COMPANY COFFEE ALUMINIUM CLIMATE

The Positive Cup

B EC AUS E CO F F E E C A N H AV E A POS I T I V E I M PACT

CRE AT ING S HA RE D VA LU E RE PO RT

IN ACCORDANCE WITH THE GRI G4 GUIDELINES

 intro
COMPANY COFFEE ALUMINIUM CLIMATE

How can
a cup of coffee
deliver greater value
for society and
COMPANY COFFEE ALUMINIUM CLIMATE

the environment?

The terroir of the Nespresso Rosabaya,

Grand Cru, Cauca, Colombia

THE POSITIVE CUP 2/3

 COMPANY COFFEE ALUMINIUM CLIMATE

THE POSITIVE CUP

is our conviction to make each cup of Nespresso an extraordinary
coffee experience, creating pleasure for consumers and benefits
for wider society and the environment.

It is a privilege for me, as CEO of Nestlé Nespresso, to present Through our engagement, we aim to show the important role the
the company’s Creating Shared Value report, setting out the work private sector can play. That means bringing new ideas, innovative
we have been doing to drive the sustainability of our business, approaches, resources and a commitment to addressing issues
creating shared value together with, and for, our partners. that ultimately affect us all. In short, being pioneers of sustainable
consumption and in this endeavour we aim to be leaders in
The success of our company is well known, in the coffee industry sustainability in our sector and encourage others to follow.
and wider business community. The power of innovation and
a commitment to excellence has propelled the strong performance One of the great privileges of my role is the opportunity to partner
of Nespresso over the last 30 years. The same level of commitment with individuals and teams from NGOs and the development sector.
to innovation and excellence, by all our employees, has also driven I never cease to be inspired by their passion and engagement and
our engagement in sustainability. This report sets out our strategy, I thank our partners, some of whom have joined us on the Nespresso
commitments and achievements – as well as identifying where Sustainability Advisory Board, for supporting our journey.
progress is still needed.
I am pleased to be able to report that at this half way stage, we are
on track with the targets we set ourselves in 2014 for achievement
Why is sustainability so important to us? by 2020. In fact, I can say with some confidence that we are already
innovating beyond the formal quantitative objectives that we set.
Because it is at the core of our business model and our Creating

THE QUALITY OF OUR GRANDS CRUS Shared Value approach. Nespresso’s innovation in portioned coffee
preparation has created a new and exceptional coffee experience
The Positive Cup is our multifaceted strategy, embodying the belief
that every cup of coffee can have a positive impact. The last couple
IS ROOTED IN SUSTAINABILITY for consumers, one which they appreciate and value. Our continuous of years have shown the perfect illustration of this and what we mean
quest to offer superior and unique profiles and aromas requires by Creating Shared Value. Our Grand Cru Suluja ti South Sudan was
a continuous improvement of coffee quality. This also increases launched in a number of markets – the first coffee to be exported
the value for the farmers producing it. Therefore, we can say from the country. Despite the recent developments and return
that our commitment to sustainable quality has led to the to armed conflict in South Sudan, we continue to be committed to
“decommoditisation” of Nespresso coffee. local communities. We also remain firmly committed to our strategy
of coffee revival. In 2017 we launched Aurora de la Paz, a Pure
We also know that we must engage in the sustainable development Origin coffee from Caquetá in Colombia, an area exposed to the
of these coffee regions. Smallholder coffee farmers are exposed civil conflict. This has been made possible by the peace process and
to unacceptable levels of uncertainty and risk to their livelihoods, Nespresso’s commitment to deploy the AAA Program among the
stemming chiefly from climate change and economic volatility. affected farming communities of the region, thus supporting
Through our unique Nespresso AAA Sustainable Quality™ Program, the post conflict agenda.
developed together with the Rainforest Alliance, we lessen these
risks, creating favourable conditions for over 70,000 farmer partners In all of this work, we are guided by the purpose of our parent
benefiting from premiums, the expert assistance of agronomists, company, Nestlé, to enhance quality of life and contribute to a
plus a wealth of other pioneering initiatives. One I derive great pride healthier future. I invite you to discover our strategy in this report
in is the introduction of the first ever retirement scheme for coffee and encourage you to share feedback, in the hope that together
farmers, developed together with the Colombian Coffee Growers we can continue to make positive impacts in the years to come.
Federation, the Colombian Government, and supported by
the cooperative in Caldas and Fairtrade International.

And finally we are aware of the changing expectations of citizens

Nespresso CEO, Jean-Marc Duvoisin, and AAA and civil society regarding the role of business, particularly in the
agronomist, Paul Karanga, visiting AAA farmers context of the COP21 agreement and the establishment of the Jean-Marc Duvoisin
Susan Waithira and Patrick Gitau in Kenya UN Sustainable Development Goals. CEO, Nestlé Nespresso

THE POSITIVE CUP G4-1, EC/EP-G4-DMA 4/5

 COMPANY COFFEE ALUMINIUM CLIMATE

S U M M A RY TA B L E O F C O N T E N T S

Throughout 30 years of rapid growth, we have been learning how to integrate sustainability into COMPANY 8
our activities, seeking to improve our operations and generate positive impact. We call this approach What really matters .......................................................................................................................... 10
The Positive Cup, which is how Nespresso brings to life the Nestlé company purpose, “to enhance Creating Shared Value ...................................................................................................................... 12
Our value chain ................................................................................................................................ 14
quality of life and contribute to a healthier future”. Our journey ...................................................................................................................................... 16
Our people ....................................................................................................................................... 18
The Positive Cup reinforces the way the Nespresso model creates §§ We now source 82% of our coffee through the Nespresso Partnerships for impact ..................................................................................................................... 20
shared value. It ensures our activities deliver economic value for the AAA Sustainable Quality™ Program, supporting AAA farms Governance ...................................................................................................................................... 22
company, preserving the environment for future generations while towards compliance with certification standards. We have grown
supporting social progress for all stakeholders. It has led to the the share of certified coffee volume from zero to 41% in eight
“decommoditisation” of coffee and provided an opportunity years. We have also started to design solutions for the wider COFFEE 24
to enhance the Nespresso consumer experience by integrating deployment of AAA in the context of the traceability constraints What really matters .......................................................................................................................... 26
sustainability into our value proposition. of the East African supply chain The Nespresso AAA Sustainable Quality™ Program ......................................................................... 28
§§ We have contributed to the multi-stakeholder process which Farmer relationship management ..................................................................................................... 30
is defining new standards for sustainable aluminium (ASI). Innovation for community resilience .............................................................................................. 32
What really matters We estimate that 56% of our capsules are valorized after use. Our approach to Natural Capital ...................................................................................................... 34
However, sourcing “ASI certified” aluminium towards 100% will The AAA Program in East Africa ....................................................................................................... 36
The topics identified during our materiality assessment process set take longer than planned and further substantial progress on Coffee revival .................................................................................................................................... 38
out on page 71, has led us to define the following ambitions: capsule valorization depends on the expansion of collective systems Monitoring and evaluation ............................................................................................................... 40
§§ Ensure sustainable coffee sourcing, contributing to improve §§ We have planted 1.4 million trees in AAA coffee producing The scope of the AAA Program ........................................................................................................ 42
the livelihoods of farmers and the resilience of their communities regions over the past two years. This investment has enabled us
§§ Unlock solutions for the circular use of aluminium with a focus to inset 100% of our company’s operational carbon footprint.
on sourcing and recycling Given the capabilities required in the field and the time ALUMINIUM 44
§§ Take actions on climate change mitigation and adaptation, needed for appropriate community engagement, we have reset What really matters .......................................................................................................................... 46
improving our environmental performance our goal, which is now towards 5 million trees by 2020 The benefits of aluminium ............................................................................................................... 48
§§ Engage everyone in our company, our partners and our consumers, Our approach to aluminium stewardship .......................................................................................... 50
in the benefits of sustainable production and consumption Capsule life cycle management ........................................................................................................ 52
What’s next The scope of our recycling actions .................................................................................................... 54

How we are doing Based on the learning and experiences gained over recent years, we
have identified a number of key priorities: CLIMATE 56
Each section of the report sets out the detail of our programs, §§ Further expand the collective collection systems to improve the
where we are on track against our ambitions and associated goals, valorization and recycling rates of capsules after use – consistent What really matters .......................................................................................................................... 58
as well as where further progress is still required. with initiatives like the EU Circular Economy package Life cycle assessment ........................................................................................................................ 60
§§ Continue to integrate community and landscape level actions into The environmental performance of our operations .......................................................................... 62
The key highlights are: the AAA Program, such as expanding our agroforestry initiatives Sustainable machine design .............................................................................................................. 64
§§ We have identified 11 of the 17 UN Sustainable Development Goals §§ Build on the Nespresso Sustainability Innovation Fund to design Agroforestry for climate adaptation .................................................................................................. 66
(SDGs) where our programs can make a contribution and accelerate co-financing solutions for proven business models The scope of our climate actions ...................................................................................................... 68
§§ The report sets out our collaboration with some of our 45 partners such as community milling
in designing and delivering solutions to sustainability challenges §§ Set science-based targets for carbon reduction and improve our
in our value chain monitoring and evaluation systems in the context of COP21 and ABOUT THIS REPORT 70
§§ Since 2014, we have invested CHF 197 million in deploying SDG 13 Materiality – methodology ................................................................................................................ 71
our programs and expanding capabilities – for example our team §§ Continue the programs which engage employees and consumers Bureau Veritas assessment ................................................................................................................ 72
of over 300 agronomists in our sustainability initiatives such as promoting recycling, Our global partners .......................................................................................................................... 74
§§ We have set up the Nespresso Sustainability Innovation Fund (NSIF), sharing the benefits of sustainable quality coffees and offering Scope and performance overview .................................................................................................... 80
already supporting projects like climate-smart agriculture specific revival coffees from regions such as Cuba and GRI G4 Content Index ...................................................................................................................... 82
in East Africa with the World Bank-BioCarbon Fund Caquetá in Colombia Impressum ...................................................................................................................................... 101

THE POSITIVE CUP EC/EP-G4-DMA 6/7

 COMPANY COFFEE ALUMINIUM CLIMATE

How does Nespresso

take responsibility
C O M PA N Y
for sustainable
consumption?
CREATING SHARED VALUE
IS AT THE HEART OF OUR
CONSUMER PROPOSITION

Efrain Ibañez and Arnoldo Cifuentes,

AAA agronomist and farmer from
Huehuetenango, Guatemala tasting coffee
in the Lausanne boutique, Switzerland

THE POSITIVE CUP 8/9

 COMPANY COFFEE ALUMINIUM CLIMATE

WHAT REALLY MATTERS

“You cannot have a sustainable proposition to
LONG -TERM SUCCESS your consumers if you are not implementing
REQUIRES ACTION sustainability practices in your business.”
BEYOND CORE Arnaud Deschamps, Market Head, Nespresso France

OPERATIONS

Throughout 30 years of rapid growth we have What really matters

been learning how to improve our sustainability To integrate sustainable production
into our consumer value proposition
performance. Our impacts mostly occur beyond
the immediate sphere of our production
97 %
Building on the insights from our materiality assessment, our main focus as a portioned coffee company
and commercial operations, requiring us to is ensuring the sustainable production of coffee and aluminium and engaging consumers in the value
of sustainable consumption. Our employees have direct relationships with coffee farmers and Club Members.
engage with stakeholders upstream and 97% of the carbon footprint This gives us more opportunities to take action in areas we do not directly control but where our business
of a cup of Nespresso comes
downstream in our value chain. has significant dependencies and impacts.
from activities that occur
beyond our core operations
Implementing our Positive Cup ambition involves (e.g. on coffee farms, during the
consumption phase) Human rights Climate change
all of our people – especially those engaging SUSTAINABLE PRODUCTION Water stewardship

Nespresso Club Members in all that we do. Long-term partner relationship

Resource efficiency & waste
Community economic development
A wide range of strategic partnerships has been Environmental stewardship

integral to our progress over the years.

More recently, we launched the Nespresso
88 %
Community development Natural capital
& unemployment

Sustainability Innovation Fund to catalyse

STAKEHOLDER CONCERN
innovation, and we strengthened our 88% of our people would Rural development Business ethics OUR BUSINESS PRINCIPLES
recommend Nespresso AND VALUES
internal processes and governance as a place of work OUR PEOPLE Traceabillity Transparency and responsible practices
Safe, inclusive and rewarding place to work Creating Shared Value stakeholder
to improve decision-making. Responsible marketing
People development and empowerment and consumer relationships
Participative engagement

Employee relations

Women’s empowerment

Food safety

Safety & health

SIGNIFICANCE OF NESPRESSO IMPACT

Our 2020 ambition and goals

Total company engagement
2016 achievements status
Invest CHF 500 million in The Positive Cup (2014-2020) CHF 197 million
Empower everyone in our company to Strategy in execution,
contribute to our sustainability agenda employee training rolled out
Catalyse innovation through the Nespresso Two projects co-funded in the NSIF
Sustainability Innovation Fund USD 9 million blended capital

Achieved On track for 2020 Not on track for 2020

G4-19, G4-27, EC/IEI-G4-DMA, G4-EC7, EC/PSP-G4-DMA, EN/MA-G4-DMA,

THE POSITIVE CUP EN/OV-G4-DMA, HR/CL-G4-DMA, HR/FAC B-G4‑DMA, HR/FCL-G4-DMA, HR/ND-G4-DMA 10/11
 COMPANY COFFEE ALUMINIUM CLIMATE

CREATING SHARED VALUE

“ We want each and every consumer
THE POSITIVE CUP to be able to appreciate the quality and
REINFORCES THE WAY the authenticity of our Grands Crus.”
THE NESPRESSO MODEL Alfonso Gonzalez, Chief Customer Officer, Nespresso

CREATES SHARED VALUE

Nespresso’s innovation in portioned coffee

preparation has created a new and exceptional
coffee experience for consumers, one which
they appreciate and value.

This required the supply of superior coffees which

are cultivated in specific terroirs. They are roasted
and blended with meticulous attention to detail and
their quality is protected by our aluminium capsules.
The origins of our Grands Crus are unique and not
interchangeable, so we cannot and do not buy our
coffee as a commodity, instead building long-term
relationships with individual farmers. Our approach
is to support producers to better manage their
farms, their businesses and their land. By doing so,
we secure the supply of higher quality crops that
meet the specific Nespresso quality and aroma
requirements. This not only delivers a better in-cup
result for our consumers but also greater income,
security and stability for the farmers.

This has led to the “decommoditisation” of

Nespresso coffees, improving the quality and
bringing more value to farmers producing the
unique profiles of coffee we depend on. It is our
expression of “Creating Shared Value”, a way of
doing business defined by Michael Porter and
adopted by Nestlé.

Chef Theo Randall, tasting the new range Daniel Delgado, AAA agronomist
of exclusive selection coffees, in a glass from Colombia, during a coffee tasting
designed especially for Nespresso by Riedel in Avenches factory, Switzerland

THE POSITIVE CUP EC/EP-G4-DMA 12/13

 COMPANY COFFEE ALUMINIUM CLIMATE

OUR VALUE CHAIN

“Our sustainability investments are
SUSTAINABLE PRODUCTION part of the brand experience and
AND CONSUMPTION ARE valued by consumers in every cup.”
INTEGRATED INTO OUR Hélène Moncorger, Chief Financial Officer, Nespresso

END TO END MODEL

SUSTAINABLE PRODUCTION SUSTAINABLE CONSUMPTION

Grow Retail Experience

Scope Scope Scope: Classic line

§§ 12 countries §§ 63 countries, >11,000 employees §§ 24 permanent Grands Crus
§§ >70,000 farmers §§ 25 Customer Relationship Centres §§ Nine limited editions and variations
§§ > 300 agronomists §§ >600 boutiques §§ Two coffee revival Grands Crus
(Cuba, South Sudan)
Program Program
§§ AAA Sustainable Quality™ §§ The Positive Boutique Scope: Vertuo line
§§ 20 permanent Grands Crus
Independent acknowledgement Independent acknowledgement
§§ The Rainforest Alliance §§ OHSAS certification Scope: Pro line
§§ Fairtrade International §§ 13 Grands Crus
§§ Fairtrade USA §§ Two exclusive selections for fine
dining

Independent acknowledgement
§§ >5.5 million Facebook fans
§§ >700 Michelin star restaurants

Source Make Remake

Scope Scope Scope
§§ Aluminium Tier 1 suppliers §§ Three production centres in §§ Over 85% of Nespresso Club
Switzerland, >1,000 employees Members have access to a capsule
Program collection point
§§ Aluminium Stewardship Independent acknowledgement
Initiative (ASI) §§ ISO 22000, ISO 14001 Independent acknowledgement
and OHSAS certification §§ Third party verification tool
Independent acknowledgement §§ CDP climate change and water, for capsule collection and
§§ SMETA compliance DJSI reporting recycling (from 2017)
§§ ASI certification (from 2018)

THE POSITIVE CUP G4-4, G4-6, G4-8, G4-9, G4-12, FP2, FP5 14/15
 COMPANY COFFEE ALUMINIUM CLIMATE

OUR JOURNEY
“We have identified 11 of the
FOR 30 YEARS, WE HAVE BEEN 17 Sustainable Development Goals
LEARNING AND ADAPTING HOW where we can make a contribution.”
WE INTEGRATE SUSTAINABILITY Jérôme Pérez, Global Head of Sustainability, Nespresso

INTO OUR ACTIVITIES

From developing our first prototype in the 1970s to our present day 1970s
Prototypes of the first system to 1986
initiatives, we have been learning how to integrate sustainability into
deliver barista coffee quality at home OUR PORTIONED COFFEE 1991
our business. Moving forwards, we are seeking to align our ambitions SYSTEM WAS BORN THE FIRST
and goals with those of the UN Sustainable Development Goals (SDGs) RECYCLING SYSTEM
– adopted by 193 Member States as the global priorities towards 2030. dedicated to Nespresso capsules
in Switzerland

Our Positive Cup ambitions seek to contribute to 11 of the 17 SDGs.

Two of these goals (SDG 12, Sustainable Consumption and Production,
and SDG 8, Decent Work and Inclusive Growth) set the direction for the
role of a consumer products company such as ours. Other goals are also
material to our value chain and business principles. All 17 SDGs are 2003
2005
outlined here with our customised descriptions and are referenced The life cycle assessment
THE NESPRESSO
2009 AAA SUSTAINABLE
using their icons throughout the report. WE SET OUR PLAN highlights the importance
of Scope 3 (emissions that
QUALITY™ PROGRAM
2012 FOR CREATING 1993
SHARED VALUE are a consequence of our
2014 Aluminium Nespresso joins the collective recycling
Stewardship
80% AAA coffee sourcing operations but are not owned
THE POSITIVE CUP: Initiative system in Germany with the support
75% capsule collection capacity or controlled by Nespresso)
A CHF 500M INVESTMENT The Aluminium Stewardship Initiative of Duales System Deutschland
(ASI) for responsible aluminium -20% GHG emission/cup
INTO POSITIVE IMPACT
Total company engagement sourcing and material stewardship
Resilient coffee farms and communities
End to end sustainably managed aluminium
Integrated actions on climate change 2030

OUR APPLICATION OF THE SDGs

2016 SDG 1 End Poverty
THE NESPRESSO SDG 2 Promote Sustainable Agriculture
2015 SUSTAINABILITY
NESPRESSO BRINGS SDG 4 Learning Opportunities for All
Grand Cru, INNOVATION FUND
Suluja ti SUSTAINABLE CONSUMPTION (NSIF) SDG 5 Gender Equality
South Sudan TO THE LONG CUP USAID and the World Bank become SDG 6 Water Stewardship
with the roll out of the Vertuo system the first partners to join the NSIF SDG 8 Decent Work and Inclusive Growth
SDG 12 Sustainable Consumption and Production
SDG 13 Climate Change
SDG 15 Natural Capital
SDG 16 Peace
SDG 17 Partnerships

2017
The first Creating Shared Value report
in accordance with the GRI Guidelines

G4-10, G4-12, G4-26, G4-LA9, G4-LA12, LA/DEO-G4-DMA,

THE POSITIVE CUP LA/ER-G4-DMA, LA/LMR-G4-DMA, LA/OHS-G4-DMA, LA/TE-G4-DMA 16/17
 COMPANY COFFEE ALUMINIUM CLIMATE

OUR PEOPLE
“Each and everyone is involved
RESPONSIBLE AND because we consider sustainability
INCLUSIVE BUSINESS as a company-wide project.”
IS ESSENTIAL FOR OUR Daniel Weston, Global Head of Creating Shared Value, Nespresso

PEOPLE AND A SOURCE

OF INSPIRATION
We have grown significantly and now employ Beyond a shared passion for coffee and the brand, Nespresso Our development programs promote
around 13,000 people. With this comes
employees are getting more engaged in the implementation a coffee and sustainability culture
of The Positive Cup strategy. Over recent years, this has led
a responsibility for our people’s wellbeing and to consistent operational progress on recycling, coffee sourcing On average, Nespresso employees spend 34.3 hours per annum in
development, as well as a need to accommodate and environmental performance. More than this, as most of training (2016). Coffee know-how and sustainability awareness are
our employees deal with consumers everyday, their active the two topics on which all employees are trained when they first join
the changing expectations of a future workforce.
participation in the program enriches the consumer experience. Nespresso. Customer-facing employees follow a three-year curriculum
We have found that the more we engage including a specific module on sustainability. As part of their career
in sustainability, the more our people want path, customer-facing employees can develop into the role of
Nespresso employees interact with “coffee ambassador”, disseminating the expertise of sustainable
to get involved.
customers everyday quality coffee throughout the company.

