The Boycott Is Back
issue 194 - April 1989
The boycott is back
Nestlé is in the dock again. Consumers worldwide are once again
being asked to stop buying its products. Peter Cox finds out
why - and hears Nestlé's side of the story.
François Perroud is Director for Corporate Affairs at Nestlé headquarters in Switzerland. 'I am in the unfortunate position of having to read the New Internationalist,' he grumbles. 'It's worthwhile reading,' he adds with heavy sarcasm, 'if you have a lot of time to lose.'
Perroud (pronounced 'Peru') is the spokesperson for a multinational with 163,000 employees worldwide, total sales of $24 billion, and the lion's share of the international infant formula market. I assure him that despite his obvious misgivings I will try to make it a fair article. 'That's certainly a departure for the New Internationalist,' he snaps.
Like many other companies, Nestlé still provides free or subsidized baby milk to hospitals in developing countries. Their critics say it is a sales tactic that results in much preventable infant malnutrition and death, and a major reason for the renewed call to boycott Nestlé products.
Perroud bristles: 'All free donations made by Nestlé to hospitals have to be asked for by hospital administrators, head nurses, directors . Right?'
But why does Nestlé give away large amounts of infant formula? Partly, says Perroud, so that medical staff get to know the products, but also for altruistic reasons 'like giving money to concert pianists or the boy scouts. Many hospitals in developing countries have a hard time making ends meet. They go to pharmaceutical companies; they go to companies that sell hospital equipment and beg - basically, that's what they do'.
Many people find the idea of Nestlé as 'fairy godmother' to the world's babies a trifle hard to swallow. Couldn't there perhaps be a more commercial motive? 'Does it promote sales?' I ask him.
'No. It doesn't. There is no direct promotion involved - how could there be? There is no tit-for-tat involved of any sort. The hospital says we need so many boxes or so many cans of infant formula, let's see who can give it to us. Right?'
'So does this come from your marketing budget?' I ask.
'Does it come from the marketing budget?' he repeats, after a pause. 'Where the individual companies put it in, I'm not in a position to say. There certainly are companies where it comes from the general budget for contributions to charities. In others it might be handled differently.'
This cuts no ice with Nancy Gaschott, staff attorney at Action for Corporate Accountability which together with the International Nestlé Boycott Committee is organizing the current boycott of Nestlé and American Home Products, another infant formula manufacturer. She says that companies only donate free supplies of baby milk to Third World hospitals and maternity wards in order to promote their products. It is a very effective technique because once bottle-feeding starts, breast milk dries up. When mother and baby leave hospital there is a physical need to buy more formula - both mother and baby are hooked.1
There is always the temptation to over-dilute the powder to eke it out a little longer. No wonder that bottle-fed babies in the Third World are twice as likely to die as breast-fed2 babies. In the hands of the poor, feeding bottles are a passport to death.
'What More Can We Do?'
François Perroud of Nestlé replies: 'On every single can of infant formula sold worldwide, there is an encouragement for mothers to breast-feed. There is a warning against the misuse of formula. What more can we do?'
'They could stop sabotaging breast-feeding at the beginning,' retorts Patti Rundall of the Baby Milk Action Coalition in the UK.
But to give Nestlé due credit, they have probably done more than most infant formula companies to curtail unacceptable marketing practices. In 1982 they created an independent monitoring organization - the Nestlé Infant Formula Audit Commission - headed by former US Senator Edmund Muskie. And although this group has on occasion found Nestlé in violation of its marketing obligations, reports from around the world suggest that other companies more regularly break the spirit and letter of the World Health Organizations's (WHO) code3 on the marketing of baby foods.
So why have Nestlé and American Home Products been singled out for the boycott? The answer is simple: if the boycott is to be effective it has to target individual companies. Nestlé is the world's largest babymilk seller and has agreed in the past to follow WHO guidelines. It has, according to Action for Corporate Accountability (ACA), broken this agreement so the boycott has been reinstated. But to show that Nestlé is not alone in its misdemeanors, American Home Products - parent company of baby-milk manufacturer Wyeth - has been picked on as well.
Moreover, the Nestlé Formula Audit Commission is not without its critics. According to ACA's Nancy Gaschott, the Commission's chairperson was chosen by Nestlé , all of its funding comes from Nestlé - it even shares Nestlé public relations firm. A member of the Commission, Professor James Post, confirms that the group undertakes very little direct monitoring of Nestlé marketing activities: 'There has not been much recent activity in the field. I think that Commission members themselves recognize that the time is right for us to do more of that'.
I ask Nestlé's François Perroud why the Commission doesn't undertake regular fact-finding missions.
'It is entirely free to do so,' he replies. 'Whenever it wants to; whenever it perceives a need.'
Nancy Gaschott is not convinced. She says that the Commission's investigation of complaints passed on to them consist of asking Nestlé for a response - and that can take some time. 'The last time ACA submitted a 49-page monitoring report to the Commission we had no response for nearly a year.
Nestlé is also probably more rigorous than other companies in monitoring the amount of free infant formula it donates to hospitals. Yet Nestlé's own Commission has found that 'in certain instances Nestlé has distributed supplies in quantities deemed to be excessive' - although 'those instances cannot be characterized fairly as indicative of a corporate policy to 'dump' free supplies'.4
Says Nancy Gaschott: 'When Nestlé's sales are threatened for one reason or another, they increase the level of supplies'. Nestlé's own figures suggest this may be the case. For example in the Ivory Coast between 1985 and 1987 they increased their free supplies of baby milk to double the amount they were selling - around the same time as the Government mounted a campaign to encourage breast-feeding. But in Brazil (where Nestle has the market all to itself) no free supplies have been donated to hospitals at all.5
Babies still dying
I ask Monsieur Perroud whether Nestlé accepts that 'Bottle Baby Death' - as the syndrome is called - actually occurs.
'Definitely,' he says. 'But I think you used absolutely the right word - "Bottle Baby". Nobody has ever checked what is in the bottle. You have dozens of instances, hundreds of instances where that bottle was checked, and we found cow's milk, we found goat's milk, we found camel's milk, we found Coca-Cola, we found sugar-water, whatever else. And we have very, very rarely found misuse of infant formula.'
Nancy Gaschott does not take kindly to this defence. 'Certainly all these things appear in bottles, as well as over-diluted formula. But a mother only resorts to feeding her baby this way because she has been persuaded by industry promotion that bottle-feeding is the best way to feed her baby. After her breast milk has dried up she discovers the incredible expense of infant formula and she does the best she can with the resources available to her.'
A final question for Monsieur Perroud lingers in my mind: 'Let's assume that a mother is encouraged to use infant formula and subsequently can't breast-feed - but also cannot afford to buy enough infant formula for her baby. Would you feel morally responsible for that in any way?'
His answer is brief, but tells me all I need to know.
'Well,' says Monsieur Perroud, 'the simple fact is that we put ideograms on the cans to show the mother how to use it.
Peter Cox is a free-lance writer. His latest book - Active Ingredients - published by Thorsons is about the drug Industry.
1 An Abbot Laboratory sales training manual states: '...for every 100 intants discharged on a particular formula brand, approximately 93 infants remain on that brand'.
2 New Scientist 19 February 1987.
3 These state that there should be: no free samples; no promotion in hospitals; no unscientific promotion to health workers; no direct consumer advertising and promotion and that labels should be non-promotional.
4 Report on the infant formula controversy by the Nestlé Infant Formula Commission 1988.
5 Letter from Thad M Jackson, Nestlé, to Edmund Muskie, 27 September 1988.
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