A Case study report On Boycotting the ‘baby killers’?

Nestle and the ongoing infant formula controversy

Submitted to: Prof. Vivek Raina

Submitted by: Bhaumik Shiroya Harshil Modi Nehal Bhavasar

Submitted date: 11/12/2013

1. Many of the criticisms of Nestlé’s practices stem from the argument that consumers in the developing world are vulnerable.4. How would you explain Nestlé’s apparent failure in pacifying its critics? What would you suggest the company do to end the boycott? 4.4 2..1. Reference…………………………………………………………………………………………………11 2 . Questions answers…………………………………………………………………………………….. Introduction…………………………………………………………………………………………….2.Table of content 1. Set out the main ethical criticisms of Nestle marketing of infant formula. What are the arguments for and against continuing the Nestle boycott from the point of view of consumers seeking to enhance the well being of mothers and babies in the developing world? What implications does your answer have for notions of consumer sovereignty? 3.3 1. Objective…………………………………………………………………………………………………..6 3. To what extent is this valid argument? 3. 1.4 The baby milk issue……………………………………………………………………………. Which consumer rights are these practices failing to respect? 3. Nestle boycott…………………………………………………………………………………….3.5 3.2.

WHO and business ethics books seem to include a case on this subject. 50000 only. NGO. There were many groups initiate further campaigns throughout the 1980. I want the product X publishes in the market at Rs. and the boycott was officially suspended. What is thought in his (Mr. There were many of the initial problems for Nestle and for that main reason why it has continued to spark hostility it means unfortunately. For example. and 2000 and a result of seek to influence by Nestle is singled government translating the code into legislation. ECO) mind? Is that joke? After this event all the media. publisher. The story should be end but there were many ways to the beginning but the first boycott of Nestle was effectively called off in 1984. condition or attitude even though they were knew that all problems. the US Senate held a public hearing into the promotion of breast milk substitutes in developing countries and joined calls for a Marketing Code. In spite of the fact there was much debate about the causal relationships involved. boycott coordinators met with Nestle. All this discussion has not able to bring a whole lot of agreement and these are the basis details of the criticism against the company. magazine. criticisms of such aggressive marketing practices eventually led to the WHO introducing a code of conduct governing the marketing of infant formula in 1981. All the manager think in his mind it is not possible and he has just said and this plan executive by us. 3 . In 1984. In 1988 IBFAN alleged that formula companies were flooding health facilities in the developing world with free and low-cost supplies. World largest food company remains mired it means boggy ground. Mr. In May 1978. ECO told in meeting that is. soft mud or dirt in a controversy that seems destined never to go away. 1990. Introduction: This case study discuss about the controversy surrounding Nestlé’s marketing of infant formula and in particular looks at how the campaign against Nestlé’s has been sustained over 30 year despite attempts by the company to appease its critics. Nestle has continued face intense opposition to its practices and has the hesitating or doubting distinction of having endured the world’s longest consumer boycott. A large number of the express complete the disapproval of and boycott action was initiated against the company during the 1970. which agreed to implement the code.1. The first issue went in public at 1973. In the Nestle infant formula controversy has been extensively discussed business ethics folklore it means that in the organization or company someone do the informally talk about the company or product and which is in a bad manner. and the boycott was re launched the following year.

The baby milk issue: Groups such as the International Baby Food Action Network (IBFAN) and Save the Children claim that the promotion of infant formula over breastfeeding has led to health problems and deaths among infants in less economically developed countries. they often do not have the means to perform them: fuel to boil water. leading to disease in vulnerable infants. As a result. which campaigners claim contributes to the unnecessary suffering and deaths of babies. many mothers are not aware of the sanitation methods needed in the preparation of bottles. which was often contaminated in poor countries. and expanded into Europe in the early 1980s.2. rice water or cornstarch with water. 4 .  Mothers in poor countries many try to save money by economizing on the formula by using less than the recommended does or substituting it with other inferior alternatives such as cow’s milk. For example. were particularly instrumental in helping to coordinate the boycott and giving it ample visibility worldwide. It spread in the United States. in order to make a container of formula last longer.1. Professor Derek Jelliffe and his wife Patrice. It was prompted by concern about Nestlé's "aggressive marketing" of breast milk substitutes. Advocacy groups and charities have accused Nestle of unethical methods of promoting infant formula over breast milk to poor mothers in developing countries. 1977. They were unable to read the language in which sterilization directions are written. who contributed to establish the World Alliance for Breastfeeding Action (WABA).  Many poor mothers use less formula powder than is necessary. against the Swiss-based Nestlé Corporation. Because of the low literacy rates in developing nations. electric (or other reliable) light to enable sterilisation at night. Nestle boycott: A boycott was launched in the United States on July 7. Among the campaigners. particularly in less economically developed countries (LEDCs).1.  Although some mothers can understand the sanitation standards required. 1. some infants receive inadequate nutrition from weak solutions of formula. largely among the poor. There were four problems that can arise when poor mothers in developing countries switch to formula:  Formula must normally be mixed with water.

