THE NESTLÉ CANADA CREATING SHARED VALUE REPORT INTRODUCTION

Nestlé was founded in 1866, when a pharmacist, Henri Nestlé, developed an infant food to save the life of a neighbour’s child. Since that time, Nestlé’s fundamental strategy has been to create value for society, and in doing so create value for shareholders. This belief – which we call Creating Shared Value – is not merely philanthropy or an add-on, but a fundamental pillar of Nestlé’s long-term business strategy worldwide.

Nestlé brought this strategy to Canada in 1918, by purchasing its first Canadian milk factory. Since that time, the company has strived to be one of Canada’s leading nutrition, health and wellness companies, with 2007 sales totaling approximately $2.1 billion.

The intent of this report is to provide insight into some of the many ways Nestlé creates value for Canadian society in three key areas: As a responsible steward of environmental sustainability; As a leader in nutrition, health and wellness; and As an ethical business leader and employer.

We are proud to share these accomplishments, as part of our effort to communicate with consumers, customers, employees, shareholders and business partners, demonstrating some of our contributions to the communities in which we operate. At the same time, we are also focused on continual improvement, striving to be the most trusted and respected nutrition, health and wellness company in Canada.

The Nestlé Canada Creating Shared Value Report 2

HOW WE MEASURE UP number 25 in the “Global Most Admired Companies” listing (2007). Nestlé has been awarded “Best in Class” status in the Dow Jones Sustainability Index, with the highest possible score for environmental policy, performance and reporting. We have been named one of the top 100 sustainable companies in the world by Innovest Strategic Value Advisors and Corporate Knights Inc., based on our effective management of environmental, social and governance risks and Our highly respected environmental opportunities, relative to our performance, commitment to industry peers. sustainability, and corporate social Nestlé has received the responsibility are recognized by Sustainable Asset Management consumers and independent (SAM) Gold Class ranking, the sustainability scorecards the world highest in the SAM Sustainability over. Year Book 2008. Since 1999, Nestlé ranked first among the SAM has assessed the Consumer Products Industry, sustainability performance of the according to surveys conducted world’s leading companies. by Fortune Magazine and

NESTLÉ CANADA AT A GLANCE

Nestlé in Canada represents Nestlé Canada Inc. and its sister companies, Nestlé Waters and Nestlé Purina PetCare.

The three operating companies employ 3,500 people, in 21 manufacturing, sales and distribution sites across the country, with 2007 sales of approximately $2.2 billion. Nestlé Canada manufactures and markets some of the world’s most recognized foods and beverages, such as , MINOR’S, , STOUFFER’S, , GOOD START, NESTLÉ BABY CEREAL, POWERBAR, DRUMSTICK, AND . Nestlé Waters’ brands include PURE LIFE, MONTCLAIR, SAN PELLEGRINO, and . Nestlé Purina PetCare brands include PRO PLAN, PURINA ONE, BENEFUL, , CAT CHOW, and .

The Nestlé Canada Creating Shared Value Report 3

THE CREATING SHARED VALUE CONCEPT

“While corporate social important aspect of nutritious food products. responsibility and competitiveness. It also In short, Nestlé aims to sustainability represent demonstrates the strengthen and add a set of useful principles unique capacity of value to every part of and practices, we business to create the supply chain: believe that the true test shared value. agriculture and of a business is whether sourcing; manufacturing it creates value for We believe that and distribution; and to society over the long creating social and bring value to our term.” environmental benefit products and, in Peter Brabeck- will enhance the quality particular, to our Letmathe, Chairman, of our products, consumers. Nestlé S.A. strengthening local communities and To learn about Nestlé’s At Nestlé, we believe producers that act as international activities that our business can our suppliers, improve and initiatives aimed at only bring long-term efficiencies and Creating Shared Value, value to shareholders if reinforce employee please visit it also brings value to satisfaction. It will also www.Nestlé.com and society. The build a context for choose “Creating interdependence business growth through Shared Value.” between business and the creation of a wider society is, for us, an market for healthy and

The Nestlé Canada Creating Shared Value Report 4

ENVIRONMENTAL SUSTAINABILITY

When it comes to environmental governing environmental activities sustainability, Creating Shared Value at our facilities, or related to our means treating the environment in a products. way that preserves it for future • Ongoing surveys and monitoring of generations. facilities, not only for compliance with our corporate standards and procedures, or applicable environmental laws and regulations, but also for identifying and implementing environmental continuous performance improvement opportunities. • At every factory in Canada, a Site Environmental officer is appointed, receiving funding and support from management to bring about environmental improvements.