The vast majority of Nespresso people are based in boutiques or

Customer Relationship Centres, listening to and helping customers.
This enables them to give direct feedback and to generate ideas
on how we can improve our products and the overall brand 85% of our employees
experience. Since 2014, hundreds of these ideas have been embraced
with the aim of delivering a better quality of service and improved
85 % feel engaged in the company
(+7pp vs. 2012)
customer satisfaction. The 2016 MBA Challenge winners from Saïd Business School,
University of Oxford
Responsible business is even
more important for millennials A closer look at
70 %
70% of staff are in contact
with consumers on a daily basis
Nespresso employees have an average age of 33. In line with local
the Nespresso Sustainability MBA Challenge
needs and culture, our market-based teams develop employee Since 2013, the Nespresso Sustainability MBA Challenge has given
engagement programs: from “green week” events generating ideas us the opportunity to engage with the next generation of business
Our people expect and appreciate around social and environmental challenges, to volunteering, leaders enrolled in international MBA schools, increasing their
a safe workplace academic programs and origin country experiences. In 2016 Nespresso awareness of the issues and opportunities around sustainable enterprise.
USA piloted the Nespresso Coffee Leadership Program, a curriculum Participation has increased year after year and we now attract more
Our boutique managers play an active role in promoting a safe with NY University Stern School of Business aimed at empowering than 80 schools annually. Challenges have dealt with topics as wide
environment. Not only for employees but also for the thousands employees to address societal challenges through their role as ranging as climate strategy, the circular economy and consumer
of customers visiting our boutiques every week. What we call business managers. engagement in sustainability. Finalists are invited to present their ideas
“the recordable injury rate” – the log of accidents that occur within and recommendations to a jury of academics, as well as to an
the business – covers our employees but also extends to the care audience of Nespresso employees. The winning team travels to a AAA
of our customers too. coffee region to see the AAA Program at work in the field. The MBA
Challenge is managed together with the Center for Intelligence in
Markets and Sustainability at the INCAE Business School in Costa Rica.
We promote greater participation of women
in our business and value chain Since 2013, the University of Cambridge Institute for Sustainability
Leadership has been an important stakeholder engaged in ongoing
Gender balance is a major focus for us, above all in leadership Nespresso consultation processes like the Sustainability Advisory Board
positions. While the global male/female balance is 43/57, this is not or the MBA Challenge. Equally, seven senior executives from the
yet reflected in the gender ratios of senior positions. Importantly,
90
Nespresso Leadership, including the CEO, have attended The Prince 90 different nationalities make up
in coffee field operations, we have learned that the presence of Wales’ Business & Sustainability program, highlighting the need the diverse Nespresso team
of female agronomists is key for the participation of women farmers for business engagement in issues such as climate change, inclusive
in training. Women excel in the adoption and implementation growth and resource security.
of best practices on farms. Today, women agronomists at our suppliers cisl.cam.ac.uk
Coffee Specialist, Filipa Perfeito, presenting Suluja ti South comprise 30% of our global field workforce.
Sudan, Nespresso boutique, Lausanne, Switzerland

G4-9, G4-10, G4-26, G4-LA9, G4-LA12, LA/DEO-G4-DMA, SDG SDG

THE POSITIVE CUP LA/LMR-G4-DMA, LA/OHS-G4-DMA, LA/TE-G4-DMA, LA/ER-G4-DMA Learning Opportunities for All Inclusive Growth 18/19
 COMPANY COFFEE ALUMINIUM CLIMATE

PARTNERSHIPS FOR IMPACT

“The nature of the challenges requires
PARTNERSHIPS DRIVE a joint approach – Nespresso cannot
INNOVATION AND solve these problems alone.”
AMPLIFY IMPACT Guillaume Le Cunff, President, Nespresso USA

Long-term collaboration has been instrumental Our latest initiative, the Nespresso Sustainability Innovation Fund, Academic expertise is an important
in us making real progress and in strengthening
aims to engage further, with a wide range of impact investors source of knowledge
and social finance institutions.
our capabilities. The Nespresso AAA Sustainable Over the years, Nespresso has partnered with a range of academic
Quality™ Program and our aluminium institutions to build knowledge related to agri-business and #SouthSudan’s #coffee farmers get a boost from
Collaboration leads to capability building Natural Capital. Our long-term partner, INCAE business school,
new @USAID @Nespresso @TechnoServe
management initiatives are both practical partnership: ow.ly/10xHt3 - @ABC
and an inclusive approach and its Sustainable Markets Intelligence Center (CIMS) have
#feedthefuture Partnerships are key to driving #sustainability
#innovation. Thank you to our partners for joining
illustrations of this. been instrumental in better understanding the model of smallholder
our discussion

Our track record in sustainable coffee sourcing, together with our coffee farming and the contribution of the AAA Program to
long-standing partnership with the Rainforest Alliance, is the most improving livelihoods.
important example of how we have built mutual capability on
sustainability. Today, more than 30 operational coffee partners and For the past three years, Wageningen University has been the
over 70,000 farmers apply the best practices of sustainable quality academic partner of the Manos al Agua platform, bringing strong
coffee production. Throughout this report, you will find partner expertise on water footprinting and water management. Since 2015,
profiles which detail our collaborations, while a full list of partners the centre for climate risk at Columbia University has been working
is outlined at the end. with us on the development of a crop insurance model, tailored to the
needs of coffee smallholders.
A closer look at
To address difficult systemic challenges, In addition, we are working with Harvard University on the Natural the Nespresso Sustainability Innovation Fund
multiple stakeholders work together Capital Protocol, the Yale School of Forestry and Environmental (NSIF)
Studies to analyse agroforestry benefits in Colombia, and we have
Over the past five years, Nespresso has been involved in setting up supported a University of Cambridge postgraduate project to assess The NSIF is a new facility, launched in 2015, which directs a portion
and participating in a range of coalitions with organisations that bring the return on investment of the AAA Program. of the CHF 500 million investment in The Positive Cup, towards
relevant expertise and a strong commitment to transform practices innovative sustainability initiatives which amplify the positive impact
for a more sustainable future. Today, Nespresso is part of five of our actions. It is designed as a source of blended capital to
multi-stakeholder platforms working on coffee landscape co-invest with institutional donors and impact investors, focusing
and aluminium stewardship topics: USD 88m additional investment initially on the areas of resilience and economic development.

§§ The Manos al Agua platform in Colombia to build knowledge

USD
88m by partners in the regions where
we source coffee (2007-2015)
The NSIF has already doubled its initial seed capital of USD 10 million,
with investments by USAID in South Sudan (USD 3.2 million) and
on Natural Capital and integrated landscape management the World Bank Group in Ethiopia (USD 6 million).
manosalagua.com

§§ The Consórcio Cerrado das Águas in Brazil to leverage efforts Investors will be critical to amplify
of landscape stakeholders and build resilient watersheds positive impact
Learn more on page 34-35.

§§ The International Platform for Insetting (IPI) in France to share Between 2007 and 2015, Nespresso leveraged its operational
best practices on how to manage socio‑environmental costs within investments in coffee producing countries through a series of
the value chain public-private partnerships channelling USD 87 million additional
investment into the regions and communities where we source What’s next
insettingplatform.com
AAA coffee. In 2015, the Nespresso Sustainability Innovation Fund
§§ The Aluminium Stewardship Initiative to set a standard for Explore investment opportunities through the
was launched to innovate in blended sustainability financing
responsible aluminium sourcing and material management Nespresso Sustainability Innovation Fund in recycling and
solutions – finding new financial mechanisms to attract investors
aluminium-stewardship.org
into socio-environmental projects that result in positive impacts. circular material management.
§§ The Club de l’Emballage Léger en Aluminium et en Acier
(CELAA) in France to establish recycling facilities
celaa.fr

Signature of a multi-stakeholder agreement

for the farmers savings plan, Aguadas, Colombia

SDG
THE POSITIVE CUP G4-15, G4-16 Partnerships 20/21
 COMPANY COFFEE ALUMINIUM CLIMATE

GOVERNANCE
“Governance means integration of
SUSTAINABILITY IS sustainability into our business but it also
INTEGRATED INTO OUR means being open to external advice.”
REGULAR BUSINESS Yvonne Iwaniuk, Global Corporate Communication & PR Head, Nespresso

MANAGEMENT PROCESSES

Nestlé’s purpose is to enhance quality of life

LEADERSHIP
and contribute to a healthier future. This drives §§ Nespresso Leadership Team
The Positive Cup, enabling sustainable consumption, §§ Nespresso CSV Global Team
supporting resilience of coffee farming communities §§ Nestlé Operations Sustainability Council CHF 197m already invested

and taking care of natural resources for future

§§ Nestlé Brands and CSV Advisory CHF
197m of the CHF 500m commitment
(2014-2020)
generations. At Nespresso, a governance structure Scope
is in place to deliver these impacts. Sustainability is §§ The Positive Cup Strategy Partnerships
§§ Nestlé Alignment
discussed at all our monthly operational meetings.

COMMERCIAL OPERATIONS TECHNICAL OPERATIONS COFFEE FIELD OPERATIONS CONSULTATION

§§ Market Heads §§ Procurement Network §§ AAA Regional Managers AND PARTNERSHIP
§§ Local Sustainability Champions §§ Factory Managers §§ Agronomist Workforce Nespresso Sustainability Advisory Board NSAB members 2016, New York, USA
§§ Coffee Ambassadors §§ SHE and Quality Managers Nespresso Sustainability Innovation Fund
§§ Technical Quality Managers Scope Multi-stakeholder Coalitions
Scope §§ Farmer Relationship Management A closer look at
Scope Strategy implementation on site §§ Supplier implementation Scope The Nespresso Sustainability Advisory Board
Local strategy implementation §§ Sustainable Quality Management Global/Local Advisory and Implementation (NSAB)
(recycling, machines, boutiques Management program
and consumer engagement) §§ The Nestlé Quality Management System Management program Set up in 2013, the NSAB comprises leading NGOs, academics,
(N.Q.M.S) The Nespresso AAA Sustainable international organisations and our brand ambassador,
Management program §§ The Nestlé Corporate Compliance Quality™ Program George Clooney. The Board meets formally once per year
§§ The Nestlé Responsible Sourcing audits Assessment of Human Resources (C.A.R.E) and the agenda is framed around:
(S.M.E.T.A; Ecovadis) §§ The Nestlé Environmental Management §§ Progress against our public commitments
§§ The Nestlé Quality Management System (N.E.M.S) §§ Concerns on strategy execution and gaps
System (N.Q.M.S) §§ The Nestlé Responsible Sourcing Audits §§ Discussion around future opportunities
§§ The Nestlé Corporate Compliance (S.M.E.T.A; Ecovadis)
Assessment of Human Resources (C.A.R.E) Other external experts are invited to present and interact with
§§ The Nespresso Recycling Management System the Board to ensure a wide range of views are represented.
All discussions are non-binding and serve more to channel external
advice on the role of the private sector on societal challenges.
Every year, the NSAB discussions focus on coffee production,
aluminium management and climate risks.

Today, the members are: brand ambassador George Clooney,

Cambridge Institute for Sustainability Leadership, Colombian Coffee
Growers Federation (FNC), Fair Labor Association (FLA), Fairtrade
International, Fair Trade USA, INCAE Business School, International
Union for Conservation of Nature (IUCN), TechnoServe, Rainforest
Alliance, World Business Council for Sustainable Development.

Coffee specialist explaining the circular use of aluminium, A team of AAA agronomists, Colombia Participants in a consultation process pre NSAB 2015,
Lausanne Boutique, Switzerland London, UK

THE POSITIVE CUP G4-24, G4-26, G4-34, G4-EN31 22/23

 COMPANY COFFEE ALUMINIUM CLIMATE

How does Nespresso

COFFEE ensure sustainable
quality coffee?
OVER A DECADE OF COLLABORATION
HAS BEEN CRITICAL IN DELIVERING
SUSTAINABLE QUALITY

AAA green coffee bags awaiting export at

Cooperativa de Caficultores de Aguadas, Colombia

THE POSITIVE CUP EC/PSP-G4-DMA 24/25

 COMPANY COFFEE ALUMINIUM CLIMATE

WHAT REALLY MATTERS

“The big challenge going forward is to
OUR PROMISE TO engage consumers with the benefits
CONSUMERS DEPENDS of sustainable production.”
ON RESILIENT FARMING Lawrence Pratt, Senior Lecturer, INCAE Business School

COMMUNITIES

To fulfil our commitment to Nespresso What really matters

consumers, we depend on a reliable source To ensure consumer appreciation of sustainable quality coffee
of the highest quality coffee. Working closely
with farmers, cooperatives and other partners
1-2 % Our Grands Crus coffees are recognised for their exceptional taste and flavour profiles. Behind this
is a long-standing commitment to sustainable coffee production, which helps protect the future supply
strengthens the resilience of our coffee producing of our coffees. Using our materiality assessment as a basis, we work with stakeholders in the coffee
sector to support resilient agricultural communities and to protect vital ecosystems and landscapes.
regions – especially to economic uncertainties Only 1-2% of worldwide We are also building the value of sustainable quality coffee into the consumer experience.
coffee meets our quality
and climate change. The Nespresso AAA
standards
Sustainable Quality™ Program was launched
in 2003 with the Rainforest Alliance. It fosters
Human rights Climate change
long‑term relationships with farmers, embeds Water stewardship

sustainable practices on farms and the

surrounding landscapes, and improves the yield
17 % Resource efficiency & waste
COFFEE LANDSCAPE CONSERVATION
Reforestation
and quality of harvests. At the same time, it Biodiversity conservation
Water stewardship
contributes by bettering the livelihoods of 17%, the share of consumers Community development Natural capital
& unemployment
willing to pay more for
farmers and their communities. It is now being

STAKEHOLDER CONCERN
sustainable production
implemented in East Africa, in line with our (Euromonitor 2016) Rural development
RESILIENT FARMING COMMUNITIES
commitment for 100% AAA sourced coffee Quality and productivity Traceabillity CONSUMER EXPERIENCE
by 2020. Economic stability Responsible marketing Transparency
Intergenerational succession Terroir discovery
Climate adaptation Product innovation

Women’s empowerment

SIGNIFICANCE OF NESPRESSO IMPACT

Our 2020 ambition and goals

Resilient coffee farms and communities
2016 achievements status
Source towards 100% of our permanent coffees
82% AAA sourced coffee
through the AAA Sustainable Quality™ Program
Increase the share of certified coffees in AAA +5 pp (vs. 2014)
Harvest time for AAA farmer
Diego María Lopez, Cauca, Colombia Expand our value proposition to rare origins and pursue Two origins: Cuba, South Sudan
innovative solutions to better livelihoods for farmers CHF 2.6 million in innovative solutions

Achieved On track for 2020 Not on track for 2020

THE POSITIVE CUP EC/IEI-G4-DMA, EN/OV-G4-DMA, EN/WA-G4-DMA, SO/LC-G4-DMA, G4-SO1 26/27

 COMPANY COFFEE ALUMINIUM CLIMATE

THE NESPRESSO AAA SUSTAINABLE QUALITY™ PROGRAM

“We’re proud to have helped build AAA.
THE AAA SUSTAINABLE It’s working to drive our shared mission and achieve
QUALITY ™ PROGRAM meaningful social and environmental impacts.”
IS OUR SOLUTION FOR Nigel Sizer, President, Rainforest Alliance

BUILDING RESILIENCE

The AAA Program is a quality coffee sourcing program, Quality and sustainability go hand in hand
designed and implemented specifically for Nespresso
in collaboration with the Rainforest Alliance and launched Experience has taught us that there is no quality without
in 2003. Through long-standing partnerships with farmers, socio‑economic and environmental sustainability, and vice versa.
coffee suppliers and cooperatives, with support from NGOs, The three pillars of the AAA Program encapsulate this learning.
it has evolved considerably over time. Sustainable farm

A | Firm commitment to quality

management is still at its heart, but today it also focuses The Rainforest Alliance and Nespresso have been working together
on community and landscape resilience and the wider since 2003 in the design and development of the AAA Program.
systemic challenges facing the sector. This collaboration led to the concept of Sustainable Quality and its
Everything starts with quality. It is the major driver for farmers deployment at farm level, combining the socio-environmental criteria
to access differentiated markets and increase farm revenues. of the Sustainable Agricultural Network (SAN) with the quality
Wider systemic solutions Practices such as harvest and post harvest processing, traceability, expertise of Nespresso. As part of more recent work, the collaboration
and also input management and varietal selection affect the quality also led to the piloting of the Rainforest Alliance/SAN climate module
The AAA Program participates in a range of multi-stakeholder of the crop. Farmers are rewarded with price premiums when their with the AAA farmers of the Huehuetenango cluster in Guatemala
coalitions that leverage the collective resources of farmer coffees are approved as high quality. and the Monitoring and Evaluation tool of the AAA Program.
organisations, academics, municipalities and governments to bring rainforest-alliance.org

A | Practical support for productivity

comprehensive solutions addressing challenges in the sector. san.ag/web

Resilient communities and landscapes Greater productivity of high quality coffees directly impacts
farmer revenues. On top of quality practices, renovation and cost
The AAA Program acts as a platform for partners to build community management also contribute to higher yields and profitability.
and landscape resilience against wider ‘off farm’ risk factors, Consistent farm management over the long-term leads to
developing solutions for both social welfare and climate adaptation. income stability.

A|
Farm management Clear focus on social and
environmental sustainability
The AAA Program supports the implementation of sustainable
agricultural practices at farm level by investing in technical assistance, Taking care of the socio‑economic and environmental conditions of
paying premiums directly to coffee producers and co-financing the farm is critical to secure consistent quality and a responsible supply
infrastructure for both quality and sustainability improvements. chain. Practices such as working conditions, water stewardship,
biodiversity protection and climate resilience contribute to long-term
stability and improved livelihoods.

