Accelerate, Transform, Regenerate: Nestlé’s Net Roadmap February 2021 1 Nestlé’s Net Zero Roadmap 3 We commit to net zero by 2050 28 Using renewable energy to manufacture our products contents 4 The Nestlé Net Zero Roadmap 32 Driving toward cleaner logistics 5 Measuring our carbon footprint 37 Removing carbon from the atmosphere 6 Our total emissions by Scope 40 Moving toward carbon-neutral brands 7 Emissions covered by our pledge 44 Using our voice to galvanize action 8 Our key actions at a glance 48 Glossary 9 Sourcing our ingredients sustainably – Dairy and livestock 14 Sourcing our ingredients sustainably – Soil and forests 19 Transforming our product portfolio 23 Evolving our packaging 2 Nestlé’s Net Zero Roadmap Climate change is one of society’s greatest People will be at the heart of our climate actions. challenges. It is also one of the greatest risks We strive to ensure that our initiatives promote WE COMMIT to the future of our business. a just transition toward a regenerative food system for all. TO Net Solving it requires all of us to act with great urgency. As the world’s biggest food and beverage The work behind all of this is detailed, rigorous BY 2050 company, we have the size, scale and reach to and intense. It requires us to examine not only influence others and to inspire collective action. our operations but also each of our products to see how we can make them better for the planet. Now we are going beyond our commitments: And as most of our emissions occur outside we are specifying our plan to halve Nestlé’s of our own four walls, we must go on the ground greenhouse gas (GHG) emissions by 2030 to collaborate with our suppliers and help them and to achieve net zero by 2050 – even as improve their production processes. our business continues to grow. We are making our footprint transparent and will make our At the other end of the value chain, we look progress clear. forward to working with our customers to shape their offering and with our consumers to encourage more sustainable purchasing and consumption. We need action from governments and regulators to create clear and fair rules for companies to make progress. But Nestlé must first lead by example. It is only by taking tangible actions that we can convince others to do the same. And it is only together that we can make a positive difference. 3 Nestlé’s Net Zero Roadmap Nestlé’s Net Roadmap Our path to Moving faster Scaling up Delivering our promise regeneration We’re excited to hit the soil running. We’re accelerating our work in manufacturing, Further down the greener path, we will Advanced agricultural techniques will deliver packaging and carbon-neutral brands. We’re also investing CHF 1.2 billion to help invest in new technologies and fundamental a regenerative food system at scale, supported by for future spark regenerative agriculture across our supply chain, as part of a total investment changes to our products and businesses zero emission logistics and company operations. of CHF 3.2 billion by 2025. around the globe. We will balance any remaining emissions through generations high-quality natural climate solutions that benefit people and the planet. Solving the problem means Our milestones identifying the problem. We found 100% Switch our 100% certified 100% Use more Source 50% of Nestlé emitted 92 million tonnes of deforestation global car sustainable renewable renewable key ingredients greenhouse gas emissions in 2018*. free for primary fleet to lower palm oil by electricity in thermal through Now we know the extent, we know supply chain emission options 2023 all our sites energy in our regenerative the road ahead. by 2022 by 2022 by 2025 manufacturing agricultural Source *Total GHG emissions were 113 million methods by 20% of key tonnes (CO2 equivalent) in 2018, 100% of our 100% certified Cut virgin Plant 200 2030 92 of which are in scope of our UN packaging sustainable ingredients plastic in our million trees 1.5°C pledge. recyclable or cocoa and through packaging by by 2030 reusable by coffee by 2025 regenerative a third by 2025 Companies and their emissions 2025 agricultural grow over time. That’s why we’re Nestlé Waters methods by promising to be net zero based on Plant 20 million becomes 2025 our 2018 baseline, no matter how trees a year carbon neutral much our company grows. by 2025 Path to zero emissions by 2050 Business as usual By 2050, we will reach By 2025, we will reduce our Emissions by operation By 2030, we emissions by 20% (million tonnes of CO2e, 2018) will reduce our 65.6 Sourcing our ingredients emissions by 50% 7.0 Manufacturing our products net 11.0 Packaging our products 7. 