Global Index 2021

FrieslandCampina

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Product categories assessed
Processed Meat and Seafood|Dairy|Other Hot Drinks
Percentage of company global sales covered by Product Profile assessment
65-70%
Headquarters
The Netherlands
Number of employees
23816
Type of ownership
Cooperative
Rank 3 / Score 5.9
Rank 4 (2018)
Product Profile
Rank 2 / Score 7.4
Rank 1 (2018)
BMS/CF Marketing
Rank 6 / Score 21%
Rank 4 (2018)
Important:

The findings of this Index regarding companies’ performance rely to a large extent on information shared by companies, in addition to information that is available in the public domain. Several factors beyond the companies’ control may impact the availability of information such as differences in disclosure requirements among countries or capacity constraints within companies, amongst others the Covid-19 pandemic. Therefore, in the case of limited or no engagement by such companies, this Index may not represent the full extent of their efforts.

Corporate Profile

Rank 3

Score 5.9

An adjustment of -1.18 to the company's score has been made based on its score in the BMS/CF Marketing Index 2021.

Company BMS/CF Scorecard

Commitment

Performance

Disclosure

The bar graph to the left shows company performance across the seven Index categories, which are key topic areas of assessment, and scores are shown for each category. The circles above provide an alternate view on the company’s overall results, showing the score per indicator type. The Commitment, Performance, Disclosure score only applies to category scores and not to the BMS/CF Assessment.

Main areas
of strength

● SCORES AND RANKS: Although FrieslandCampina’s score has slightly decreased from 6.0 in 2018 to 5.9 out of 10 in 2021, the company’s overall rank has improved from the fourth to third place. The company ranks first in Category C ‘Accessibility’ and Category D ‘Marketing’. It ranks 2nd on the Product Profile with a score of 7.4 out of 10 and performs above average in all index categories.

● GOVERNANCE: Through its updated ‘Nutrition Policy’, FrieslandCampina continues to place a strong strategic focus on nutrition and health, and addressing malnutrition. Published in 2020 as part of the company’s updated ‘Nutrition Policy’, the ‘Better Products Program’ strives to ensure that at least 70 percent of its products are considered as ‘nourishing for daily use’ – as opposed to ‘indulgent’ – and that at least 70 percent of sold volume complies with their ‘Global Nutritional Standards’. The program is based on the World Health Organization (WHO) Global Action Plan for the prevention and control of noncommunicable diseases 2013-2020, and explicitly seeks to address obesity/overweight and undernutrition.

● GOVERNANCE: Through its updated ‘Broadening Access to Nutrition’ program, the company seeks to address micronutrient deficiencies and undernutrition through a deliberate strategy of expanding access and improving the affordability of its fortified and nutritious products. Importantly, FrieslandCampina has sought to identify priority populations in the countries it’s active in based on data from the WHO and the Food and Agriculture Organization (FAO), as well as regional studies South East Asian Nutrition Survey (SEANUTS) and Accelerating Nutrition Improvements in Sub-Saharan Africa (ANI).

● PRODUCTS: FrieslandCampina continues to implement the updated Global Nutritional Standards (GNS), its Nutrient Profiling Model (NPM) that sets criteria for both positive components (such as milk protein, fiber, vitamins, and minerals) and trans-fat, saturated fat, added sugar, and salt. The criteria for the latter group were derived from Choices International and developed by independent scientists. The company has benchmarked its GNS against the Health Star Rating system (HSR), finding a deviation of less than 10 percent in the estimated percentage of healthy products. Moreover, the company only fortifies products that meet its GNS criteria, and bases its approach on the WHO guidelines and CODEX CAC/ GL 2-1985.

● ACCESSIBILITY FrieslandCampina is commended for its strong performance in pricing and distribution (Category C). As part of its updated ‘Broadening Access to Nutrition program’, the company has enhanced its commitments, strategies, and practices by effectively adopting a policy on affordability and accessibility. The concrete, measurable targets linked to this program stand out. One of the company’s objectives is to increase the share of affordable nutrition products in its lower-income markets (Nigeria, Pakistan, Ivory Coast, Indonesia, Vietnam, and the Philippines) to at least 15 percent of sold volume in 2025. Additionally, the program aims to increase the percentage of affordable nutrition products that comply with its own Affordable Nutritional Standards in these markets to at least 50 percent by 2025. In its efforts to improve the accessibility of its affordable healthy products, FrieslandCampina has conducted robust pricing and distribution analysis, and shares examples of arrangements made with distributors regarding how healthy products are made accessible in several low- and middle-income countries.