CHF 35m/year – yearly The AAA approach is delivering

CHF
35m /year investment in technical assistance
and premiums to farmers
positive impacts at farm level
The celebration of the late harvest coffee Naora, launched
in 2012 with the community of Pinchote, Colombia
Five years after the initial launch of the AAA Program in Colombia,
Nespresso commissioned an independent study to evaluate the
impact on farmers. Undertaken by research institute CRECE between
2009 and 2012, it showed that the AAA Program delivered positive
The three levels of AAA intervention: Cauca landscape, impacts versus conventional coffee farming on social (+22.6%),
Colombia; coffee processing at the community mill in Jardin, environmental (+52.1%) and economic (+41.0%) indices.
Antioquia, Colombia; a AAA farmer harvesting coffee in
Cauca, Colombia

G4-16, G4-EC7, G4-EN31, EN/SEA-G4-DMA, HR/SHRA-G4-DMA, SDG SDG

THE POSITIVE CUP LA/SALP-G4-DMA, SO/LC-G4-DMA, G4-SO1 Inclusive Growth Promote Sustainable Agriculture 28/29
 COMPANY COFFEE ALUMINIUM CLIMATE

FARMER RELATIONSHIP MANAGEMENT

“Technical assistance, such as the kind provided
A A A IS FIRST AND by FNC and Nespresso on AAA is, in my view,
FOREMOST A FARMER essential to build trust with coffee producers.”
REL ATIONSHIP PROGRAM Roberto Velez, Chief Executive Officer, Colombian Coffee Growers Federation

Sustainable quality practices are fundamental Since 2003, Nespresso has been investing at farm level The AAA Farmers Award – a recognition
for farmers building an economically viable
– providing technical assistance, paying premiums and of excellence and dedication
delivering specific socio‑environmental projects to generate
coffee farming business. Through a process better and more sustainable quality. Every year since 2013, we have celebrated the outstanding
of continuous improvement and collaborative achievements of exceptional farmers and agronomists from every
effort, farmers are encouraged to learn‑by‑doing, producing country. They are welcomed to Switzerland to discover
A farmer’s journey towards the other end of the value chain: visiting our production centres,
with the support of our agronomists and trainers. sustainable quality meeting Nespresso employees, and discussing their coffees with
Club Members in boutiques.
As soon as coffee farmers join the AAA Program, they receive technical
assistance in the form of training sessions, individualised guidance and
a customised action plan. In return, there is a very clear expectation
that they will commit to achieving a set of socio‑environmental,
quality and productivity practices as defined in the Tool for the
Assessment of Sustainable Quality™ (TASQ™ CORE). A premium
is paid for the quantity of approved coffee they sell. However, an
important principle of the AAA Program is that farmers are under
no obligation to sell their coffee to Nespresso.
A closer look at
Tool for the Assessment of Sustainable Quality
(TASQ™)

>
300 >300 the number of
AAA agronomists
The TASQ™ assists farmers on their journey towards sustainable
quality and comprises three elements:
§§ Pre-requisites for entry – no child labour, no forced labour and
no incidence of harassment and abuse
§§ TASQ™ CORE consists of 39 criteria which must be met within
AAA farmers, Miller Hurtatiz and Marc-Aurelio Alonso, a three-year time frame
rewarded for their dedication §§ TASQ™ ADVANCED consists of additional criteria, guiding farmers
to further improve quality, productivity and sustainability and
advancing them to a possible certification. Certified farmers receive
additional premiums, not only for the coffee they sell to Nespresso,

90 90% of the AAA farmers are satisfied but also for the certified coffee they sell elsewhere
%
with the AAA Program (CRECE, 2012)
The Colombian Coffee Growers Federation (FNC) is a
long-standing partner of Nespresso for the implementation of the
AAA Program in Colombia. We jointly invested in regions like
Cauca, Nariño and Santander, distributing high quality coffee plant The critical role of suppliers and cooperatives
material and implementing water treatment systems and have
partnered on a significant water stewardship program in 25 water Coffee suppliers and cooperatives play a central role in the
basins in the country. The nature of this relationship has allowed us deployment of the AAA program, not only in the commercialisation
to work together on innovations such as the late harvest Naora of coffee but also in training and in monitoring the progress of
Limited Edition and Aurora de la Paz, a special coffee related to the farms.
the peace process in the country.
federaciondecafeteros.org These partnerships are organised through the “AAA shared
commitment”, a mutual agreement that places importance on
the long-term relationships with producers, transparency, economic
Daniel Augusto Delgado, an FNC AAA agronomist,
traceability to farms and agronomist workforce management.
training farmer Nilson Jair Diaz Muñoz
on agricultural practices

G4-12, G4-16, G4-LA15, G4-EN33, HR/CL-G4-DMA, G4-HR5, SDG SDG

THE POSITIVE CUP HR/FCL-G4-DMA, SO/LC-G4-DMA, G4-SO1 Learning Opportunities for All Promote Sustainable Agriculture 30/31
 COMPANY COFFEE ALUMINIUM CLIMATE

INNOVATION FOR COMMUNITY RESILIENCE

“With the retirement savings plan,
THE AAA PROGRAM the coffee farmers and their
PROMOTES COLLABORATIVE children can see a future.”
INNOVATION FOR Dario Soto, Chief Executive Officer, Fairtrade International

LONG -TERM COMMUNITY

STABILITY
Smallholder coffee farmers are exposed to Over recent years, the AAA Program has evolved to extend Community milling for Sustainable Quality –
uncertainties that hinder long-term planning and
its support beyond farm level. This means contributing to improve livelihoods and water stewardship
to strengthening community resilience and providing more
investments in their farms. Volatility of exchange security at a local level – with encouraging results already In many cases, smallholder farmers process coffee cherries on their
rates and market prices, and inconsistency in being observed in Colombia. The following innovations have own farms as there is no centralised infrastructure available to deliver
been piloted in specific AAA regions to test the potential the crop. “Wet milling” at farm level is hard work because the
crop quality have direct impacts on farm revenue.
for scalability. cherries are fragile and need to be processed within a few hours of
More and more, these risks are exacerbated the harvest to protect quality. This means long working days and
by external factors such as climate change, creates a significant risk to the quality, and consequently the value, Fairtrade International (FLO), the producer network of
Farmers can now plan for retirement of the production. Moreover, it requires proper water treatment
especially where economic securities such as Latin America* and Nespresso have been collaborating since 2013
installations that are often not in place, leading to water contamination to further promote farmers’ organisation and empowerment within
crop insurance and pensions are not in place. Social surveys in the Caldas region of Colombia, highlighted the fact for the community. A successfully managed centralised mill presents the AAA Program. This work also led to the design and implementation
As a result, the sector becomes less attractive that only 10% of the coffee farmers had access to a pension while their significant benefits. Some of these are reflected in the following of a savings plan for the retirement of coffee smallholders in the
average age was 53*. In 2014 Nespresso contributed to develop the results obtained with the Jardin community mill, a collaboration
to the next generation of coffee producers. region of Caldas, Colombia. The success of this program relied on
first-ever retirement savings plan for smallholder coffee farmers. The between the farmers, the cooperative of Antioquia, and Nespresso’s the collaborative engagement of local and national institutions.
long‑term relationship established through the AAA Program, served as partners Cafexport and USAID. *CLAC: Coordinadora Latino Americana y del Caribe de Pequeños Productores
a solid foundation for its implementation. This initiative also seeks to §§ 100% increase in the volume of AAA quality coffee y Trabajadores de Comercio Justo
incentivise the next generation to enter the industry. Developed §§ 17% increase in farmer income fairtrade.net
together with the Colombian Ministry of Labour, the Aguadas Coffee §§ 60% reduction in water usage
Growers Cooperative and Fairtrade International (FLO), the scheme §§ 100% of waste water is properly treated
provides farmers an additional 20% from the Colombian Government, §§ Three hours of time gained per farmer per day during harvest season
on top of farmers’ investment into the savings plan.
A closer look at
At the end of 2016, Nespresso had contributed USD 2.2 million,
crop insurance
benefiting around 1,100 AAA and Fairtrade-certified farmers, of which CHF 2.6m invested in innovative
35% saved additional money. The popularity of the initiative means that
now even non‑AAA farmers are enrolling. To our knowledge, a further
CHF
2.6m solutions (savings plan and
community milling)
Coffee smallholders do not have access to insurance schemes
that protect against climate change risks. Nespresso has partnered
two cooperatives have independently adopted a similar mechanism.
with Blue Marble Microinsurance to create a tailored crop insurance
*Source: CRECE
proposition. PlaNet Guarantee and the International Research
Institute for Climate and Society (Columbia University) started
to develop the basis for an index-based insurance system that
provides compensation when the weather index reaches certain
pre‑determined levels. Nespresso and Blue Marble Mircoinsurance
are collaborating with these partners and with AgriLogic to refine
this concept and implement a complete insurance proposition.
In 2017, this proposition will be piloted with AAA producers
in the Caldas region of Colombia.
Fair Trade USA has been collaborating with Nespresso since 2013 to
promote smallholder organisation and community-led development
projects in areas where farmers lack formal organisational structures, Central Mill, Jardin, Colombia
such as cooperatives. Working closely with the Colombian Coffee
Federation, Fair Trade USA has certified more than 6,800 smallholder The objective of this first mill in Jardin was to test the operational What’s next
farmers in the Southern Colombian regions of Cauca and Nariño. feasibility of centralised coffee processing in Colombia. In 2015,
a second initiative was launched with the objective to pilot a financial §§ Consolidate the learning of Huila community mill business
In 2016, the newly-formed Fair Trade committees, elected by the farmers
model supported by impact investment for scalability. In collaboration model for scaling
themselves, decided to invest their development funds in potable
with Acumen and the farmers’ group “El Desarrollo”, we invested §§ Test the crop insurance model in Caldas
water projects and collective procurement actions to facilitate access
to agricultural nutrients for improved productivity. in a new community mill in Huila (Colombia) which started production
AAA farmers at the launch of the Farmer Retirement fairtradeusa.org in September 2016. Results are currently being monitored.
Savings Plan, Aguadas, Colombia, 2014

SDG SDG SDG

THE POSITIVE CUP G4-16, EN/WA-G4-DMA, G4-HR6, SO/LC-G4-DMA, G4-SO1 End Poverty Water Stewardship Partnerships 32/33
 COMPANY COFFEE ALUMINIUM CLIMATE

OUR APPROACH TO NATURAL CAPITAL

“Integrated landscape management is
QUALITY COFFEES ARE critical for protecting biodiversity and
HIGHLY DEPENDENT ensuring community stability.”
ON HEALTHY Inger Andersen, Director General, IUCN

ECOSYSTEMS

Every business relies on services provided Our approach to Natural Capital seeks to understand our
impacts and how to steer our operation to protect and restore
by nature and functioning ecosystems.
the natural resources that coffee stakeholders, and more
However, commercial activities impact on these generally communities, depend upon.
environmental systems. The Natural Capital
movement aims to encourage government,
A need to act beyond the AAA farm borders
civil society and the private sector to work
together to value and manage these The distinct flavours of our Grands Crus derive from the terroirs The International Union for the Conservation of Nature
in which they originate. This approach to sourcing has highlighted (IUCN) and Nespresso began working together in 2009. Today,
environmental assets. our collaboration focuses on better understanding our impacts
the need to encourage the sustainable use of land beyond the
boundaries of AAA farms. That’s why the AAA Program has, since and dependencies on nature and communities, as well as exploring
its inception, promoted environmental practices which protect and an integrated landscape management approach. In 2016, the piloting
restore ecosystems. However, to focus our actions and maximise of the Natural Capital Protocol (NCP) for businesses aimed to explore
positive impacts, a better understanding of Natural Capital values how to value Natural Capital for improved decision-making. Equally,
– such as biodiversity, water and soil – and our role as a landscape it allowed the IFC Colombian pilot to understand the links and
stakeholder, have become essential ingredients of our strategic relationships between government, business and the financial sector
planning. To put this into practice, we are testing various tools and relating to Natural Capital.
Coffee landscape in the region of Cerrado Mineiro, Brazil
approaches to guide our actions on the ground.
IUCN played an instrumental role in coordinating the development
of the first sustainable aluminium standard for the industry in 2015. A closer look at
From biodiversity assessment to iucn.org Consórcio Cerrado das Āguas
biological corridors naturalcapitalcoalition.org/protocol
Nespresso commissioned IUCN in 2013 to conduct an Ecosystems
The Integrated Biodiversity Assessment Tool (IBAT) provides insight Services Review (ESR) of the Cerrado Mineiro region. This review
into biodiversity risks and opportunities with biodiversity. In 2016, with had the ambition to understand how sustainable coffee agriculture
the support of IUCN, 40,000 Colombian AAA farms were mapped could significantly contribute to the conservation and use of
in IBAT. 10% of these appeared to be positioned within 2km of biodiversity and water. The learnings resulted in the establishment
Key Biodiversity Areas (KBA). To complete the assessment, IUCN is of a cross‑sector platform “Cerrado das Águas” to enable collective
currently identifying the critical biodiversity values for which these actions in integrated landscape management and positive impact.
10% of AAA farmers have a role to play. This includes, for example, The platform’s stakeholders have agreed to explore the innovative
the AAA farmers of the Galeras area in Nariño, Colombia, who approach known as “No Net Loss (NNL)/Net Positive Impact (NPI)”.
joined a national effort to build biological corridors supported by
the Global Environment Facility (GEF) and the World Bank. The approach requires an understanding of the critical services
supplied by the landscape. By the end of 2016, with the support
A comprehensive screening of the AAA farmers’ practices will make of Imaflora, the local SAN partner, the consortium had designed
it possible to identify the opportunities that the AAA Program brings an “NPI” action plan, which is now being piloted in Patrocinho.
to biodiversity. *https://portals.iucn.org/library/sites/library/files/documents/2015-003.pdf

ibat-alliance.org

What’s next

§§ Develop a financing model for the Brazil Cerrado consortium

§§ Screen the AAA sourcing regions against risks and opportunities
related to Natural Capital
The map represents the proximity of AAA farmers
§§ Rollout the biodiversity assessment framework using IBAT
in Nariño to the protected area of Galeras
(inside the red line)

SDG
THE POSITIVE CUP G4-16, EN/WA-G4-DMA, EN/BI-G4-DMA, G4-EN14 Natural Capital 34/35
 COMPANY COFFEE ALUMINIUM CLIMATE

THE AAA PROGRAM IN EAST AFRICA

“Kenyan and Ethiopian coffees offer unique qualities.
A A A IN EAST AFRICA There are significant opportunities for improvement
FULFILS OUR that require different ways of working.”
100% SUSTAINABLY William Warshauer, President, TechnoServe

SOURCED COFFEE
COMMITMENT
Initially deployed in Latin America and Asia, The specific nature of the coffee trading model in Kenya
and Ethiopia, with limited traceability to farm and limited
the AAA Program has acquired solid credentials
20k
opportunity to build direct relationships with coffee producers, Over 20,000 farmers trained
over 13 years. In line with our commitment makes it difficult to implement the AAA Program in its current
>
since 2013
to 100% AAA sourcing, it has been expanded form. In addition, typical farms are small in scale and have low
productivity. Therefore, in keeping with the principles of the
into East Africa – an area known as the
AAA Program, Nespresso works at community milling level,
“cradle of coffee”. Its coffees are recognised intervening through technical assistance at farm level, in the
Support at mill level focuses on TechnoServe and Nespresso have been working together since
as some of the world’s finest and are in high regions producing our coffee.
social and environmental compliance 2006 to implement better business skills and agronomy solutions for
demand on the international coffee market. AAA farming communities. Their robust technical assistance model
On the whole, non-compliance is mainly related to environmental and strong field presence has helped in adapting and expanding
AAA in East Africa is building capacity the AAA Program to the African context. They are instrumental in
criteria. Many wet mills in Ethiopia and Kenya use outdated processing
to act at farm and mill level operationalising the Nespresso Creating Shared Value approach,
technologies that overuse water and do not treat waste water
discharge appropriately. New techniques and technologies are being with the contribution to the re-establishment of coffee supply
The focus of the technical assistance is twofold, upgrading wet chains in South Sudan and the introduction of the Cuban Grand
implemented as solutions. Beyond the environmental performance,
mill practices in terms of sustainable quality and driving farm level Cru coffee in the USA.
agronomists assess compliance with social TASQ™ CORE criteria.
productivity and resilience. Since 2012, TechnoServe has been technoserve.org
This enables early detection and mitigation of non-compliance.
instrumental on the ground in the deployment of the AAA Program.
Over 90 AAA agronomists have been recruited and trained
and around 1,000 demonstration plots were set up to demonstrate
practically the positive impact of best practices.
What’s next

§§ Expand record-keeping training for smallholders

§§ Rollout of the fair treatment awareness campaign

140
>
Over 140 wet mills enrolled in training
since 2013

A closer look at
Support at farm level Abebech Kassaye
focuses on productivity increases
Old and unproductive coffee trees are the reality for smallholder
Pruning and plant rejuvenation are key practices which significantly farmers in Ethiopia. Historically, very few were prepared to cut these
boost coffee tree yield. Yet only around a quarter of smallholders trees at the base for rejuvenation because of the fear of losing the
are currently applying these practices. This highlights a significant little production they may get the following year. Yet rejuvenation
opportunity to improve farm revenue, bringing wider community results in the trees producing substantially more coffee within
benefits. Demonstration plots help farmers see the benefits first-hand just two years. After participating in some AAA training in 2015,
and are a critical part of the training we provide. Abebech Kassaye, an AAA farmer, changed her mind and said:
“When I observed the stumped coffee trees in the demonstration
Our first assessment, based on a sample of farmers, shows that many plot, I was convinced that I could harvest a small crop in just change
of them are adopting yield-driving practices such as composting year. I would like to be a model farmer for others... to encourage
and pruning. my community to adopt agronomic activities on their farms too.” AAA farmer, Abebech Kassaye together with TechnoServe
country manager Mefthe Tadesse
Abebech is an outstanding example of how women farmers can
play a critical role in the local community and its coffee sector.

Shemole and Challa Didamo receiving the

AAA Farmer’s award 2014, Sidama, Ethiopia

SDG SDG
THE POSITIVE CUP G4-12, G4-16, G4-HR4, G4-HR5, G4-HR6, G4-SO1 End Poverty Promote Sustainable Agriculture 36/37
 COMPANY COFFEE ALUMINIUM CLIMATE

COFFEE REVIVAL
“I was moved by your work in South Sudan.
QUALITY COFFEE It’s the only good news I’ve heard
REVIVAL CAN OFFER from there for a while.”
A MORE RESILIENT Sharon Waxman, President, FLA

FUTURE FOR FARMING

COMMUNITIES
Quality coffee cultivation has been in decline Together with our partner TechnoServe, we have been exploring Suluja ti South Sudan:
the potential of these lost coffee origins, in terms of rarity of reviving rare coffees
in some regions, where it was once a thriving quality and flavour, as well as the economic development
agricultural sector. Sometimes these regions opportunity for local communities. This has led to a focus on South Sudan’s coffee industry was largely destroyed during 40 years
are home to rare, even uncatalogued varieties what we call “Coffee Revival” – an opportunity to re-inject of civil war. Part of the “cradle of coffee”, it is one of the only places
economic dynamism and market access to catalyse wider in the world where Arabica and Robusta coffees grow in the wild.
of wild coffee (Arabica and Robusta). Their community development. These initiatives give Nespresso The United States Agency for International Development (USAID)
Encouraged by George Clooney – himself heavily engaged in the
microclimate gives rise to unique taste profiles. consumers access to rare coffees and contribute to a more development of the region – Nespresso partnered with TechnoServe
has contributed to a number of Nespresso projects in the areas of
resilient future for farming communities. community resilience and economic development in Colombia.
and the Ministry of Agriculture of the Republic of South Sudan to
revive high quality coffee production in the country. The work began
In 2016,they signed a three-year partnership for USD 3.18 million with
in 2011 and by the end of 2013, the country’s first coffee cooperatives
Cafecito de Cuba: were established and the first three wet mills constructed. In October
Nespresso and TechnoServe to strengthen efforts to rebuild the
rediscovering quality with character 2015, with the launch of the Grand Cru Suluja ti South Sudan,
coffee industry in the new country of South Sudan.
usaid.gov
Nespresso became the first roaster to offer South Sudanese coffee
Cuba has produced some of the greatest Arabica coffee in the world. to consumers abroad. Despite the recent developments and return
With fertile soil and ideal climate conditions, the country offers an to armed conflict in the region, we continue to be committed to
excellent coffee growing environment. In recent decades, Cuban the revival of the coffee sector.
coffee has not been available in commercial export volumes. In 2015,
Nespresso started to explore the opportunity to strengthen trade
relations with the smallholder coffee sector in the east of the country. SOUTH SUDAN, THE BOMA REGION:
CRADLE OF COFFEE
Cafecito de Cuba was launched as the first coffee from Cuba
available in the US market for over 50 years, after the opening up
of commercial links between the countries. At the end of 2016,
Nespresso initiated a plan to support the development of sustainable
coffee farming practices for smallholder farmers. This benefits both
the farmers and their communities, as well as making the
exceptional character of Cuban coffee available to consumers
around the world.

Jennifer Poni receiving the Nespresso Sustainability Award

from Patrice Bula, Executive Vice President at Nestlé

A closer look at
USD
3.18m USD 3.18m partnership
with USAID
Jennifer Poni

Agronomist Jennifer Poni is a leader in South Sudan’s coffee industry

and a trailblazer for women farmers in her community. Having fled
the war in the 1970s, she is now the first AAA agronomist in
What’s next
South Sudan, working with TechnoServe, teaching best practices
We aim to enrol over such as stumping and pruning. She shows farmers – and in particular
Contribute to the post-conflict settlement in Colombia
with the launch of the Grand Cru, Aurora de la Paz
>
2,000 2,000 smallholder farmers
in the AAA Program by 2020
women in the community – how they can reap the rewards of
sustainable coffee growing.
A farmer drying coffee in the Eastern Cuban region which
produces Cafecito de Cuba, Cuba

SDG
THE POSITIVE CUP G4-16, HR/CL-G4-DMA, SO/LC-G4-DMA, G4-SO1 Peace 38/39
 COMPANY COFFEE ALUMINIUM CLIMATE

MONITORING AND EVALUATION

“Since 2009, Nespresso has put effort into building
TOOLS AND TECHNOLOGY a comprehensive and robust monitoring and
FACILITATE THE evaluation system using advanced technology.”
MONITORING AND Carlos Ariel Garcia, Project Coordinator, CRECE

STEERING OF AAA IMPACT

Since 2009, Nespresso has been engaged A monitoring and evaluation tool provides third party Fair treatment compliance is Progress report on the AAA Program
in better understanding the effects of the
verification of AAA progress as well as insight into the a critical foundation of AAA
critical drivers of change. 2016 ACHIEVEMENTS
AAA Program. In 2015, a comprehensive The Tool for the Assessment of Sustainable Quality, TASQ™ Volume traceability
“Theory of Change” was developed to define incorporates as pre-requisites, critical practices regarding fair treatment VOLUME OF COFFEE DELIVERED AT FACTORY
Our management system provides such as harassment, child labour, minimum wage, and freedom of
the pathway between field activities and
feedback and insight on AAA impact association. Failure to comply at any point in time with any of these
long-term impact. criteria triggers an alert within the F.A.R.M.S. and a mitigation plan 100%
The activities at AAA farm level (including commercial transactions, is put in place by a specific taskforce. After non-compliance is assessed
agronomist visits and farm assessments) are consolidated in a and confirmed, farmers or wet mills are given 90 days to resolve including 41% from farms which are
Rainforest Alliance Certified™, Fairtrade-certified
management system named F.A.R.M.S. (Farm Advanced Relationship the issue, with another assessment undertaken within this period and/or Fairtrade Certified™
Management System). When visiting farmers, AAA agronomists to re-verify compliance. If this is not achieved, farms are excluded
use the mobile application of F.A.R.M.S. The interface provides an from the AAA Program.
at-a-glance status of the farm including objectives, achievements,
performance and the agronomist’s previous review. This information 82% 18%
is accessible globally and provides a consolidated status of the
AAA Program’s deployment. sourced from AAA Program sourced from Nespresso compliant
suppliers matching Nespresso quality
requirements
Since the end of 2015, the farm assessment by AAA agronomists
has been complemented with data collected by the Sustainable
Agricultural Network (SAN), into a consolidated monitoring and
evaluation tool (M&E). Developed together with the Rainforest
Alliance and CRECE, the M&E tool helps qualify the underlying 74% 8%
drivers of change and integrates new insights across the coffee
with full traceability based on mass balance approach, i.e. the volume
supply chain. to farm of Nespresso coffee purchased vs. volume produced
by the Ethiopian and Kenyan wet mills receiving support
from the AAA Program
Around 140 data points per farm are monitored to report the
performance of the AAA Program in five areas: coffee quality and Compliance vs. socio-environmental criteria
farm productivity, social wellbeing, environmental protection, farmer AAA FARMS AND WET MILLS ASSESSED
livelihood and satisfaction. Following a pilot phase in two regions of A farm's performance scorecard – available
Colombia in 2015, the tool has been deployed in Latin America to agronomists via the F.A.R.M.S.
and Asia.
LATIN AMERICAN AND EAST AFRICAN
ASIAN FARMS WET MILLS

