Nestlé/Nespresso

Update, April 2024: Shared value is a joke for coffee farmers in Chiapas, Mexico. Promises and assistance by Nestlé have fallen so short of covering costs for these farmers they burned sacks of coffee in the streets.

Nestlé has released their 2015 Creating Shared Value report. The Swiss multinational is one of the largest food companies in the world and produces one of the most correspondingly voluminous CSR reports. I delved into the 2013 report in some detail, and you can refer to that post for context. Here, I will just highlight the most salient reports regarding coffee.

• Nestlé continues to purchase about 10% of the world’s coffee production. In 2014, those purchases totalled 842,000 metric tons, in 2015 it was 849,000 tons. I track these figures in the table at Corporate coffee: How much is eco-certified?.
• Of those 849,000 tons, only 56% is traceable back to a farm or plantation (p.115). The company defines that traceability as 4C Verified — compliant with the most rudimentary, baseline standards in the industry. Or to put it another way, over 373,000* tons is NOT traceable to source and may not even meet the most basic standards of ethical human and environmental decency.
• More astonishing, Nestlé sources about a quarter of their coffee (225,600 tons) directly from 760,000 farmers (p. 100) via their Farmer Connect program (p.117) of which 85% is 4C compliant. That means 15% of their direct-sourced coffee — from known producers they are working with — is not even 4C Verified.
• 85% of the approximately 55,000 tons of coffee used for Nespresso’s permanent Grand Cru coffee pod selections is sourced under their Nespresso AAA Sustainable Quality program (p. 119), about the same percentage as the past 3 years. This is their proprietary program based on Rainforest Alliance standards. Read more here.
  
• There is no mention of the volume of organic or other eco-certified coffee purchases. Nestlé doesn’t place value in third-party certification for coffee (see statement below).

At 351 pages, there is much more material in the report, which you can download at their website.
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*56% of 849,000 tons = 475,440, although later (p. 118) in the report they say that 482,054 tons represents 56%. The latter would mean they purchased 860,811 tons of coffee, so I used the former figures, as they are given several times in the report.

Updated in April 2016

In 2009, Nespresso, the premium capsule coffee unit of the giant Swiss multinational food corporation Nestlé, announced a sustainability initiative they called Ecolaboration. I covered the goals in this post.

One major focus has been Nespresso’s AAA Sustainable Quality Program (“AAA program” for short). The goal in 2009 was to source 80% of Nespresso’s coffee from this program by 2013. They reached that goal, and in 2015 they were at 85%, with a goal of 100% by 2020. It is important to note that parent company Nestlé buys around 850,000 tons of green coffee annually, of which only about 0.2% is eco-certified (via Fair trade/organic).  Nespresso, which has a separate supply chain, sourced 55,000 tons of coffee through the AAA program in 2013, which represented 84% of their purchases. Thus, Nespresso buys about 65,500 tons of coffee, a small fraction of the total purchased by the company.

The AAA program’s three “A’s” are Quality, Productivity, and Sustainability. Once a farm meets the quality requirements (about 50 criteria) and is accepted into the AAA program, they enter a process to evaluate their social and environmental sustainability efforts. This aspect of the program was developed in partnership with Rainforest Alliance. For many years, the criteria or guidelines were not available to the public.  The Generic Tool for the Assessment of Sustainable Quality (TASQ) is now available online. What follows is an overview of the requirements for producers to be included in the AAA program under this TASQ, with an emphasis on the environment. Many of the statistics providing context for the guidelines come from Nespresso’s Ecolaboration Full-term Report, 2009-2013, published September 2014 (PDF), or the Coffee Barometer 2014 (PDF).

Criteria and scoring

The TASQ is based on the 2010 Sustainable Agriculture Network (SAN) standards used for Rainforest Alliance farm certification.  Nespresso has divvied up and tweaked the 10 principals and 99 criteria in the 2010 SAN standard into 42 principals and 296 criteria. Of those, 36 are classified as “critical” (12% of total). They include prohibitions on such things as hunting endangered species, paying below the minimum wage, or not documenting coffee transactions, and are considered “internationally accepted minimum standards for sustainability.”

If a farm does not meet all the critical criteria, they are designated as Under-performing but allowed time to resolve the shortcomings. Once a farm meets all the critical criteria, they are then considered compliant and at the Basic performance level. Thus, there is a low bar (especially regarding environmental standards) for inclusion in the program.

There are three more performance levels in the AAA program, reached by complying with increasing percentages of criteria on top of the critical ones: Emerging (at least 33% of non-critical), High Performing (66%) and Certified (80% or greater and at least 50% per principal).

