Nestlé: a Resilient, Responsible Firm

Nestlé cared for not only its employees’ health during the emergency situation caused by the new coronavirus pandemic but also for their financial security. The financial indicators of the first six months show that steps taken to support company employees and those in need were clearly successful from an economic viewpoint as well.

Nestlé Hungária has been operating in Hungary for nearly 30 years and is currently the largest Swiss investor and employer. The corporation is interconnected with the country in so many ways and is especially proud of the fact that the majority of its suppliers are Hungarian enterprises, which annually sell various products and services to the global Nestlé network at a value of HUF 54 billion. Although at the beginning of this year, due to the COVID-19 pandemic, all companies worldwide had to face serious difficulties, Nestlé Hungária not only maintained its impetus but also managed to move up a gear. Company turnover, mainly due to exports, increased by 5.7% as compared to the first six months of 2019. Hungarian revenues increased by 4.3% to HUF 27.5 billion.

Continuous supply
These are more than promising signs after a six-month period when the most decisive factor was overall and drastic economic downturn due to the pandemic. “As the major player of the Hungarian food industry, we could not sit back during the coronavirus situation: it was our priority, our strategic task to continuously supply the population with food and pet food,” Nestlé Hungária managing director Péter Noszek, who is also a board member at the Swiss-Hungarian Chamber of Commerce (Swisscham). In addition to protecting the safety and health of its employees, he listed maintaining the financial security of colleagues as one of the most important goals of the company.
The company, which reacted to the crisis situation swiftly and effectively, spent HUF 350 million on direct employee financial support. Those who could not carry out their tasks because of the pandemic received their basic salary, and as of April 1, an extraordinary wage and benefits package was introduced for three months of the pandemic emergency period. With that,
salaries of employees working in Hungarian production units and warehouses increased by up to 20 %, while sales colleagues received a 10 % basic salary supplement, he added.

Providing for the community
The company spent another HUF 80 million on health protection and security measures, providing targeted support for those commuting to work as well as a free meal each day.
Thanks to these initiatives, the company strengthened its relationship with communities and local governments where Nestlé factories operate, in line with the joint value creation undertakings of the global company group, Péter Noszek said. As part of these undertakings, the company, which offered dedicated assistance wherever possible during the pandemic, aims to improve the livelihood of 30 million communities around the world directly linked to the business activities of the company by 2030. In the first six months of the year, the company proved its flexible resilience: the half-yearly report that has just been published shows promising organic growth (2.8 %) and improving margins (30 basis point growth in underlying trading operating profit).
“The measures we introduced are considered unique in the Hungarian market, in terms of the sum of expenditure, the nature of aid as well as their diverse nature,” the managing director concluded.

ACTING FOR THE ENVIRONMENT
As the world’s largest food production company, Nestlé makes great efforts to eradicate plastic pollution, one of the most pressing environmental protection problems of the planet. It has pledged to use solely recyclable or reusable packaging materials by 2025. In accordance with these undertakings, the company has already taken steps in Hungary, ie: the NESQUIK All Natural cocoa powder produced in the Szerencs factory is available in recyclable paper packaging on the market. Nestlé is an active member of the sustainable development organization BCSDH, where it works to put into practice and apply the three basic pillars of sustainable growth: the principles of economic efficiency, ecological balance and social quality of life, to contribute to the sustainable development of the Hungarian economy and society.