Nestlé Canada, has achieved significant At Nestlé, our actions demonstrate this environmental progress by focusing on commitment and approach – on a daily these key areas: basis – respecting the environment, supporting sustainable development, WATER MANAGEMENT and applying environmentally sound We are committed to reducing the business practices in every area of amount of water used in our factories our operations. and offices, respecting local water resources, and ensuring that all the In Canada, we are committed to water used is returned clean to the environmental stewardship and our environment. Through our efforts, we initiatives include: have reduced water consumption in our factories by 7.6% since 2001, and have • Integrating robust environmental reduced the amount of waste water programs and environmental generated by 31% during the same management/performance systems period. We are actively working to into all our businesses. reduce water use in our operations by a • Practicing waste and pollution further 5% in 2008. prevention, reduction and control, initiating energy and resource ENERGY AND EMISSIONS conservation, and recycling and Nestlé Canada acknowledges its solid waste management practices. responsibility and leadership role in • Ensuring every employee both climate change by vigorously reducing understands the company’s energy use and emissions. Since 2002, commitment to the environment, and we have reduced energy consumption in is prepared to deliver the our operations by 10%. Carbon environmental responsibilities and emission have been reduced by 19% expectations that are part of their since that time. We are committed to daily jobs and activities at Nestlé. reducing our energy use by a further 3% • Adhering to all applicable national, in 2008. provincial and local regulations

The Nestlé Canada Creating Shared Value Report 5

Our ultimate environmental goal is to ensure that our company is doing its part in leading responsibly, and setting the benchmark for others in helping to preserve Canada’s environment. SUSTAINABLE SOURCING Sustainable sourcing is fundamental to Nestlé’s long-term success. That's because the key ingredients of so many of our products come from nature. OPTIMIZING PACKAGING Although we own no agricultural land, In 2008 we changed the packaging for Nestlé’s practice of sustainable our 1.62 litre and 1.89 litre ice cream agriculture addresses the tubs to packaging that is recyclable and environmental, social and economic resealable. dimensions of farming and sourcing. This includes providing technical We continually evaluate our packaging, assistance to help promote farming pursuing innovative designs that reduce methods that preserve soil, water, air, the amount, use recycled materials, and energy and genetic diversity; minimizing improve recyclability. From 1998 to the risk of contaminants in raw 2007, we achieved significant packaging materials; improving productivity and source reductions for glass, metal, yields; boosting farm income; and, paperboard and plastic/laminate, improving labour conditions. totalling more than 2.2 million tonnes. Nestlé actively participates in WASTE MINIMIZATION international initiatives, such as the Common Code for the We work constantly to reduce the Community, the World Cocoa amount of waste produced in our offices Foundation, and the International Cocoa and factories through ongoing programs Initiative – organizations that provide of source reduction, recycling and solid assistance and education to farm-based waste management, specifically tailored communities in developing countries, in to the unique needs of each facility and order to improve their livelihoods product. We also support curbside through a sustainable agriculture recycling programs in Ontario and system. Quebec, by contributing towards 50% of the cost of municipal recycling. Nestlé is a co-founder of the Sustainable Agriculture Initiative (SAI). TRANSPORTATION Launched in 2002, SAI involves 22 major food trading and producing We endeavour to reduce the companies working together to improve environmental impact of transporting sustainable agricultural practices and and distributing products from our production systems and enhance their factories and distribution centres to efficiency. For more information, please customers and consumers. We have visit www.saiplatform.org. introduced leading-edge methods to ensure that vehicles, containers, etc., are used in the most efficient way, For more information about Nestlé Canada’s improving load utilization and reducing commitment to environmental sustainability, visit www.nestlé.ca/en/community/ both the number of vehicles and trips. environment.

The Nestlé Canada Creating Shared Value Report 6

NUTRITION, HEALTH AND WELLNESS

benefit their overall health and wellness.