595% as well as Morgan Stanley’s European stock index by 1. As per the recent poll revealed that Nestle was one of the world’s most boycott companies and was the number one target for boycott in the U.  Advertisements encouraging mothers to adopt modern bottle feeding in place of old-fashioned and inconvenient breastfeeding. but because the supplementation has interfered with lactation.   Promotion booklets ignoring or downplaying the benefits of breastfeeding. Objectives: Through this case we have an opportunity to examine (in terms of understand) the ethics of marketing practices as well as to discuss the role of ethical consumptions in curbing perceived ethical violations. does not label its products in a language appropriate to the countries where they were sold. one newspaper report said that Nestlé’s share price has increase by 1. after leaving the hospital. the company introduced an ombudsman system it means “a person who investigates and attempts to resolve complaints and problem like between student and university and employee and employer but here refers to company and consumers and government” to encourage employee to confidentially report violation of the code without fear of retribution. and offers gifts and sponsorship to influence health workers to promote its products.  IBFAN also allege that Nestle uses "humanitarian aid" to create markets. IBFAN claim that Nestle distributes free formula samples to hospitals and maternity wards. In spite of fact it has admitted is unambiguous in its public pronouncements that breastfeeding is the best for babies. Incentives to milk nurses and health workers to endorse bottle feeding. 2. the family must continue to buy the formula. After the aware that campaigners remained new ways of managing the last few years the company has stepped up efforts to develop new way of managing the baby milk issue in 2002. Since 1977 at the time of beginning of boycott. For that matter one survey has been doing in financial times and PWC since 1998 and boycott has done Nestle little harm pointing out that it was rated world’s 11 most respected companies in 2004. the formula is no longer free.66%. After independent assessment that declared in 2005 that it had found no systematic shortfalls in terms of Nestlé’s implementation of its instruction on the marketing of breast milk substitute.K but still has a long way to go before it convinces its critics of its ethics. 5 .

ignoring the benefits of breastfeeding: they promoted the formula by telling that this is the substitute of the breast milk which a mother can give it to their babies. they also communicated that some mothers who found breast feeding as traditional culture and wants to change it so they can use the baby food to feed their babies. Nestlé was not abiding the rules imposed by the WHO code: the way nestle promoting their product was totally against the rules of the WHO because WTO does not support such kind of activities which impact the health and the health of the babies secondly these kind of practices eventually leads to the WTO to introduce a code of conduct governing the marketing of infant formulas.  Nestle. Which consumer rights are these practices failing to respect? Answer: Nestle is the one of largest food product company in the world. This baby food also impacted on the health of the babies and one of the most important things was they were marketing the baby food by replacing the mother’s milk which is one of the most important ethical issues.  Nestle. during its marketing operations. and for marketing their baby food they have ignored so many ethical issues which are also against the consumer rights. with its advertisement. 6 . Questions: Que: 1 Set out the main ethical criticisms of Nestle marketing of infant formula. The some of the other main important issues are as follows:  Commercializing its product. o Promotional booklets ignoring the benefits of breastfeeding.  Nestle promoted aggressively its products. has neglected the value of breastfeeding: they promoted the formula in such places where the mothers are illiterate and ask them to use this baby food they also followed the some other practices to promote the baby food such as: o Free samples to mother o Free supplies to hospitals and clinics o Encouraging mothers to adopt modern bottle feeding in place of old – fashioned and inconvenient breastfeeding. is not assumed the moral responsibility for infant mortality caused by low intake of enzymes derived from breast milk: they were just ignoring all the health related issues and factors and promoting their baby food every where even.3. thanks to the illiteracy of poor people. Secondly they also promote it by saying that the mother who are HIV/AIDS infected so their babies will also get infected by that so they can use it as substitute because by this their babies will safe form HIV/AIDS.

To what extent is this valid argument? Answer: I think that this is absolutely true. and it is found that many companies had targeted the such undeveloped and developing countries like countries of Africa. 7 . In developing countries people. and they sold their products and impacted the live of the people. we can say that company like Nestle and a lot of multinational company take advantages by this fact and make the consumer an easy prey to hunt. especially the poorest people are more vulnerable than the others because they don’t have an education in consumer’s affairs and in this kind of countries where the poor people don’t ha ve such kind of consumer rights and information so the companies have the advantage to promote sell their product in these places. Que: 2 Many of the criticisms of Nestlé’s practices stem from the argument that consumers in the developing world are vulnerable. Russia and Asia. In fact one of the greatest plagues of the countries in the developing world is rampant illiteracy because people are not that much literate and they cannot understand the thinks which are important to know they just simply follows the things which are communicated to them whether it is write or wrong.o Giving money to nurses and health workers to promote bottle feeding instead of breast feeding. All these practices are failing to respect several consumer rights such as:    the right to safety people must be protected against dangers in products the right to be informed People has the right to be given all the information they require about a product or service The right to consumer education people have the right to demand education in consumers affairs and the right to satisfaction of basic needs people have the right to basic goods and services which guarantee survival.