What’s next

§§ Build carbon footprint related data into the M&E tool 98% 100%
§§ Align the methodology of reporting AAA volume and
assessed assessed
progress in Africa with Latin American and Asian reporting Fair Labor Association (FLA) has been instrumental in reviewing
the social criteria of TASQ™, our farm assessment tool. Moreover,
the organisation also developed all methodologies relating to the
implementation of the social module. The president of Fair Labor
1.8 1.2
Association is a board member of the Nespresso Sustainability average non-compliant average non‑compliant
Advisory Board (NSAB). criteria (vs. 16 criteria) criteria (vs. 14 criteria)

fairlabor.org
RECURRENT NON-COMPLIANT CRITERIA
§§ Protective clothing for
Interactive data reporting from F.A.R.M.S. agrochemical application
§§ Agrochemical safe storage
used by management §§ Waste water treatment

G4-16, G4-EN33, G4-EN/SEA-G4-DMA, G4-HR4 HR/FCL-G4-DMA, G4-HR5 HR/FCL, SDG SDG

THE POSITIVE CUP G4-HR6 HR/SHR-G4-DMA, G4-HR11, G4-LA15, HR/FAC B-G4-DMA, LA/SALP-G4-DMA Inclusive Growth Promote Sustainable Agriculture 40/41
 COMPANY COFFEE ALUMINIUM CLIMATE

THE SCOPE OF THE AAA PROGRAM

“The efficiency of AAA is that it offers a global
OVER 70,000 FARMERS framework adapted to local challenges.”
ARE PART OF THE AAA PROGRAM Paulo Barone, Head of AAA operations, Nespresso

MEXICO Arnoldo maintains his family-run farm,

where he grows a small assortment
SINCE 2004 of Arabica coffee varieties, such as
>1,300 FARMS Bourbon, intercropped with other
≈3,800HA
GUATEMALA
plants such as citrus and shade trees.
Since 2011, he has held a leadership
role as manager of an association of
82 %
82% of our coffee is sourced
via the AAA Program
SINCE 2005 around 70 coffee farmers in the area.
>880 FARMS
SOUTH SUDAN
Arnoldo Cifuentes Matías SINCE 2015
≈6,500HA >700 FARMS
AAA Farmer in Guatemala,
≈420HA
COSTA RICA
Huehuetenango
Farm size: 2ha
SINCE 2003
>3,700 FARMS
Joined AAA in 2014
ETHIOPIA Titin is considered a leader within
SINCE 2012 the farmer group of her cluster
≈22,400HA
>14,600 FARMS (with 49 farmer members). Thanks to
her pioneering spirit, she has inspired
N I CA R A G U A
SINCE 2009 ≈3,900HA other women to become independent
>60 FARMS farmers and to improve farmer

KENYA
4,600HA livelihoods. She has been awarded by
INDIA
COLOMBIA SINCE 2014 SINCE 2011
the cluster with the “Women Pioneer
Coffee Farmer Award 2015”.
SINCE 2004 >7,400 FARMS
>1,300 FARMS
Titin Uhan
≈32,000HA
>37,800 FARMS AAA Farmer in Indonesia
≈2,000HA Farm size: 2ha
≈63,200HA Joined AAA in 2014

BRAZIL
SINCE 2005 INDONESIA
SINCE 2014
>2,600 FARMS >970 FARMS

≈1,070HA
≈133,000HA

PERU
SINCE 2014
>100 FARMS

≈1,700HA

Since starting to work with

Nespresso, Isaya has used the
revenue from coffee to pay school
41% of our coffee comes from fees, cover hospital bills and hire

41 farms which are Rainforest Alliance farm labour. He also used his 2014
% harvest earnings to invest in a
Certified™, Fairtrade-certified brick‑making business, as he plans
AAA has helped Diogo transition
and/or Fairtrade Certified™ from a family farm to a business to create a more diverse and secure
farm with specific goals. This included income for his family.
the cultivation of specialty coffees,
preserving the environment and Isaya Lokolong Latiyo
satisfying the people involved, from Coffee Farmer in South Sudan, Yei
his employees to the final consumer. Farm size: 2.5ha (1ha of coffee)
Joined AAA in 2014
Diogo Dias Teixeira de Macedo
AAA Farmer in Brazil, Vale do Grama
AAA Farm size: 596ha
(220ha of coffee)
Joined AAA in 2009

73 %
73% of the AAA farmers are smallholders
located in Colombia and Ethiopia 300k ha
300,000ha managed
by AAA farmers

THE POSITIVE CUP G4-6, G4-9, EC/PSP-G4-DMA, G4-FP2 42/43

 COMPANY COFFEE ALUMINIUM CLIMATE

How does Nespresso

unlock solutions for
A LU M I N I U M
the circular use
of aluminium?
OUR CHOICE OF ALUMINIUM REQUIRES
ENGAGEMENT IN SOURCING
AND RECYCLING

THE POSITIVE CUP G4-EC2 44/45

 COMPANY COFFEE ALUMINIUM CLIMATE

WHAT REALLY MATTERS

“The future will be about innovation
ALUMINIUM HAS THE towards a circular economy.”
POTENTIAL TO BE AN Peter Bakker, President and Chief Executive Officer,

ICON FOR SUSTAINABLE World Business Council for Sustainable Development (WBCSD)

CONSUMPTION

To protect the flavours and freshness of our What really matters

highest quality coffees from the adverse effects To promote sustainable production and the circular use of aluminium
of light, air and humidity, aluminium is
the best material available today. Moreover,
75 % Our aluminium capsules have become iconic as a hallmark of design and quality. Using the materiality assessment
as a basis, we are working proactively with civil society and supply chain stakeholders to tackle the upstream
it is robust, yet lightweight, and can be challenges of sustainable aluminium production, for the primary aluminium we use. Equally, we work at national
and municipal level to maximise the circular potential of capsules after use thereby increasing secondary
infinitely recycled. 75% of the aluminium ever
aluminium use.
produced is still in use today

Our decision to use this material for our capsules CIRCULAR SOLUTIONS
Consumer value proposition
is sometimes questioned. We therefore recognise Secondary aluminium use
Human rights Climate change
SUSTAINABLE PRODUCTION
our responsibility to continue to invest in and
67
Traceability Water stewardship

promote its sustainable usage. % Carbon efficiency Resource efficiency & waste
Human and labour rights
Natural capital protection
Together with IUCN and other partners, Business integrity
67% is the energy saving
Nespresso initiated the aluminium industry’s first of using sustainably mined
Community development
& unemployment
Natural capital

global standard regarding traceability and and refined (ASI) aluminium

STAKEHOLDER CONCERN
COLLECTIVE RESPONSIBILITY
socio-environmental performance. And alongside Business ethics
Seamless post-use collection systems
Public sector engagement on material recovery
a range of local partners, we invest in dedicated Traceabillity

recycling channels as well as collective schemes, Responsible marketing

to unlock circular solutions with the aim of

achieving sustainable consumption.

SIGNIFICANCE OF NESPRESSO IMPACT

Our 2020 ambition and goals

End to end sustainably managed aluminium
2016 achievements status
Offer convenient recycling solutions
86% collection capacity
to all our consumers
Continue to increase capsule recycling rate +9 pp (vs. 2009)
Unlock the circular use of aluminium Capsule to capsule supply chain in place
Source “ASI certified” aluminium towards 100% ASI Performance Standard now available

Achieved On track for 2020 Not on track for 2020

EC/IEI-G4-DMA, EC/PSP-G4-DMA, EN/MA-G4-DMA, EN/PS-G4-DMA,

THE POSITIVE CUP EN/OV-G4-DMA, HR/ND-G4-DMA, HR/FAC B-G4-DMA 46/47
 COMPANY COFFEE ALUMINIUM CLIMATE

THE BENEFITS OF ALUMINIUM

“Aluminium is a sustainable and even
ALUMINIUM permanent material – it is produced, used
PROTECTS AROMAS and endlessly recycled without losing its
AND FLAVOURS AND IS intrinsic and valuable properties.”
INFINITELY RECYCLABLE Maarten G. Labberton, Packaging Director, European Aluminium Association

ORIGINAL Aluminium keeps coffee fresh A closer look at

the aluminium supply chain
Food grade layer Aluminium has been widely used for decades to wrap sensitive
food products such as butter, chocolate, roast and ground coffees.
Filter UPSTREAM PRIMARY PRODUCTION
It’s ideally suited as it prevents exposure to oxygen, moisture and
light, which would degrade the quality of our coffees. More generally,
Aluminium foil it protects any food from degradation, reducing waste.

Roast and ground coffee In our capsules, the coffee is not in direct contact with the aluminium Bauxite mining
Alumina production
foil due to a food grade protection. Therefore, aluminium can never
Aluminium membrane
migrate into the cup during the brewing process.

Seal

Aluminium is infinitely recyclable Primary production

Aluminium offers usage versatility and performance. As a result

of its intrinsic characteristics of robustness and recyclability, 75%
of the aluminium ever produced is still in use today. Aluminium DOWNSTREAM
“lightweights” transport to reduce fuel consumption and resists MANUFACTURING/RECYCLING
PROFESSIONAL
corrosion to last for decades in the construction and automotive
Recycling production
industries, in solar panels and more. No matter how long it is used
Food grade layer for, recycled aluminium retains the same technical properties as primary
aluminium.
Aluminium foil

Investing in effective recycling systems at scale and engaging with the Recycling Semi-fabrication
Roast and ground coffee
public is critical to make the most of these properties.

Aluminium remains our preference

for quality and sustainability
Use phase Product manufacture
Nespresso uses aluminium because it embodies both functional
VERTUO and environmental attributes. It protects the aromas and flavours of
our coffees to ensure every cup is of consistent quality. And it’s not
Food grade layer just recyclable but infinitely recyclable. We choose to continue to use
this material and commit to actively contributing to the creation of a
Aluminium foil responsible aluminium supply chain, as well as implementing material
stewardship principles in our business.
Roast and ground coffee

Aluminium membrane

86 %
86% of the carbon footprint of aluminium
occurs between mining and production 95 %
Producing aluminium from already-used
aluminium saves energy by 95%

Aluminium foil used for the capsule membrane

THE POSITIVE CUP G4-12 48/49

 COMPANY COFFEE ALUMINIUM CLIMATE

OUR APPROACH TO ALUMINIUM STEWARDSHIP

“ASI has raised the bar for
THE ALUMINIUM multi‑stakeholder collaboration on
STEWARDSHIP INITIATIVE (ASI) end to end material management.”
DRIVES THE RESPONSIBLE Giulia Carbone, Deputy Director, Business and Biodiversity Programme, IUCN

AND TRACEABLE SOURCING

OF ALUMINIUM
In 2009, Nespresso approached the International The formation of ASI has led to the development of a “ASI certified” means human rights respected
Union for the Conservation of Nature (IUCN) to
certification program, designed to address the challenges upstream in the value chain
within the aluminium sector and to generate positive impacts
trigger the development of a global standard for on communities, biodiversity and climate. The ASI Performance Topics relating to human rights are highly material in the mining
sustainable aluminium production and sourcing. Standard and ASI Chain of Custody Standard form the core of and industrial sectors of aluminium. The ASI Performance Standard
the certification program. Nespresso representatives currently embeds three principles related to human rights.
The resulting partnership inspired 13 other
serve on the ASI Board and the Standards Committee.
companies and 14 civil society and stakeholder Emissions, Effluents and Waste (Principle 6) commits companies to
organisations to get involved (2013‑2014) to minimise emissions and effluents that have adverse effects on people
Lower carbon footprint of or the environment and to manage waste effectively – in accordance
create what is now known as the Aluminium
“ASI certified” aluminium with the waste mitigation hierarchy. Human Rights (Principle 9)
Stewardship Initiative. commits companies to take appropriate action to assess, prevent
Due to its energy intensity, the production of primary aluminium and remedy potential adverse impacts on human rights – in‑line
from bauxite has a high carbon footprint. Materials Stewardship and with international protocols. Labour Rights (Principle 10) commits
Greenhouse Gas Emissions (Principles 4 and 5 of the ASI Performance companies to provide workers with decent work and to treat them
Standard) will play a key role in reducing the carbon footprint of ASI with dignity and respect, in-line with ILO conventions.
aluminium – which in turn will result in the reduction of the carbon
footprint of a Nespresso capsule. Principle 4 ensures that aluminium
production scraps and after-use products will be managed to produce “ASI certified” will provide full transparency
aluminium, while avoiding bauxite from mining impacts and energy and traceability of the aluminium in
usage. Principle 5 commits companies – specifically primary aluminium our capsules A closer look
companies – to reduce and limit their GHG emissions from at ASI Principles
a life cycle perspective. Until now, our suppliers have been assessed against SMETA 4-Pillars
(Sedex Members Ethical Trade Audit). These cover national compliance The ASI legal entity was created in 2015 as an independent,
and best practice in labour, health and safety, and environmental multi-stakeholder, membership-based organisation with a mission
“ASI certified” means biodiversity and business ethics practices. By the end of 2015, our direct capsule to collaboratively foster responsible production, sourcing and
conservation in mining suppliers had achieved full SMETA compliance (Tier 1). The ASI stewardship of aluminium. Civil society organisations have joined
certification program will enable compliance with a wider scope ASI as members to help build the program to ensure it is credible
The ASI compliant companies in mining have committed of sustainable practices in the value chain and lead to improved and rigorous. 11 principles underpin the ASI Performance Standard
to managing biodiversity impacts (Principle 8). This requires them to: transparency and traceability up to the bauxite mining phase. which will be complemented by the ASI Chain of Custody Standard.
1. Avoid and minimise the negative impacts of mining activities
2. Undertake on-site rehabilitation and restoration where feasible 1 Business Integrity
3. Fully compensate for any residual impacts, such that no overall What’s next GOVERNANCE 2 Policy and Management
biodiversity loss results from a development project 3 Transparency
§§ ASI to launch the full certification program by the end of 2017
ASI companies have also committed to never undertaking §§ Nespresso to encourage suppliers to self-assess their performance 4 Material Stewardship
development within World Heritage sites. against the ASI Performance Standard 5 Greenhouse Gas Emissions
§§ Nespresso to source “ASI certified” aluminium towards 100% ENVIRONMENT 6 Emissions, Effluents and Waste
by latest 2025 7 Water

8 Biodiversity

9 Human Rights
SOCIAL 10 Labour Rights
11 Occupational Health and Safety

Discover more at aluminium-stewardship.org

Aluminium blocks from collected capsules

to be recycled, Switzerland

G4-16, G4- EN/SEA-G4-DMA, EC/PSP-G4-DMA, EN/EM-G4-DMA, SDG

THE POSITIVE CUP EN/EN-G4-DMA, HR/SHR-G4-DMA, LA/SALP-G4-DMA Sustainable Consumption and Production 50/51
 COMPANY COFFEE ALUMINIUM CLIMATE

CAPSULE LIFE CYCLE MANAGEMENT

“In Germany, Nespresso capsules can be put into
RECYCLING IS household recycling bins. Modern technology can
A COLLECTIVE sort out the capsules for aluminium recycling.”
RESPONSIBILIT Y Dr. Markus van Halteren, Managing Director,“Der Grüne Punkt” Duales System Deutschland

TO UNLOCK THE
VALUE IN ALUMINIUM
Nespresso’s first capsule recycling initiative began in 56% of our used capsules are valorized Progress report on
Switzerland in 1991. Ever since, we have been developing
used capsule valorization
partnerships and driving initiatives that fit the context Approximately 56% of Nespresso capsules sold today are used to
of the markets in which we operate. create value after consumption. Almost half of these are recycled 2016 ACHIEVEMENTS
directly. The remainder are valorized to generate energy, and the
aluminium from almost half of those capsules is subsequently recycled.
Nespresso and the local infrastructure
build capsule collection capacity Our focus is on continuing to increase capsule collection capacity as
well as informing consumers on how to recycle their used capsules.
Collaboration between Nespresso, policymakers and local The combination of these actions will translate into improving the
municipalities provides the capacity for capsule collection i.e. the
capacity to collect capsules after use in a way that is convenient for
circular use of aluminium.
56%
consumers. In certain countries (e.g. Germany, Sweden and Finland)
consumers simply dispose of their capsules in the same way they do Capsules can become new capsules of post-consumption capsules are valorized
for other household packaging – via the relevant Packaging Recovery
Organisation (PRO) scheme. In countries where this is not yet feasible, The recycled aluminium which is most suitable for the manufacture
Nespresso partners with and incentivises the relevant PRO to collect of Nespresso capsules is the aluminium from used Nespresso capsules,
and recycle the capsules. Where neither of these options is open to us, which are made from the same specific alloy. Therefore, wherever
24% 32%
From capsule From other
we have established ad-hoc collection options in Nespresso boutiques, capsule collection channels exist – and it makes environmental collection capacity processes
and across various pick-up points and local waste centres. We also and economic sense – we promote a circular approach to the
partner with postal services or courier companies to collect used management of used Nespresso capsules.
capsules directly at home. Collective capsule collection systems make 24% of our capsules are recycled, either §§ Estimated 18% from post-consumer
through Nespresso established recycling waste with aluminium recovery and
both environmental and economic sense – they improve the circular In 2013 we began piloting the feasibility of this capsule-to-capsule programs or through national recycling energy generation
use and re-use of materials such as aluminium and are more cost approach, which became operational in 2015, and has led to the schemes; coffee is transformed into §§ Estimated 14% from post consumer
effective solutions on a cost per collected capsule basis. production of 10 million capsules. Whilst the volume is still limited, biogas, heat or compost use with energy generation

this initiative has been widely publicised on-pack to draw our

consumers’ attention to the benefits of the circular use of
materials and recycling.
In 2016, Nespresso spent CHF 24.6m
CHF
24.6m on collecting and recycling capsules
– an increase of CHF 6.3m over 2015

What’s next
Since 1993, Nespresso has been working with Duales System
§§ Drive the recycling rate of capsules in line with the increased
Deutschland (DSD) in Germany to access the collective system
target of the EU Circular Economy Package, through extended
for capsule recycling. DSD has been an important advocate and
collective collection systems
ambassador for the collection of small metal packaging materials,
§§ Implement independent third party verification tool for capsule
and more broadly for a new circular economy. This has enabled
collection capacity and recycling rate
Nespresso to benefit from an aluminium packaging recovery system
which generates a high 85% recovery rate in the country.
gruener-punkt.de

The recycling at home solution in Switzerland

G4-12, G4-EC7, EN-28, EN-31, EN/EM-G4-DMA, EN/MA-G4-DMA, SDG

THE POSITIVE CUP EN/OV-G4-DMA, EN/SEA-G4-DMA, G4-EN2 EN/EN-G4-DMA, G4- EN/PS-G4-DMA Sustainable consumption and production 52/53
 COMPANY COFFEE ALUMINIUM CLIMATE

THE SCOPE OF OUR RECYCLING ACTIONS

“When I discovered I could recycle the
PRACTICAL LOCAL capsule, I bought a machine.”
SOLUTIONS HELP OUR Nespresso Club Member, France

CLUB MEMBERS TO Limited Edition

Taschenmesser VICTORINOX

RECYCLE CAPSULES Das war eine Nespresso Kapsel.

Anlässlich 25 Jahre Recycling der Aluminiumkapseln ist Nespresso Partnerschaften
eingegangen, um aus dem Aluminium der gebrauchten Kapseln Schweizer Design-
Objekte mit Kultstatus zu kreieren. Aus der Zusammenarbeit mit Victorinox entstand
dieses «Pioneer»-Taschenmesser, dessen Alox-Schalen aus 100 Prozent recyceltem
Aluminium gebrauchter Nespresso Kapseln gefertigt wurden.

Mehr dazu unter

nespresso.com/secondlife
Oder diesen Code scannen:

USA SWITZERLAND
RECYCLING IN PLACE SINCE: 2010 RECYCLING IN PLACE SINCE: FA_Display_Knife-25Years-DE_BS_160628.indd 1

1991 04.07.16 14:44

COLLECTION CAPACITY: 100% COLLECTION CAPACITY: 100% 86% global collection

KEY PARTNER:
INCREASE OF RECYCLING RATE VS. 2015:
UPS
+4PP
KEY PARTNER:
INCREASE OF RECYCLING RATE VS. 2015:
BAREC
+8PP 86 % capacity, with a target of 100%
for 2020

25 YEARS CELEBRATION
OF RECYCLING
CONSUMER CAMPAIGN

Katarzyna is the Sustainability Manager

of Nespresso France. With the support
of the market head, she established
the CELAA, a group committed to
the recycling of small aluminium and
steel packaging in collaboration
with Eco‑Emballages, the national
Judith is the Technical and Quality Director at framework organisation for
Nespresso USA. Together with her team, collective recycling in France.
she has reached a 100% recycling capacity Consumers are encouraged
rate in the USA. Customers can recycle to use the collective system via
their capsules either through a UPS mailback a communication campaign Désormais, déposer vos capsules Nespresso
dans le bac de recyclage, c’est possible !

program or by dropping off capsules at named “Trop Facile” (too easy).

