and measurements to promote good governance; • Lead the BOD in considering the creation of an Executive Committee, Compliance, Ethics, Regulatory, Audit, and other Committees that will implement policies on compliance, corporate governance, and good corporate citizenship; and • Task the Executive Directors to adopt programs to ensure good governance is included in their business plans and strategies for the long-term, and requires them to render regular reports at every Board meeting.

The Corporate Secretary

The Corporate Secretary must be a Filipino citizen; however, he/she need not be a Director of the Company. He/she shall be present at all Board meetings and is expected to:

• Set the agenda of the BOD meetings, provide due notice to the Directors, and record faithfully the minutes of the meetings;

• Provide inputs and support to the Chairman in developing policies and programs for the BOD in promoting a culture of good corporate governance in the Company; and

• Submit reports to the Securities and Exchange Commission as required by the Corporation Code and its rules and regulations, and to such other government bodies regulating the activities of the Company.

Jacques Reber

Bianca Wong

G4-38

G4-39


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The Treasurer

The Treasurer is selected by the Board of Directors and may not necessarily be a member of it. He/she is expected to: • Have custody of all the money, securities and values of the Company and shall keep regular book of accounts. • Deposit and withdraw the money, securities and value into a banking institution in the City of Manila, Philippines as per the direct advice of the Board of Directors. • Perform all his/her other duties incident that is assigned by the Board of Directors.

Agenda of the BOD Meeting

Board of committees

The Board has formed committees to support certain functions and help in corporate governance. All committees have their own sets of rules in accordance with their respective objectives.

The monthly BOD meetings shall primarily cover Company policies, business plan and strategy, management supervision, and matters deemed within the purview of the former. The Chairman, along with the Corporate Secretary, is tasked to set the tone in the selection of subjects to be included in the agenda. Every Director of the Company is obliged to propose matters or issues to be discussed during the said meetings. Furthermore, the agenda shall be organized in an efficient manner, considering the relevance of the matters to be included, and the time allotted for the meeting. The agenda shall also be duly filed with the BOD Minutes Book of the Company.

Board Structure and ProcessExecutive Committee

• There are two Executive Committees created by the BOD; its composition is determined by the BOD as well. • The Executive Committees are chaired by the Chairman of the BOD. • The agenda and frequency of the meetings of the Executive Committees are determined by the Chairman. • Nestlé in the Market Committee (NiMCom): This Executive Committee monitors the business performance of the Company with focus on driving growth and achieving set targets. This Executive Committee also steers the long-term strategic directions of the business. Furthermore, it continuously explores initiatives in good corporate governance, which it recommends to the BOD for approval and carries out implementation once approved. • The meetings of these Executive Committees are duly recorded and filed.

Other governance informationGeneral Principles of Governance: • Nestlé recognizes the rights and responsibilities of shareholders. • Nestlé upholds the equitable treatment of shareholders, respecting the principle “one share – one vote”. • The Board of Directors of Nestlé is accountable to the shareholders. Its members act on a fully informed basis, in good faith, with due diligence, competence, and care in the best interest of the Company. • It is incumbent upon the Management and all employees of Nestlé, in the exercise of its authority, and in the performance of their duties, to act with fairness and honesty, promote and accept accountability, encourage transparency, and observe and foster a high level of commitment to professional ethics and integrity.

Mandeep Chhatwal


145144

Board Structure and ProcessRemuneration

The By-Laws of the Company provide that Directors shall not receive any salary or compensation for their services. In relation to this, the BOD has delegated to the shareholders of the Company the discretion to remunerate its Directors concurrently serving as executive officers.

Conflict of Interest Policy

This policy is implemented to avoid conflict between personal interests of all employees including the Board members or of a third party with the interests of Nestlé. The Company condemns any act of corruption or bribery that may affect its management and the values upheld by each employee. Conflict of interest shall be avoided at all times.

