Nestlé is one of the biggest food producers in the world - with many products such as Kit Kats, Nescafé and Shredded Wheat being household names in the UK.
Baby Milk Campaign
Nestlé is also the target of a boycott campaign by groups who accuse the company of breaking international rules on the marketing of breast milk substitutes. Many Christians support the boycott of Nestlé - and other companies that allegedly break the International Code of Marketing Breast-Milk Substitutes - as they believe that the marketing practices used in developing countries are harmful.
Medical science has proven that breast milk is better for babies than powdered milk. However, in some circumstances a breast milk substitute might be the best option - for instance if the mother has died, or if she is unable to produce her own milk.
Nestlé is the target of the boycott campaign because it is the biggest producer and marketer of breast milk substitute. It is also accused of violating the code. Nestlé says that it is doing its best to uphold the code and will fully investigate any violations that are reported.
Review and Consultation
In July 2002 the Methodist Joint Advisory Committee on the Ethics of Investment (JACEI) began a review that looked into whether it would be appropriate for the Central Finance Board (CFB) to hold shares in Nestlé, given its ethical and Christian guidelines.
Baby Milk Action, a UK based campaign group, and Nestlé participated in a consultation process. You can read the all the papers below.
Decision - Nestlé and the Church
After the review process, JACEI came to the conclusion that evidence suggested that Nestlé responded to grass-roots campaign pressure as well as investor dialogue. Consequently, JACEI advised the CFB that there are presently insufficient reasons to avoid an investment in Nestlé on ethical grounds.
This decision caused some controversy in the Church, though the position was accepted by the majority at the Methodist Conference in 2006. The JACEI decision on Nestlé does not necessarily mean that Methodists think that Nestlé is a perfect company - rather, its operations are not unethical in a way to preclude investment.
One of the reasons for investing is that shareholders can hold the company's executive board to account, and put pressure on from within. This approach should be seen to go hand-in-hand with a consumer boycott, which many Methodists will continue to support.
The Consultation Process (PDF)
Central Finance Board Briefing Paper (PDF)
Written response to Briefing Paper from Baby Milk Action (PDF)
Written response to Briefing Paper from Nestlé (PDF)
Central Finance Board Questions (PDF)
Written response to questions from Baby Milk Action (PDF)
Written response to questions from Nestlé (PDF)
Minutes of Consultation (PDF)
CFB Policy Statement on Ethical Issues Relating to the Food Industry (PDF)
JACEI Statement on Nestlé - 24 November 2005 (PDF)
Methodist Church Press Release (PDF)