Nespresso boutiques or selected retail
partners. In addition, the team is always Marta is the Technical Quality Manager
looking for new ways to recycle the for Australia. Together with her team and
capsules to make it as convenient FRANCE the marketing team, she has developed
as possible for consumers. recycling solutions with Australia Post,
RECYCLING IN PLACE SINCE: 2008
enabling consumers to post their used
COLLECTION CAPACITY: 91% capsules back to Nespresso for recycling.
KEY PARTNER: ECO-EMBALLAGES
INCREASE OF RECYCLING RATE VS. 2015: EQUAL

AUSTRALIA
RECYCLING IN PLACE SINCE: 2010
COLLECTION CAPACITY: 100%
KEY PARTNER: AUSTRALIA POST
INCREASE OF RECYCLING RATE VS. 2015: +2PP
Countries with a collective collection system
The number of Technical Quality
Countries with both dedicated and collective collection systems
33 Managers overseeing recycling
solutions worldwide
Countries with a dedicated collection system

SDG
THE POSITIVE CUP G4-6, G4-9, G4-16 Partnerships 54/55
 COMPANY COFFEE ALUMINIUM CLIMATE

How does Nespresso

contribute to
C L I M AT E
global actions on
climate change?
CLIMATE CHANGE DEMANDS
INTEGRATED ACTIONS TO ENSURE
SUSTAINABLE QUALITY COFFEE

THE POSITIVE CUP G4-EC2 56/57

 COMPANY COFFEE ALUMINIUM CLIMATE

WHAT REALLY MATTERS

“With no action on climate, many coffee
COFFEE CULTIVATION producing regions will lose suitability for
DEPENDS ON A cultivation of Arabicas by 2050.”
STABLE CLIMATE Dr. Aaron Davis, Senior Research Leader, UK Royal Botanic Gardens

The effects of climate change are becoming What really matters

apparent in coffee producing regions. We take To take consistent action in our value chain to address the causes
and consequences of climate change
this seriously, acknowledging the fact that every
cup of coffee has a footprint. Life cycle
3 %

The regions where we source our highest quality coffees are particularly vulnerable to the adverse effects
assessment steers our efforts to reduce the main of climate change. That’s why, using the knowledge gained from our materiality assessment, we are working
drivers of this footprint – from aluminium 3%, the share of Nespresso’s together with farmers and other partners to build resilience into AAA farming landscapes. Equally, we recognise
operations (Scope1 and 2) in our responsibility to continuously improve the environmental performance of a Nespresso cup of coffee.
stewardship to coffee machine design to We are also involving our Club Members in the value of carbon neutral and sustainable quality coffee.
the carbon footprint of a cup of
sustainable coffee production. We also work Nespresso (Quantis, LCA 2013)
continuously to improve the environmental
Climate change
performance of our factories and boutiques. Water stewardship

On AAA farms, agroforestry is proving an

65
CLIMATE CHANGE ADAPTATION Resource efficiency & waste
> % Climate-smart farming
important part of the solution for climate Agroforestry ENVIRONMENTAL PERFORMANCE
Green house gas reduction
change adaptation. The carbon sequestration Integrated landscape management
Operational resource efficiency
of the planted trees helps to further mitigate At least 65% of Arabica
Community development
& unemployment
Natural capital Machine eco-design

the footprint of every cup of Nespresso. volume at risk with

STAKEHOLDER CONCERN
climate change Rural development Business ethics

Traceabillity

Responsible marketing SUSTAINABLE CONSUMPTION

Precision consumption
AAA Sustainable Quality
Circular systems
Product environmental footprint

SIGNIFICANCE OF NESPRESSO IMPACT

Our 2020 ambition and goals

Integrated actions on climate change
2016 achievements status
Reduce the carbon footprint
-19.4%
of a cup of Nespresso by 28% vs. 2009
Inset 100% of our company’s operational carbon footprint
(Scope 1 and 2 GHG emissions equivalent to the global 100% inset
volume of capsules sold)
Strengthen coffee landscape resilience
1.4 million trees planted
Members of the Nespresso and Pur Projet teams through extensive tree planting towards 5 million
visiting an agroforestry model farm
in Coorg AAA cluster, India Achieved On track for 2020 Not on track for 2020

THE POSITIVE CUP EC/IEI-G4-DMA, EC/PSP-G4-DMA, EN/MA-G4-DMA, EN/PS-G4-DMA, EN/OV-G4-DMA 58/59

 COMPANY COFFEE ALUMINIUM CLIMATE

LIFE CYCLE ASSESSMENT

“A cup of Nespresso coffee can result
LIFE CYCLE in a lower environmental footprint than
ASSESSMENT STEERS other ways of consuming coffee.”
OUR APPROACH TO Sébastien Humbert, co-founder Quantis

CARBON EFFICIENCY

Life Cycle Assessment (LCA) is a recognised Portioned coffee, a precise consumption Our carbon mitigation actions Progress report on
tool used to identify and quantify the key carbon mitigation
It is often assumed that portioned coffee is a poor choice for the All the initiatives outlined in this report – from AAA coffee sourcing
environmental impacts of a product. environment. However, independent research shows this not to be to aluminium sourcing and usage, to machines and operations –
We use this methodology primarily to support the case. Most of the environmental impact of a cup of coffee is in contribute towards carbon reduction. However, these reductions alone
our decisions on carbon mitigation actions, Scope 3 – the sourcing of the coffee and the energy used in will not deliver The Positive Cup vision. That’s why in addition, we are REDUCING THE INSETTING THE
preparation. When a comparative life cycle assessment of different actively investing in projects in our AAA supply chain that can create CARBON FOOTPRINT OF COMPANY’S OPERATIONAL
as well as to compare the environmental preparation and consumption options is made, the environmental further positive impacts, including generating carbon credits. This is A CUP OF NESPRESSO CARBON FOOTPRINT
performance of different modes of coffee performance of portioned coffee can actually be the same or even called insetting and, as a first step, we are investing in agroforestry (Scope 1, 2 and 3 GHG emissions) (Scope 1 and 2, equivalent to the global
as a means to deliver it. This involves the planting of native species of volume of capsules sold since 2015)
preparation in a consistent way. greater than that of other roast and ground solutions. Because some
filter coffee preparation heats more water than is needed and makes trees in and around AAA coffee farms – equivalent to Nespresso’s
more coffee than is consumed, the footprint per cup can be higher. Scope 1 and 2 emissions.
In these cases a cup of Nespresso may have a better environmental
performance. The precise portioning and on-demand preparation -28 %
-19.4 %
100 %
100 %

mean that comparatively less coffee and less energy is required per
cup. This “precision consumption” is important in that even with the goal 2020 achievement 2016 goal 2020 achievement 2016
vs. LCA 2009 vs. LCA 2009
packaging required for portioning, the impact of coffee and energy
used is reduced. The overall footprint is further improved when
the portion packaging is recycled or otherwise valorized after use.

LIFE CYCLE ASSESSMENT OF A CUP OF NESPRESSO

Expressed in % CO2 eq. per cup (Quantis, LCA 2013)

We started to work with Quantis in 2005 to conduct our first

product life cycle assessment. This helped us to understand
Coffee 19%
the intrinsic benefits of precise and on demand preparation
as well as to identify opportunities for further improvement
of environmental performance.
Packaging 18% Maria Ramirez, wife of AAA farmer Marcos Gabriel Ruiz, quantis-intl.com
participating in the agroforestry insetting project in Guatemala

Operations (Scope 1 and 2) 3% A closer look at

Life Cycle Assessment (LCA)
Operations (Scope 3) 8% What’s next
LCA is a methodology which enables the evaluation of the
environmental performance of a specific product’s consumption.
§§ Carbon reduction target to be achieved latest 2021, due to delayed
Within LCA, Nespresso has chosen the carbon indicator to guide
“ASI certification” and the need for AAA carbon M&E
integrated and consistent actions on climate change. Although
§§ Define post 2020 science-based goals in line with COP21
the LCA approach is framed as per ISO 14040, there is a certain
§§ Review the LCA methodology incorporating the latest European
Consumer use of machine 47% flexibility in its application, use of assumptions and no standardised
“Product Environmental Footprint” knowledge for the carbon
inclusion of certain steps of the value chain. Nespresso has applied
roadmap post 2020
conservative assumptions for calculating the environmental
performance, in line with Nestlé guidelines. As we collect actual data,
the accuracy of the product’s carbon footprint is improved, enabling
more focused actions.
After use management 5%

SDG
THE POSITIVE CUP EN/EN-G4-DMA, G4-EN7, G4-EN18 , EN/EM-G4-DMA Climate Change 60/61
 COMPANY COFFEE ALUMINIUM CLIMATE

THE ENVIRONMENTAL PERFORMANCE OF OUR OPERATIONS

“We implemented a LEED certification for
OUR FACTORIES,DISTRIBUTION our third factory to assess and strengthen
AND BOUTIQUES ARE our environmental efficiency.”
SUBJECT TO CONTINUOUS Daniele Jungling, Global Head of Operations, Nespresso

ENVIRONMENTAL
PERFORMANCE IMPROVEMENTS
Our three factories are located in Switzerland We seek to enhance environmental performance in every way we The environmental performance of our factories Progress report on
while our network of boutiques span 63 countries.
can – through the reduction or reuse of the resources we consume. improves even as production volumes grow factory environmental performance
Together these areas are relatively small Although our three Nespresso factories are relatively modern, we Target 2020 vs 2010 2016 achievements
contributors to our overall environmental Our logistics team explore and implement continue to explore opportunities for even greater resource efficiency.
evolving best practices
impact. However, as they are under our direct -50% -27%
The recovery of rainwater and rinsing water has led to a 27% reduction
control, we strive to reduce these impacts To transport green coffee from port warehouse to production centre, in “drinking” water consumption per ton of product manufactured.
Water consumption
(m3/ton of
even further. we only use rail transport. We also continue to explore ways to improve Our zero waste to landfill target was reached in 2014. In 2016, 96% manufactured product)
the environmental performance of our supply and distribution network. went to recycling channels while 4% was incinerated, resulting in
20 initiatives have been identified which will contribute to our carbon energy recovery.
mitigation roadmap, including: an extension of the rail solution beyond
Switzerland, the optimisation of pallet content in containers, and the use Electricity consumption in our manufacturing sites is managed using
of non-fossil combustibles by our transport providers. -14%
best practices: the recovery of heat during manufacturing, the use of -30%
gravity, the use of natural lighting or LED, and photovoltaic panels Carbon footprint
(kg CO2 eq./t of
installed on factory roofs. The net energy recovery can directly benefit
manufactured product)
local households as our factories are connected to the grid.

100 %
100% rail transport of green
coffee from port to factories
Environmental performance data for our factories is aggregated
within Nestlé’s reporting, for external ratings like CDP climate change
change,
CDP water, and Dow Jones Sustainability Index.

Boutiques build on LEED/BREEAM

Procured renewable
electricity* 100 %
0 %

certification learnings

Building on the learnings of BREEAM certification in our Munich

boutique and LEED certification in our San Francisco boutique, we
collaborated with consulting agency ESA, to establish a performance *This excludes the fact that the Swiss electrical mix is composed at 56% of renewable source.
scorecard for boutiques in 2015. As well as incorporating best practice Water consumption/carbon footprint reductions are based on volume/ton of
product manufactured
guidelines on waste management, the scorecard will help identify
areas for improvement in water, energy consumption and the sourcing
The Biogas plant of Henniez, Switzerland
of materials.

A closer look at
What’s next how coffee grounds generate electricity

§§ Define a renewable electricity procurement roadmap globally

§§ Enlarge the scope of zero waste to landfill, to distribution
Since 2016, the coffee ground waste from our factories and recycled
capsules in Switzerland, has been processed at the Henniez biogas
Zero Zero waste to landfill
in our manufacturing sites

centres and boutiques plant in Switzerland. Representing more than 10% of the biogas fuel
§§ Expand our biogas approach to include our capsule input by volume, the coffee grounds generate close to 60% of the
recycling partners output (2.1 million m3 per year). The plant supplies electricity to the
Henniez water bottling plant as well as the equivalent of 1,000
households’ electricity requirements, before being composted for the
farming community. An energetic assessment has shown that one
recycled capsule entering a biogas factory generates as much energy
as the production of one capsule made from recycled aluminium.
Solar panels on the roof of Nespresso factory,
Romont, Switzerland

EN/EN-G4-DMA, G4-EN7, EN/WA-G4-DMA, SDG

THE POSITIVE CUP G4-EN8, EN/EM-G4-DMA, G4-EN18 Climate Change 62/63
 COMPANY COFFEE ALUMINIUM CLIMATE

SUSTAINABLE MACHINE DESIGN

“From a technical perspective, durability is
NESPRESSO MACHINES built into these machines, cup after cup,
ARE DESIGNED TO BE up to 9,000 times.”
ROBUST, REPAIRABLE Marco Restelli, Global Head of Product Development, Nespresso

AND ENERGY EFFICIENT

Nespresso has reinvented the way millions of Together with our partners in machine design, Nespresso Responsible supply chain
experts strive to not only meet the quality demands of our
people worldwide prepare coffee with machines
consumers but also to improve the environmental performance Started in 2012, the assessment of all our direct machine suppliers
designed to deliver an exceptional cup, every of our machines. The life cycle of machines is analysed to spur against SMETA 4-Pillars (Sedex Members Ethical Trade Audit) has
time. Our range spans compact machines for innovation in the three key areas of “Reduce, Reuse, Recycle”. resulted in 92% compliance by the end of 2016. Mainly located in
home use to professional devices for the Europe, these suppliers are sourcing parts from Asian factories which
will be assessed in the next phase.
business, hospitality and travel industries. Increased reliability
All of them integrate advanced technologies and more compact machines
to manage the exact balance of water Refurbished machines can brew
Machine reliability is essential for achieving consumer satisfaction and up to 15,000 cups
temperature, pressure, quantity and speed. loyalty, and reducing waste. Our technical department works closely
with machine manufacturers to produce robust, well-functioning Our machines are designed to brew at least 9,000 coffees – around
devices. Today, 10 times fewer machines are returned due to defects 10 years with average use. Since defects are a part of life for any
than five years ago. Over the past 12 years, newer designs has led to appliances, we have set up 250 after sales centres in key markets.
significant reductions in weight and volume. Launched in 2016, the When a consumer calls Nespresso to report a problem with their
Inissia machine is around half the weight and one-third of the volume machine, we make an initial phone diagnosis which usually resolves it.
of its equivalent early 2000 machine. If physical repair work is needed, we organise a pick up at home, Final step of the machine refurbishment process
sending it to one of our after sales centres. Within a week, the
machine is repaired, descaled, cleaned and returned to the consumer,
thereby lengthening its life. A closer look at
machine refurbishment for increased
We recently tested a new approach – refurbishing pre-owned consumer satisfaction
machines to offer to consumers in exchange of their defective ones.
This extends the lifetime of all coffee machines by two-thirds, creating At the end of 2015, France and Canada introduced the refurbishment
Energy efficiency a total lifetime brewing capacity of 15,000 cups. offer to consumers calling after-sales. Those with a defective machine
Thermo block improvement for energy efficiency receive an equivalent model with an extra six-month warranty the
following day and can upgrade it with a minimum financial
The energy consumption of our machine in-use is the biggest contribution. The defective machine is collected and, if repairable,
contributor to the carbon footprint of a cup. That’s why since is usually reintegrated into the refurbishment cycle. If not, it proceeds

90
2009, all Nespresso machines for private consumers save 90% satisfaction to end of life recycling. In France, 20% of consumers choose the
energy by switching to an automatic stand-by mode after just %
with our after-sales service refurbishment option and 80% of the machines returned have
a few minutes of inactivity. Our professional machines, which been refurbished and integrated back into refurbished stock.
brew coffees all day long, must remain ready-to-use for much The remaining 20% were recycled.
longer. These feature an insulated water heater, which
reduces energy consumption by 30%.

Recycled materials for parts

250 250 after-sales centres
worldwide 95% of the weight of our machines
is recyclable
Recycled plastics
When a machine is not repairable, it enters the recycling channel
When there is no requirement to use virgin plastic, we – either at a boutique or an official collection point for electronics
aim to use post-consumer recycled plastics (PCRP) to reduce What’s next in the relevant market. In principle, 95% of the weight of the machine
demand on natural resources. In our latest innovations, is recyclable. However, current electronic recycling systems recycle only
the frame, capsule container, drip-tray and a number §§ Secure SMETA compliance of Tier 2 suppliers by 2018 60% of the weight. The materials recovered are potentially reused as
of other small parts are made with PCRP – comprising §§ Extend the refurbishment offer to four European countries new machine parts.
40% of the total weight of plastic.
Nespresso machine evolution over time

EN/MA-G4-DMA, G4-EN2, EN/EN-G4-DMA, SDG

THE POSITIVE CUP G4-EN7, EN/EM-G4-DMA Sustainable Consumption and Production 64/65
 COMPANY COFFEE ALUMINIUM CLIMATE

AGROFORESTRY FOR CLIMATE ADAPTATION

“The benefits of trees go way beyond
WE OPERATIONALISE carbon – we've listed at least 100 social,
AGROFORESTRY AS economic and environmental benefits.”
OUR NATURE-BASED Tristan Lecomte, Founder, Pur Projet

SOLUTION FOR
CLIMATE ADAPTATION
Extreme weather patterns are already causing Our existing and ongoing contribution to renovation programs Carbon sequestration monitoring
which create disease resistant coffee plants is now complemented
significant damage to coffee communities while
by the more systematic deployment of an agroforestry and The Nespresso agroforestry projects are verified by a third-party
threatening the supply of the highest quality reforestation program. This agricultural best practice offers against the standard “Solidarity Reforestation”. The validation audits
coffee our consumers expect. It’s imperative to multiple benefits, integrating actions on the farm with those initially check that the projects are designed and developed according
that impact the wider landscape. Pur Projet and Nespresso have been working together since 2013
strengthen the resilience of farming communities to best practices, and the carbon sequestration potential is assessed.
to implement an extensive agroforestry program with the AAA
Regular verification audits, which occur every three to five years over
by acting at source. 30 years, confirm the carbon sequestration volumes on the basis
coffee producers of three countries: Colombia, Guatemala and Ethiopia.
Our priority is climate resilience of actual biomass monitoring.
The program aims to deliver insetting. Pur Projet is a co-founder
for coffee communities of the International Platform for Insetting, a coalition of civil and
private sector organisations committed to improving positive impacts
Climate change is already affecting farmers all around the world, with through insetting.
purprojet.com
adverse weather patterns and high incidence of disease resulting in
decreases in quality and declines in productivity. Our role is to work
with our partners and farming communities to maintain quality
1.4m Around 1.4 million trees planted
(2014-2016)

and productivity despite these adverse effects.

The multiple benefits of agroforestry Our approach to financing

Scientists have identified and researched a wide range of positive Nespresso is committed to fully financing the planting of trees
impacts of agroforestry at farm and landscape level, including in the AAA coffee supply chain, equivalent to our operational GHG
carbon sequestration, water replenishment and pollinator habitat emissions (Scope 1 and 2). Furthermore, we are piloting a carbon
conservation. Given the complexity of comprehensive monitoring neutral value proposition for French consumers. We are making an
and evaluation processes, in the initial phase we have decided to additional investment to inset the carbon footprint of a cup of
focus on two environmental (soil quality, carbon sequestration) and Nespresso, equivalent to the total number of Nespresso capsules sold
one socio‑economic (revenue diversification) indicator. in France. This financial commitment has leveraged co-investment
from IDH (the sustainable trade initiative) and the World Bank Group.