Membership to associations

ASEAN Food and Beverage Alliance (AFBA) Arise Philippines Corporate Network for Disaster Response (CNDR) Employers’ Confederation of the Philippines (ECOP) European Chamber of Commerce of the Philippines (ECCP) Food Industry Asia (FIA) Global Compact Network Philippines Grow Asia Infant & Pediatric Nutrition Association of the Philippines (IPNAP) League of Corporate Foundations (LCF) Makati Business Club (MBC) Management Association of the Philippines (MAP) People Management Association of the Philippines (PMAP)

Philippine Business for the Environment (PBE) Philippine Association of National Advertisers (PANA) Philippine Business for Social Progress (PBSP) Philippine Chamber of Commerce & Industry (PCCI) Philippine Chamber of Food Manufacturers, Inc. (PCFMI) Philippine Disaster Resilience Foundation (PDRF) Philippine-Swiss Business Council (PSBC) Pollution Control Association of the Philippines (PCAP) Supply Chain Management Association of the Philippines (SCMAP) Wallace Business Forum (WBF)

Code of Ethical Behavior

The Nestlé Corporate Business Principles prescribe values and principles which the Company has committed to worldwide. In relation, its Code of Business Conduct, on the other hand, specifies and helps the continued implementation of the Corporate Business Principles by establishing minimum standards of behavior in key areas. All possible situations that may occur are not covered by the Code. It is designed to provide a frame of reference against which certain judgments may be made. Employees should seek guidance when they are in doubt about the proper course of action in a given situation. Ultimately, however, it is the primary responsibility of each employee to “do the right thing,” which requires a commitment to these business values and principles.

Core Values

All Nestlé employees must comply with the Nestlé Corporate Business Principles. These values are practiced and realized every day through relevant business codes, policies, processes, and tools. Application and effectiveness are monitored through various channels, including CARE audits. To assist continuous improvement, Nestlé has introduced a formal commitment to provide training for these principles.

Accessible through the Company website, these principles touch on a comprehensive set of areas such as consumer welfare, human rights and labour practices, our people, suppliers and customers, and the environment.

G4-41

G4-16 G4-56


147146

Related Party Transactions

The Company has a policy that prohibits conflict of interest. Activities made outside of Nestlé that interfere with the employee’s responsibilities or if they create risks for the Company’s reputation or if they in any other way conflict with the interests of Nestlé are not to be pursued. This includes making fair and objective hiring and people development decisions.

Respect for Basic Human Rights

Nestlé Philippines respects personal dignity, privacy, and personal rights of all its employees and is committed to maintaining a proper decorum at the workplace free from discrimination and any kind of harassment on the basis of gender, religion, nationality, race, age and sexual orientation. The Company upholds the human rights of all people and ensures that its operations at all its work sites throughout the country protect these human rights. The Company likewise stands firmly against child labor, forced labor, sexual harassment, and all forms of corruption. These values are enshrined in the Company’s Code of Conduct.

Board Structure and ProcessEnsuring Compliance

2016

2015

2014 3

7

4

CARE Audits Conducted

Nestlé engages the services of independent international 3rd party auditor Bureau Veritas to audit the Company’s different worksites, including its co-manufacturers and key business partners. The audit, called CARE, monitors adherence to and observance of the prescribed Safety, Health and Environment, Labor Standards, Business Integrity, Human Rights, and Security practices. Annually the Company also conducts an independent Contempo audit,

Anti-Corruption and Anti-Competitive Behavior

In Nestlé, compliance with all applicable laws and regulations must never be compromised. Additionally, employees consciously adhere to internal rules and regulations as they apply in a given situation. These internal rules specific to the Company are what is required by the law. The Company did not receive any reported incident of violation of such laws.

Contempo audits are done annually

which evaluates compliance by Nestlé Philippines and all its 3rd party suppliers to labor laws, standards, and regulations particularly on the use of 3rd party or non-regular workers. All suppliers covered by an audit requirement were audited using a third party auditor, Bureau Veritas, based on local legislation requirements and Nestlé internal policies and standards. All the sites were found compliant with these criteria.