In Their Words

I tried LEAN CUISINE on a whim. MAKING The package picture looked so appetizing, so I took a chance NUTRITION THE and purchased it. I fell in love with this food, all of them are so PREFERRED good and filling. Within 4 months I’ve lost 15 pounds. The portions CHOICE: 60/40 are great, just enough to fill me up and not stuff me. Even though I lost the weight, I plan to Since its early continue eating the LEAN As part of our global CUISINE foods because they beginnings, Nestlé’s taste so fantastic. strategy has been nutrition efforts, Nestlé Nestlé LEAN CUISINE has implemented a consumer based on nutritious products that contribute formal product I just wanted to tell you how to the health and well- assessment process to happy I am with new identify products’ 1/3 LESS SUGAR. Getting my being of consumers. In kids to drink milk has always recent years Nestlé has nutritional strengths, been a challenge, but you have reinforced this strategy, weaknesses, and changed all that. Now, making opportunities for sure my kids get all the calcium becoming the world’s they need each day is a breeze. leading nutrition, health improving and Thank you, Nestlé! enhancing nutritional NESQUIK consumer and wellness company, with worldwide sales of quality. I want to thank you for the CHF 107.6 billion. information I receive in the Nestlé Known as “60/40+”, this Baby Program. The information is very helpful in knowing what Nestlé continues to be process involves the the next step is with my baby. a global leader in rigorous testing of our Keep the newsletters coming. products to ensure that Nestlé consumer Research and Development, with a minimum of 6 out of approximately 5,000 10 consumers prefer the people actively involved. taste of the Nestlé In 2007, the company product being tested to spent CHF 1.88 billion a competitor’s on R&D, this figure equivalent. It also having more than means that we evaluate doubled in the past eight our products and our years. competitors’ products to ensure we have As part of the world's nutritional superiority. A largest food company nutritional plus means we leverage these offering a nutritional resources to create benefit that our shared value for competitor isn’t offering. Canadian consumers, Ultimately, the by providing products consumer is the winner and information to with a test process in place to continually

The Nestlé Canada Creating Shared Value Report 7

improve the taste and STOUFFER’S nutritional value of the Canada’s number one foods they prefer. frozen meals brand has developed delicious new In Canada, we test recipes, and has consumer preference on reformulated some of its a selection of our top most popular ones, to brands each year. Well- meet the Heart and known products like Stroke Foundation’s LEAN CUISINE Meat Health CheckTM criteria. Lasagna, COFFEE- These meals deliver an MATE French Vanilla improved nutrition and Nestlé TURTLES profile, with less salt and have exceeded the fat, as well as the great 60/40+ assessment with tasting, home-style, high scores for comfort food qualities consumer taste that consumers love. preference and NESQUIK 1/3 LESS nutritional benefit. SUGAR While sugar is a part of a regular diet, some kids PRODUCT can consume too much. And, since more than REFORMULATION half of kids today don’t get enough calcium, We know that healthy encouraging them to eating is a priority for drink their milk is critical our consumers and we to meeting their daily HÄAGEN-DAZS HALF continuously look for calcium requirement. THE FAT ways to improve our Although even our Häagen-Dazs is now products. Issues such regular NESQUIK has as Trans Fatty Acids, available in a lower fat less sugar than a similar salt and sugar are of format. Consumers serving of fruit juice, concern to consumers, can enjoy all the taste Nestlé created vitamin- and we have of Häagen-Dazs with and iron-enriched reformulated many of only half the fat of the NESQUIK 1/3 LESS our products to improve original. Flavours with SUGAR POWDER and their nutritional profile half the fat are the NESQUIK 1/3 LESS and satisfy consumers’ Häagen-Dazs SUGAR SYRUP. These new products let kids interest in making favourites Vanilla, enjoy all the goodness healthy choices. A few Dulce de Leche and examples of such of white milk with 1/3 Coffee. formulations are: less sugar than our original NESQUIK – helping them get the nutrition they need – every day.

The Nestlé Canada Creating Shared Value Report 8

TRANS FAT FREE CONFECTIONERY At Nestlé we recognize that Canadians are concerned about the presence of Trans Fatty Acids (TFA’s) in food products and the implications for their health. We have had a policy on TFA reduction for a number of years, which is more strict than Canadian guidelines. For example, Nestlé Canada chocolate bars – KIT KAT, COFFEE NESTLÉ thus our continuous , AND PROFESSIONAL commitment to improve SMARTIES – do not At Nestlé Professional the wellness credentials contain TFA’s from we work closely with the across our Nestlé added fat sources. As foodservice industry to Professional product these bars contain milk provide them with a portfolio. there will be naturally wide variety of food and occurring TFA’s from beverage products for added fat sources, out-of-home consumers. however, we have Nestlé Professional is eliminated all added committed to nutrition, TFA’s from the health and wellness and vegetable oils in these addressing the needs products. and desires of today's customers. We continuously look for opportunities to improve the nutritional profile of our products in areas such as trans fats and salt. For example our TRIO® cream soups have been reformulated to meet the Trans Fat free claim. We have also collaborated with our customers to provide Trans Fat free Alfredo Sauces in addition to sodium reduced soups. We realize that nutrition, health and wellness will continue to be top of mind with consumers,