5 Managing logistics 0.8 Travel and employee commuting zero 4 Nestlé’s Net Zero Roadmap 2018 2021 2025 2030 2050 measuring our carbon footprint We take a whole life cycle approach to determining farmers, logistics providers and consumers. the carbon footprint of our products. It is a process To achieve net zero GHG emissions by 2050, that involves working with many others, such as we need to act throughout our value chain. Product emissions from farm to fork UPSTREAM DOWNSTREAM Suppliers to Nestlé Nestlé operations Customers, consumers and end of life Agriculture Raw material Manufacturing Packaging Logistics Retail Consumers End of life Sourcing high-quality suppliers Making products. Packaging our Storing and delivering and business Our consumers For products ingredients Sourcing materials manufactured our products around channels enjoying Nestlé’s and packaging. from suppliers, and ingredients and products. the world. Offering and selling products wherever co-operatives and transporting them products to shoppers they are. direct from farmers. to Nestlé. in stores. 5 Nestlé’s Net Zero Roadmap OUR TOTAL EMISSIONS Nestlé’s total GHG emissions by Scope BY SCOPE million tonnes of CO2e, in 2018 Emissions from our direct operations, known Scope 1 as Scope 1 and Scope 2, accounted for just 5% Emitted directly 3.3 3.0% 3.3 of our GHG emissions. The vast majority of 2.5 our GHG emissions (95%) come from activities from sources we own or control such as on-site in our supply chain. As a result, that is where combustion (coal, natural gas, fuel for company’s we focus most of our efforts. vehicle fleet). Total Scope 2 Emitted indirectly 2.5 2.2% from the generation of purchased energy like electricity and heating/cooling network. million tonnes 113of CO e Scope 3 2 All other indirect emissions 107.3 94.8% in our value chain, both upstream and downstream, such as sourcing and use of sold products. 107.3 Figures have been rounded. 6 Nestlé’s Net Zero Roadmap Emissions covered Nestlé’s in-scope GHG emissions by operation (92 out of 113) by our pledge million tonnes of CO2e, in 2018 Progress toward net zero will be measured Scope 3 against our 2018 GHG emissions. We 65.6 Sourcing 65.6 71.4% Dairy and livestock 34.2 calculated this baseline and defined our our ingredients Soil and forests 25.0 footprint in partnership with South Pole, Other 6.4 an external consultant. Scope 1, 2 & 3 Manufacturing 7.0 7.7% In setting our targets, we have followed our products Total the Science Based Targets initiative’s (SBTi) criteria. They provide a clearly defined pathway Scope 3 for coupling future-proof growth with reductions Packaging 11.0 11.9% 7.0 in GHG emissions. As our Scope 3 emissions our products make up 95% of our footprint, we are addressing Scope 3 million tonnes more than 80% of these. The SBTi approved 92of CO e 2 Managing 7.5 8.2% our targets in November 2020. 11.0 logistics This data is our starting point. As we enhance Scope 3 our ability to identify and measure emissions, 7.5 and better use the data that has been disclosed Travel and employee 0.8 0.8% by our suppliers and others, our monitoring commuting will improve. We intend to also share our Figures have been rounded. science-based methodology for calculating 0.8 GHG emissions to help push new frontiers in climate data transparency for the food and What’s not included Scope 3 Scope 3 beverage industry. As a company at the start of its net zero Consumer use Purchased services, journey, following SBTi guidelines for now we of sold products leased assets, capital have excluded the following emissions from our 12.7 million tonnes goods, investments net zero pledge: of CO2e 8.6 million tonnes of CO2e 7 Nestlé’s Net Zero Roadmap OUR KEY ACTIONS AT A GLANCE Sourcing our Evolving Driving toward Moving toward ingredients sustainably our packaging cleaner logistics carbon-neutral brands Working with farmers, suppliers Packaging helps keep our food safe Optimizing routes, filling vehicles As consumers demand increasingly and communities to source ways but causes waste. Investments in more efficiently, switching to transparent and sustainable that protect ecosystems, reduce packaging innovations and new low-emission fuels and renewable products, our brands will continue emissions and enhance livelihoods. business models help keep waste electricity and using more to adapt, embracing sustainability. Dairy and livestock out of landfill. rail transport. Page 40 Page 9 Page 23 Page 32 Soil and forests Page 14 Transforming Using renewable energy Removing carbon Using our voice our product portfolio to manufacture our products from the atmosphere to galvanize action Creating new, low-carbon products, Making products more sustainably Using nature’s own solutions such Forging deep engagement and reformulating existing ones by switching to renewable as agroforestry, soil management, on climate issues with farmers, using ingredients and processes electricity, using more renewable and restoring peatlands and forests industry, governments, NGOs that are good for both consumers fuels and investing to lock GHGs in the ground.