149148

Business Continuity Management

Guided by a robust Business Continuity Policy focused on building organizational preparedness and resilience against natural and man-made disruptions, Nestlé recognizes the Philippine disruption landscape and puts primacy on ensuring continuity in all critical business functions. Business Continuity is business-owned and process driven, it delivers proven capability to manage business disruptions, protects people and helps ensure supply during disruptions. Incident response plans are continually reviewed and calibrated as the organization acknowledges severe and unpredictable weather patterns as the ‘new normal’. In 2016, 31 drills of critical process functions as well as 67 safety and medical drills were carried out. In the event of disruptive activity, emergency response teams have been organized across the Company’s sites to conduct evacuations and ensure the safety of staff and personnel. Moreover, preparedness is further enhanced

by buffer stocks of the logistical needs in case of disruptions. These sites are also equipped with power generators, and/or power plants to provide alternative sources of electricity in times of emergency. During disruptive events, keeping communication lines open and viable is of critical importance. To achieve this, the BCM plan has employed satellite phones across operations while also maintaining a BCM hotline. Proactive typhoon advisories are also sent out and quick reference guides detailing what to do in times of incidents

are distributed to engage each member of the organization. Collaboration with government agencies, volunteer associations, and cause-oriented groups both locally and internationally is critical in planning, response, and mitigation. Nestlé began putting in place a Rapid Deployment Force situated near the Rockwell building consisting of highly-trained, equipped an off-site mobile 3rd party team that will quickly respond to incidents. This will be launched in the 2nd quarter of 2017.

Disaster response for employees

The Philippines is visited by an average of 20 typhoons per year. Nestlé is committed to building a culture of preparedness by instituting process-driven information campaigns aimed at securing the personal safety of its employees. A weekly 10-day weather outlook is cascaded throughout the organization together with text advisories sent out twice a day before, during, and after a typhoon. Work cancellation and work-from-home protocols are also in place.

I would like to take this opportunity to thank those people who helped us last Wednesday October 21, 2015 to be out in our flooded place. To Sir JO SACE and his colleague who do not hesitate to rescue us and make rescue possible and successful even their life might be at danger too. To MS. MARIZ SEPILLO who make constant follow up on the status of rescue. To Erika Joy Bautista who constantly checks on my status and my family These are those individuals that by their very existence, actions and leadership, light a path to see more clearly through life, hardship and possible trauma. With this, they point the way for others to follow whatever goal may be accomplished. Also, I would like to extend my deepest gratitude to NBS and NPI for securing that their employee was safe during this kind of situation. It was such an immediate and effective response made by you. I am very proud that I became part of this company.

Again, on behalf of my family, our deepest gratitude for helping us .

Regards, ELPHIE R. MULDONG

Board Structure and ProcessG4-14


151150

Milk Code Compliance

As a manufacturer of infant formula,

follow-up formula and young

children’s milks, Nestlé Philippines

fully complies with the World Health

Organization’s International Code of

Marketing of Breast-milk Substitute

(dated 1981), the Philippine National

Milk Code or Executive Order No.

51 (dated 1986) and its Revised

Implementing Rules and Regulations

(dated 2006) which are designed

to promote safe and adequate

nutrition for infants through the

protection and promotion of

breastfeeding and by ensuring that

when the use of safe alternatives to

breast milk is deemed necessary,

it is done on the basis of adequate

and objective information

and through appropriate and

responsible marketing and

distribution.

In addition, Nestlé Philippines

adheres to the global Nestlé Policy

and Instructions for Implementation

of the WHO Milk Code. To further

strengthen operational Milk

Code compliance locally, Nestlé

Philippines has incorporated all

guidelines and legislation into its

company policy and procedure

manuals on the marketing of breast

milk substitutes. Furthermore,

Nestlé Philippines also carries out

internal and external independent

audits on Milk Code compliance

conducted by respected external

independent parties.

Nestlé has also put in place an

Ombudsman system wherein

complaints on Milk Code violation

may be sent. For complaints,

proceed to www.nestle.com.ph/

info/contactus. The page contains

separate contact details specific to

WHO concerns.


In order to participate in concerted

efforts on the Milk Code’s

enforcement, Nestlé Philippines

is also a founding member of

the Infant and Pediatric Nutrition

Association of the Philippines

(IPNAP) to promote responsible

business practices and ethics,

uphold food safety standards,

and strengthen the compliance

to the Philippine National Milk

Code through multi-stakeholders

dialogues between the public and

private sectors.