“Certified” here does not mean that a farm automatically receives Rainforest Alliance (or any other) certification. If a farm chooses to apply for RA certification, Nespresso pays for the first year of certification audits. This is encouraged because at the farm level, only 30% of each harvest from participating farmers meets Nespresso’s quality requirements. Nespresso maintains that due to overall quality improvements and/or certification, farmers are able to sell the rejected portion of their crop at a higher price to other buyers.

As of 2015, according to the company Creating Shared Value Report, there are 75,000 farmers in the AAA program, but Nespresso does not disclose the percentages of farms at each performance level. The progress report stated that as of 2013, overall compliance of participating farms with the AAA standards reached 79.8%.  I took this to mean that 79.8% of farms in the program were in compliance (i.e., at least at the Basic level). It could mean that on average farms were compliant with 79.8% of criteria, but I’m not sure why it would not have been worded that way. Also unclear was whether “overall compliance” included quality criteria, or just TASQ criteria. No further similar reports have been published as of early 2016.

On a positive note, the report also noted that 30% of Nespresso coffee was Rainforest Alliance certified¹.

The level of documentation required for various criteria varies depending on the size of the farm — 10 ha or less or greater than 10 ha. Nespresso doesn’t indicate how many of their producers are smallholders.

Inspections are done by Nespresso agronomists, and verified by SAN partner auditors. These include Rainforest Alliance’s own auditing division in many of the countries where Nespresso sources coffee².

Ecological criteria

Nespresso states that 30% of their criteria fall under the umbrella of the environment. These include topics such as waste disposal and soil preservation.

More narrowly, there are 5 principals covering ecosystem management and wildlife conservation: Protection of Natural Areas, Reforestation, Shade Management, Conservation of Biodiversity, and Susceptible Species Protection. There are 37 criteria in these principals (12.5% of total).

The four shade criteria are fairly general, e.g., one is “There is a shade planting program with records.” One is very similar to the shade guideline from the 2010 SAN standard — this is the one that has been proposed to be watered down in the upcoming revision of the SAN standards. Overall, the ecological criteria tend to be quite generic and many are not quantifiable. Further examples include “Farms provide support to the conservation of nearby protected areas and conform to the management plans of those areas” and “Wild animals bred in the farms are supervised by a competent professional.”

Of the 37 ecological criteria, 7 are critical (none of the shade criteria nor any of the reforestation criteria), which represents 19% of the 36 overall critical criteria, and 2% of all criteria. Some of the critical criteria also seem open to interpretation, such as “The ecosystems conservation program takes into account natural ecosystems restoration and the reforestation of on-farm areas that are not appropriate for agriculture.” However, there are supporting documents to the TASQ that are not available publicly that may clarify some of these criteria.

Bottom line

• Nespresso is sourcing a small fraction of the total coffee purchased by parent company Nestlé under guidelines that are similar to those used by Rainforest Alliance or UTZ.
• The bar for inclusion in this program is much lower than other true certifications, with producers being allowed in the program (at least temporarily) even if they do not meet all critical criteria representing baseline sustainability standards.
• A small percentage of the criteria are related to the ecology of farms, many are generic and without quantifiable goals.
• Nespresso does not disclose a breakdown of the percentage of farms at each performance level.

Future plans

The next iteration of Ecolaboration is dubbed The Positive Cup by Nespresso. Their new coffee sourcing goal is to source 100% of its permanent Grand Cru range through the AAA program by 2020. There are now there are 45 Grand Cru coffees of which 19 are in the permanent range. These numbers seem to change as limited editions come and go; we don’t know if the new goal will translate to an amount that is more or less than the 80% of Nespresso’s total tonnage it is currently sourcing under the program.

You can read more about the various aspects of sustainability efforts at Nespresso, including those beyond coffee sourcing, at their web site.

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¹It is not known how many of these producers obtained Rainforest Alliance certification as a result of going through the AAA program, or if they already had it. Many producers carry multiple certifications or affiliations. For example, according to their Mid-term Report Coffee Target 2011, about 25% of Nespresso’s coffee came from Colombia. The same year, Starbucks published a report on over 200 of their farmers in Colombia (PDF). Forty-two percent of them were also Nespresso suppliers, but nearly all were already in Starbucks CAFE Practices program (with its more stringent environmental requirements) first.

These overlaps make it difficult to assess any single program without accounting for producers that participate in multiple schemes because the credit for improvements might be due to the pre-existing affiliation.

²This arrangement is a little cozy. As noted in Table 15.7 of the chapter cited below, the Nespresso AAA standards are defined by RA, RA controls the accreditation process, and RA auditors controls compliance standards (certification). These authors do not consider Rainforest Alliance certification itself as third party accredited.

