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PACO III

ATNI 2013

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Rationale

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Encourage improvements in companies’ policies, practices and performance to result in:

• Greater consumer access to more nutritious foods and beverages

• An environment facilitating the consumption of healthier foods and beverages through improvements in areas such as marketing, labeling, and package sizes

InvestorsProvide context for company engagement

MediaRaise profile of industry role in malnutrition

Civil societyFacilitate effective advocacy

PolicymakersInform development of nutrition policies

AcademicsStimulate research on best practices

Provide companies a tool for benchmarking their nutrition practices

Serve as an impartial source of information for interested stakeholders

Stimulate dialogue

and action

Given their size and reach, companies can make a significant contribution to addressing obesity and undernutrition

ATNI seeks to

June 2013

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Governance

June 20133

Expert GroupProvides technical advice on

methodology for assessing companies

Global Stakeholder NetworkWidest possible network of stakeholders,

including those involved in public consultation on Index methodology

Independent Advisory PanelProvides strategic advice on stakeholder engagement, institutional considerations

and financial sustainability

Executive Director andATNI team

Funders

Methodology development

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Company assessment methodology was developed through an extensive multi-stakeholder process

June 2013

Methodology and scoring weights

5 June 2013

Geographic scope

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Global Index25 of the worlds largest

food and beverage companies

IndiaMexico

South Africa

3 Spotlight Indexes10 of the largest

companies by F&B revenue in each market

Regional balance: 1 country per major region

‘Double burden’ of malnutrition

Large or growing F&B industry

+

June 2013

Purpose

• Assess the extent to which multinational companies implement their global commitments within specific countries

• Compare the performance of multinational companies between countries – how consistently do they implement their commitments?

• Compare the performance of local vs multinational companies – is there a significant difference in how they tackle nutrition issues?

Value of Spotlight Indexes

June 20137

Expected outcomes

• Understand local context and how that drives/affects companies’ responses

• Provide a tool for local stakeholders to monitor major F&B companies in their market

• Encourage action from both local and multinational players

• Identify opportunities for further research and collaboration with local organisations and experts

Companies in Spotlight Indexes: not yet rated

June 20138

INDIA MEXICO SOUTH AFRICA

Britannia Industries Coca Cola AVI

Coca Cola Grupo Bimbo Coca Cola

Gujarat Milk Marketing Federation (Amul)*

Grupo Herdez Groupe Danone

ITC Grupo Industrial Lala Kraft Foods Inc (now Mondelez)

Kerala Milk Marketing Federation** Kellogg Company Parmalat (now owned by Lactalis)

Mother Dairy Fruit & Veg ** Kraft Foods Inc (now Mondelez) Pioneer Food Group

Parle Products Nestlé PepsiCo

PepsiCo PepsiCo Nestlé

Nestlé Sigma Alimentos (ALFA) Tiger Brands

Unilever Unilever Unilever

* Cooperative** Government-owned

Global ranking 2013

9 June 2013

Key findings

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• Across the board, the world’s largest food and beverage manufacturers can do substantially more to improve consumers’ access to nutrition

o Only three companies scored above 5.0 on a 10-point scaleo The majority of companies scored below 3.0

• Many companies are now taking at least some action to improve access to nutritiono Companies are doing the most in the area of incorporating nutrition into their corporate governance and management

systemso Many companies are motivated to act by the business risks associated with nutrition, as well as the opportunity to play a more

active role in addressing nutrition challenges

• Danone, Unilever and Nestlé are the highest-ranking companieso They have corporate strategies that include explicit commitments to improving nutrition and the corresponding integration of

nutrition considerations into core business activitieso But even their scores demonstrate that there is significant room for improvemento Danone and Nestlé’s reported lack of compliance with the International Code of Marketing of Breast-milk Substitutes is a

significant concern

• Companies’ practices often do not measure up to their commitmentso Companies’ scores on nutrition strategy and governance were higher than their scores on product formulation, accessibility,

and marketingo Within each of these areas, their level of implementation lagged behind their stated commitments

• Companies could do more to address undernutrition and at a broader scaleo Company scores on undernutrition are significantly lower than those on obesityo Many companies do not articulate a clear recognition of the role they can play in addressing undernutrition

• Many companies are not very transparent about their nutrition practiceso In particular, the lowest-ranked companies on the Index do not disclose sufficient information on their policies and practices to

evaluate any approaches they may have to nutrition

June 2013

Key recommendations

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• An essential first step for companies to address the challenges of obesity and undernutrition is to integrate nutrition into their corporate strategies

o Companies should develop clear and measurable corporate objectives and targets on nutritiono They should also create robust incentive and accountability structures

• Stronger mechanisms are needed to track companies’ performance on their commitments and targets in order to improve consumers’ access to nutrition, including:

o External mechanisms, such as independent audits, third-party evaluations, and incorporation of input from experts or other stakeholders

o Internal mechanisms, such as Board and executive-level oversight of the company’s performance against its nutrition commitments