Soil quality monitoring in Cauca, Colombia Based on the knowledge gained over the initial two years of these Arnaud Deschamps, Nespresso France, Tristan Lecomte from
projects, specifically the challenges of implementation undertaken Pur Projet and other business leaders attending the launch
Pur Projet collaborates with the Yale School of Forestry and with local communities, we have revised our goal to be towards of the IPI platform at COP21 in Paris.
Environmental Studies in the United States to assess the impact of five million trees planted by 2020.
agroforestry and reforestation on soil quality and fertility. Having A closer look at INTERNATIONAL
INSETTING
defined and tested the scientific protocol in 2015, soil quality will be International Platform for Insetting PLATFORM

monitored over the next 10 years in the Cauca region of Colombia. What’s next
The International Platform for Insetting’s mission is to be a catalyser
to help develop and certify Insetting projects worldwide. It was
§§ Identify needs and opportunities for agroforestry
Socio-economic study in Sidama, Ethiopia within our sourcing operations
launched at the Paris Climate Conference (COP21) in December
2015. In 2016, IPI developed a Standard to allow private sector
§§ Explore NSIF co-financing models
Pur Projet collaborates with Harvard University to monitor the outputs organisations engaged in Insetting to have their programs and
of the agroforestry project for timber and fruit production, and to projects certified and registered. In May 2015, Nespresso joined as
evaluate if they have an impact on a series of livelihood indicators a founding member and given our strong belief in the benefits of
including net income, food security, and self-sufficiency. Drivers an insetting approach, we volunteered our Agroforestry Program
such as access to markets and gender equity are also considered as a pilot for a more systemic governance and accreditation process.
in the evaluation. After developing a monitoring and evaluation The details of the pilot are publicly available on the IPI website,
Irene Chapuel working in the Corsavida nursery providing methodology, the baseline data was collected in 2016 and will registered using the blockchain technology.
shade trees for the agroforestry program be monitored yearly. insettingplatform.com

in the Cauca region, Colombia

SDG
THE POSITIVE CUP G4-16, SO/LC-G4-DMA, G4-SO1 Climate Change 66/67
 COMPANY COFFEE ALUMINIUM CLIMATE

THE SCOPE OF OUR CLIMATE ACTIONS

“We see, despite the size of the
WE ARE INCREASINGLY challenges, leading companies finding ways
CONNECTING OUR LOCAL to internalise Natural Capital impacts.”
A A A CLIMATE SOLUTIONS Dean Sanders, Director, GoodBrand

TO WIDER NATURAL
CAPITAL COALITIONS

GUATEMALA
AGROFORESTRY SINCE 2014

5.7m
LOCAL IMPLEMENTER: PUR PROJET WITH ADESC AND FEDECOCAGUA USD 5.7m – Nespresso investment
USD
TREES: >290,000 in climate actions (2014-2016)
FARMERS: >800
COVER EQ. IN HA: ≈580

COLOMBIA
AGROFORESTRY SINCE 2014
INDONESIA
LOCAL IMPLEMENTER: PUR PROJET WITH FNC AGROFORESTRY SINCE 2016
TREES: >670,000 LOCAL IMPLEMENTER: OLAM
FARMERS : >2,700 TREES: >63,000
COVER EQ. IN HA: ≈2,150 COMMUNITY: >1,300 INDIVIDUALS
COVER EQ. IN HA: ≈80
RENOVATION PROJECTS WITH
RESISTANT MATERIAL: 2008-2013

COALITION “MANOS AL AGUA”

TREES: >160,000
COVER EQ. IN HA: ≈500

ETHIOPIA
AGROFORESTRY SINCE 2015
LOCAL IMPLEMENTER: PUR PROJET WITH BOKASSO COOPERATIVE
TREES: >150,000
Initiative for Sustainable Forest Landscapes

FARMERS: >520
A closer look at
Manos Al Agua AGROFORESTRY SINCE 2016
LOCAL IMPLEMENTER: TECHNOSERVE Our partner
The “Manos al Agua” initiative is a five-year program
(2013-2018) which aims to address climate related risks,
TREES: >90,000
Since 2007, the World Bank Group has been an active
as well as the impacts and dependencies on water of coffee FARMERS: >5,000 partner of the Nespresso AAA Sustainable Quality™ Program.
production. The initiative has raised EUR 20.5 million from BRAZIL Together with one of their institutions, the International
a large range of stakeholders, including the public sector Finance Corporation (IFC) and the coffee supplier ECOM,
COALITION: CERRADO DAS AGUAS CLIMATE SMART AGRICULTURE: TECHNOSERVE
(Colombian and Dutch governments) and the private sector they collaborated on a five-year partnership in Central America
(Nestlé, Nespresso, The Colombian Coffee Growers Federation AND THE BIOCARBON FUND INITIATIVE FOR to accelerate the implementation of the AAA Program and
(FNC)) with the aim of creating a framework for an integrated SUSTAINABLE FOREST LANDSCAPES the Rainforest Alliance certification. In 2016, the World Bank
approach to managing Natural Capital. A group of 85 experts Group, through the IFC and BioCarbon Fund, committed
– from Cenicafé, the Wageningen University and Research to a USD 6 million financial contribution to the AAA Program
Centre, as well the extensionist service of the FNC – are aimed at accelerating the adaptation of Ethiopian coffee
operating the program. The program directly benefits farmers to climate change.
11,000 Colombian coffee-growing families in 25
ifc.org
watersheds and around 500,000 people (water users).
biocarbonfund-isfl.org
manosalagua.com/ 1 million trees to be planted
1m with TechnoServe in Ethiopia
and Kenya (2016-2018)

SDG SDG SDG

THE POSITIVE CUP G4-16, G4-EC7, EN/WA-G4-DMA Natural Capital Climate Change Partnerships 68/69
 COMPANY COFFEE ALUMINIUM CLIMATE

MATERIALITY – METHODOLOGY

This is our first Creating Shared Value report, created “in accordance” Wider opinion leaders’ views
with GRI’s G4 Sustainability Reporting Guidelines and the Food Additional desk research was undertaken to complement the above
Processing Sector Disclosure. The report addresses material issues and identify current sustainability challenges, opportunities and trends.
or those that reflect significant economic, environmental and social This was centred on a range of studies like EY megatrends, WEF risk
impacts, and those issues that substantively influence the assessments assessments 2016, and Globescan sustainability surveys.
of our stakeholders. Materiality assessment is about identifying the
issues that are significant for our business and also matter to our
stakeholders. We plot the economic, social and environmental issues Identifying what really matters
that are of most concern to our stakeholders, against the impacts that
our business generates for the economy, society and the environment. Prioritisation of impacts
The resulting matrix highlights the material issues to be considered by The three processes defined here – Nespresso stakeholders’
our business, which may be ongoing, evolving or new. This consultation, alignment with Nestlé’s materiality and wider opinion
assessment is used to help select the information to feature in the leaders’ views, resulted in a rating of each material aspect – from
report, thereby meeting stakeholder expectations. At the end of 2015, significant to moderate to major. A weighted average of these ratings
we built a process to establish our first materiality assessment based defined the final plotting in the matrix.
on the GRI Reporting Principles for Defining Report Content.
The process is explained below.

ABOUT THIS REPORT

Human rights Climate change
Water stewardship

Understanding what really matters Resource efficiency & waste

Nespresso stakeholders’ consultations Community development

STAKEHOLDER CONCERN
Natural capital
& unemployment
As a regular way of managing our sustainability strategy and related
impacts, we engage in ongoing dialogue with our internal and Rural development Business ethics

external stakeholders to understand their opinion and views about Traceabillity

Responsible marketing
our organisation, processes, goals and ambitions. Over the last two
years (2014-2016), this has involved some 140 external stakeholders
Employee relations
and 50 internal stakeholders. In addition, regular media screening
and consumers’ opinion surveys are conducted on these topics. Women’s empowerment

The outcome of these consultations allowed us to identify and rank

Safety & health Food safety
our stakeholders’ concerns. It also highlighted gaps within some
stakeholder groups, as well as GRI sustainability aspects not
SIGNIFICANCE OF NESPRESSO IMPACT
sufficiently represented and discussed in the consultation processes.
To rectify this, phone interviews were conducted with selected
stakeholders – mostly groups under-represented in the earlier process. Validation
These interviews confirmed the outcome of the first wave, while The draft of the materiality assessment was circulated for validation to
ensuring that all GRI aspects were being followed. the members of the Nespresso Sustainability Advisory Board (NSAB),
as part of the pre-reading materials for the board meeting.
Alignment with Nestlé’s materiality
In 2014, Nestlé undertook a stakeholder-led materiality process, with Interpretation
19 issues identified as being the most material. The definition of each In every chapter of this report, the materiality assessment has been
material issue is available in the Nestlé in Society report 2015 p.12 to 16. interpreted through a specific lens: Company, Coffee, Aluminium and
As an operating unit of the Nestlé Group, many of Nespresso’s and Nestlé’s Climate. This has enabled us to highlight “what really matters” at the
stakeholders, operations, impacts and dependencies are common. Thus, beginning of each chapter and the related actions for that specific
we built on the experience and comprehensive consultation process topic. This then steers the subsequent content and coverage within
carried out by Nestlé to finalise our materiality assessment. It led us to the remainder of the chapter.
Liliana Franco, Colombian AAA agronomist, align the specific phrasing of the material aspects with those of the
visiting the Nespresso Avenches Factory, Nestlé Group and fine-tune their ranking.
Switzerland

THE POSITIVE CUP G4-18, G4-19, G4-20, G4-21, G4-24, G4-25, G4-26, G4-27, G4-33 70/71
 COMPANY COFFEE ALUMINIUM CLIMATE

BUREAU VERITAS ASSESSMENT “It is our opinion that Nespresso has established
appropriate systems for the collection, aggregation
and analysis of sustainability data.”
Bureau Veritas

Assurance Assessment standard Responsibilities Statement of independence, integrity and competence

We performed our work in accordance with a comprehensive internal The preparation and presentation of the Selected Information in the Bureau Veritas is an independent professional services company
This report is subject to independent assurance by Bureau Veritas. protocol that guides our verification activities. Our methodology is Report are the sole responsibility of the management of Nespresso. that specialises in quality, environmental, health, safety and social
The aim of this process is to provide reassurance to Nespresso based on international best practice and incorporates the requirements Bureau Veritas was not involved in the drafting of the Report. accountability with over 185 years history. Its assurance team has
stakeholders of the accuracy, reliability and objectivity of the reported of the most widely used assurance international standards including Our responsibilities were to: extensive experience in conducting verification over environmental,
information, and that it covers the issues material to the business. AA1000 Assurance Standard, ISAE3000, and ISO14064-3. Our §§ Obtain limited assurance about whether the Selected Information social, ethical and health and safety information, systems
conclusions are for ‘limited’ assurance as set out in ISAE 3000. has been prepared in accordance with internationally acceptable and processes.
definitions of the relevant indicators
Independent assurance statement Limitations and exclusions §§ Form an independent conclusion based on the assurance Bureau Veritas operates a certified1 Quality Management System
Excluded from the scope of our work is any verification of information procedures performed and evidence obtained which complies with the requirements of ISO 9001:2008, and
Introduction and objectives of work relating to: §§ Report our conclusions and findings to the Nespresso’s accordingly maintains a comprehensive system of quality control
Bureau Veritas UK Ltd. (Bureau Veritas) has been engaged by Nestlé §§ Activities outside the defined verification period management in the form of a management report including documented policies and procedures regarding compliance
Nespresso SA (Nespresso) to provide limited assurance over selected §§ Positional statements (expressions of opinion, belief, aim or future with ethical requirements, professional standards and applicable
sustainability performance indicators for inclusion in its 2016 intention by Nespresso) and statements of future commitment Methodology followed and summary of work performed legal and regulatory requirements.
Sustainability Report and website. This Assurance Statement applies §§ Other information included in Nespresso’s Report As part of our independent verification, we undertook the
to the related information included within the scope of work following activities: Bureau Veritas has implemented and applies a Code of Ethics, which
described below. This limited assurance engagement relies on a risk based selected §§ Reviewed the process followed by Nespresso in identifying the meets the requirements of the International Federation of Inspections
sample of sustainability data and the associated limitations that this organisation’s material sustainability issues Agencies (IFIA)2, across the business to ensure that its employees
Scope of assurance entails. Our work was limited to head office based activities and §§ Examined the data collection and consolidation processes used maintain integrity, objectivity, professional competence and due care,
The scope of our work was limited to assurance over the following understanding how Nespresso consolidates and reconciles data to compile the Selected Information, including assumptions made, confidentiality, professional behaviour and high ethical standards
content included within Nespresso’s Creating Shared Value Report provided by local markets/countries. The reliability of the reported and the data scope and reporting boundaries in their day-to-day business activities.
2016 – The Positive Cup (“the Report”) for the period 1 January data is dependent on the accuracy of data collection and monitoring §§ Conducted interviews with relevant personnel of Nespresso
2016 to 31 December 2016 (the “Selected Information”): arrangements at market/site level, not addressed as part of this Head Office The assurance team for this work conducted the verification
assurance. This independent statement should not be relied upon §§ Reviewed documentary evidence produced by Nespresso independently and to our knowledge does not have any conflict
1. Nespresso’s processes related to the following: to detect all errors, omissions or misstatements that may exist. §§ Assessed the disclosure and presentation of the Selected of interest due to any other Bureau Veritas projects with Nespresso.
§§ Review of Nespresso’s materiality analysis Information to ensure consistency with assured information
§§ Review of the used coffee pods collection and recycling process §§ Checked the alignment of the reported data and information
as well as data collection process to the requirements of the Global Reporting Initiative (GRI) G4
§§ Review of Product lifecycle emissions model Sustainability Reporting Guidelines
§§ Review of Nespresso’s Insetting program
§§ Check of the Report’s alignment with GRI G4 “in accordance Conclusion
with core option” requirements On the basis of our methodology and the activities described above,
nothing has come to our attention to indicate that the Selected
2. Specific indicators: Information is not fairly stated in all material respects. It is our opinion Bureau Veritas UK Ltd.
§§ AAA Program facts and figures that Nespresso has established appropriate systems for the collection, London
§§ Headcount numbers (including diversity data) aggregation and analysis of sustainability data. April 2017
§§ Public private partnerships data in coffee producing countries
§§ Total reportable injuries and work related fatalities
§§ Energy consumption
§§ Scope 1 and Scope 2 Greenhouse gas emissions

1
Certificate of Registration FS 34143 issued by BSI Assurance UK Limited
2
International Federation of Inspection Agencies – Compliance Code – Third Edition

THE POSITIVE CUP G4-32, G4-33 72/73

 COMPANY COFFEE ALUMINIUM CLIMATE

OUR GLOBAL PARTNERS “The Positive Cup is much more than a company project.
We are thankful to our partners for their considerable
efforts and commitment to our long-term vision.”
Julie Reneau, Sustainability Strategy and Stakeholder Relationship Manager, Nespresso

ACUMEN BLUEMARBLE MICROINSURANCE DUALES SYSTEM DEUTSCHLAND (DSD) FAIR TRADE USA
Acumen operates as a non-profit organisation Bluemarble Microinsurance is a consortium DSD was the first extended producer Fair Trade USA is a leading third-party certifier
that focuses on poverty eradication. The of eight companies with a mission to extend responsibility system (EPR) to put in place of Fair Trade products in the United States.
organisation raises charitable funds to invest insurance protection to the underserved in a collective packaging recycling system. It audits and certifies transactions between U.S.
equity and debt in enterprises serving emerging markets. It has committed to providing gruener-punkt.de companies and their international suppliers
low‑income people and covering the following drought protection to smallholder farmers in to guarantee that the farmers and workers
areas of focus: access to water, energy, Africa, addressing a largely unmet insurance ECOM producing Fair Trade Certified goods are paid
education, and medical care. need in the region. Ecom Agroindustrial Corp. Ltd is a global fair prices and wages, work in safe conditions,
acumen.org bluemarblemicro.com commodity trading and processing company protect the environment and receive community
specialising in coffee, cotton and cocoa in major development funds to empower and uplift
Versión del logo a color.

Aluminium ALUMINIUM STEWARDSHIP INITIATIVE CAFEXPORT producing and consuming countries, with their communities. Nespresso is working with
Stewardship
Initiative The Aluminium Stewardship Initiative (ASI) is a Cafexport has been Nespresso’s supplier since ancillary agricultural operations in oilseeds. Fair Trade USA as part of the AAA Program
standards setting and certification organisation 2003 and successfully implemented the AAA Ecom is one of the world’s top 3 merchants in Cauca-Nariño, Colombia.
that recognises and fosters the responsible fuente
línea
Program in the region of Caldas-Antioquia in in coffee, one of the largest coffee millers in the fairtradeusa.org
gradado

production, sourcing and stewardship of Colombia, including working with specific world. ECOM implements the AAA Program in
aluminium. As a member-based, global initiative, partners in the region, such as Expocafé and some clusters in Costa Rica, Mexico, Guatemala, FUNDACIÓN INTERAMERICANA DE
ASI is the result of producers, users and FNC to guarantee the advancement of the Nicaragua, Brazil and India. INVESTIGACIÓN TROPICAL
stakeholders in the aluminium value chain AAA Program and its farms. ecomtrading.com FIIT is a Guatemalan non-governmental
coming together to build consensus on cafexport.weebly.com and non-profit organisation established in
“responsible aluminium”. EFICO March 1987 which promotes scientific research,
aluminium-stewardship.org CENTRO DE ESTUDIOS REGIONALES Efico is a Belgium based company experienced in protection of natural ecosystems and sustainable
CAFETEROS Y EMPRESARIALES (CRECE) trading and commodity sustainability projects. management of natural and agricultural
ASPINWALL COFFEE CRECE is an independent consulting and Efico has been working with Nespresso since its ecosystems in the short, medium and long-term.
Aspinwall Coffee, the coffee division of the research firm based in Colombia. It has been creation in 1986 and before that on a project fiitgt.com

legendary Aspinwall & Co. Ltd, India, has been a instrumental in the development of the basis within Nestlé, and has a strong international
trusted and respected name in coffee trading Monitoring and Evaluation Tool in the context background in green coffee ever since 1926. FEDERACION NACIONAL
circles globally for more than half a century. Being of a defined Theory of Change. It was chosen as supplier in Brazil and Guatemala DE CAFETEROS (FNC)
one among the pioneering enterprises to have crece.org.co and has successfully implemented the AAA FNC is considered as one of the largest
introduced coffee processing and trade from Program in these countries. agricultural organisations representing and
India, Aspinwall has never let its lure for coffee CISA/MERCON efico.com delivering support services to over 500,000
die down and is today a prominent exporter and CISA/MERCON is a supplier of green coffee coffee growers in the country. Since 1927, it
processor of finest Indian coffee beans. to the international coffee roasting industry. FAIR LABOR ASSOCIATION has provided an institutional framework for the
aspinwallcoffee.com The operation in Nicaragua is led by CISA The Fair Labor Association (FLA) is a non-profit sector which enabled Colombia to promote and
Exportadora, the largest coffee export company organisation committed to protecting export its high quality Arabica coffee to the
BLASER CAFÉ AG in the country. Nespresso works with CISA/ workers’ rights and improving working international market.
Blaser Café AG is a Swiss family run business MERCON, as part of the AAA Program, conditions worldwide by promoting adherence federaciondecafeteros.org

based in Bern, Switzerland. Blaser has been for a cluster in Nicaragua. to international labour standards.
working with Nespresso successfully in Brazil merconcoffeegroup.com fairlabor.org GOODBRAND
by developing key clusters: bourbon quality in GoodBrand is a corporate social innovation
Vale da Grama and Arabica in Cerrado. It has CLARMONDIAL FAIRTRADE INTERNATIONAL consultancy. It helps challengers create impact –
very strong partners in the area (Wolthers Clarmondial is an independent investment Fairtrade International is a non profit, delivering value for society and for their brand
in Brazil and Allanasons in India), which have advisory company that delivers financing multi‑stakeholder association involving and business.
successfully implemented the AAA Program. solutions to sustainable natural resource 25 member and associate member goodbrand.com

blasercafe.ch management, particularly for agriculture and organisations (labelling initiatives and producer
rural development in emerging markets. networks), traders, and external experts.
clarmondial.com Its mission is to connect producers and
consumers, promote fairer trading conditions
and empower producers to combat poverty.
fairtrade.net

SDG
THE POSITIVE CUP G4-25 Partnerships 74/75
 COMPANY COFFEE ALUMINIUM CLIMATE

OUR GLOBAL PARTNERS

IDH International Research Institute INTERNATIONAL RESEARCH INSTITUTE NATURACERT PLANET GUARANTEE
for Climate and Society
IDH accelerates and up-scales sustainable trade FOR CLIMATE AND SOCIETY NaturaCert is an initiative of Fundación Natura, PlaNet Guarantee is a platform for innovation
by building impact oriented coalitions of front (IRI, COLUMBIA UNIVERSITY) which has been designed to offer services in the field of inclusive insurance and social
running multinationals, civil society organisations, IRI’s mission is to enhance society’s capability to of certification and verification of national protection. Operating as a consulting and
governments and other stakeholders. Nespresso understand, anticipate and manage the impacts and international standards for Colombian brokerage firm, PlaNet Guarantee implements
has cooperated with IDH as part of its Agroforestry of climate in order to improve human welfare sustainable agricultural products. NaturaCert’s innovations in the fields of health, life, index
Program as well as its AAA Program in Ethiopia. and the environment, especially in developing mission is to promote the conservation and insurance and is operating in Africa, Latin America
idhsustainabletrade.com countries. The IRI conducts this mission through sustainable use of biodiversity through the and Asia. Its vision is a rapid generalisation of
strategic and applied research, education, provision of these services, to contribute to inclusive social protection in the world, with a
IMAFLORA capacity building, and by providing forecasts and the strengthening and competitiveness of the mission to design and implement innovative and
The Institute of Agricultural and Forest information products with an emphasis on products and services of its clients. technological solutions that push the boundaries
Management and Certification – Imaflora – is a practical and verifiable utility and partnership. naturacert.org of insurance accessibility. PlaNet Guarantee
civil non-profit association, founded in Piracicaba, iri.columbia.edu has developed solutions in credit insurance,
in the interior of São Paulo, in 1995. Born under NKG – NEUMANN KAFFEE GROUPE life insurance, crop index insurance and
the premise that the best way to conserve tropical IUCN Neumann Kaffee Gruppe (NKG) is the worldwide health insurance.
forests is to give them an economic destination, IUCN is a membership union composed of both leading green coffee service group. With its planetguarantee.com

combined with good management practices and government and civil society organisations. unique cross-cultural network they are present in
responsible management of natural resources. It harnesses the experience, resources and reach all important coffee production and consuming PRODUCTOS Y PROCESOS
Imaflora believes that environmental certification of its 1,300 member organisations and the input markets around the globe. All companies SUSTENTABLES
is one of the tools that respond to part of of some 15,000 experts. IUCN is the global operate as independent profit centres offering Productos y Procesos Sustentables is the official
the challenge with strong inducer power of local authority on the status of the natural world and a broad range of quality services and products accredited entity in Mexico which offers and
sustainable development in the forestry and the measures needed to safeguard it. along the green coffee value chain. NKG’s provides audits and certification services under
agricultural sectors. iucn.org business activities are geared towards creating the requirements established by the Sustainable
imaflora.org long-term profitability and responsible business Agriculture Network, Rainforest Alliance
KANCHA conduct. It stands for reliability and fairness Certified, Tool Assessment Sustainable Quality
INCAE BUSINESS SCHOOL AND CIMS Kancha S.A.S. is an organisation specialised when bringing together the interests of (TASQ) tool and common code for the coffee
INCAE Business school is a non-profit organisation in change management and organisational producers and roasters. community (4Cs). PPS’ objective is to promote
based in Costa Rica, devoted to teaching and development. It provides solutions through nkg.net social development and the sustainable use
research endeavours in the fields of business and consulting, facilitation, coaching, training, of natural resources.
economics, with training programs for leaders. and the development and implementation OLAM sustentables.org