The Nestlé Canada Creating Shared Value Report 9

PORTION CONTROL

At Nestlé we believe all foods can fit within a healthy, balanced diet and active lifestyle. To assist Canadians in managing their calories and weight, we offer a variety of portion and less, giving consumers snack-size range of calorie controlled the opportunity to AERO, KIT KAT, products: indulge, within a COFFEE CRISP and healthy, balanced diet. SMARTIES as peanut- LEAN CUISINE – free treats. Mouthwatering, simple, NESTLÉ SNACK SIZE and above all, healthy. – Consumers can treat To ensure our products’ From deliciously themselves to a snack peanut-free status, we wholesome Spa dishes size COFFEE CRISP, operate a dedicated to Sélections and now KIT KAT, AERO and facility with rigorous Panini that offer more of SMARTIES for just 40 to quality control what consumers crave, 80 calories per bar. processes. This LEAN CUISINE is all These bars also have includes extensive raw about offering the added benefit of material, ingredient and consumers a wide range being made in a peanut- finished product testing of tasty meals that free facility. programs, supplier and recognize the desire to employee protocols, as eat nutritiously, all well as regular audits, portion controlled. employee training, NESTLÉ PEANUT dedicated and certified SACHETS - FREE PROMISE allergen control staff, NESTEA sachets and established Good contain all natural Manufacturing Nowhere is our flavours and 5 calories Practices. per 500 ml serving. A commitment to Creating Shared Value more great way to keep Clear labelling on all simply or more hydrated and maintain a snack-size products powerfully expressed balanced diet. made in our peanut-free than in our Peanut Free facility assures Promise. For years, NESTLÉ SINGLES – Canadians that they can Canadian consumers Launched in 2007, for enjoy their favourite with life-threatening consumers who want treats with confidence. peanut allergies have just a bite of their counted on Nestlé to favourite, mouth- deliver the chocolate watering chocolate, bars they love and trust Nestlé offers COFFEE that are suitable for CRISP, KIT KAT and people with peanut AERO Singles. Each allergies. That’s why we bar is 100 calories or continue to provide our

The Nestlé Canada Creating Shared Value Report 10

COMMUNICATION TO CONSUMERS

At Nestlé we communicate about the nutritional benefits of our products to consumers in a number of ways, through nutritional information on our websites, through our Consumer on Nestlé’s global they are made, Services, and directly website at ingredients, nutrition on-pack. www.Nestlé.com. As facts and food safety. well, many of our brands Consumer comments, ON-PACK provide consumers with complaints and Making healthy food nutrition, health and suggestions are closely choices can be wellness information. monitored to ensure that confusing. That’s why we are listening to what we have created the Visit these sites for a our consumers have to Nestlé Nutritional wealth of health, say, and providing Compass™ to provide wellness and nutrition information they need consumers with quick, information: on our products to make www.Nestlébaby.ca healthy food choices. easy-to-understand www.purina.ca information about the www.powerbar.ca nutritional benefits of www.Nestlé_waterna.com www.leancuisine.ca our products, to allow www.perrier.com them to make informed www.Nestléprofessional.com In Their Words choices. The Compass Yes, I’d just like to thank your appears on our product CONSUMER consumer care people for their packages, and includes SATISFACTION understanding about allergies, We are committed to how important they are to those the Nutrition Facts some of us who have some sort. Table, as well as more listening to our It’s really nice to talk with in-depth information consumers, and in someone who takes it seriously and discusses it logically. Thank about a product's 2007, we interacted with you. specific nutrition over 135,000 Nestlé consumer consumers through benefits, tips on making As a consumer, the response healthier choices, and a Consumer Services. By time to get back to me was very 1-800 number to call for calling the 1-800 quick. It was listed on the email that it would be 2-3 days but more nutrition details. number, or actually somebody contacted me e-mailing the address within two hours so I applaud you on the back of our for that. WEBSITES Nestlé consumer products, consumers Extensive nutrition can speak with information is available representatives who will on our company website inform them about all at www.Nestlé.ca, and Nestlé’s products, how

The Nestlé Canada Creating Shared Value Report 11

ADVERTISING Nestlé will not marketing activities to specifically target promote and support advertising to healthy dietary choices Nestlé believes in children under 6 and healthy lifestyles to empowering consumers years of age. children under 12 years to make healthier When targeting of age. Participants will choices through advertising to also shift their transparent product children aged 6 to advertising and information and under 12, Nestlé will marketing emphasis to responsible only advertise foods and beverages communications. All products with a that are consistent with Nestlé companies follow nutritional profile the principles of sound detailed Consumer which helps children nutrition guidance, Communication achieve a healthy, including those that are Principles, which ensure balanced diet, lower in total calories, all communications such including clear limits fats, salts and added as advertising, help for such ingredients sugars, and higher in consumers to exercise as sugar, salt and nutrients that are their right to informed fat. significant to public choice with accurate, health. clear, responsible In 2007, Nestlé joined messages. the Canadian Children’s For information about Food and Beverage this initiative, visit With respect to Advertising Initiative, a www.adstandards.com/ Canada’s youngest voluntary initiative by 16 childrensinitiative. consumers, our policy is of Canada’s leading clear: food and beverage Nestlé does not companies. Through advertise directly to this initiative, Nestlé and children under 12 its colleagues will use years of age. our creativity and

