In a move to advance its supply chain standards, Nestlé has entered into a two-year collaborative agreement with the United Nations’ International Labour Organization (ILO). Announced on Thursday, the partnership will concentrate on enhancing labor practices within coffee supply chains originating from Brazil, Colombia, and Mexico.
The initiative forms a key component of the broader Nescafé Plan 2030, a program for which Nestlé committed over one billion Swiss francs in 2022. The ILO will act as a mediator, facilitating dialogue between national governments, employers’ associations, and trade unions. The core objective is to pinpoint root causes of labor rights infringements and implement targeted corrective actions, with a specific focus on improving recruitment procedures and upholding workers’ rights at the country level.
Nescafé Plan 2030 Exceeds Initial Targets
Nestlé is reporting accelerated progress against its sustainability roadmap. The company has revealed that in 2024, some 32% of the coffee sourced for Nescafé products came from farms employing regenerative agricultural practices. This achievement surpasses the interim goal of 20% that was originally set for 2025.
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The drive for more resilient supply chains is motivated by both ethical and economic imperatives. The financial livelihoods of approximately 125 million people worldwide are tied to coffee cultivation. For a global corporation like Nestlé, ensuring stability in its supply network is a critical business concern. This is especially true as investors and regulators increasingly scrutinize the environmental, social, and governance (ESG) performance of major multinational firms.
Shareholder Focus: Dividend and Annual Outlook
Attention now turns to the company’s upcoming 159th Annual General Meeting, scheduled for April 16 in Lausanne. The Board of Directors will propose a dividend distribution of CHF 3.10 per share. If approved, this will mark the 66th consecutive year without a reduction in Nestlé’s dividend payout.
Looking at the current fiscal year, CEO Philipp Navratil has provided guidance forecasting organic sales growth between 3% and 4%. Management also anticipates a modest improvement in the underlying operating margin and projects a free cash flow exceeding CHF 9 billion. The company notes that currency headwinds and ongoing volatility in commodity prices remain the primary challenges to its financial performance.
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