CIMS is a non-profit organisation based in of strategies designed to transfer knowledge. Olam is one of the world’s largest coffee
Costa Rica focused on sustainable agricultural By documenting this, people are able to harness companies, with over 20 years in the business PUR PROJET
value chains and smallholder farmers throughout the knowledge base of their organisation. and a strong presence in almost all of the large Pur Projet is a social business which assists
Latin America. It provides evidence-based kancha.info coffee-producing regions which is well- companies and communities in the deployment
research and strategic advice to the private, supported by an extensive network of marketing of ecosystem projects, with the objective of
public and NGO sectors. offices across the world’s coffee consuming delivering long-term resilience within their value
incae.edu | cims-la.com countries. It provides a comprehensive supply chain. PUR Projet is B Corp certified.
chain solution that links millions of coffee purprojet.com

INSTITUTE IPE growers to roaster clients, specialising in every

IPÊ – Instituto de Pesquisas Ecológicas is a Brazilian supply chain stage from procurement, wet and
non-governmental organisation that works dry milling, classification, transportation and risk
for the conservation of the country’s biodiversity, management, to marketing processed coffees
through science, education and sustainable in its target markets.
business. Founded in 1992, it holds the title of olamgroup.com

Oscip – Civil Society Organization of Public Interest,

and its headquarters is in Nazaré Paulista (SP).
ipe.org

SDG
THE POSITIVE CUP G4-25, G4-26, G4-27 Partnerships 76/77
 COMPANY COFFEE ALUMINIUM CLIMATE

OUR GLOBAL PARTNERS

QUANTIS SKN – CARIBECAFE THE WORLD BANK GROUP USAID

Quantis guides top organisations to define, SKN Caribecafe has a long tradition in Colombia, AND INTERNATIONAL FINANCE USAID is the lead U.S. Government agency that
shape and implement intelligent environmental active in the coffee export activity for more than CORPORATION works to end extreme global poverty and enable
sustainability solutions though the life cycle 65 years and recognised as a reliable and quality The World Bank Group, established in 1944, is resilient, democratic societies to realise their
thinking. Quantis delivers resilient strategies, oriented Colombian coffee supplier. Their an international organisation made up of 189 potential. Recognising coffee’s contribution to
robust metrics, useful tools, and credible mission is to contribute to Colombian coffee member countries and consisting of five financial poverty reduction and development, USAID
communications. activity by further developing their role as institutions with the mission to end extreme devotes significant resources to improving the
quantis-intl.com distributors of Colombian coffee while working poverty within a generation and boost shared productivity and incomes of smallholder coffee
for the social, economic and general welfare of prosperity. One of its institutions, IFC, is the producers in Africa, Latin America, and Asia,
RAINFOREST ALLIANCE the coffee community. Since 2003, SKN has largest global development institution focused in particular through Feed the Future, the U.S.
The Rainforest Alliance’s ambitious mission is to participated in sustainability projects in several exclusively on the private sector. IFC helps Government’s global hunger and food security
conserve biodiversity and ensure sustainable coffee zones, the AAA Nespresso Program developing countries achieve sustainable growth initiative. USAID is the largest donor to
livelihoods by transforming land-use practices, in Huila being the largest, most comprehensive by financing investment, mobilising capital in South Sudan.
business practices, and consumer behaviour. Since program under execution. international financial markets, and providing usaid.gov

1987 its work has been guided by understanding nkg.net advisory services to businesses and governments.
that the health of the Earth is linked to the worldbank.org VOLCAFE
well-being of those whose livelihoods depend on SOFIES Volcafe is one of the world’s largest and oldest
the land and forests. The Rainforest Alliance Sofies is a sustainability consulting and project TOTAL IMPACT CAPITAL sourcing companies for green coffee, supplying
provides training to farmers and foresters, works management firm composed of a team of 30+ TOTAL Impact Capital specialises in sourcing and Nespresso with coffee from two countries. Since
with businesses committed to sustainability, and consultants and a large network of partners developing private investment opportunities that 2005, Volcafe has been implementing the
motivates citizens to adopt sustainable lifestyles and experts. are socially and financially attractive. It also Nespresso AAA Sustainable Quality™ Program
rainforest-alliance.org sofiesgroup.com designs innovative, sustainable financial solutions in two clusters in Costa Rica, providing training
for governments and non-profits to support and technical assistance to over 1,800 farmers.
ROOT CAPITAL TECHNOSERVE their missions. Since 2012, Volcafe has also implemented
Root Capital is an agricultural impact investor that TechnoServe is a leader in harnessing the power totalimpactcapital.com the AAA Program in the Cundinamarca cluster
grows rural prosperity in poor, environmentally of the private sector to help people lift themselves in Colombia.
vulnerable places in Africa and Latin America out of poverty. A non-profit organisation operating UNIVERSITY OF CAMBRIDGE volcafespecialty.com

by lending capital, delivering financial training, in 29 countries, TechnoServe works with – INSTITUTE FOR SUSTAINABILITY
and strengthening market connections for small enterprising people in the developing world to LEADERSHIP WBSCD
and growing agricultural businesses. build competitive farms, businesses and industries. The Institute for Sustainability Leadership within WBCSD is a global, CEO-led organisation
rootcapital.org With nearly 50 years of proven results, the University of Cambridge’s School of of forward-thinking companies that galvanises
TechnoServe has helped millions to create lasting Technology is dedicated to working with leaders the global business community to create
SAN prosperity for their families and communities. from business, government and civil society on a sustainable future for business, society and
The Sustainable Agriculture Network (SAN) is technoserve.org the critical global challenges of the 21st century. the environment. WBCSD has been an NSAB
an association of NGOs that started its activities cisl.cam.ac.uk member since 2015.
in 1997, and was legally established with wbcsd.org

headquarters in Mexico in January 2010.

The SAN is a group of international non-profit
organisations working for the conservation of
biodiversity and rural development. Its vision
of the world is one where agricultural activity
contributes to biodiversity conservation and
sustainable livelihoods.
san.ag

SDG
THE POSITIVE CUP G4-25, G4-26, G4-27 Partnerships 78/79
 COMPANY COFFEE ALUMINIUM CLIMATE

THE POSITIVE CUP SCOPE

AND PERFORMANCE OVERVIEW

The performance table below summarises all the indicators that reflect the progress of our activities and our impacts over
the years. They are reported for the calendar year ending 31 December 2016. To ease the reading, we have indicated the
correlation between our indicators, the Global Reporting Initiative (GRI) indicators and the Sustainable Development Goals
criteria. In the table, “Baseline date” represents the start point for monitoring.

Indicators GRI indicator SDG 2016 Baseline Baseline date Indicators GRI indicator SDG 2016 Baseline Baseline date

Company Aluminium
Investments in The Positive Cup (in ,000 CHF; cumulative) G4-EC7 1.3, 1.5 197,276 59,686 2014 Investments in collection and recycling systems
G4-EC7 12.2 59,254 16,377 2014
( in ,000 CHF, cumulative)
Number of markets where we operate G4-6 63 4 2003 Capsule collection capacity 8.4, 12.2 86% 24.30% 2009
Number of employees, excluding agents employees G4-9 13,135 330 2003 Percentage of ASI certified aluminium purchased 8.4, 12.2, 12.7 0% 2014
Recordable injury rate (per million hours worked) G4-LA6 8.8 4.3 7.9 2004 Used capsule valorisation 56% 2016
Number of boutiques 603 1 2000
Capsule recycling rate G4-EN 28 8.4, 12.2 24% 15% 2009
Number of production centres 3 1 1986

Number of Grand Cru permanent range 57 4 1986

Number of Facebook fans (millions) 5.7 0.2 2009

% of our consumers satisfied with the Nespresso brand
G4-PR5 94% Indicators GRI indicator SDG 2016 Baseline Baseline date
(scoring 7 to 10)1
Climate
Investments in climate adaptation solutions
G4-EC7 15.2, 15.3 5,750 923 2014
(in ,000 CHF, cumulative)
Carbon footprint reduction per cup of Nespresso 12.2 -19.4% 0% 2009
Indicators GRI indicator SDG 2016 Baseline Baseline date Number of trees planted within AAA landscapes
15.2, 15.3 1,441 130 2014
(in ,000, cumulative)
Coffee
Total on site water withdrawal (m3 per ton of product) G4-EN8 8.4, 12.2 7.6 19.1 2010
Investments in technical assistance and premiums
G4-EC7 1.3, 1.5 107,938 33,726 2014 Total on site energy consumption
(in ,000 CHF, cumulative) 8.4, 12.2 4.0 4.7 2010
(Gigajoules per ton of product)*
Number of AAA agronomists 342 20 2005
Direct and indirect GHG emissions
G4-EN15 8.4, 12.2 96 123 2010
Number of countries with AAA Program 6.3, 6.4, 6b, 8.3 12 5 2005 (kg CO2 per ton of product, Scope 1 and 2)*
Waste for disposal (kg per ton of product) G4-EN23 12.2, 12.5 0 0 2010
Farmers enrolled in AAA Program 6.3, 6.4, 6b, 8.3 71,216 1,500 2005
2.4, 6.3, 6.4, 6b, * Reporting boundary includes only Nespresso factories
Area managed under AAA in ,000ha 300 10 2009
15.3, 15.5
6.3, 6.4, 6b, 8.3,
Percentage volume sourced from the AAA Program2 82% 10% 2005
12.7, 15.3
Percentage volume in accordance with responsible
G4-FP2 6.3, 6.4, 6b, 8.3, 15.3 41% 0% 2005
production standards
AAA agronomist positions held by women 5.5 30% 0% 2005

Number of farmers enrolled in the savings plan 1.3, 8.3 1100 0 2014

Coffee revival origins 8.3 2 0 2014

% AAA farms within 2km of High Conservation Value areas G4-EN11 15.5, 15.9 10.0% 2016

1
Average of the indicator monitored on 38 countries
2
The figure includes the volume with full traceability to farm (as well reported in the Nestlé in Society report 2016) and the African volume with mass balance traceability

G4-6, G4-9, G4-EC7, G4- FP2, G4-EN8, G4-EN11,

THE POSITIVE CUP G4-EN15, G4-EN23, G4-EN28, G4-LA6, G4-PR5 80/81
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

GENERAL STANDARD DISCLOSURES

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Strategy and analysis

G4-1 TPC: Introduction > CEO statement p.5 CEO statement about the relevance of sustainability to the organisation
and the organisation’s strategy for addressing sustainability

Organizational profile
G4-3 TPC: Front cover of report Name of the organisation
G4-4 TPC: Nestlé Nespresso S.A. > Our value chain p.14-15 Our value chain: products and services
NCW: Facts and figures www.nestle-nespresso.com/about-us/facts-and-figures
G4-5 NCW: Our Company www.nestle-nespresso.com/about-us/our-company Location of our headquarters
G4-6 TPC: Coffee > The scope of the AAA Program p.42-43 Where we operate
TPC: Coffee > The scope of our recycling actions p.54-55
TPC: Company > Our value chain p.16-17
NCW: Global Presence www.nestle-nespresso.com/about-us/global-presence
G4-7 NCW: Our company www.nestle-nespresso.com/about-us/our-company Ownership and legal form
CGR: Company > Group structure and shareholders p.3-4
G4-8 TPC: Company > Our value chain p.16-17 Our geographical markets, sectors served, customers
AR: Nestlé Food and Beverage p.24 and beneficiaries types
AR: Principal key figures and sales by area p.45, 48
CFS: Companies of the Nestlé Group p.149
NCW: Facts and figures www.nestle-nespresso.com/about-us/facts-and-figures
G4-9 TPC: Company > Our people p.18-19 The scale of our organisation (employees, operations, sales, products Net sales Non-disclosure of financial statement Nespresso report of financials, net sales,
TPC: Aluminium > The scope of our recycling actions p.54-55 and services) capitalisation for Nespresso net revenue is aggregated with Nestlé
TPC: Coffee > The scope of the AAA Program p.42-43 Financial Statements
TPC: About this report > Our CSV performance: number of employees p.81
G4-10 TPC: Company > Our people p.18-19 The structure of our workforce The total workforce is not reported by region The split per category is not available We are looking at how this information
TPC: About this report > Our CSV performance: number of employees p.81 and gender can be collected to include it in our 2020
NCW: News and features > Nespresso Corporate Production Centres Factsheet CSV report
www.nestle-nespresso.com/asset-library/documents/nespresso%20-%20
corporate%20production%20centres%20factsheet.pdf
G4-11 NiS: Our people > Promoting positive employee relations p.172 Existence of bargaining agreements
G4-12 TPC: Company > Our value chain p.16-17 Our supply chain
TPC: Coffee > Farmer relationship management p.30-31
TPC: Coffee > The AAA Program in East Africa p.36-37
TPC: Aluminium > The benefits of aluminium p.48-49
TPC: Aluminium > Capsule life cycle management p.52-53
G4-13 N/A – This is our first GRI report Significant changes since last reporting period
G4-14 NCW: Business Principles www.nestle-nespresso.com/about-us/business-principles Our approach to precautionary principle Nespresso should consider providing
NiS: Environmental sustainability > Our policies and standards p.110 more details about its application
of the precautionary principle
G4-15 TPC: Company > Partnerships for impact p.20-21 Our economic, environmental and social charters, principles and initiatives
NiS: Creating Shared Value > Our contribution to global goals p.10
NiS: Creating Shared Value > Collaborations and partnerships p.23
G4-16 TPC: Coffee > p.29, 30, 33, 35, 36, 39, 41 Significant memberships in associations and national or international
TPC: Company > Partnerships for impact p.20-21 advocacy organisations
TPC: Aluminium > Our approach to aluminium stewardship p.50-51
TPC: Aluminium > p. 52, 54
TPC: Climate > Agroforestry for climate adaptation p.67
TPC: Climate > The scope of our climate actions p.68-69

Identified material aspects and boundaries

G4-17 Nestlé Nespresso S.A. Our organisation’s entities
G4-18 TPC: About this report > Methodology p.70 Our materiality assessment
G4-19 TPC: Company > What really matters p.10 Our material aspects
TPC: About this report > Methodology p.70
G4-20 TPC: About this report > Methodology p.70 Boundaries of our material aspects inside the organisation Nespresso should consider reporting on
boundaries of material aspects
G4-21 TPC: About this report > Methodology p.70 Boundaries of our material aspects along our supply chain Nespresso should consider reporting on
boundaries of material aspects
G4-22 There are no restatements of information as this is our first GRI report Significant changes in materiality since previous report
G4-23 There are no restatements of information as this is our first GRI report Significant changes in scope and aspect boundaries since previous report

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 82/83
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

GENERAL STANDARD DISCLOSURES

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Stakeholder engagement
G4-24 TPC: About this report > Methodology p.70 Our stakeholders
TPC: Company > Governance and management tools p.22
G4-25 TPC: About this report > Methodology p.70 Identification of our stakeholders
TPC: About this report > Our partners p.74, p.76 and p.78
G4-26 TPC: About this report > Methodology p.70 Our approach to stakeholder engagement
TPC: Company > Our value chain p.16
TPC: Company > Our people p.18
TPC: Company > Governance p.22
TPC: About this report > Our partners p.76 and p.78
NiS: Nestlé in society: Creating Shared Value > Responding to stakeholders p.22
G4-27 TPC: Company > What really matters p.10 Our answers to stakeholders’ main concerns
TPC: About this report > Methodology p.70
TPC: About this report > Our partners p.76 and p.78

Report profile
G4-28 This report covers Nespresso’s global operations for the year ending 31 December 2016. Reporting period
Where we refer to a “market”, it means our business and/or activities at the level of a
country or countries
G4-29 N/A – This is our first GRI report Previous report date
G4-30 GRI full report updated in 2021 (2020 strategy achievements) Reporting cycle
GRI summary report published yearly (includes highlights of the year, commitments status
and GRI quantitative indicators)
G4-31 TPC: About this report > Impressum p.101 Contact point for questions
G4-32 a. This report is prepared ‘in accordance’ with the core option of the Global Reporting “In accordance” option chosen, content index and external
Initiative’s (GRI) G4 guidelines, and the Food Processing Sector Supplement assurance report
b. TPC: About this report > GRI indicator table p.84-97
c. TPC: About this report > Bureau Veritas assessment p.72-73
G4-33 TPC: About this report > Bureau Veritas assessment p.72-73 Informations on external assurance for the report

Governance
G4-34 TPC: Company > Governance p.22-23 Our governance structure
NCW: Nespresso management website
www.nestle-nespresso.com/about-us/management

Ethics and integrity

G4-56 NCW: Business Principles www.nestle-nespresso.com/about-us/business-principles Our values, principles, standards and norms
NiS: Human rights and compliance p.132-150
NiS: Human rights and compliance > Anti-corruption p.147
NiS: Our people > Our people strategy p.153–154
NiS: Creating Shared Value > Business ethics p.15

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 84/85
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

SPECIFIC STANDARD DISCLOSURE

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Economic
Material aspect: Economic performance How we create and distribute economic value
EC/EP- NiS: Creating Shared Value: a long-term perspective p.9–11 Management approach of our economic performance
G4-DMA TPC: Introduction > CEO statement p.5
TPC: Introduction > Ambitions and Goals p.6
TPC: Company > Creating Shared Value p.12-13
G4-EC2 TPC: Climate chapter p.56-69 Impact of climate change in economic performance
Material aspect: Market presence Redistribution of wealth to local communities
EC/MP- Our global presence has a significant impact on local economies employment both directly Management approach of our market presence
G4-DMA and in our supply chain
NCW: Facts and figures www.nestle-nespresso.com/about-us/facts-and-figures
NiS: Our people > Promoting positive employee relations > Supporting a living wage p.171
G4-EC6 – Senior management hired from the local community Indicator omitted The information is currently unavailable We are looking at how this information
can be collected to include it in our 2020
CSV report
Material aspect: Indirect economic impacts Positive indirect economic impacts at national, regional
or local level generated by Nespresso’s operations
EC/IEI- Our value chain generates significant indirect economic impacts, both positive and negative Management approach of our indirect economic impacts
G4-DMA TPC: Coffee > What really matters p.26
TPC: Aluminium > What really matters p.46
TPC: Climate > What really matters p.58
G4-EC7 TPC: Coffee > The Nespresso AAA Sustainable Quality™ Program, p.28-29 Development and impact of infrastructure investments
TPC: Aluminium > Capsule life cycle management p.52-53 and services supported
TPC: Climate > The scope of our climate actions p.68-69
TPC: About this report > Our CSV Performance p.81
The investments related to the services in place are commercial engagements
These investments aim to generate positive impacts
Material aspect: Procurement/sourcing practices Procurement practices that allow trust and stability
among suppliers
EC/PSP- TPC: Coffee > What really matters by TPC: Coffee chapter p.24-43 Management approach of our procurement and sourcing practices
G4-DMA TPC: Coffee > What really matters p.24-43
TPC: Aluminium > What really matters p.46-47
TPC: Aluminium > Our approach to aluminium stewardship p.50-51
FP2 TPC: Company > Our value chain p.14 Purchased volume in accordance with responsible production standards
TPC About this report > Our CSV Performance p.81