The Nestlé Canada Creating Shared Value Report 12

PRODUCT healthcare professionals. QUALITY AND SAFETY We provide unrestricted educational grants to healthcare institutions to Nestlé is committed to deliver nutrition quality in all of our education programs to products. We ensure healthcare professionals the food safety of our across the country. We products by holding also provide grants to ourselves to the highest healthcare professionals standards for their in support of research manufacturing and that aims to improve the handling. We know how health of Canadians. important trust is to our consumers as they Nestlé is an active choose products for member of industry themselves and their associations such as the loved ones. We have Food and Consumer strict quality procedures Products of Canada, in place in all of our and Concerned factories, for rigorous Children’s Advertisers, monitoring and and supports nutrition evaluation of the foods and healthcare which we make for our associations such as valued consumers. Dietitians of Canada, the Canadian Foundation of Dietetic Research, the Canadian SUPPORTING Society for Clinical NUTRITION Nutrition, and the EDUCATION Canadian Society for Nutritional Sciences, that work diligently to Nestlé collaborates with improve the health and healthcare wellness of Canadians. professionals, local governments and associations to improve and promote the health and welfare of Canadian families. Nestlé’s Healthcare Professional website (www.nutrition. Nestlé.ca) provides a full overview of educational programs, resources and information for

The Nestlé Canada Creating Shared Value Report 13

CREATING VALUE IN OUR COMMUNITIES

In Their Words

With support from Nestlé Canada, our organization continues to promote Active Playgrounds, and increased participation in physical activity, through fun, cooperative play. Nestlé’s commitment to Active Playgrounds directly benefits children and youth across Canada, as they hop, skip and jump into active, healthier lifestyles. Canadian Intramural Recreation Association of Ontario

As a Founding Sponsor of Kids Help Phone, Nestlé Canada has At Nestlé we believe Canada’s only toll-free, provided invaluable marketing healthy communities are national, bilingual, and funding support for the vital to the long-term phone and web service, and has become a wonderful example of all that stability of our society counseling, referral and effective corporate social and economy. For this information service for responsibility can achieve. Whether through committee reason, we are children and youth. involvement in the annual committed to making a KHP provides the Nestlé Pro-Am Golf Tournament, positive contribution to immediate, anonymous or outstanding participation in the Bell Walk for Kids, Nestlé and its the communities in and confidential support employees continue to be there which we live and work kids need and deserve, for Kids Help Phone so that we through our Good Food, 24 hours a day, 365 can continue to Be There For Kids. Good Life Community days a year. Kids Help Phone Program.

Purina has been key to Lions United Way Foundation of Canada dog We are proud of our Nestlé Canada supports guides since day one – 22 years community the United Way and its ago, and Purina’s support just keeps making a bigger and involvements and member agencies bigger difference. It’s helping us partnerships, and we through corporate grow to provide more and more applaud the dedication support and internal guide dogs to Canadians with physical and medical disabilities. of our partners as they campaigns. We are Lions Guide Dog Foundation improve these proud to partner with of Canada communities for us all. this organization that builds upon the strength of volunteers and COMMUNITY voluntary action, helping PARTNERSHIPS to develop caring communities and responding to a broad Kids Help Phone range of human needs Nestlé Canada is a on a national scale. founding sponsor of Kids Help Phone (KHP),

