Davos Agenda

Time for action: A recipe for success with 5 key ingredients

Agriculture Nescafé Agua Branca, Brasil Image: Nestle

Paul Bulcke
Chairman of the Board of Directors, Nestlé
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Davos Agenda

This article is part of: Sustainable Development Impact Summit
  • We face interlinked global challenges that are existential for humanity in the long run – contemplation is not a viable strategy.
  • We must make sure that we frame decision-making appropriately and in a way that proactively overcomes inertia and drives action.
  • 5 key ingredients are: a long-term perspective and purpose; values must guide actions; consistency and coherence; dependability; and a holistic and multi-stakeholder mindset.

We are living in a moment in time which calls for all of us – at the individual and collective levels – to act. We face interlinked global challenges that are existential for humanity in the long run. Contemplation is not a viable strategy.

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Making choices and acting decisively can be difficult. This is human nature, of course. The risk of taking a wrong turn often seems greater than the opportunity of taking the right one. But it is important to be able to move forward even in the absence of all the perfect answers. In this context, we must make sure that we frame decision-making appropriately and in a way that proactively overcomes inertia and drives action.

Five key ingredients

I see five key ingredients that can help. These are not by any means exhaustive, but they are important elements to consider. They have long been reflected in Nestlé’s DNA and Creating Shared Value approach. Let me address each in turn, sharing some reflections on Nestlé’s recently announced promise to advance regenerative food systems at scale.

First, a long-term perspective and purpose is essential, appropriately combined and balanced with short-term agility and intensity. Too often, we juxtapose the two, but they are intimately and necessarily linked. We need to be able to change course quickly when our context changes – COVID-19 has shown us how important this is. Yet agility without a long-term purpose can only lead to imbalance and chaos.

At Nestlé, we believe in the power of food to enhance quality of life for everyone, today and for generations to come. We want to meet the needs of a growing population responsibly, with healthy, delicious, convenient, affordable, and sustainably grown food. If the average generation span is about 25-30 years, Nestlé has served five to six generations to date. We sincerely intend to serve many more. Yet we are keenly aware that we can only be successful if we address today’s critical environmental and social challenges: climate change, water stress, land degradation, loss of biodiversity, farmers’ livelihoods. All of these will significantly impact our supply chain operations and have the potential to hinder us from achieving our long-term purpose.

That is why Nestlé has developed concrete plans to support the transition to a regenerative food system. In starting this journey, we are future proofing our business – ensuring we can serve the next five to six generations – by protecting, renewing and restoring the environment and improving the livelihoods of farmers who provide us with our raw materials.

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Second, values must guide actions. Values ensure good judgement when faced with inevitable yet difficult trade-offs. Sometimes we may need regulation, which can provide a level playing field or encourage harmonisation. But we cannot regulate ourselves to glory. Values must underpin all actions.

Third, consistency and coherence. Actions and resources must be aligned with purpose and deployed in a focused manner over several consecutive years. This generates a compounding effect. Building on past work, Nestlé is investing CHF1.2 billion over the next five years in regenerative agriculture, focusing on three main levers of action, each of which builds on the other: technical assistance, investment support and premiums for regenerative agriculture goods.

Fourth, dependability. When you make choices, these will naturally impact your stakeholders. They too must adapt, and they too will face the same hesitations. But you need them to join in. For this, you must be dependable. This means explicitly supporting those on the frontlines as well as delivering expected gains to those who are implicated, especially consumers, business partners and investors. In our regeneration journey, Nestlé is doing precisely that. We are explicitly committing to work with our network of more than 500,000 farmers and 150,000 suppliers, while at the same time communicating closely and in a transparent way with all its other partners.

And fifth, a holistic and multi-stakeholder mindset. This is the foundation for the first four ingredients mentioned above. The transition to a regenerative food system is an economic, technical, behavioral, political and, ultimately, whole-of-society challenge. Industry can show the way and large companies can scale their activities to help deliver a regenerative food system. But a truly systemic transformation of our current food system will require a holistic vision and roadmap that all stakeholders can embrace. It will require collaboration and, beyond that, coordination across the entire food value chain. The upcoming UN Food System Summit is an important moment to drive the kind of cooperation we need to achieve a healthy and sustainable food system for all, and ultimately achieve the 2030 Sustainable Development Goals.

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These are just five ingredients that I believe can help frame decision-making and choices in times of complexity and ambiguity. There are certainly others and I welcome any additional thoughts. Let the action begin!

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