Environment
Material aspect: Materials Conserving global resources, reducing materials intensity
EN/MA- TPC: Company > What really matters p.10-11 Management approach of our materials use
G4-DMA TPC: Aluminium > What really matters p.46-47
TPC: Aluminium > Capsule life cycle management p.52-53
TPC: Climate > Sustainable machine design p.64-65
NiS: Environmental sustainability > Our policies and standards p.110
G4-EN2 TPC: Climate > Sustainable machine design p.64-65 Recycled input materials Omitted for aluminium We do not disclose the volume of procured
TPC: Aluminium > Capsule life cycle management p.52-53 recycled aluminium for commercial
confidentiality
Material aspect: Energy Energy use and requirements implying a minimum impact
EN/EN- TPC: Aluminium > Our approach to aluminium stewardship p.50-51 Management approach of our energy use
G4-DMA TPC: Aluminium > Capsule life cycle management p.52-53
TPC: Climate > Life cycle assessment p.60-61
TPC: Climate > The environmental performance of our operations p.62-63
TPC: Climate > Sustainable machine design p.64-65
NiS: Environmental sustainability > Our policies and standards p.110
G4-EN7 TPC: Climate > Life cycle assessment p.60-61 Reduction in energy requirements of products and services Omitted numbers in joules Our energy savings all along the value chain
TPC: Climate > The environmental performance of our operations p.62-63 are translated in CO2 equivalent.
TPC: Climate > Sustainable machine design p.64
See our CDP 2016 Investor submission found on
www.nestle.com/csv/performance/external-assessments
(Due to different reporting timings the CDP submission available at time of publication
is for the previous year. The latest CDP submission will be available on publication using
the above link)

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 86/87
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

SPECIFIC STANDARD DISCLOSURE

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Environment
Material aspect: Water Proper management of water and waste water
EN/WA- Nestlé commitment on Water Stewardship: www.nestle.com/asset-library/documents/library/ Management approach of our water use
G4-DMA documents/corporate_social_responsibility/nestle-commitment-water-stewardship.pdf
TPC: Coffee > What really matters p.26-27
TPC: Coffee > Innovation for community resilience p.32-33
TPC: Coffee > Our approach to natural capital p.34-35
TPC: Climate > The environmental performance of our operations p.63
TPC: About this report > Our CSV Performance p.81
G4-EN8 Total water withdrawal at factory ( in ,000m3): 526 including Surface water: 475; Water withdrawal
Ground water: 0; Municipal water:45; Rain water: 7

TPC: Climate > The environmental performance of our operations p.62-63

Material aspect: Biodiversity Strategy for biodiversity management and minimum impact
on land in or adjacent to protected areas
EN/BI- TPC: Coffee > Our approach to Natural Capital p.34-35 Management approach of our impacts on biodiversity
G4-DMA
G4-EN13 a. TPC: Coffee > Our approach to Natural Capital p.34-35 Habitats protected or restored c. Indicator omitted The IBAT screening is currently still under We will update our 2020 CSV report
a. b. d. TPC: About this report > Our CSV Performance p.81 progress with IUCN as per the outcome of the action plan
under progress
Material aspect: Emissions Minimum emissions of greenhouse gases and of ozone-
depleting substances and other significant air emissions
EN/EM- TPC: Aluminium > Our approach to aluminium stewardship p.50-51 Management approach of our procurement and sourcing practices
G4-DMA TPC: Aluminium > Capsule life cycle management p.52-53
TPC: Climate > Life cycle assessment p.60-61
TPC: Climate > The environmental performance of our operations p.62-63
TPC: Climate > Sustainable machine design p.64-65
NiS: Environmental sustainability > Our policies and standards p.110
G4-EN18 a. TPC: Climate > What really matters p.58-59 Greenhouse gas (GHG) emissions intensity
b. TPC: Climate > What really matters p.58-59
c. TPC: Climate > Life cycle assessment p.60
d. CO2 equi. includes CO2, N2O, CH4
Material aspect: Product and services Minimum impacts of our products and services during their use
and end-of-life
EN/PS- TPC: Aluminium > What really matters p.46-47 Management approach of environmental impacts of products
G4-DMA TPC: Aluminium > Capsule life cycle management p.52-53 and services
Cardboard packaging has not been considered with a high materiality for this report,
nevertheless the sourcing of corrugated carbon and paper is covered within the Nestlé
responsible sourcing guideline. Equally, 100% of the cardboard used by our factories is
recycled at its end-of-life
G4-EN28 TPC: Aluminium > Capsule life cycle management p.52-53 Recycling of products sold and packaging Nespresso should include more
TPC: About this report > Our CSV Performance p.81 information regarding the data collection
process in compliance with criterion b.
Material aspect: Overall Our overall expenditures and investments for
environmental protection
EN/OV- TPC: Company > What really matters p.10-11 Management approach of our environmental expenditures
G4-DMA TPC: Coffee > What really matters p.26-27
TPC: Aluminium > What really matters p.46-47
TPC: Climate > What really matters p.58-59
G4-EN31 TPC: Company > Governance and management tools p.22-23 Expenditures for environmental protection
TPC: Coffee > The Nespresso AAA Quality TM Program p.28
TPC: Aluminium > Capsule life cycle management p.52
TPC: Climate > The scope of our climate actions p.68-69

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 88/89
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

SPECIFIC STANDARD DISCLOSURE

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Environment
Material aspect: Supplier environmental assessment Managing our suppliers potential or actual impacts
on the environment
EN/SEA- a. TPC: Coffee > Monitoring and evaluation p.40 Management approach for our suppliers’ environmental assessment
G4-DMA b. Establishment of sourcing programs which enable the evaluation of the sustainability
(social and environmental) of our suppliers
TPC: Coffee > The Nespresso AAA Sustainable Quality™ Program
TPC: Aluminium > Our approach to aluminium stewardship p.50-51
G4-EN33 a. TPC: Coffee > Monitoring and evaluation p.41 Environmental impacts in supply chain and actions taken Nespresso should present the
b. TPC: Coffee > Monitoring and evaluation p.41 information in a way that is compatible
c. TPC: Coffee > Monitoring and evaluation p.41 with criteria d and e
d. TPC: Coffee > Farmer relationship management p.30
e. TPC: Coffee > Farmer relationship management p.30-31
TPC: Coffee > Monitoring and evaluation p.41
TPC: About this report > Our CSV Performance p.81

Social
Labour practices and decent work
Material aspect: Employment Appropriate working conditions in our operations and along
our supply chain
LA/EM- NiS: Our people > Our people strategy p.153 Management approach of employment
G4-DMA Our offices, boutiques and factories are subject to the certification OHSAS. By the end
of 2016, all our premises certified with the exception of Canada, Germany, France and
Luxembourg (covering around 80% of the Nespresso employee population)
G4-LA1 a. a. Total number and rate of new employees hired a. Indicator omitted The information is currently not available We are looking at how this information
b. 3,264; 26.6% b. Total number and rate of employee turnover can be collected to include it in our 2020
CSV report
Material aspect: Labour/management relations Our employees are satisfied and motivated thanks to proper
human resources management
LA/LMR- TPC: Company > Our people p.18-19 Management approach of labour and management relations
G4-DMA NiS: Our people > Promoting positive employee relations p.171-172
G4-LA4 NiS: Our people > Promoting positive employee relations p.171-172 Minimum notice regarding operational changes
Before making operational changes that could substantially affect our
employees, we provide a period of notice outlining the proposed changes.
While a minimum period and provisions for consultation and negotiation are specified
in collective agreements in 28 countries, in others, it depends on local laws.
On average, the minimum period is 38 days
Material aspect: Occupational health and safety Assisting our workforce members regarding occupational
diseases and injuries through education, training, prevention
or treatments
LA/OHS-G4- TPC: Company > Our people p.18-19 Management approach of occupational health and safety
DMA Our offices, boutiques and factories are subject to the certification OHSAS. By the end of
2016, all our premises to the exception of Canada, Germany, France and Luxembourg
G4-LA6 a. Recordable injury rate Nespresso global: 4.3 per million hours worked, Injuries, occupational diseases, absenteeism and fatalities a. Occupational diseases rate (ODR), lost day a. The data is currently not available We are looking at how this information
work related fatalities: 0 rate (LDR), absentee rate (AR), for the per region and per gender can be collected to include it in our 2020
c. Injuries and illnesses are classified and reported according to a global Nestlé standard, total workforce (that is, total employees b. The data is currently not available CSV report
which is based on the United States OSHA record keeping standard plus supervised workers), by:
TPC: About this report > Our CSV Performance p.81 - Region
- Gender
b. Report types of injury, injury rate (IR),
occupational diseases rate (ODR), lost
day rate (LDR), absentee rate (AR) and
work-related fatalities for independent
contractors working on-site to whom
the organisation is liable for the general
safety of the working environment, by:
- Region
- Gender
Material aspect: Training and education Improving our human capital and organisation development
through internal training and education programs
LA/TE- TPC: Company > Our people p.18-19 Management approach of training and education for our workforce
G4-DMA
G4-LA9 TPC: Company > Our people p.18-19 Hours of training per employee Gender This data is not available We are looking at how this data can be
Employee category collected to include it in our 2020 CSV report

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 90/91
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

SPECIFIC STANDARD DISCLOSURE

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Social
Labour practices and decent work
Material aspect: Diversity and equal opportunity We foster diversity and equal opportunities to different
age groups and minorities
LA/DEO- NCW: Nestlé Code of Business Conduct Management approach of diversity and equal opportunity
G4-DMA https://www.nestle-nespresso.com/about-us/business-principles in our workforce
TPC: Company > Our people p.18-19
G4-LA12 a. TPC: Company > Our people p.18-19 Composition of governance bodies and workforce according a. Report the percentage of individuals within This data is not available We are looking at how this information
b. TPC: Company > Our people p.18-19 to different categories the organisation’s governance bodies in can be collected to include it in our 2020
each of the following diversity categories: CSV report
- Gender
- Age group: under 30 years old,
30-50 years old, over 50 years old
- Minority groups
- Other indicators of diversity
 where relevant
b. Report the percentage of employees
per employee category in each of the
following diversity categories:
- Gender
- Age group: under 30 years old,
30-50 years old, over 50 years old
- Minority groups
- Other indicators of diversity
 where relevant
Material aspect: Equal remuneration for women and men We work to ensure equal gender opportunities
in our workforce
LA/ER- TPC: Company > Our people p.18-19 Management approach of equal remuneration for women and men
G4-DMA in our workforce
G4-LA13 – Ratio of basic salary and remuneration of women to men Omission This data is not available We are looking at how this information
can be collected to include it in our 2020
CSV report
Material aspect: Supplier assessment for labour practices Ensuring our suppliers have acceptable labour practices
LA/SALP- a. TPC: Coffee > Monitoring and evaluation p.40 Management approach of our suppliers labour practices
G4-DMA b. Establishment of sourcing programs which enable the evaluation of the sustainability
(social and environmental) of our suppliers
TPC: Coffee > The Nespresso AAA Quality™ Program p.28
TPC: Aluminium > Our approach to aluminium stewardship p.50-51
G4-LA15 a. TPC: Coffee > Monitoring and evaluation p.41 Significant actual and potential negative impacts for labour practices Nespresso should present the
TPC: Aluminium > Our approach to aluminium stewardship in the supply chain and actions taken information in a way that is compatible
b. TPC: Coffee > Monitoring and evaluation p.41 with criteria d and e
c. TPC: Coffee > Monitoring and evaluation p.41
d. TPC: Coffee > Farmer relationship management p.30
e. TPC: Coffee > Farmer relationship management p.30-31
TPC: Coffee > Monitoring and evaluation p.41
Material aspect: Labour practices grievance mechanisms Existence of grievance mechanisms regarding labour practices
accessible by our suppliers workforce
LA/LPGM- NiS: Human rights and compliance > Reporting of compliance violations p.148-149 Management approach of labour practices grievance mechanisms
G4-DMA
G4-LA16 NiS: Human rights and compliance > Reporting of compliance violations p.148-149 Number of grievances about labour practices

Human rights
Material aspect: Non-discrimination Ensuring no discrimination around race, colour, sex, religion,
political opinion, national extraction or social origin
HR/ND- NCW: Nestlé’s Corporate Business Principles: Management approach of non-discrimination
G4-DMA www.nestle.com/asset-library/documents/library/documents/corporate_governance/
corporate-business-principles-en.pdf
TPC: Company > What really matters p.11
NiS: Our people > Combating discrimination p.172
G4-HR3 In 2016, we had two complaints alleging harassment against management team Number of incidents of discrimination and measures taken against them
members (whether at global or local level). Both complaints were investigated and found
to be without merit

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 92/93
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

SPECIFIC STANDARD DISCLOSURE

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Social
Human rights
Material aspect: Freedom of association and collective bargaining Absence of internal policies that may affect employees
ability to join a trade union or bargain collectively
HR/FACB- NCW: Nestlé’s Corporate Business Principles: www.nestle.com/asset-library/documents/ Management approach for ensuring freedom of association
G4-DMA library/documents/corporate_governance/corporate-business-principles-en.pdf and collective bargaining
TPC: Company > What really matters p.11
TPC: Coffee > Monitoring and evaluation p.41
G4-HR4 a. 0 occurrence of the violation of this criteria has been recorded, however we remain Identification of freedom of association limitations in operations
vigilant in the sourcing regions where large farms or wet mills employ many workers and suppliers and measures taken
such as Brazil, Guatemala, Ethiopia, Kenya and India
b. TPC: Coffee > Monitoring and evaluation p.40
TPC: Coffee > The AAA Program in East Africa p.36 (not p. 38)
Material aspect: Child labour No child labour or young workers exposed to hazardous work
HR/CL- NCW: Nestlé’s Corporate Business Principles Management approach of child labour risks
G4-DMA www.nestle.com/asset-library/documents/library/documents/corporate_governance/
corporate-business-principles-en.pdf
TPC: Company > What really matters p.11
TPC: Coffee > Monitoring and evaluation p.41
TPC: Coffee > Farmer relationship management p.31
G4-HR5 a. b. Five occurrences of the violation of this criteria has been recorded in Colombian Identification of child labour in operations and suppliers
coffee sector (field operations): three solved, one in progress and one exclusion from and measures taken
the program. We remain vigilant in the sourcing regions where such non compliance
have already occurred like in Guatemala, Ethiopia and Kenya
c. TPC: Coffee > Monitoring and evaluation p.40
TPC: Coffee > The AAA Program in East Africa p.36
Material aspect: Forced or compulsory labour No forced or compulsory labour in our facilities or suppliers
HR/FCL- NCW: Nestlé’s Corporate Business Principles Management approach of forced or compulsory labour risks
G4-DMA www.nestle.com/asset-library/documents/library/documents/corporate_governance/
corporate-business-principles-en.pdf
TPC: Company > What really matters p.11
TPC: Coffee > Monitoring and evaluation p.41
TPC: Coffee > Farmer relationship management p.31
G4-HR6 a. 0 occurrence of the violation of this criteria has been, however we remain vigilant in Risks of compulsory labour and measures taken
the sourcing regions where such non compliance have already occurred like in
Guatemala, Ethiopia and Kenya
b. TPC: Coffee > Monitoring and evaluation p.33
TPC: Coffee > The AAA Program in East Africa p.36
Material aspect: Supplier human rights assessment Availability of mechanisms to screen potential human rights
violations in our suppliers
HR/SHRA- a. TPC: Coffee > Monitoring and evaluation p.40 Management approach of our suppliers’ human rights assessment
G4-DMA b. Establishment of sourcing programs which enable the evaluation of the sustainability
(social and environmental) of our suppliers
TPC: Coffee > The Nespresso AAA Quality™ Program p.28
TPC: Aluminium > Our approach to aluminium stewardship p.50-51
G4-HR11 a. TPC: Coffee > Monitoring and evaluation p.41 Significant actual and potential negative human rights impacts in the Nespresso should present the
TPC: Aluminium > Our approach to aluminium stewardship supply chain and actions taken information in a way that is compatible
b. TPC: Coffee > Monitoring and evaluation p.41 with criteria d and e
c. TPC: Coffee > Monitoring and evaluation p.41
d. TPC: Coffee > Farmer relationship management p.30
e. TPC: Coffee > Farmer relationship management p.30-31
TPC: Coffee > Monitoring and evaluation p.41
Society
Material aspect: Local communities Working to engage with local communities
SO/LC-G4- TPC: Coffee > What really matters > p.26 Management approach of local communities engagement
DMA TPC: Coffee > Innovation for communities resilience > p.32
TPC: Coffee > The AAA Program in East Africa > p.36
TPC: Coffee > Coffee revival > p.38
G4-SO1 100% of our coffee operations have projects which engage with local community as part of Percentage of operations with implemented local community
the deployment of the AAA Program engagement, impact assessments, and development programs

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 94/95
 COMPANY COFFEE ALUMINIUM CLIMATE

GRI G4 CONTENT INDEX

SPECIFIC STANDARD DISCLOSURE

Indicators Page number (or link) Description Identified omission(s) Reason(s) for omission(s) Explanation for omission(s) External assurance

Social
Material aspect: Anti-competitive behaviour Working to avoid current or future anti-competitive behaviour
SO/ACB- AR: Corporate governance and compliance p.54 Management approach to avoid anti-competitive behaviour
G4-DMA NIS: Business principles and governance p19-24

G4-SO7 There are three ongoing claims against us, of which two were initiated by Legal actions for anti-competitive behaviour, anti-trust,
the same competitor and monopoly practices
Product responsibility
Material aspect: Customer health and safety Selling products totally safe for consumption
PR/CHS- This is our responsibility to ensure that the products we retail on the markets are proper for Management approach for ensuring our customers health and safety
G4-DMA consumption and free of any kind of contamination. We have a quality management system
in place to ensure the quality and safety of our products and our factories are certified
ISO 22000
FP5 100% of production volume is manufactured in sites certified by an independent third party Percentage of production volume manufactured in sites certified
TPC: Company > Our value chain, p.14-15 by an independent third party according to internationally recognised
food safety management system standards
Material aspect: Product and service labelling Ensuring consumers access to complete information
on our products
PR/PSL- We measure yearly our customer satisfaction with our products Management approach for ensuring our products and services
G4-DMA and services via a global survey proper labelling
All information regarding the products description and ingredients
are available on the outer packaging
Consumers can contact Nespresso via emails and call centres to ask any
questions or escalate any comments regarding the products and services
G4-PR5 TPC: Coffee > What really matters p.27 Results of surveys measuring customer satisfaction
TPC: About this report > Our CSV Performance p.81
Material aspect: Marketing communications Implementing loyal and trustful advertising
and marketing practices
PR/MC- NCW: Nestlé Business Principles Management approach about marketing communications
G4-DMA www.nestle-nespresso.com/about-us/business-principles
NIS: Nutrition, Health and Wellness > Responsible marketing p.52-56
G4-PR7 NIS: Human Rights and Compliance > Reporting of compliance violations > Incidents of non-compliance with regulations and voluntary codes
The Nestlé Integrity Reporting System p.148 concerning marketing communications (advertising, promotion,
NIS: Human Rights and Compliance > Reporting of compliance violations > Tell us p.149 and sponsorship)
Material aspect: Customer privacy Ensuring total protection of customers privacy and data
PR/CP- NCW: Nespresso’s Privacy and personal data policy Management approach for ensuring privacy to our customers
G4-DMA https://www.nestle-nespresso.com/info/privacy-policy
NIS: Human Rights and Compliance > Data Privacy p.149
G4-PR8 There have been no reportable breaches of customer data. Whilst there have been incidents Complaints regarding breaches of customer privacy and losses of
with the potential to compromise customer data privacy, these incidents were resolved within customer data
24-48h of being raised and there was no impact on customers

TPC The Positive Cup – CSV Report 2016 CFS Nestlé Financial Statements 2016
NCW Nespresso Corporate Website AR Nestlé’s Annual Review 2016
THE POSITIVE CUP G4-32 CGR Nestlé’s Corporate Governance Report 2016 NIS Nestlé in Society 2016 96/97
 COMPANY COFFEE ALUMINIUM CLIMATE

We dedicate this report to the most important partners

of all – the AAA farmers and agronomists. They share
our passion for high quality and sustainable coffees and
contribute to make every cup enjoyed by our consumers,
a positive cup.

The Nespresso Team

AAA farmer, Juan Carlos Martínez, and his son
Juan de Dios Martinez, with the
Santander limited edition, Colombia

THE POSITIVE CUP 98/99

 COMPANY COFFEE ALUMINIUM CLIMATE

IMPRESSUM

In case of doubt or differences of interpretation,

the English version shall prevail over a translated version.

CONCEPT & CONTENT

Nestlé Nespresso, Sustainability Team

GRI COMPLIANCE
Nestlé Nespresso, Sustainability Team with Sofies

VISUAL & VERBAL IDENTITY

Nestlé Nespresso, Sustainability Team with creative agency Magic Pencil

PHOTOGRAPHY
Christian Lamontagne
Emmanuel Nguyen Ngoc
Patricia Rincon Mautner
Alexis Narodetzky

BROCHURE
All wasted paper is recycled
Condat Mat Périgord paper FSC
Cover 300 gsm, printed four colours recto/verso with soft touch lamination recto
Inside pages 115 gsm, printed four colours and satinated varnish recto/verso

CONTACT
Nestlé Nespresso S.A.
Sustainability and Corporate Communications
Avenue de Rhodanie 40
CH-1007 Lausanne
Switzerland
Telephone: +41 21 796 9696

AAA farmer Isaya Lokolong Latiyo on his farm,

South Sudan

THE POSITIVE CUP G4-31 100/101

 COMPANY COFFEE ALUMINIUM CLIMATE

www.nespresso.com/positive