When I used to hear the word “Nestle”, I would immediately think of the unhealthy chocolate bars that children would get for Halloween. Images of glucose and calories were often associated with this company. However, this all changed when I heard about its plan to create shared value, a concept that was greatly emphasized in Comm 101.
A blog post by Hans Jöhr, the head of agriculture at Nestle, recently outlined the corporation’s initiatives to create shared value. As stated by the Harvard Business Review, there are three distinctive ways to effectively create shared value: re-conceiving products, redefining productivity in the value chain, and enabling local cluster development. Nestle is focusing primarily on cluster development by implementing a rural development plan. The basis of this plan is to provide financial assistance and agricultural education to the thousands of farmers that supply raw materials. This key activity allows Nestle to create economical and societal benefits. Rural farmers are trained to increase productivity and quality as well as establish sustainable farming systems. Simultaneously, Nestle is able to improve profitability by creating higher quality products and a reliable supply chain.
Furthermore, Nestle holds frequent stakeholder forums to explain the idea of CSV and the company’s future plans. The company has also created a biennial “Nestle CSV Prize” that rewards business-oriented organizations for its efforts to create shared value. This prize acts as an incentive or motivation for other businesses to follow this emerging idea of creating shared value.
After reading about Nestle’s initiatives, my perception of the brand has been completely altered. Now, I see Nestle as an organization that truly cares about society and aims to address various global issues. I believe that the idea of CSV is brilliant and more companies should implement this into their business models. Large corporations have the ability to make a difference in the world, and I hope to see this trend continue.
Nestle has even created a separate YouTube channel for CSV, often uploading forum highlights and interviews. Below is a two minute video from their channel that explains the company’s work in Pakistan and the effect it has on farmers.
https://www.youtube.com/watch?v=p1yNcsKXrxs
References:
http://sloanreview.mit.edu/article/creating-shared-value-at-nestle/
http://www.nestle.com/csv/what-is-csv
http://www.marketwatch.com/story/debating-development-2013-creating-shared-value-forum-2013-10-29
External blog:
http://globalfoodforthought.typepad.com/global-food-for-thought/2012/09/guest-commentary-a-new-approach-to-agricultural-development.html
Image:
http://www.modernghana.com/GhanaHome/image_preview.asp?which=1&menu_id=1&id=NDM5NDI3
http://www.nestle.com/brands/chocolateconfectionery/chocolateandconfectionerycsv