Soto, G., and J.-F. Le Coq. 2011. Certification process in the coffee value chain. Chapter 15 in Ecosystem Services from Agriculture and Agroforestry: Measurement and Payment. Rapidel, B., et al., eds. London, Earthscan.

Some corporate sustainability reports are underwhelming. The JM Smucker Co. (owner of Folgers, among other brands) is a great example. Not much to it, and whole swaths are repeated word-for-word from year to year.

Food mega-giant Nestlé, on the other hand, produces phone-book sized sustainability reports. Granted, Nestlé is a larger company with more products. Still, their 2013 Creating Shared Value report is a whopping 404 pages, overwhelming in its scope. Any reader would get lost in its facts, figures, and examples. Let’s call it the everything-including-the-kitchen-sink approach.

I know I’m cynical, but as I grudgingly sat down to read over Nestlé’s latest report, I couldn’t help but wonder if this was an intentional effort to swamp people with data or just impress them with size, all to obscure a so-so sustainability record.  I will restrict my critique here to just what pertains to coffee.

There are two things to note about Nestlé’s coffee business. First, there are at least two coffee supply chains in the company. Nespresso is responsible for its own supply chain, separate from the rest of Nestlé’s green coffee purchasing¹. The rest goes to Nestlé’s other brands, primarily instant under the Nescafé label.

Second, on page 150, Nestlé states it buys 10% of the world’s coffee production; thus, in 2013 Nestlé bought 870,000 tons of green coffee². It’s unclear if this includes Nespresso, but since the figure right in line with previous estimates of Nestlé purchases, we will assume that it does.

How Nestlé’s defines sustainable coffee

In their Responsible Sourcing Guideline (PDF), Nestlé defines responsibly sourced green coffee as that which is verified against the 4C Code of Conduct or standards such as their own Nespresso AAA Sustainable Quality Program.

What does this mean? 4C compliant coffee is not certified, but indicates meeting a basic, entry-level standard. There are no meaningful, quantifiable eco-criteria, and the 4C Code addresses only the most egregious, illegal, unsustainable practices in the industry. The Nespresso AAA program uses criteria that are based on the Sustainable Agriculture Network (SAN) standards used for Rainforest Alliance certification, but which criteria and how they are scored or evaluated is not publicly disclosed. [Update 2015: here is a post on the environmental and social requirements for producers in the AAA program. Note the low bar for entrance into the program.]

So how much of Nestlé’s coffee is “responsibly sourced”?

The majority of Nestlé’s coffee goes to their non-Nespresso brands. Of this, the company states (page 152) that 71,493 tons, or 8.2% of their annual purchases, was 4C compliant, reaching just the most basic level of “sustainability” standards.

Meanwhile, 84% of their Nespresso purchases were made under their AAA program. Nestlé considers volume data proprietary, but in 2010 Nespresso stated³ it purchased 49,020 tons of coffee (5.6% of Nestlé’s total purchases). Nespresso has experienced considerable growth. If we guess that it purchased 60,000 tons, then 84% of that would be 50,400 tons under their AAA program, or 5.7% of Nestlé’s annual purchases. It’s probably safe to say that around 6-7% of Nestlé’s total purchases were sourced under the Nespresso AAA program.

So, less than 135,000 tons is sourced under some sort of standard, leaving nearly three-quarters of a million tons of coffee not meeting any sort of basic sustainability requirements at all!

Even less than meets the eye?

On page 125, Nestlé states a goal to source 90,000 tons of coffee that complies with the Sustainable Agriculture Standard by 2020.  That sounds like a volume that would be around 10% of Nestlé’s annual purchases. However, a footnote explains that this is an “aggregate figure from 2010 to 2020”. In other words, 90,000 tons over 10 years, or 1% of Nestlé’s total green coffee purchases.

A similar footnote is not given for their goal of sourcing 180,000 tons of 4C-compliant coffee by 2015, but later in the report when these figures are provided, the language seems to indicate that this is also a cumulative amount. For instance, on page 152, the report says (my emphasis added) “By 2015, we aim to source 180,000 tonnes…” and “By the end of 2013, we had sourced 148,198 tonnes…” On page 157, it says “…we will have bought 180,000 tonnes…by 2015…” If this were an annual amount, wouldn’t the wording be, for example, “In 2013, we sourced…”?

Other tidbits:

• They tout that an independent study found that Colombian farms in their Nespresso AAA program had “52% better environmental conditions” than non-AAA farms. Examining the actual report (link here) shows that this figure included farms with Rainforest Alliance certification. It did not say how many of the farms had the certification, or how the conditions on these certified farms drove up the environmental index.
• The percentage of their suppliers that comply with the company’s supplier code has declined from 96% in 2011, to 74% in 2013.

