As you may already know, Nestlé works with farmers throughout the world to help improve their yields and the efficiency of their agricultural processes.

It was on this theme of rural development that I recently spoke at the 2010 Sustainable Agricultural Partnerships Conference in San Francisco, California.

The forum marked the fourth year of the summit and brought together hundreds of food and beverage manufacturers, processors, retailers, farmers and suppliers. It provided a unique opportunity for everyone - from representatives of major corporations to NGOs - to discuss strategies on how to measure and reduce water and carbon impacts throughout the agricultural supply chain.

I talked specifically about the close relationship our Gerber baby foods team has built with Michigan farmers - partnering with some for more than 35 years to obtain fruits and vegetables. Our work in this area is truly in the spirit of Creating Shared Value – ensuring that we receive the ingredients for our products while at the same time supporting local agricultural production and the communities who depend on it for their economic well-being.

Throughout the forum, I was struck by experiences others have with sustainable agriculture and how much the issue matters to them.  Hearing people like Alex Morgan of the Rainforest Alliance, Scott Exo of Food Alliance, Deane Little of New Sky Energy, Lauren Faber of the California Environmental Protection Agency, and many farmers discuss these issues underscored for me the strength and importance of our CSV proposition.

At Nestlé, I think we’re playing a key role in these debates, and have a lot to add to the conversation. To find out more about the biggest challenges companies like us face when ethically sourcing commodities, you can watch my interview with Martin Smith from Just Means.com here:

This evening, the non-profit organisation, International Development Enterprises (IDE) Cambodia, was awarded the first Nestlé Prize in Creating Shared Value for a rural development project which aims to improve the living standards of the Cambodian rural population by increasing agricultural productivity and income.

Since 2005, IDE Cambodia has developed a network of small rural entrepreneurs to become Farm Business Advisors (FBAs), selling a range of products and services to help small-scale farmers improve their farming techniques and income.

The FBAs are given training and business support by IDE to assist farmers to initiate, intensify, or expand market-oriented agricultural production.

Through this approach, farmers become more effective producers and marketers, thereby increasing their revenue. In turn, FBAs earn an additional income from selling their products and services at a profit.

 

Creating  Shared Value is right at the heart of this project.  If the farmers are successful, the FBAs are successful.  The system flourishes only if there is real value being created at the farm level so everyone in the project is heavily invested in the farmers’ success. 

 

Thanks to our commitment of CHF 500,000 (approximately, USD 475,000), IDE Cambodia will significantly expand this project and positively impact an additional 20 000 people in more than 4 000 rural households. This adds to the 4 500 farmers the IDE already supports in Cambodia.

More information about the CSV Prize can be found here.

The Nestlé Prize in Creating Shared Value is awarded every other year to an individual, NGO, or small business. 

This is to encourage and reward an outstanding innovation for improving access to and management of water, improving the lives of farmers and rural communities, or bringing improved nutrition to populations suffering from nutritional problems.

You can watch a film about IDE Cambodia here. Pictures of the project in action are also available here.  

Ethical Corporation’s Pam Muckosy speaks with Ian Donald (Managing Director), Fakhar Ahmed (Head of Corporate Affairs) and Jack Moser (Advisor for Agricultural Services) of Nestlé Pakistan on the Company's work with farmers around sustainability.

Training opportunities for farmers in South Africa have been boosted under an initiative to increase the growth of vegetable crop chicory, used in Nescafé Ricoffy. Modelled from a successful initiative which started in India in 2004, over a dozen farmers have been offered the opportunity to farm chicory and learn through coaching and mentoring techniques to progress from small-scale to commercial farming level. Chicory – used in the Nestlé instant coffee mix – is often used as a caffeine-free coffee substitute. Johan Spies, Agricultural Services Group Manager for Agricultural Services in Nestlé South Africa said: “We need to motivate and train farmers, particularly emerging black farmers, in the skills of growing chicory.  In providing enough chicory from a sustainable source, plus giving farmers with no or little income some expertise and creating a market for the product at a good price – all highlights Creating Shared Value (CSV).” As part of the South African government's policy of land redistribution, black farmers have now been given the opportunity of farm ownership through an organised process.  This has necessitated the need for training opportunities for farmers with little practical farming and business skills to run sustainable farms.

Nestlé today inaugurated the USD 100 million expansion of its milk processing facilities in Kejayan, Indonesia, which has now become one of Nestlé’s ten largest milk-processing plants worldwide. In one of the company’s largest investments ever in the country, Nestlé is aiming to double the Kejayan plant’s capacity to produce high quality nutritious milk products to meet the demand of Indonesian consumers. This will significantly increase Nestlé fresh milk intake from local dairy farmers to more than one million litres per day in the next few years from its present intake of approximately 620,000 liters per day. The Kejayan plant has always stood as a symbol of Nestlé’s commitment to Indonesia, particularly to the 30,000 dairy farmers of East Java, Indonesia who have been collaborating with the company for over 30 years. The expansion is expected to have a significant impact on the economic development of the surrounding area. An excellent example of creating shared value --  for society as well as shareholders.

The first edition of the Nestlé Prize in Creating Shared Value was a great success with more than 500 applications received from all over the world. Thank you to all participants for sending us their project applications! Applications received represented a broad range of approaches to problems of nutrition, water, or rural development. Examples of projects included innovative solutions for improving access to and management of water, for improving the lives of farmers and rural communities, or delivering high nutritional value to populations suffering from nutritional deficiencies. The Nestlé Prize Screening Committee selected the best applications from the pool of entries and the Nestlé Advisory Board on Creating Shared Value will choose the Nestlé Prize Laureate. Mark your calendar: the winner will be announced on 27 May, 2010! The Nestlé Prize in Creating Shared Value seeks to recognize successes in the areas of nutrition, water, and rural development. More information about the Prize can be found on http://www.nestle.com/CSV/CSVatNestle/CsvPrize/About.htm. Nestlé will commit to the Prize winner an investment of up to CHF 500,000 for a specified period of time, to assist in the development and scale-up of the innovation.