● MARKETING: Apart from committing to adhere to the International Chamber of Commerce (ICC) Framework for Responsible Food and Beverage Marketing Communications, FrieslandCampina is the only company to make explicit commitments for marketing strategies to reach priority populations – providing evidence of taking steps to understand and reach these with appropriate products through tailored marketing, and does so on a global scale. Through its Broadening Access To Nutrition programme’, the company uses a promotion strategy of advertising, social media, and educational messages, all adapted to the country and local distribution channels used by the target group and brand. One example is the promotion of its small-packaged and small-sized Peak product in Nigeria through TV, and commercials and educational messages on Facebook.

● MARKETING: FrieslandCampina has updated its responsible marketing policy, the Corporate Standard for Responsible Marketing Communications. Through this, the company commits to only market products to children under 12 years old that meet the FrieslandCampina Nutrition Criteria for Marketing Towards Children, while also committing to using responsible marketing techniques to do so. The policy also regulates the deployment of children, celebrities (including influencers), or fantasy and animated characters, and the responsible use of promotional toys, games, vouchers, and competitions. Furthermore, the company utilizes tools to ensure its digital marketing does not reach younger age groups and applies these to all own- and third-party digital media.

● LABELING: Friesland Campina performs strongly on its front-of-pack (FOP) and back- of-pack (FOP) product labelling commitments and disclosures. The company is one out of three companies that commits to using interpretative labeling on all relevant products, globally. This is a huge improvement from only displaying nutrients in numeric format in 2018, as using interpretative labelling is industry best practice. It provides nutritional information to consumers in a clear and easy-to-read format, and can help consumers make more informed, healthier choices. The company has also advanced on implementing its BOP labelling commitments to more than 90% of products globally, an increase from more than 80% of products in 2018.

● ENGAGEMENT: The company is one of only four committing to play an active role in supporting governments’ efforts to combat all forms of malnutrition on a global scale, while providing examples of working with the European Union and governments of the Netherlands and Philippines. In addition, FrieslandCampina receives credit for disclosing its lobbying measures with the Netherland Ministry of Health and Malaysian Ministry of Health, regarding lowering sugar content with the results from SEANUTS research. The company showed evidence of engaging with a wide range of stakeholders in developing its nutrition strategy, policies, and programs, including international organizations, national bodies, CSOs, and academic institutions or scientific experts.

Priority areas
for improvement

● PRODUCTS: The FrieslandCampina Global Nutritional Standards set limits on levels of sodium, saturated fats, and added sugars for all products that the company positions as ‘tailored nutrition’, ‘affordable nutrition’, and ‘daily nutrition’. However, these limits are not applied to products positioned as ‘treats and taste enhancers’. ATNI encourages the company to set targets for limiting negative nutrients in this product category, and to increase its transparency around how these are defined and what parts of its portfolio they will cover.

● ACCESSIBILITY: FrieslandCampina could consider expanding the scope of its strategy and targets by aiming to reach all consumers, including priority populations, in all the markets it is active in, with affordable, accessible healthy products, and report on progress made. The company is encouraged to provide evidence of conducting pricing and distribution analysis in all markets it is active in, including middle- and high-income countries, to reach low-income consumers and those with limited physical access (e.g., in food deserts and poor urban areas).

● LIFESTYLES: While the company commits to supporting employee health and wellness through its ‘Boost (Boest) Vitality Programme’, this only covers direct employees of the company. ATNI recommends that the company improves its score by extending the same program to employees’ family members and other value chain actors, such as smallholder farmers, factory workers, and small-scale vendors. The company could also consider making public commitments to allowing parents to take paid parental leave up to 26 weeks and more, and to providing breastfeeding mothers with appropriate conditions and facilities at work.

● LABELING: On the use of health and nutrition claims, FrieslandCampina shows limited commitments. To prevent misuse of claims, or the placement of claims on unhealthy products, it is recommended that the company commits to not using claims on products unless they have been pre-determined as ‘healthy’ by a relevant (preferably government-endorsed) NPM. This should be applied to all products and markets that the company is active in. In addition, to strengthen its performance on product labeling, ATNI encourages the company to make public commitments not to provide additional interpretive labeling or other information FOP that directly relates to the message of the mandatory FOP labeling (which may confuse consumers or modify the effect of the mandatory labeling).

● ENGAGEMENT: ATNI advises that FrieslandCampina publicly commits to only lobby in support of measures designed to improve health and nutrition that have a solid grounding in independent, peer-reviewed science. It could consider developing adequate internal controls to ensure their lobbying activities align with company policy, such as assigning oversight and conducting audits of its lobbying activities to the Board. The company is also encouraged to consider increasing its transparency regarding lobbying expenditures and activities in the markets in which it is active.

● ENGAGEMENT: In 2019, the company created an Advisory Council to advise the ‘FrieslandCampina Institute’, a non-commercial source of scientific research for nutrition and health professionals, consisting of international multidisciplinary researchers in the area of malnutrition, nutrition, population health, and consumer behavior. However, it is not clear if the company has an expert advisory group advising on its commercial nutrition strategy.