In a similar vein, the company’s strategy for biodiversity impacts of coffee states: “Biodiversity issues are managed primarily through the use of the 4C Coffee Code, the Nespresso AAA Sustainability Quality Program and the Nescafé Plan, which, in partnership with Rainforest Action Network, has developed better farming practices.”

In a nutshell

Remember, Nestlé has no interest in investing in or marketing third-party certified coffee, so it’s worth repeating we get from Nestlé:

• around 50,000 tons of coffee sourced under their Nespresso AAA guidelines, with a low bar for inclusion
• plus 71,493 tons sourced under the dubiously-meaningful 4C code of conduct,
• leaving more than 740,000 tons of coffee sourced from farms following no sustainability standards, or at least none known or being disclosed to the public.

Footnotes:

¹Alvarez, G., C. Pilbeam, and R. Wilding. 2010.Nestlé Nespresso AAA sustainable quality program: an investigation into the governance dynamics in a multi-stakeholder supply chain network. Supply Chain Management 15(2):165 – 182. DOI: 10.1108/13598541011028769

²Data converted from world production statistics, International Coffee Organization. 

³Nestlé Nespresso Ecolaboration Progress Report, June 2011.

(Revised and updated throughout as of January 2022)

Nespresso, the single-serve espresso machine/pod division of giant conglomerate Nestlé, has received accolades for its “Ecolaboration” sustainability project. Nespresso accounts for only 5% of Nestlé’s sales, but Ecolaboration provides the majority of the company’s public green image. I’ve written about the coffee sourcing aspect of this project in the past, revealing what a tiny fraction of Nestlé’s coffee is to be sourced sustainably under this initiative. Here, we’ll take a look at Nespresso’s coffee capsule/pod recycling efforts, which are frequently misrepresented in the media — unfortunately, in Nespresso’s favor.

Nespresso will put in place the capacity to recycle 75% of its capsules. They never claim this many will be recycled, and don’t reveal how many have been recycled in the past. Nespresso’s proprietary coffee capsules, used in their single-serve espresso machines, are made of aluminum, a metal that is entirely recyclable. But just because the capsules are made of a recyclable material doesn’t mean they are being recycled.

What Nespresso is actually doing – increasing capacity

Nespresso encourages recycling by establishing “collection points” (big bins) for the capsules in their boutiques and local communities; in a few areas Nespresso Club customers can return them via courier when new capsules are delivered. Nespresso has never set actual recycling goals, they have only claimed they would increase capacity to recycle the capsules. The current goal is 75% by 2013, up from the current 60%. This means establishing enough collection systems to collect 75% of the capsules — it says absolutely nothing about how many capsules are actually recycled.

What Nespresso is not doing – revealing recycling rates

In their June 2011 progress report, Nespresso repeats their capacity goals, and despite listing all kinds of metrics, never once mentions the true recycling rate for the capsules, only the number of collection points in various countries.

I don’t care if Nespresso’s capacity is 200% of the capsules sold. It means nothing unless the capacity is being used. Nespresso states that 12,300 capsules are used PER MINUTE. That’s 6.4 billion a year*. Even if half are being recycled that means over 3200 metric tons of aluminum is being sent to landfills annually. This is just another example of convenience and profit (the coffee works out to $60/pound, generating an estimated 30% profit margin) trumping environmental responsibility.

As of 2020, it was estimated that *14 billion capsules are sold per year, but as the linked article notes, as the criticism of the company’s environmental impact has increased, the less they’ve reported regarding sales and recycling rates. Experts have said the rate is as low as 5%, with Nespresso claiming about 30%. Even at 30%, the remaining capsules represent 12,600 tons of aluminum being landfilled annually (enough to create 60 Statues of Liberty, according to the article in the Guardian).

What the media is doing – ignoring the above

What is really discouraging is that the media frequently overlooks that Nespresso is talking about capacity and not actual recycling rates. Examples of articles that mistakenly say Nespresso will be recycling 75% of its capsules are here, here, and here, just to show a few. Careless media outlets either miss the distinction, or are unmotivated or don’t care to question the effectiveness and results. As a result is that consumers are left thinking Nespresso is recycling large numbers of capsules instead of distributing tons of waste.

Barriers to recycling Nespresso capsules

I’m not sure if people who already find preparing a cup of coffee from whole beans too much effort are the best candidates to recycle the capsules.  For the most part, they’ll have to collect the capsules at home and schlep them into a Nespresso retail outlet. In the U.S., as I noted in my post about Keurig’s K-Cup recovery program, American consumers don’t always recycle even when it’s easy for them; voluntary residential curbside recycling without incentives in the U.S. averages around 68%.

