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Nestlé: a special year in 2020 Annual Report

An update on the Group's strategy, innovation, digitization and sustainability/Report attached

Nestlé has released its 2020 Annual Report which highlights the company's financial and non-financial results and provides an update on strategy, innovation, digitization and sustainability. Despite the challenges related to Covid-19 in 2020, Nestlé has performed well, achieving improvements in organic sales growth, profitability and capital efficiency for the third consecutive year. A key contribution to the growth of the Group is given by the effort made to reduce the environmental footprint. Some examples highlighted in the report include the launch of Sensational Vuna, a plant-based alternative to tuna, and the increased use of paper packaging for brands like Maggi. The company further reduced the average time to market of these products by an additional 10% and increased the number of multi-market launches by 23%.

Nestlé's ongoing digital transformation has enabled it to accelerate growth and engage with consumers better in a year that has seen a surge in online shopping. Nestlé's e-commerce sales increased 48.4% and represented 12.8% of the Group's total sales in 2020. In addition, more than 60% of all of the company's digital media campaigns used a Data-driven approach focused on personalized messaging for consumers. In the "Creating Shared Value" (CSV) section of the report, Nestlé stresses that it has fully achieved 28 of the 36 previously established commitments to support the UN Sustainable Development Goals. The full annual report contains Nestlé's annual review as well as corporate governance and compensation reports and financial statements, which were released on February 18, 2021.

In December 2020, the company published the detailed plan with fixed deadlines to reduce greenhouse gas (GHG) emissions by half by 2030 and to achieve net zero emissions by 2050 (see EFA News article of 3-12 -20 ). Non-financial performance reporting is becoming increasingly important, and as previously announced, the company believes shareholders should have a say on environmental, social and governance (ESG) issues. Nestlé welcomes the upcoming changes to Swiss legislation in this area. Meanwhile, the board is seeking shareholder support for its climate roadmap. Each year at the AGM (General Shareholders' Meeting), shareholders have the opportunity to vote on the total compensation of the board of directors and executive committee of Nestlé. This year, Nestlé changed the structure of the short-term bonus for executive committee members. Fifteen percent of that bonus will now be linked to achieving ESG goals.

Nestlé is also working on splitting the current Nominating and Sustainability Committee into a separate Nominating Committee and a Targeted Sustainability Committee. This reflects the importance of sustainability in corporate governance and allows board members to spend more time and focus on each of these topics. On the occasion of the upcoming Agm on April 15, Nestlé will also publish its first Task Force on Climate-Related Financial Disclosures (Tcfd) Report. The Tcfd report assesses the strength and resilience of the company's strategy and business model in different climate scenarios.

The complete 2020 annual report is attached.

Attachments
hef - 18010

EFA News - European Food Agency
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