Global Index

India Spotlight Index

Global Index 2016

A. Governance findings

Key findings 

  • There is one clear leader in this Category, Nestlé, which scored 8.7. Mars, FrieslandCampina, Ajinomoto and Brasil Foods were the most improved companies in the ranking.
  • Nestlé, Unilever, Danone and PepsiCo each demonstrateevidence of embedding a commitment to addressing global nutrition challenges within their business models. Most peer companies, however, still do not appear to appreciate the scale of these challenges nor the imperative of taking a leading role in addressing them.
  • The majority of companies demonstrate some orientation towards nutrition through commitments that imply a process for greater integration of nutrition factors into core business considerations. In total, 18 companies have made at least one commitment that indicates improved integration of nutrition into overall corporate strategy, nutrition governance and management systems.
  • Many companies have still not embedded nutrition issues into core business strategies and day-to-day practices across global operations. Efforts to transform high-level commitments into concrete practices such as linking executive compensation to nutrition objectives, or monitoring the sales of healthy products, remain poor across the board. With companies increasingly expanding into emerging markets, the continued lack of integration of issues of undernutrition at a top-line strategic level is a concern.
  • Category A is the second highest scoring Category in the 2016 Global Index (after Category D), with an average score of 3.6. In the 2013 Index Category A was the highest scoring Category.
  • The top four ranked companies in this category – Nestlé, Unilever, Danone and PepsiCo – all scored above 5 and exhibit an advanced approach to how nutrition issues can be considered and addressed. The companies ranked from fifth to ninth, demonstrate an awareness of the importance of nutrition issues in their business strategy and have started incorporating this awareness into their businesses. The next eight companies, ranked twelfth to nineteenth, show some recognition that nutrition issues should be considered, but have taken insufficient steps to integrate this recognition into
    operations.
  • Three companies score zero. They did not disclose efforts to integrate nutrition issues into their business strategy. This could ultimately cause competitive disadvantage for these companies, as consumer eating trends indicate an increasing preference towards healthier options.
  • With respect to undernutrition, the majority of companies assessed recognize that they have a key role to play in addressing this challenge. However corporate strategies to address issues of undernutrition are far less developed than for nutrition issues. There is a clear gap between recognition and action.
  • Many companies express high-level commitments to address undernutrition. But only seven have allocated oversight and responsibility to senior executives. Similarly, only Ajinomoto, Danone, Nestlé and Unilever have formally set out plans. The vast majority fail to demonstrate any action or progress or monitor performance. The companies that are active, Grupo Bimbo, Kellogg’s, FrieslandCampina, Mars, Mondelez, and PepsiCo, appear to take a more ad-hoc approach, with initiatives in (a few) of the developing countries they operate in.
  • In general, companies perform most strongly in section A3, Quality of Reporting. Scores for A1 on strategy and A2 on management are generally lower. This outcome reflects a tendency by some companies to build communication strategies around ad-hoc or marginal efforts to address nutrition and undernutrition. Instead they should seek to develop integrated nutrition strategies with supporting management and governance frameworks to drive growth through an enhanced focus on healthy and fortified products.

Key recommendations

  • Adopt or enhance a formal global nutrition strategy: The six companies that do not appear to have developed any type of nutrition strategy should initiate the process. The twelve companies that are taking ad-hoc action, should develop more formal and comprehensive strategies, which incorporate objectives to address areas such as product reformulation, accessibility, responsible marketing, supporting healthy lifestyles, labeling, the use of health and nutrition claims, and engagement with governments and stakeholders. Food companies have a critical role to play in global efforts to address issues of undernutrition and the nutrition-related aspects of chronic disease. However without strong global nutrition strategies they will continue to lack focus, coordination and accountability, therefore slowing efforts to address undernutrition or nutrition-related aspects of chronic disease.
  • Implement clearer management arrangements, incentives and reward structures: The ten companies that have not assigned accountability for the implementation of a nutrition strategy and/or programs should do so. Ideally responsibility should be allocated directly to the CEO or another executive who reports directly to the Board of Directors. The 16 companies that have not assigned responsibility for their day-to-day nutrition activities should do so. Only five companies demonstrate that the incentives of either senior managers or the CEO are linked to the achievement of set nutrition objectives. Clear management arrangements and strengthened incentive structures can lead to management-level action to ensure delivery of nutrition objectives. They are tools that all companies that are serious about improving societal nutritional outcomes should utilize.
  • Enhanced disclosure: A significant amount of the information on companies’ nutrition strategy, governance and management was derived through confidential corporate disclosure. This includes proprietary commercial materials which is fully appreciated by ATNI. Nevertheless, companies are encouraged to improve public reporting on how nutrition is integrated into core business processes.
  • Put greater and more strategic focus on preventing and addressing undernutrition: Almost half of companies scored on undernutrition are doing too little to address the issue. Especially when compared to efforts to tackle obesity and related diseases. They should emulate the leading companies by establishing formal strategies to address undernutrition delivered through a double value proposition.
  • Undertake much more strategic and market research related to undernutrition: Good strategies for any area of business are based on extensive research and consideration. Fewer than half of the companies assessed appear to have done research in this area. Such research is critical to the identification of any commercial opportunities or other ways in which issues of undernutrition can be addressed. The absence of market research appears to underlie the current ad-hoc and sometimes ill-informed approaches pursued by many companies.
  • Target activities to tackle undernutrition on priority countries and populations: All companies should increase the focus of their undernutrition activities to ensure the greatest impact possible is generated. Explicit emphasis should be placed on priority countries and particularly on women of childbearing age, children under-two, the populations in greatest need of fortified foods and the provision of other support to address undernutrition. Furthermore, companies should focus on delivering more tailored solutions to micronutrient deficiencies among these groups.

Improving nutrition for all

The Access to Nutrition Index rates food and beverage manufacturers´ nutrition-related policies, practices and disclosures worldwide on a recurring basis.

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Funders

Bill & Melinda Gates Foundation

Ministry of Foreign Affairs

Robert Wood Johnson Foundation

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