And why can’t Nespresso capsules just be tossed in recycling bin, like other aluminum? As with K-Cups, the coffee grounds have to be separated from the capsules by the consumer. This leads to the second problem: many recycling programs cannot process items as small as the Nespresso capsule because they fall through the holes used for weeding out debris, or jam the sorting machines. Therefore, well-meaning consumers may very well just be sending them to someone else to toss in the garbage.

An update in 2019, verifes that 1) most recycling systems cannot handle these little pods and 2) only 33% of U.S. Nespresso customers send back their pods to the company, even though it’s free. Yes, the company has spent some money in New York City so that the pods (as well as similar metal items) can be recycled at their facilities. But that’s one city in the entire country. Piffle.

A final insult

For years, Nespresso produced many billions of capsules made entirely of new aluminum. This even though they repeatedly touted the recyclability of aluminum on their websites and promotional materials, as if they utilized it themselves. It wasn’t until 2021 that Nespresso introduced (some) recycled aluminum content in (some) of their capsules. The company’s use of new aluminum contributes to the environmental hazards of mining the raw products and producing aluminum. And for the icing on the cake, Nespresso states that their aluminum supplier is the mining giant Rio Tinto, a company with an incredibly long list of environmental degradation, cultural desecration, human and labor rights abuses, and corporate corruption, the linked examples just to name a few!

Greenwash

Strictly speaking, greenwashing is the use of marketing to imply that a company’s products are environmentally friendly. Nestlé’s  statements are clear in what they are (and are not) doing when it comes to their Nespresso capsule recycling, and even their green coffee sourcing. They can’t be entirely blamed for the lack of critical examination of their efforts. However, Nespresso’s very heavily promoted Ecolaboration campaign says nothing about the sustainability of the rest of Nestlé’s coffee division — the other 94% of the coffee they buy.  Or about the lack of genuine corporate citizenship by the entire company itself. I think it’s fair to categorize Nespresso’s capsule recycling initiative, and Ecolaboration itself, as a greenwashing tool for Nestlé, don’t you?

P.S. As they have with Keurig K-Cups, enterprising people have come up with refillable replacement pods for some Nespresso machines. As of 2021, several have gone out of business. The three most popular still available are Sealpod, Capmesso, and RECAPS.

Nespresso capsule photos by Sarah Deforche and Jean-Yves Romanetti.

In response to a Greenpeace campaign, mega-giant food conglomerate Nestlé has reportedly pledged to rid its products of deforestation. A closer read of Nestlé’s own press releases reveals apparently narrower goals, and there is no mention of eliminating deforestation in its coffee supply chain. In fact, other recent Nestlé coffee initiatives point to increased deforestation.

Nestlé responds to public pressure

Originally, the Greenpeace campaign demanded Nestlé quit sourcing palm oil for its products from companies that engaged in (sometimes illegal) deforestation in Indonesia. Public pressure was so intense that Nestlé not only suspended purchasing palm oil from a supplier with a particularly egregious record, the chairman called for a moratorium on deforestation, a few months later announced a partnership with the non-profit The Forest Trust (TFT), and “committed to ensuring that its products do not have a deforestation footprint.”

Reports of corporate responsibility may be premature

That sounds great, but don’t expect substantive action anytime soon. Nestlé is initially only working toward identifying bad players in its palm oil supply chain. Their goal is to source all their palm oil from “sustainable” sources by 2015. Unhappily, palm oil certification schemes have been marred by fraud allegations; the criteria, even if followed, contain loopholes; and some organizations contend that palm oil monocultures are simply inherently unsustainable.

Nestlé talks a lot about adherence to their Supplier Code. This lightweight document contains a single paragraph on sustainability (“supporting” and “encouraging”, but not requiring, sustainable practices) and one paragraph on the environment (in its entirety: “The Supplier must operate with care for the environment and ensure compliance with all applicable laws and regulations in the country where products or services are manufactured or delivered.”).

By the way, Nestlé declared that the biofuel industry is really responsible for forest destruction. This is a favorite tactic of misbehavers: pointing out that there are worse offenders, as if we must focus attention on causative agents only in rank order. Liver cancer causes fewer deaths than lung cancer, but we look for cures for both simultaneously.

Nestlé’s coffee plans: 220 million trees

Coffee has not been mentioned in any of these discussions. Nestlé buys upwards of 907,000 tons of green coffee annually, fuelling the largest market share of packaged coffee in the world. In August (after all the anti-deforestation hoopla), Nestlé announced it was investing US$487 million in its global coffee supply chain. This follows their big robusta expansion push in Mexico that I wrote about in May.