A visual summary of Nestlé's commitment to creating shared value in 2009. We look forward to your comments!

The seventh CSR Asia Summit was held in Kuala Lumpur on 27 and 28 October 2009 and aimed to be the most innovative and challenging conference on Corporate Social Responsibility (CSR) in the Asia-Pacific region. The participants were reminded that amidst the global economic crisis, CSR is more important than ever. With the theme “Sustainable Business as the Road to Recovery”, the event was attended by more than 300 delegates from all over Asia. It explored key CSR issues and strategies to demonstrate leadership in times of turbulence. Nestlé Malaysia was an active participant in the Summit, featuring exhibits to introduce Nestlé’s concept of CSR, which is Creating Shared Value (CSV). The booth showcased both local and global CSV initiatives, as well as Nestlé Malaysia’s reporting initiatives. Nestlé’s CSV initiatives in Nutrition, Water and Rural Development were highlighted as exhibits as well as via a video. Apart from the breakout sessions, roundtables, training and stakeholder sessions were also organised for the delegates. The topics were mainly focused on Asia and brought new insights for businesses, governments, NGOs and other CSR practitioners.

When you think about agricultural advances, you probably think better tools, better fertilizers, and better techniques. However, rural farmers often simply don’t know what technology is available to them, so communications are equally important in driving agricultural advancement. Burkina NTIC is launching the first social media network to share best practices, pricing data, and other useful information among farmers in West Africa. Similar information and communication technology (ICT) initiatives have already shown great success; earlier this year a Malian farmer organization doubled its profits by using similar communication platforms.

The webcast on the Emerging Global Food Crisis got me thinking about the sustainability of feeding programs alongside a food crisis. At the moment, Nestlé Philippines has a feeding program in place and its sustainability is dependent on the parent volunteers through the improvement of their livelihoods, which will eventually enable them to run the feeding program on their own. In essence, however, the sustainability of a feeding program is also largely dependent on the availability of food. The presence of a school garden can be one solution to this availability problem. Just to illustrate, in Rwanda, the planted school gardens benefited the school and the community in several ways. They increased the students’ knowledge on food security and nutrition. The students acquired gardening skills, and most importantly the school garden provided constant food supply for the ongoing feeding programs in place. Some schools in the area were even provided cow sheds and hen houses, as well as Friesian cows to care for. These cows were used for the children's milk consumption while cow dung was used for soil fertility. The feeding program enabled the schools to save money in the long run as their food supply came from their own garden. Any surplus in produce was sold to the community to garner profit, thus benefiting the school even more in the process. To know more about the Rwandan School Gardens click on this link: School Garden in Rwanda Often times, land space and availability are issues to consider when it comes to producing school gardens. Click on the link to see how an NGO called Send a Cow in Uganda tackled that problem by creating “bag gardens.” Send a Cow, Uganda

In this video three Brazilian farmers talk about how genetically modified crops and biotechnology have helped change their lives. For starters, they say biotechnology has increased the biodiversity of the environment and increased their yield and productivity.  As they point out, getting the most out of fixed resources is an important part of conservation. Perhaps most importantly, farmers say biotechnology saves them many hours of work – time which they now spend with their families.

For more than 30 years the International Fund for Agricultural Development (IFAD) has worked to eradicate rural poverty in developing countries around the world. Check out this collection of videos to learn more about the organization and its work.

Improving Agriculture in Africa from Earth Institute on Vimeo.

Soil fertility techniques developed by Pedro Sanchez are helping villages in Africa get out of poverty. In this video, Sanchez explains how simple, scalable methods are transforming a village in Sauri, Kenya.

Even with recent rains, California faces its third consecutive year of drought. UC Davis economist Richard Howitt forecasts hard times for farmers that could result in a loss of 25,000 jobs. These kinds of shortages threaten farmers around the world, solving water crises is one of CSV’s key objectives.

In Ghana, farmers are not only at the whims of the sun and rain, their crops are also threatened by molds which release microtoxin chemicals into their crops.  These chemicals reduce immunity and lower the foodstuffs market value. Just by sitting down with farmers, having dialogues, showing pictures and sharing techniques, Nestlé is helping entire communities solve real-life problems. As a local farmer Morou Mohammed puts it, ‘These techniques can give me a healthy life and give me a good price at the market.’

Check out how mango farmers in India are working with companies directly, instead of through agricultural traders. Many of these farmers were dependant on such traders to sell their produce – and they are meant to shield them against rock-bottom prices – but some contend the traders increase their own margins at the farmer’s expense. One agricultural development manager says, "We are trying to [ensure we receive] good materials. Instead of giving 6 percent to the traders, I'd rather spend 5 percent on agricultural extension work and keep 1 percent for myself. This is basically about creating value for both the farmers and the company.” By using corporate agricultural improvement techniques, these mango farmers are seeing 20 – 30 percent increases in their yields and they’re preserving declining water tables. This is a great example of what we mean by creating shared value – something Nestlé has been doing around the world for years.

Farmer’s all over the world lack irrigation channels for crops and rely on unpredictable rains for their livelihood.  Read how the Bill & Melinda Gates Foundation is supporting efforts to share technologies with farmers that lift water from the ground, distribute it across the farm, and store it for future use. Getting the most out of local water supplies using scalable, sustainable technology is an agricultural extension progress that has long been an important part of creating shared value.  Check out our work with farmers in the coffee supply chain – these communities face some of the most demanding water requirements of all.