Nestle is to appoint a number of ombudsmen charged with the task of uncovering unethical marketing of its baby milk formula by employees.
The Swiss food group is rolling out the initiative to cover its 230,000 employees across the world, but is particularly keen to track down abuses in developing countries.
Each country unit will appoint a senior manager as an ombudsman from a department other than marketing or sales who will receive internal complaints about marketing activity that may infringe the World Health Organization’s code on baby milk formula marketing.
A group level ombudsman, executive vice president Francisco Castaner, will assess complaints from employees who feel uncomfortable about raising concerns at the country level.
Complaints to the ombudsman will be referred to one of the company’s 200 internal auditors, who will investigate and report back to both the ombudsman and the employee who made the complaint.
Nestle has been the subject of boycotts over a number of years for alleged unethical marketing of baby milk formula to breastfeeding mothers in developing countries, but the company claims it makes every effort to comply with the WHO code. It now wishes to encourage whistleblowers to root out ‘rogue’ marketing – such as offering free gifts to mothers and doctors – of which it is unaware.
‘The idea is to allow Nestle employees to alert the company about any potential code violations in a confidential way,’ said Christina Drotz-Jonasson, assistant vice president.
‘The ombudsman is outside the normal line management structure, so we hope this will encourage people to come forward if they need to.’
Drotz-Jonasson acknowledged that the ombudsman system would have no external input, but said it was intended to complement existing measures to monitor marketing, such as the organization’s regular internal and occasional external audits in developing countries.
During the first ten years of the WHO code, Nestle’s marketing was monitored by the NIFAC Commission, an independent organization, but Drotz-Jonasson said this monitoring had been in abeyance for some years ‘because the code is so embedded at Nestle’. In 2000, Nestle had identified four cases of unethical marketing by staff and had taken disciplinary action against the managers involved.
Nestle says any breach of the WHO code by employees can result in their salary being suspended, bonuses witheld, a change of position or even dismissal, depending on the severity of the breach.
The UK-based Baby Milk Action pressure group partially welcomed the move, but said it was worried that the ombudsman would lack independence and claimed this was ‘a very clever public relations effort to win over non-governmental organizations’.
Nestle has published its first annual ‘sustainability review’ outlining its social and environmental performance.
The unverified report, which has been circulated with the company’s annual financial accounts, says Nestle is ‘in the early stages of devising quantitative measures of social sustainability’ and will improve the quality and depth of its data over the next year.