A centerpiece of the current plan is the global distribution of 220 million high-yield coffee plants over the next 10 years. The plants will be free, and the farmers will not be obligated to sell to Nestlé. In other words, the farmers are taking on all the risk of increasing their commitment to coffee, without any guarantees it will be purchased.

Where and how will all this coffee be grown? High-yield coffee varieties are invariably planted in full sun. The push by multinational corporations for farmers to replace their shade coffee systems with higher-yielding, chemical-dependent hybrids was how this whole sun versus shade coffee dilemma was born! Much of the Nestlé coffee will be robusta, used in instant coffee such as the company’s Nescafé brand. Robusta coffee is also grown in the sun. I don’t see how this will not contribute to deforestation.

Another part of the plan includes increasing the amount of coffee purchased directly from farmers to 180,000 tons over the next five years. Direct buying, rather than purchasing from middlemen, should, theoretically, cut down on instances of the company buying coffee from habitat-destroying and illegal sources. In early 2007, the World Wildlife Fund revealed that Nestlé was among the buyers of robusta coffee illegally grown in a Sumatran national park. Their excuse was that they had no way of knowing where their coffee came from when it went through several buyers.

Nestlé’s direct buying goal, if met, will only cover about 23% of its total purchases. In their publication “Faces of Coffee” (pdf), when their direct purchases were at 14%, Nestlé noted,

“…it is unrealistic to believe that [direct buying] could be applied to a significantly larger portion of a roaster’s purchases…”

Let’s conclude, then, that the majority of Nestlé’s coffee purchases will continue to come from possibly-dubious or at least difficult-to-trace sources.

A small portion of suppliers to meet very minimal standards

Nestlé also aims to bring all of the farms that directly supply the Nescafé factories (not all of their direct-sourced coffee) up to the 4C Association sustainability baseline code by 2015.

This is not a certification; the 4C Code of Conduct outlines baseline requirements for coffee production. Only the most atrocious practices (such as bonded and forced labor) are considered unacceptable. The Code itself is made up of 28 principals, each having three statements categorized like traffic lights (red, yellow, and green) indicating “desired performance.”

The 4C system is considered inclusive.  Thus, coffee may be marketed as 4C compliant even if there are “red” practices (“must be discontinued”) so long as there is an equal number of “green” (“desirable”) practices in the same category (equaling a “yellow” average), at least for some unspecified period of time. So, for instance, a producer can kill endangered species and use the “most hazardous” pesticides so long as soil and water conservation plans are in place.

The 4C code is the lowest rung of the ladder for coffee production. I know we all have to start somewhere, but frankly, I am appalled that any of Nestlé’s coffee suppliers don’t meet these most basic standards of human and environmental decency.

A final aspect of Nestlé’s coffee initiative is to purchase 90,000 tons of Nescafé coffee sourced according to the “Rainforest Alliance and Sustainable Agriculture Network (SAN) principles” by 2020. Remember the math that 90,000 tons of all of their coffee would be about 11% of total purchases. Since this goal only applies to beans for Nescafé, it is an even smaller percentage of the company’s total purchases.

Also, note that this coffee will not be Rainforest Alliance certified, it will only conform to SAN principles. These ten principals simply form the basic framework of the certification criteria. So, for example, the Ecosystem Conservation principal states “Farmers should promote ecosystem conservation and recovery.” Without specific standards and criteria, evaluation of compliance with this or any principal is wide open for interpretation, and therefore lacks real meaning for consumers.

Keep Pushing

Considering the evidence, lauding Nestlé’s conversion to genuinely sustainable practices looks premature.

Certainly, it is a positive move that Nestlé is working with The Forest Trust (TFT), which focuses on products and their responsible supply chains. But it’s not a certification. According to this interview, TFT performs gap analyses on supply chains, identifies where they do not meet sourcing guidelines, and helps create action plans. This sounds like a potentially drawn-out process that allows Nestlé to kick true sustainability down the road.

As for coffee, TFT does not have experience or expertise working with coffee supply chains. Therefore, it’s important that Nestlé is working with Rainforest Alliance. RA’s own press release reiterates that Nescafé will not be using the Rainforest Alliance seal. I think RA is being overly optimistic in saying that this initiative will result in Nestlé “increas[ing] its supply of coffee beans without clearing rainforest.”

That sentence does, however, speak to the true goal: increasing supply. Robusta prices hit amazing highs in 2008 (probably when this plan was hatched) and prices are again climbing. Arabica futures are now at a 13-year high.  Any time coffee prices are high, coffee farmers tend to plant more coffee. In 3 to 5 years when the plants begin to produce, the glut of coffee causes prices to plummet. Nestlé is only adding to this problem by handing out tens of thousands of high-yield coffee plants. Nestlé is looking not for a sustainable coffee supply, but a sustained coffee supply.