Responsible Advertising

Nestlé Philippines strictly abides by the country’s laws and regulations on advertising. The Company complies with the Ad Standards Council provisions not to mention competitors directly in its ads nor to portray them inaccurately. The Company also follows global guidelines set by the Nestlé Consumer Communication Principles, a set of guidelines that define what constitutes responsible and ethical, truthful and credible, and valuable and informative communication. In line with this, Nestlé ensures that all its claims regarding health, nutrition, and wellness benefits of its products are scientifically supported. Considering the influence of media on children, Nestlé Philippines is committed to responsible marketing among children. Nestlé’s global commitment to the European Union (EU) Pledge program and the International Food and Beverage Alliance (IFBA) initiatives on using commercial communications to educate consumers on achieving balanced diets and active healthy lifestyles is a testament to this. The Company, alongside other food and beverage companies who are members of the Philippine Association of National Advertisers, is a signatory to the Philippine Pledge on “Responsible Advertising to Children”. Furthermore, the Company exercises caution when communicating to children less than 12 years old. The Company does not advertise directly to children under 6 years old. Advertising to children aged 6 to 12 is limited to promoting a healthy and balanced diet. Any sampling or promotional activities in schools are also done only with the consent of school authorities and are always accompanied by educational and nutritional messages.

G4-PR3, G4-PR6

http://http://www.nestle.com.ph/info/contactus


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Materiality ApproachOutlined below is Nestlé’s process in identifying its most material aspects, considering GRI’s principles

Identification Prioritization Validation Review

• Review of impacts along the value delivery chain and defined boundaries where the Company has an impact.

• Impact assessment vis-a-vis global and national sustainable development concerns.

• Leveraged on existing stakeholder management processes to account for their views and expectations.

and prescribed process. The output, presented as a table on pages 153-155, serves as the main content of this report.

• Ranking of aspects based on perceived degree of impact to the business and to stakeholders.

• Risks and opportunities analysis

• CSV Council review and identification of key topics.

• Ensuring identified material aspects mirror stakeholders’ views and expectations

• Continuing evaluation of the relevance of identified material topics.

• Review of performance against global targets

G4-18

Nestlé’s Material Topics and Aspect Boundaries

Category and Relevance Material Aspects Aspect Boundary

Economic

Nestlé operates with the concept

of Creating Shared Value by

promoting inclusive growth

and remunerating its key

stakeholders.

Economic Performance

Indirect Economic Impacts

Procurement Practices

Internal and External

(suppliers, governments,

and local communities)


(customers, governments,

and local communities)


(suppliers)

Environment

Nestlé adopts policies that

guide the Company in keeping

its impacts to the environment

at the barest minimum level

and pursues programs that

will accelerate its progress on

environmental stewardship. The

Company extends the same

standards to be met by its

suppliers.

Materials, Energy, Water,

Emissions, Effluents and

Wastes, and Compliance

Supplier Environmental

Assessment

Internal (business

operations), and local

communities


(suppliers)

Materiality Approach

G4-19, G4-20, G4-21


155154


Social: Labor Practices and Decent Work Nestlé attracts and enables the best people for the job. The Company’s success rests on the engagement level of its employees and extends the same standards to be met by its suppliers.

Employment, Training and Development, Occupational Health and Safety Supplier Assessment for Labor Practices

Internal (business operations) Internal and External (suppliers)

Social: Human Rights Nestlé upholds the protection of human rights beginning from its employees. The Company extends the same standards to be met by its suppliers.

Non-discrimination, Freedom of Association and Collective Bargaining, and Forced or Compulsory Labor Child Labor and Supplier Human Rights Assessment

Internal and External (suppliers) Internal and External (suppliers)


Social: Society Nestlé strives to maintain a harmonious relationship with its local communities and operates within the bounds of ethical standards.

Local Communities Local Communities Anti-corruption, Public Policy, Anti-competitive Behavior, and Compliance Supplier Assessment for Impacts on Society

Internal and External (local communities and partners) Internal (business operations) Internal and External (suppliers)

Social: Product Responsibility Nestlé develops products and implements projects that respond to the needs of our customers, particularly in the areas of health and nutrition.