• Companies’ priorities for improving their approach to nutrition should include:o Ensuring product formulation, marketing and labeling efforts are in line with recommendations from norm-setting bodies such

as the World Health Organization and the Food and Agriculture Organization of the United Nationso Setting product formulation targets for all relevant ingredients and across their entire product portfolios and articulating these

targets in a format that allows for a clearer understanding of the scope of such effortso Identifying and applying approaches to make products of high nutritional quality more affordable and widely available,

especially to lower-income consumerso Implementing a strict and comprehensive policy on marketing to children that applies to all media channels and all countries

in which a company operateso Increase efforts to address undernutrition and scale up those approaches that are the most successfulo For companies that manufacture breast-milk substitutes, ensure compliance with the International Code of Marketing of

Breast-milk Substitutes

• Companies should increase public disclosure of their nutrition activities

June 2013

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Post launch reaction to ATNI:What companies are saying

June 201312

“#Nestle ranks highly in #ATNI: We commit to further

action on malnutrition in new CSV report”

News from Nestle@nestlemedia

“High ranking in ATNI index particularly around products, lifestyle &

engagement with an action plan for improvement”

Unilever News@Unilever

“We welcome a continuous dialogue with ATNI (the

index) that enables us to identify and address

challenges collaboratively”

Coca-Cola

“On the next index in two years, we will perform

better.”

FrieslandCampina

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Post launch reaction to ATNI:What media are saying

June 201313

“New nutrition index rates food with thought”

Nancy HellmichUSA Today

“Nutrition index ranks US below European producers”

Andrew JackFinancial Times

“Danone, Unilever and Nestlé ranked top for nutrition – but

could do better”

Caroline Scott-ThomasFoodNavigator

“Work to be done to address global nutrition challenges”

Eric SchroederFood Business News

“indexes such as the ATNI can be used to increase the buy-in of stakeholders and to monitor corporate behaviour by reinforcing companies with the best

business practices and identifying those that fail to improve”Op-Ed

The Lancet

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Investor support

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40 firms collectively managing over $2.6 trillion in assets have signed the ATNI Investor Statement

June 2013

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Assessing impact

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Serve as an impartial source of information for interested stakeholders

Encourage improvements in companies’ policies, practices and performance to result in:

• Greater consumer access to more nutritious foods and beverages

• An environment facilitating the consumption of healthier foods and beverages through improvements in areas such as marketing, labeling, and package sizes

Improvement over time as measured by company ratings on subsequent versions of ATNI

Provide companies a tool to benchmark their nutrition practices

Investors# of statement signatories and $AUM

Media# of stories about ATNI and companies

Civil society# of invitations to make presentations

Policymakers# of requests for dialogue

Academics# of times cited in relevant articles

Stimulate dialogue and action# of interactions between stakeholders

Food and beverage manufacturers• # of company engagements• # of company press releases about ATNI

Outputs OutcomesActivities Impact

Engagement with and uptake by:(illustrative measures)

Increased market availability & household accessibility of healthy foods and improved food consumption environment

Improved diets

Improved nutritional status

Improved health status

These impacts will not be directly attributable to ATNI but links to impact may be plausible

June 2013

Future plans

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ATNI has the potential to magnify its impact over time in numerous ways and improve:

• First version of Global Index launched in March 2013; Spotlight Indexes during 2013• In order to maximize impact:

o Release rankings on a regular basis to track company improvementso Allow enough time between editions for companies to make meaningful changes

• Constructively engage with companies to augment impact of ranking• Iterative approach to improving methodology for future versions but maintain most of

initial structure to enable year-on-year comparison• Regularly monitor impact

• First version of ATNI represents current state of knowledge and consensus around best practices

• Final report highlights important issues that require further research and/or consensus building

• Facilitate progress by convening key stakeholders

Facilitate nutrition ‘knowledge agenda’

Publish company ranking every two years

Evaluate opportunities for growth

• Depending on the nature of stakeholder response and demand, consider opportunities such as:

o Expanding number of companies evaluatedo Expanding geographic scope (additional Spotlight countries)o Expanding scope across value chain (upstream suppliers, retailers)

June 2013

Issues requiring further research and/or consensus-building

• Greater clarity on what constitutes a robust nutrient profiling system and movement towards a consensus ‘gold standard’

• A standard format in which to report product reformulation efforts, which allows an understanding of the scope of such efforts and comparison of companies’ efforts

• Research on how pricing affects low-income consumers’ purchasing decisions of healthier products• Characterization of how individual companies affect the food consumption environment (for instance, through their

marketing activities or labeling practices), and development of metrics that capture these impacts• Assessment of companies’ role in encouraging food safety (for example, through efforts such as package labeling

systems that provide transparency in the production of food or educate consumers on appropriate ways to prepare foods at home to ensure their safety)

• Guidelines for and methods to assess company performance on responsible:o Commercial sports sponsorshipo Nutrition education (or, more broadly, support of healthy diet and active lifestyles)o Marketing to adolescents

• Development of a rigorous, transparent and methodologically reliable on-the-ground assessment of breast-milk substitute manufacturers’ marketing practices

• Characterization of food purchasing patterns among consumers in markets with a significant burden of undernutrition, so as to better understand the role played by processed foods in their diets

• Role of fortification of packaged foods in the context of broader national fortification strategies• Appropriate role for food and beverage companies in interventions other than fortification to address undernutrition• Guidelines for the responsible marketing of foods, particularly for those being sold in markets with a burden of

undernutrition where guidance is less well developed, including complementary foods

Knowledge agenda

17 June 2013

Corporate Profile methodology structure - detail

18 June 2013