The Nestlé Canada Creating Shared Value Report 14

Canadian Association Disaster Support of Food Banks Nestlé has long pitched Everyone needs food to in when people are live, learn and be happy. struck by disaster and For that reason, Nestlé left in need. Working Canada donates with the Red Cross, regularly through the during Canadian ShareGoods Program. disaster relief efforts, ShareGoods is a Nestlé provides the partnership between the special bond between necessities of food and Food and Consumer people and their pets. water, as well as pet Products of Canada – of Nestlé Purina PetCare food for animals which Nestlé Canada is is an active supporter of impacted when a a member – and the numerous organizations disaster strikes. Canadian Association of that support animals Food Banks, to share and their owners: Anaphylaxis Canada food and consumer Dog Guides and Nestlé is a proud products with individuals Service Dogs, supporter of and families in need sponsorship of walk- Anaphylaxis Canada, an across Canada. a-thons, and animal organization dedicated shelters. to informing, supporting, Adopt-A-Family Purina Animal Hall educating and Nestlé Waters’ of Fame, another advocating for the employees have been popular and needs of individuals and making the holidays innovative program, families living with life- more enjoyable for less honours animals threatening allergic fortunate members of that have reactions, or their community. Each demonstrated anaphylaxis. The year, Nestlé Waters of exceptional bravery, organization also Guelph partners with loyalty and conducts and supports their local Children’s intelligence in saving research related to Foundation to adopt a human life. anaphylaxis. several families. PawsWay, a new pet community and Supporting Our Four- discovery centre Legged Friends opening June 2008 Nestlé Purina PetCare at Toronto’s is dedicated to Harbourfront Centre. improving the lives of dogs and cats through quality nutrition, care and education. At the company’s core is the phrase “Your Pet, Our Passion®”, a philosophy that inspires each and every employee. Nestlé Purina PetCare focuses on promoting responsible pet care as well as celebrating the

The Nestlé Canada Creating Shared Value Report 15

PROMOTING ACTIVE HEALTHY LIFESTYLES

Active Playgrounds Getting kids up, active and off the couch is the goal of Active Playgrounds. These workshops and resource guides – featuring over 100 playground games – are offered by the Canadian Intramural Recreation Association Long Live Kids POWERBAR Events of Ontario, and are Nestlé is proud to be and Programs available across one of the companies Nestlé POWERBAR Canada with the support involved with Long Live brand supports athletes of Nestlé. Kids, a national, child- of all ages and levels, focused social both on and off the field. Dietitians and marketing initiative This includes university EATracker created by Concerned stars, local up-and- The Eating and Activity Children’s Advertisers comers, celebrated Tracker (EA Tracker), encouraging kids to eat athletes and Olympians. from the Dietitians of smart move more and From world-class Canada, is a web-based become media-wise. marathons to grassroots assessment tool, The messages for kids events, POWERBAR enabling Canadians to are delivered through a salutes and supports the track their daily food and series of public service local and national activity choices. The announcements, as well sporting events, where tool also provides as an educational participants at all levels personalized feedback program delivered to are challenged to on calories, essential educators, parents and achieve their personal, nutrients, activity levels community leaders best. and body mass index across Canada. (BMI). Available on the Dietitians of Canada website (www.dietitians.ca), EA Tracker received start-up funding through an unrestricted educational grant from Nestlé Canada.

The Nestlé Canada Creating Shared Value Report 16

Brand Initiatives Our well-known brands are fully conscious of the special role they can play in supporting organizations that aid others. Here are a few examples of our brands in action in the community: LEAN CUISINE and REAL DAIRY support the Canadian Breast Cancer Foundation with donations from the sale of their products. Nestlé Nutrition also offers a comprehensive array of continuing medical education programs for healthcare professionals focusing on nutrition. NESTLÉ PURE LIFE Fruit Flavoured Water Beverage (sweetened with Splenda) supports a variety of diabetes organizations’ initiatives – including the Juvenile Diabetes Research Foundation – as well as the Canadian Diabetes Association by providing participants in their walks with beverages. PURINA PRO PLAN provides their product to service dogs in training.

EMPLOYEE VOLUNTEERING

Nestlé Canada employees are active in their communities, extending the Good Food, Good Life philosophy to their neighourhoods, and enhancing society through their personal volunteer efforts. To recognize their significant contributions, Nestlé Canada launched the “Nestlé Cares Employee Volunteering Program” in 2004, which provides a financial grant in the name of an employee, who volunteers his or her time, to a registered charity. These Good Food, Good Life ambassadors are making a difference, and Nestlé Canada is proud to have them on our team.

The Nestlé Canada Creating Shared Value Report 17

AN ETHICAL BUSINESS LEADER

Nestlé has a strong corporate culture, delivering the value and quality they which unites people from widely have come to expect from Nestlé. different backgrounds in a single corporate culture built around basic SUPPLIER RELATIONSHIPS human values and principles. Our day- to-day activities are guided by: Nestlé aims to deal only with reputable Nestlé Corporate Business suppliers who are willing to apply Principles; Nestlé’s quality standards. Key suppliers, with which Nestlé has a Nestlé Management and contractual relationship, are audited to Leadership Principles; and ensure they comply with the Nestlé Nestlé Code of Business Corporate Business Principles, or that Conduct. they are actively working to achieve compliance. Whenever instances of Global policies on nutrition, marketing, non-compliance are brought to the environment, occupational health and Company’s attention, Nestlé will safety, and human resources originate, demand corrective measures be as well as support these principles. promptly initiated. Nestlé’s principles and policies are available as downloads from www.Nestlé.com/csv/downloads. MARKETING OF INFANT FORMULA While these principles and policies continue to evolve and adapt to an ever- changing world, our basic fundamentals remain unchanged, and reflect the values of fairness, honesty, and a concern for people. Our compliance with these principles is regularly audited by internal and external experts.

