A group of rebel shareholders urging Nestlé to stop selling so much chocolate have been blocked after only 11% of the FMCG’s shareholders backed the reforms.
Last month, a coalition of its shareholders coordinated by investment NGO ShareAction, called upon the food and drink manufacturer to stop its heavy reliance on foods high in fat salt and sugar (HFSS).
The rebel faction, which included investors including Legal & General and the National Employment and Savings Trust, yesterday (18 April) voted against the Nestlé board and called for the Swiss company to revamp its portfolio and “dramatically improve its impact on people’s health”.
Yet the results of the vote, which was held at the meeting in Lausanne, showed that 88% of shareholders backed the board, which argued that a proportional goal for nutritious foods would “weaken valuable parts of our portfolio and create opportunities for competitors without yielding public health benefits.”, reported The Times.
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In response, ShareAction said:“While the vote we achieved may be less than we wanted, the direction of travel is clear. Investors and consumers are recognising the importance of addressing the business risks and public health impacts of an industry that is heavily reliant on the sales of unhealthy food.
“Left unaddressed, the public health trends that spurred this resolution will only worsen. Consequently we expect investor support for such resolutions at food companies to increase.”
The vote result comes amid Nestlé calling the coalition’s actions “disappointing and counterproductive”, when the news of the impending vote was first broken last month.
A spokesperson for Nestlé at the time told Grocery Gazette: “We appreciate the constructive dialogue with ShareAction and the investor coalition over recent years, so this resolution is disappointing and counterproductive. ShareAction are targeting the wrong company.
“We are already moving and more would be accomplished by asking other firms to level up.…we disagree with the notion that we should aim to limit growth in specific areas of our portfolio. A proportional target is counterproductive to our value creation model.
“It would require us to weaken valuable parts of our portfolio, creating opportunities for competitors without yielding public health benefits. Our goal is to achieve success across all segments of our portfolio, ensuring that we address responsibly the diverse needs and preferences of our consumers.”
