EU Policy. Nestlé shareholders push for more healthy offerings amid sugar scandal fails

A group of company investors, that includes Legal and General Investment Management (LGIM), with investments amounting to a total of 1.68 trillion dollars in assets (under management) supported the resolution voted on at Nestlé's Annual General Meeting in Lausanne, Switzerland.

With 88% of the votes against, the company rejected the shareholders petition to "reduce its reliance on sales of less healthy products".

“While the vote we achieved today may be less than we wanted, the direction of travel is clear. Investors and consumers are recognising the importance of addressing the business risks and public health impacts of an industry that is heavily reliant on the sales of unhealthy food," Simon Rawson, Deputy Chief Executive of ShareAction, the NGO that coordinated the resolution, said after the vote. 

He added that left unaddressed, the public health trends that spurred this resolution will only worsen. 

Last year, Nestlé announced new health targets, pledging to increase sales of more nutritious products by 2030 by 50%, which, according to the shareholders is not ambitious enough.

The resolution called for an internationally recognised target to be set to significantly reduce the sales of unhealthy foods worldwide.

Nestlé's webpage reads that "driven by our company purpose – enhancing the quality of life and contributing to a healthier future – we are focusing our efforts on ensuring that our product brands enable healthier lives".

Howarth explained in a press release that, despite the company's claims, three-quarters of its global sales are unhealthy products that contain high levels of salt, sugar and fats.

The investors' call comes amid a scandal on high sugar baby food sold by Nestlé in low- and middle-income countries revealed in an investigation by Public Eye and the International Baby Food Action Network (IBFAN).

The company controls 20% of the world's baby food market which amounts to nearly $70 billion (€656 billion). In low- and middle-income countries, Nestlé’s baby food brands Nido and Cerelac made more than $2.5 billion (€2.3 billion) in 2022, according to Euromonitor.

The investigation shows that these baby food brands promoted as healthy and