Customer Health and Safety, Product and Service Labeling, and Marketing Communication Compliance

Internal and External (customers) Internal (business operations) Internal

Materiality Approach

G4-19, G4-20, G4-21 G4-19, G4-20, G4-21


157156

Stakeholders Channels of Engagement Material Topics Addressing Material Topics

Customers

• Daily customer touch points: distribution centers, personnel, phone, email, and social media channels

• Availability of products • Product requirements and processes • Personnel capability to address concerns

• Feedback on concerns

Consumers

• Daily customer touch points: distribution, personnel, phone, email, and social media channels

• Availability of products • Product requirements and processes • Personnel capability to address concerns

• c/o data handler

Business partners/ suppliers

• Supplier accreditation and audit

• Accreditation process and requirements • Product and service delivery

• Orientation • Greening the Supply Chain

Stakeholder ManagementG4-24, G4-26, G4-27


Employees

• Online portals, face-to-face meetings and learning sessions • Annual performance appraisals • Periodic engagement survey

• Refer to OCS/Employee Engagement Survey results

• c/o HR

Parent Company

• Periodic meetings via conference call

• Profitability • Business growth and continuity • Cascade of global commitments

• Regular updates • Cross-functional meetings among business units to discuss action plans

Stakeholder Engagement Data Sheet

Stakeholder Managem

entG4-24, G4-26, G4-27


159158


Regulators

• Annual bank examination • Regular audits • Regular correspondence through letters, email and meetings

• Accreditation process and requirements • Product and service delivery • Transparency and accountability

• Orientation • Greening the Supply Chain compliance to regulations • Conduct of internal and external audits • Formal explanations and responses to queries

Industry groups

• Periodic industry meetings and working committee meetings • Periodic conferences, seminars, and fellowship activities

• Continuing membership • Sharing of industry updates and common concerns related to product and service delivery • Voicing of significant business concerns • Discussion of industry trends

• Participation in meetings • Provision of opinion, inputs, and positions to the government led by Technical Working Group • Attendance to meetings, exhibits, conferences, seminars, symposia, and fellowship activities • Participation in meetings with key policy and decision makers • Active membership

Stakeholders Industry groups

Channels of Engagement

Material Topics • Setting of industry standards and market practice • Provision of avenues for personnel growth • Building of collaborative networks

Addressing Material Topics

Communities

• Regular engagement (site level)

• Livelihood (local hiring) • Capacity building activities • Health and Safety

• Community development programs • Partnerships

Stakeholder Managem

entG4-24, G4-26, G4-27 G4-24, G4-26, G4-27


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G4-33 G4-33


163162

GENERAL STANDARD DISCLOSURES

Page number / Direct answers External

Assurance

Strategy and Analysis

G4-1 Message from the Chairman and CEO, 11-13 Creating Shared Value, 19-25 Nestlé Philippines and the SDGs, 26-29

Yes, 160-161

Organizational Profile

G4-3 About Nestlé in the Philippines, 2 Yes, 160-161

G4-4 Nestlé Products, 8-9 Yes, 160-161

G4-5 No. 31 Plaza Drive, Rockwell Center, Makati City 1200 Philippines Yes, 160-161

Organizational Profile

G4-6 The Company only has operations in the Philippines. Yes, 160-161

G4-7 Effective September 30, 2016, the ice cream and chilled dairy business operated by Nestle Philippines, Inc (“NPI”) in the Philippines was sold to Froneri Philippines, Inc. The same was transferred as Nestle’s contribution to the joint venture entered into by and between its parent Company Nestlé S.A. (“Nestle”) and PAI Partners S.A.S. (“PAI”), via its wholly owned portfolio Company Riviera, the ultimate parent of the R&R Ice Cream Plc.

Yes, 160-161

G4-8 About Nestlé in the Philippines, 2 Yes, 160-161

G4-9 Economic Value Creation, 5 Employee Diversity and Inclusion, 126-129

Yes, 160-161

G4-10 Employee Diversity and Inclusion, 126-129 Yes, 160-161

G4-11 The Company had 4 CBAs from 2014-2016, with an estimated total of 2,143 employees covered by the CBAs.

Yes, 160-161

G4-12 Creating Shared Value, 19-25 Greening the Supply Chain, 80

Yes, 160-161

G4-13 There were no significant changes in the Company during the reporting period

Yes, 160-161

Commitment to External Initiatives

G4-14 Business Continuity Management (BCM), 148-149 Yes, 160-161

G4-15 About this report, 15 Yes, 160-161

G4-16 Membership to Associations, 144 Yes, 160-161

Identified Material Aspects and Boundaries

G4-17 Our Business, 4-5 Yes, 160-161

G4-18 Materiality Approach, 152 Yes, 160-161

G4-19 Nestlé’s Material Topics and Aspect Boundaries, 153-155 Yes, 160-161



G4-22 Whenever applicable, footnotes are placed in the body and the appendices to explain restatements.