THE CUSTOMER COMES At Nestlé we believe that breastfeeding FIRST is optimal for babies. This message is incorporated into all of our Nestlé is customer-focused, and values communications to consumers. the strong relationships we have with a wide variety of customers across the Nestlé supports the position of the country. They all have very different Canadian Paediatric Society, the requirements, but every one expects Dietitians of Canada, and Health excellent service, high quality products Canada, as outlined in the document and timely delivery. Our task is to entitled, The Nutrition for Healthy Term understand what customers want, and Infants, which promotes breast-feeding respond to their expectations rapidly for as long as possible is best, and that and effectively. We are focused, each iron-fortified formula is appropriate if and every day, on meeting the high mothers choose to supplement or expectations of our customers, and on discontinue breast-feeding. In addition, Nestlé complies with the Food and Drug

The Nestlé Canada Creating Shared Value Report 18

Act and the Competition Act, which regulate the infant formula industry here in Canada.

For more information on Nestlé’s position on breastfeeding, please visit www.babymilk.ca.

AGRICULTURE AND RURAL DEVELOPMENT

Nestlé spends approximately CHF 13 billion a year on agricultural materials such as milk, coffee and cocoa. So, good farming and management although we do not own any agricultural methods to improve efficiency, land or operate commercial farms, our profitability, transparency and approach has been to improve the sustainability in the production, farming methods and living standards processing and trading of coffee. for millions of farmers, through technical assistance, support of trade Cocoa liberalization, and active participation in Although Nestlé does not own any discussions on pressing global issues cocoa farms or plantations, we are such as water usage and governance. committed to contributing to more Coffee sustainable cocoa growing through programs run with other industry Nestlé has been working closely with members, governments in the producer coffee farmers for more than 30 years. countries of West Africa, and other Today, we are the world’s largest direct partner organizations. buyer of coffee; we source about 13% of For example, Nestlé is a founding our green coffee directly from farmers, participant in the International Cocoa helping to ensure they receive a better Initiative – a joint industry-labour union price for their coffee. Nestlé also offers and civil society initiative which works to which are Fairtrade certified, eliminate abusive labour practices. where consumer or retail customer Nestlé is also a founding member of the demand is sufficient. World Cocoa Foundation, which As a responsible market player, Nestlé supports cocoa farmers and their gets involved not only in helping the families worldwide. local economies, but also in promoting For more information about Nestlé’s quality in coffee production, and worldwide efforts to improve the lives of diversification in agricultural activities. cocoa and coffee farmers, visit Nestlé’s commitment to the Common www.Nestlé.com/sharedvaluecsr. Code for the Coffee Community (4C), illustrates this concern. The 4C builds on a voluntary code of conduct adopted by the coffee producers, traders, civil society and other stakeholder organizations, who are committed to

The Nestlé Canada Creating Shared Value Report 19

OUR PEOPLE

In Their Words

There is a reason that I have been with this company for over twenty years – it’s the passion that resonates among the people working here. You get caught up in it, you believe in it and when you get the letters and phone calls from satisfied customers telling you how happy and healthy their pets are eating or using our products, who wouldn’t want to work here? We are all contributing to the well-being of pets across Canada. We believe in this company and what it stands for – ‘Purina. Your Pet, In return for their Our Passion’. dedication and tireless Lauralee Camilleri, Nestlé Purina PetCare employee efforts, we offer all members of the Nestlé We are not just average people, just doing an average job. We At Nestlé, people are Canada team superior are special people, doing an the difference. Our working conditions. Our extra special job. Our team of employees are our long-term investments exceptional people provides millions upon millions of greatest source of pride give our employees customers with the safest, as well as our strongest better job opportunities cleanest, best-tasting water in competitive advantage. and increased income. North America. We should be very proud of ourselves, that we Our principle is that have the privilege to provide a Nestlé Canada creates each employee should much-needed product. Jamie Martin, Nestlé Waters long-term value for have the opportunity to employee society by providing develop his or her The Nestlé Cares Employee meaningful job potential in a safe and Volunteer program contributes to opportunities for more fair workplace where my satisfaction as a volunteer, than 3,500 employees in they are listened to, and my pride in the company. It is one more reason why I am proud 21 manufacturing, sales respected and valued. to work for Nestlé. Firstly, it and distribution sites acknowledges that the work that I across the country. It is do as a Nestlé employee outside of my job is supported and valued through their dedication by the company. My volunteer and hard work that we work with Girl Guides of Canada is important to me, my daughter are able to produce high and our community. I appreciate quality, innovative and that Nestlé also believes in giving nutritious products for all back to your community, and that the company actually takes Canadians to enjoy. action by making a donation. My fellow Guiders were impressed that I work for a company that would make such a tangible contribution. Julie Camilleri, Nestlé employee