Nestle continues to aggressively promote their infant formula in areas of the world where this is a reality. Nestle have stated publicly that they will meet with Baby Milk Action/IBFAN to try to resolve these differences.   Nestle has a long-term presence in developing countries and so surely could not survive in business if its marketing of infant formula was harming its customers.5 million infants a year has not been substantiated by the World Health Organization.  Nestle sales represents put pressure upon health professionals in developing countries to advise new mothers to formula feed using their products. although not legally binding. It has commissioned an external audit to investigate allegations in Pakistan. Violations reported by Baby Milk Action/IBFAN will be investigated if sufficient evidence is given and if there is a case these will be stopped.  Nestle has appointed internal auditors to ensure Nestlé’s instructions are followed. Other organizations meet with Nestle on other subjects and progress is made the claim that Nestle kills 1. 8 . In developing countries many mothers are forced to mix formula powder with polluted water that they have no means to purify.  The dispute with Baby Milk Action and the International Baby Food Action Network (IBFAN) basically comes down to a question of interpretation of the marketing requirements. carries moral and political weight.  The boycott is confrontational and does not advance the issue. Nestle did promote infant formula like any other product. But it has noticed by the International Code of Marketing of Breast Milk Substitutes since this was adopted in 1981. It also has an ombudsman independent of line managers who staff can report concerns to.Que: 3 What are the arguments for and against continuing the Nestle boycott from the point of view of consumers seeking to enhance the well being of mothers and babies in the developing world? What implications does your answer have for notions of consumer sovereignty? Answer: The some of the arguments to continue the Nestle boycott are as follows:  They claim that Nestle is still failing to comply with The International Code of Marketing of Breast milk Substitutes. a code prepared by WHO and UNICEF which.   Nestle have been found providing mothers in poor countries with free milk samples that last just long enough to ensure their milk dries up. with advertising etc.

In this diagram I have mention why this crisis happened. In this case there is mentioned that is illiterate women those who are mother to gave their child 9 .  Nestle should give in writing that it will make the required changes to bring its baby food marketing policy and practice into line with the International Code and Resolutions. All these were the reasons of boycotts of the Nestle products. secondly they should also stop such kind of practices which are performed by the companies.     In developing countries most mothers cannot afford to formula feed and are forced to significantly dilute feeds with water.4: How would you explain Nestlé’s apparent failure in pacifying its critics? What would you suggest the company do to end the boycott? Answer: For the explanation we have draw the one diagram for the whole situation why nestle were failed in pacifically their critics. Nestle systematically violates the WHO’s International Code for Marketing Breast milk Substitutes that was put in place to protect babies. they should spread the awareness related to health and live that which the things which are good. In developing countries many mothers are illiterate and cannot read the instructions on a tin of formula necessary for safe formula feeding. However babies are all too often fed white water to make ends meet. This particular situation was creating just because of the prior purchase or unawareness about the product in terms of how it is used. They should also distribute educational material and some kind of Health camps which can support the interest of the people and their health. relevant World Health Assembly Resolutions are minimum requirements for every country. Que. In these areas good quality nutrition is more important than anywhere. Meanwhile older children suffer nutritionally because what little money they do have is spent on formula instead of food for the family. but I will say there should be some practices which should be perform by the Nestle they are as follow. Some of the other steps which should be taken by the government of countries and organization like WHO and other.  Nestle should accept and publish that they are following the International Code and the subsequent.

They were failure in pacifying its critics because they knew that thing still they don’t take any step for shutout that matter.milk without reading instruction which is given on the product by the Nestlé.  Diagram: Animosity (Hostility) Efficacy Boycott participation Prior Purchase Consumer ethnocentrism Product judgement 10 .

and offers gifts and sponsorship to influence health workers to promote its products.com/nestles-infant-formula-scandal-2012-6?IR=T 2. after leaving the hospital. For example. IBFAN (International Baby Food Action Network) claim that Nestlé distributes free formula samples to hospitals and maternity wards.org/wiki/Nestl%C3%A9_boycott 11 . http://en. the family must continue to buy the formula. Nestlé of unethical methods of promoting infant formula over breast milk to poor mothers in developing countries. Through those practices they can stop because all are aware about the product to use in a right way. References: 1. so that the Nestlé’s marketing manager has to have taking some step through that consumer came to know about the how this product should use which is not use in reality just because of illiteracy.V. Also they have to find out the participation of the nestle boycott which is mention in above diagram. IBFAN also allege that Nestlé uses "humanitarian aid" to create markets. Consumers are unable to read not in show the broadcast in T. http://www. Step like nestle have start the video advertisement through that consumer come to know how to use. the formula is no longer free. but because the supplementation has interfered with lactation. In that diagram product judgment directly and via prior purchase participation of nestle boycott. does not label its products in a language appropriate to the countries where they are sold.We suggest that company to end the boycott is that.wikipedia. 4. first they have to stop those activities which are motivate to increase or taking ahead this crisis.businessinsider.