Yes, 160-161

G4-23 No changes in scope and aspect boundaries from the previous report.

Yes, 160-161

This report has been prepared ‘in accordance’ with GRI’s G4 Sustainability Reporting Guidelines’ Core option. The GRI Content Index below indicates the reported disclosures and the location of information in this report. The Assurance Statement can be found in pp. 158-159.

GRI G4 Content IndexGRI Content Index

G4-32


165164

Stakeholder Engagement

G4-24 Stakeholder Management, 156-159 Yes, 160-161

G4-25 Creating Shared Value, 19-25 Yes, 160-161



Report Profile

G4-28 Reporting Period and Scope, 16 Yes, 160-161

G4-29 2013 Creating Shared Value Report Yes, 160-161

G4-30 This year, we are reporting triennially but moving forward, we

will be reporting biennially

Yes, 160-161

G4-31 Contact Details, 172 Yes, 160-161

G4-32 Reporting Standards and Frameworks, 16

GRI G4 Content Index, 162-171

Yes, 160-161

G4-33 Assurance, 17

Independent Assurance Statement, 160-161

Yes, 160-161

Governance

G4-34 Board Structure and Process, 138 Yes, 160-161

G4-38 Board of Directors, 140-143 Yes, 160-161

G4-39 The Chairman, 141 Yes, 160-161

G4-40 Qualifications of a Board Director, 139 Yes, 160-161

G4-41 Conflict of Interest Policy, 144 Yes, 160-161

Ethics and Integrity

G4-56 Core Values, 145 Yes, 160-161

SPECIFIC STANDARD DISCLOSURES

DMA and

Indicators

Page number/direct answer Reason(s) for

Omission(s)

External

assurance

CATEGORY: ECONOMIC

Economic Performance

G4-DMA Economic Value Creation, 6-7 Yes, 160-161

G4-EC1 Economic Value Creation, 5-6 Yes, 160-161

Indirect Economic Impacts

G4-DMA Nestlé Philippines and the SDGs, 26 Nutrition, 31-55 Rural Development, 82-103 Helping Society, 105-111

Yes, 160-161

G4-EC8 Nestlé Philippines and the SDGs, 26 Nutrition, 31-55 Rural Development, 82-103 Helping Society, 105-111

Yes, 160-161

Procurement Practices

G4-DMA CSV in Nestlé’s Value Chain, 20-21 Rural Development, 82-103

Yes, 160-161

G4-EC9 CSV in Nestlé’s Value Chain, 20-21 Rural Development, 82-103

Yes, 160-161

GRI Content Index


167166

CATEGORY: ENVIRONMENTAL

Materials

G4-DMA Material Efficiant Packaging and Waste Recovery, 67

Yes, 160-161

G4-EN2 Material Efficiant Packaging and Waste Recovery, 67

Yes, 160-161

Energy

G4-DMA Energy Efficiency, 74-79 Yes, 160-161

G4-EN5 Energy Intensity, 75 Yes, 160-161

G4-EN6 Energy Intensity, 75 Yes, 160-161

Water

G4-DMA Water Management in Nestlé Operations, 58-61 Advocating Water Stewardship, 62-63

Yes, 160-161

G4-EN8 Water Intensity, 59 Yes, 160-161

Emissions

G4-DMA Greenhouse Gas Intensity, 77-79 Yes, 160-161

G4-EN18 Greenhouse Gas Intensity, 77 Yes, 160-161

Effluents and Waste

G4-DMA Managing Solid Waste, 64-73 Water Management in Nestlé’s Operation, 58-61

Yes, 160-161

G4-EN22 Water Management in Nestlé’s Operation, 58-61

Yes, 160-161

G4-EN23 Managing Solid Waste, 64 Disposal Methods of Non-Hazardous Waste Generated, 66 Balik Baterya Program, 72

Yes, 160-161

Compliance

G4-DMA Ensuring Compliance, 147 Yes, 160-161

G4-EN29 We received no significant fines or

notices of violations for environmental

non-compliance for the period covered.