The public must keep up the pressure on Nestlé and other similar companies to make meaningful, verifiable, prompt changes in their coffee supply chain to ensure authentic ecological and economic sustainability for all players. Until then, we shouldn’t be drinking a single one of the 4600 cups of Nescafé that the company claims are consumed every second worldwide. I’ve just learned this is International Nestlé-Free Week, so it’s a good time to start.

The Mexican government and the multinational food conglomerate Nestlè have partnered to increase the production of robusta coffee in nine of Mexico’s states. The majority of  coffee grown in Mexico is arabica. Robusta is grown by about 19,000 families on 34,000 hectares of land in the states of Chiapas, Oaxaca, Puebla, and Veracruz. Current estimates are that Mexico produces 150,000 to 240,000 60-kg bags of robusta annually, oughly 5% of total coffee production in the country.

The plan is to increase robusta production to 500,000 bags by 2012, with 2000 hectares being planted with new robusta trees this year*. Nestlè is supplying the high-yield stock, and ultimately the output will go to supply their Nescafè soluble coffee plant in Toluca, outside of Mexico City. Nestlè plans to increase the capacity of this plant by 40%, which will make it the largest instant coffee production facility in the world. Currently, 450,000 bags of coffee are imported into Mexico to fuel the instant coffee beast.

Many of Mexico’s coffee farmers are not happy about this plan, concurring with a 2006 FAO recommendation that robusta production in the country not be increased due to concerns about oversupply and farmer income. Let me add my environmental concerns to the mix.

Unlike arabica coffee, which can (and is, in much of Mexico) grown as an agroforestry crop under mixed shade, robusta is grown in the sun and will require the clearing of valuable lowland forests, no doubt substantial amounts of fertilizer and pesticides, and cause collateral environmental damage.

Deforestation is already a problem in Mexico; between 1990 and 2005, the country lost nearly 7.5% of its forests and woodlands. The problem is especially severe in the state of Veracruz with a loss of 22% of forested lands between 1993-2000.

Ironically, this will also impact arabica production in the highlands. At least one study [1] has shown that deforestation of tropical lowland areas reduces the moisture of the air flowing up adjacent mountains. This decreases montane humidity and increases the elevation of the cloud deck, altering the highland forested areas where arabica coffee is grown (not to mention impacting all the other biodiversity associated with these habitat changes). Simulations indicate that “…inland cloud forests like those of southern Mexico may be profoundly influenced by regional deforestation.”

Perhaps Mexico needs to rethink this strategy. The biggest beneficiary will be Nestlè’s profits. Although some farmers may see short-term gains, in the long run deforestation contributes to climate change, food insecurity, and loss of biodiversity. That’s a big price to pay for more cheap unsustainable instant coffee.

*It will require 9400 to 79,000 ha to produce a half million bags, with the low figure representing the production of some of Nestle’s highest yielding varieties, based on yields in the Phillipines.

[1] Lawton, R. O., U. S. Nair, R. A. Pielke, Sr., and R. M. Welch. 2001. Climatic impact of tropical lowland deforestation on nearby montane cloud forests. Science 294:584-587.

Instant coffee photo by mat300 under a Creative Commons License.

Several months ago, Nespresso, a division of the giant Swiss multinational food corporation NestlÁ©, announced a major sustainability initiative they are calling Ecolaboration. Nespresso manufactures espresso machines that use proprietary single-use aluminum coffee capsules.

Ecolaboration has three main goals they aim to achieve by 2013:

1. To reduce its carbon footprint by 20% per cup, primarily by developing “greener” espresso machines.
2. To increase its capacity to recycle its aluminum capsules to 75% (this does not mean 75% will be recycled, see note 1 below and this post) and to “co-convene an industry roundtable on improving the sustainability performance of the aluminum.”
3. Source 80% of its coffee from Rainforest Alliance (RA) certified farms (previously, RA was only helping assess farms in their compliance with Nespresso-specific standards, not certifying them; see note 2).

I’m only going to address the coffee sourcing aspect, as sustainably-grown coffee is the focus of this blog.

First, I read Nespresso’s fact sheet on “protecting coffee ecosystems.” A third of the document explains the importance of shade and biodiversity, while the rest neglects to specify any criteria or concrete measures proposed by the company protect the environment.