The Nestlé Canada Creating Shared Value Report 20

EMPLOYEE WORK/LIFE HEALTH & SATISFACTION BALANCE SAFETY

We strive to create a We encourage our We owe it to all feeling of personal employees to live a employees to provide a belonging among all balanced life, with work healthy and safe Nestlé employees, and family in harmony. working environment. In wherever they are, in Nestlé Canada has our manufacturing offices and factories all developed a set of facilities, Nestlé has a over the world. Nestlé family-friendly policies safety record that is offers competitive and flexible benefits, twice lower than the salaries, a safe including confidential industry average. In workplace, and training counselling and these facilities, safety is programs to help information services. In a part of every employees improve their addition, employees on employee’s professional skills. pregnancy leave receive performance incentive. Promotions are based topped-up salary Health and Safety entirely upon merit, coverage, a kit with programs across our skills and experience, parenting information, sites involve continuous without regard to race, and a breast-milk pump. improvement of our religion, sex or This is consistent with processes, work nationality. Above all, our belief that mother’s practices and systems we treat every employee milk is best for babies. as a result of monitoring with respect and dignity. safety performance and analyzing accidents or occupational health problems. DEVELOPMENT

Nestlé Canada offers performance-based, DIVERSITY results-oriented training for employees. They RECOGNITION Nestlé is committed to can benefit from one-on- PROGRAM the principles of one job training and diversity, and our traditional classroom employee profile reflects sessions, as well as the We established the Nestlé a broad variety of opportunity for Recognition Program in backgrounds, beliefs international experience. 1994, to reward employee and cultures. We are The number of our excellence. Since then, proud that 50% of our employees who have Nestlé Canada has given executive management assumed responsibilities more than 3,000 awards to team is female. with other Nestlé individuals and teams markets totalled 30 in within the company. Our 2007. top-performing employees are also eligible for enriching cross-functional and international assignments.

The Nestlé Canada Creating Shared Value Report 21

POSITIVE UNION news, in general. This running programs, is done through Town health professional RELATIONSHIPS Hall meetings at our guest speakers, and an sites, floor meetings at extensive employee Nestlé Canada has our Head Office, an assistance program. strong and constructive internal newsletter, our relationships with all 10 Intranet or in In 2007, Nestlé of the unions that we Communications posted launched a global work with, representing throughout the nutrition education 12 collective company. Our initiative for all agreements. Through President regularly visits employees. Called “NQ regular contact with the all sites and holds (nutrition quotient) unions, we ensure our informal breakfast Nutrition Training,” work relations are meetings with employees in Canada – productive and employees to gain their from the factory floor to transparent, based on insights and ideas on senior executives – are principles of mutual the business. trained on the respect and fundamentals of cooperation. HEALTH & nutrition, as well as key corporate nutrition WELLNESS initiatives, in order to COMMUNICATION boost overall nutrition As part of our Good knowledge throughout Nestlé communicates Food, Good Life the company and regularly with philosophy, Nestlé reinforce Nestlé’s employees about promotes healthy, active commitment to Nutrition, business strategy, living to employees Health and Wellness. company performance, through programs such industry initiatives, new as health and wellness products and company days, walking and

The Nestlé Canada Creating Shared Value Report 22

In Closing

We trust this report has provided you with an overview of some of the ways Nestlé is Creating Shared Value in Canada. While we have made progress in many areas, we know there is still much more work to be done.

And, although the issues are many – and complex – we are confident that by maintaining a long-term approach to our business we will continue to make a positive contribution to the communities in which we live and work.

To learn more about how Nestlé is Creating Shared Value – both internationally and locally – please visit the websites below. As well, your feedback on this report is welcomed, and can be directed to [email protected]é.com.

Please visit: www.Nestlé.ca www.Nestlé.com www.Purina.ca www.Nestlé-watersna.com www.Nestléprofessional.com

The Nestlé Canada Creating Shared Value Report 23