Supplier Environmental Assessment

G4-DMA Greening the Supply Chain, 80 Yes, 160-161

G4-EN32 Greening the Supply Chain, 80 Yes, 160-161

CATEGORY: SOCIAL – LABOR PRACTICES AND DECENT WORK

Employment

G4-DMA Investing in Human Capital, 112-135 Yes, 160-161

G4-LA1 Employee Diversity and Inclusion, 126-129 Yes, 160-161

G4-LA2 Employee Benefits and Compensation, 122-125

Yes, 160-161

Occupational Health and Safety

G4-DMA Health and Safety, 132-135 Yes, 160-161

G4-LA6 Injury Rate, 133 Yes, 160-161

Training and Education

G4-DMA Training and Development, 116-121 Yes, 160-161

G4-LA9 Total Training Hours by Gender, 119

Total Training Hours by Position, 121

Yes, 160-161

Supplier Assessment for Labor Practices

G4-DMA Greening the Supply Chain, 80 Yes, 160-161

G4-LA14 Greening the Supply Chain, 80 Yes, 160-161

GRI Content Index


169168

CATEGORY: SOCIAL – HUMAN RIGHTS

Non-discrimination


G4-HR3 No incidence reported, no aspect of

operation within our organization is

identified to have significant risks.

Yes, 160-161

Freedom of Association and Collective Bargaining


G4-HR4 No aspect of our operations within our

organization was found to have violated

or is at significant risk of violating

the right to exercise the freedom of

association and collective bargaining.

Yes, 160-161

Child Labor


G4-HR5 No incidence reported, no aspect of

our operations within our organization

was identified to have existence of child

labor.

Yes, 160-161

Forced/Compulsory Labor


G4-HR6 No incidence reported, no aspect of our operations within our organization was identified to have existence of forced labor.

Yes, 160-161

Supplier Human Rights Assessment


G4-HR11 No incidence reported, no aspect of our operations and supply chain was identified to have negative human rights impacts

Yes, 160-161

CATEGORY: SOCIAL – SOCIETY

Local Communities

G4-DMA Rural Development, 82-103 Helping Society, 105-111

Yes, 160-161

G4-SO1 Rural Development, 82-103 Helping Society, 105-111

Yes, 160-161

Anti-corruption

G4-DMA Code of Ethical Behavior, 145 Yes, 160-161

G4-SO5 No confirmed incidents of corruption

reported in 2014 to 2016.

Yes, 160-161

Public Policy


G4-SO6 Our businesses made no contributions

to political parties.

Yes, 160-161

GRI Content Index


171170

Anti-competitive Behavior


G4-SO7 No legal actions were filed against the

Company regarding anti-competitive

behavior, violation of antitrust and

monopoly laws.

Yes, 160-161

Compliance


G4-SO8 No significant fines and sanctions. Significant fines per Securities and Exchange Commission is greater than PHP 50,000.

Yes, 160-161

Supplier Assessment for Impacts on Society


G4-SO10 No incidence reported, no aspect of our operations and supply chain was identified to have negative impacts on society

Yes, 160-161

CATEGORY: SOCIAL – PRODUCT RESPONSIBILITY

Customer Health and Safety

G4-DMA Nutrition, 30-55 Yes, 160-161

G4-PR1 Access to Nutritious Food, 32 Yes, 160-161

Product and Service Labelling

G4-DMA Nutrition Education, 36-47 Yes, 160-161

G4-PR3 Nutrition Education, 36

Milk Code Compliance, 150

Yes, 160-161

Marketing Communication

G4-DMA Nutrition Education, 36-47

Milk Code Compliance, 150

Responsible Advertising, 151

Yes, 160-161

G4-PR6 Milk Code Compliance, 150 Yes, 160-161

G4-PR7 No reported incidents of non-

compliance reports against the

Company.

Yes, 160-161

Compliance


G4-PR9 No fines paid on non-compliance with

laws and regulations concerning the

provision and use of products and

services.

Yes, 160-161

CONTACT DETAILS We would like to hear from you. For comments or inquiries on Creating Shared Value Contact us: [email protected],com This report is printed on 9lives Offset, a paper that is manufactured from 100% recycled fiber.

G4-31

Nestlé Philippines, Inc.

©2016, Corporate Affairs Department

Nestlé Center, 31 Plaza Drive

Rockwell Center, Makati City, 1200 Philippines www.Nestlé.com.ph

http://www.Nestle.com.ph

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