Thus, the Rainforest Alliance certification criteria will have to act as surrogate for Nespresso’s sustainability efforts. That’s fine, but exactly how much coffee does that “80% certified” represent? Specifically, and importantly, how much as a percent of coffee purchased by parent NestlÁ©, a company famous for its dismal corporate responsibility ratings [3]?

(Updated August 2010 to reflect actual published figures) In 2008, NestlÁ© purchased 780,000 tons of green coffee, similar to previous years and typical of their annual volume [4]. In 2010, Nespresso purchased 490,000 bags (60 kg each) or 29,400 tons under their “AAA Sustainable Quality Program” which includes, but is not exclusively, Rainforest Alliance certified farms [5]. This represents 60% of Nespresso’s purchases, but just under 3.8% of NestlÁ©’s total purchases. Their stated goal is now to source 80% of Nespresso coffee from the AAA program by 2013 (again, not exclusively Rainforest Alliance certified), which would be 5% of NestlÁ©’s total purchases.

The commitment to sustainably-grown, eco-friendly coffee by Nespresso is an extremely small percentage of NestlÁ©’s total purchases. This situation qualifies for what I consider to be the most offensive of the four greenwashing criteria set forth by Greenpeace: Dirty Business. This criteria states “Touting an environmental program or product, while the corporation’s product or core business is inherently polluting or unsustainable.”

I don’t even have to dig any farther into the elaborate hoopla on the Ecolaboration site (which frankly sounds like a rip-off of General Electric’s Ecomagination program). I cannot support such a meager effort, in particular from a company with such a long track record of disregard for labor and human rights, environmental protection, honesty in labeling and marketing, and other unethical business practices.

Notes:

[1] Nespresso offers recycling of the aluminum (home and office type only) capsules in several European countries. Even when Nespresso has expanded recycling efforts, it fails to create any meaningful increase in recycling rates. Due to technical constraints, the capsules themselves are not made from 100% recycled aluminum. This post explains that the whole pod recycling issue is greenwashing.

[2] Nespresso first partnered with Rainforest Alliance (RA) in 2003, and signed a five-year pact in 2006. In the first phase of this partnership (known as the Nespresso AAA Sustainable Quality Coffee Program), RA developed guidelines specifically for Nespresso to improve quality and sustainablity practices on farms supplying Nespresso. These farms were not being certified by RA under their usual criteria. RA appraised the farms to see if they were “implementing better methods and are decreasing their impact on the natural world.” Nespresso must have been happy with the partnership, as they routinely donate tens of thousands of dollars to RA (see annual reports). Under the Ecolaboration project, the goal is for 80% of the coffee to actually come from certified farms meeting RA’s standards. Update 2015: here is a post on the environmental and social requirements for producers in the AAA program. Note the low bar for entrance into the program.

[3] Corporate Watch lists numerous corporate crimes; another laundry list is at Global Investment Watch; Responsible Shopper outlines some boycotts and alerts; Source Watch lists more problems; and Ethical Corporation provides an article skeptical of NestlÁ©’s CSR report. Add it all up, and you get an award for least responsible company in 2005 (nomination here).

[4] Coffee Barometer 2009, linked to and summarized here; Ethical Sourcing – Creating Shared Value, 2008, NestlÁ© (PDF).

[5] NestlÁ© Nespresso Ecolaboration Progress Report, June 2011 (PDF).

Photo by svet under a Creative Commons license.

A report recently announced that Nestlè’s research and development facility in France has developed clones of Robusta coffee plants specific to particular countries. They are distributing them to “countless coffee growers across the globe.” These producers are suppliers of green beans to Nestlè’s instant coffee division, Nescafe, and the plants are developed to increase yield and income.

Each plant is genetically identical, as they are produced in a lab by somatic embryogenesis, a form of tissue culture. Therefore, should a pest, disease, or pathogen infect a farm planted with a particular clone of coffee plant, it is likely to wipe out every genetically identical tree on the farm, as well as every genetically identical tree planted within reach of the infection.

Tissue culture is not uncommon in agriculture, or even in coffee production. But as this statement in an article on the American Phytopathological Society web site succinctly states,

“The modern emphasis on monoculture of  genetically identical crops,
commercial propagation, and worldwide distribution of improved
varieties increases the likelihood that a chance infection will lead to
the development of a disease epidemic and the attendant crop losses.”

One only needs to look at the Irish potato famine, Dutch elm disease, southern corn leaf blight, or the current banana crisis for examples of the dangers of genetic homogenization. The dichotomy in the coffee industry is quite amazing. On the one hand, this mass production of identical plants, geared toward high yield and profits in instant coffee. On the other, a push to save wild varieties of coffee, and the pursuit of beautiful microlots and unique tastes by true coffee lovers. I know which “hand” I’m in!