● BREAST-MILK SUBSTITUTES AND COMPLEMENTARY FOODS: To fully align with the Code, FrieslandCampina is encouraged to fully incorporate World Health Assembly (WHA) 69.9 recommendations in its BMS marketing policy which strengthen and/or clarify the scope and recommendations of the original 1981 Code, and the subsequent relevant resolutions. It is also advised that the company extends coverage of its BMS marketing policy to growing-up milks. ATNI further recommends the company to commit to upholding that policy and associated standards and guidelines in countries where local regulations are less stringent and less comprehensive than its own policy, in respect of product scope and/or Code provisions.

Category Analysis

Governance

Governance

Products

Accessibility

Marketing

Lifestyles

Labeling

Engagement

Nutrition

A1
Nutrition strategy
A2
Nutrition management
A3
Reporting quality
B1
Product Profile
B2
Product formulation
B3
Defining healthy products
C1
Product pricing
C2
Product distribution
D1
Marketing policy
D2
Marketing to children
D3
Auditing and compliance
E1
Employee health
E2
Breastfeeding support
E3
Consumer health
F1
Product labeling
F2
Claims
G1
Influencing policymakers
G2
Stakeholder engagement

Commitment

Performance

Disclosure

The big circle on the left represents the company result for this Index category, showing the rank out of 25 and the score below it. The smaller circles above indicate company's scores on the three types of indicators.
The big circle on the left represents the company result for this Index category, showing the rank out of 25 and the score below it. The smaller circles above indicate company's scores on the three types of indicators.
The big circle on the left represents the company result for this Index category, showing the rank out of 25 and the score below it. The smaller circles above indicate company's scores on the three types of indicators.
The big circle on the left represents the company result for this Index category, showing the rank out of 25 and the score below it. The smaller circles above indicate company's scores on the three types of indicators.
The big circle on the left represents the company result for this Index category, showing the rank out of 25 and the score below it. The smaller circles above indicate company's scores on the three types of indicators.
The big circle on the left represents the company result for this Index category, showing the rank out of 25 and the score below it. The smaller circles above indicate company's scores on the three types of indicators.
The big circle on the left represents the company result for this Index category, showing the rank out of 25 and the score below it. The smaller circles above indicate company's scores on the three types of indicators.

Detailed Product Profile Results

2
Rank 2 / Score 7.4

The Product Profile is an independent assessment of the nutritional quality of companies’ product portfolios. For this purpose, ATNI uses the Health Star Rating (HSR) model, which rates foods from 0.5 to 5.0 based on their nutritional quality. ATNI uses the threshold of 3.5 stars or more to classify products as generally healthy. This assessment is undertaken in partnership with The George Institute for Global Health (TGI), with additional data input from Innova Market Insights.

The methodology for the Global Index 2021 Product Profile has been revised and now includes three scored elements. The overall Product Profile score reflects: B1.1, the mean healthiness of a company’s product portfolio; B1.2, the relative healthiness within product categories compared to peers, and; B1.3, changes in the nutritional quality of product portfolios compared to the Global Index 2018 Product Profile. The steps taken to calculate the final Product Profile scores are visualized in Box 1. The next section further explains each of these three elements.

FrieslandCampina has been assessed for the second time in the Global Index Product Profile. In the previous assessment, two of the company’s markets were selected, and a total of 24 products analyzed – accounting for approximately 0-5% of global retail sales in 2017, excluding baby foods, plain tea, and coffee. In this Index, a total of 494 products have been analyzed across 10 of the company’s major markets. Products from the top five best-selling product categories within each market are included. In 2019, these products accounted for 65-70% of the company’s global retail sales, excluding baby foods, plain tea, and coffee.

Germany, Indonesia, The Netherlands, Nigeria, The Philippines, Russia, Thailand, and Vietnam are new countries included in this iteration. In 2018, one product category was covered by the assessment, compared to three categories in 2021. Products form the ‘Other Hot Drinks’ and ‘Processed Meat and Seafood’ categories are assessed in 2021 but were not in 2018.

In this Product Profile assessment, FrieslandCampina’s scores 6.5 out of 10 (B1.1) in the mean healthiness element, and 8.3 out of 10 (B1.2) for the relative healthiness of its products within categories compared to peers. This results in FrieslandCampina obtaining an overall score of 7.4 out of 10, ranking second out of 25 in the Product Profile.

B1.1 Portfolio-level Results

Average
HSR (out
of 5 stars)
(sales-
weighted)
10
Countries
included
Range of
global sales
included
Healthy products
(HSR)
Products suitable to market
to children (WHO regional
models) - UNSCORED
3.3 Germany, Hong Kong, Indonesia, Netherlands, Nigeria, Philippines, Russia, Thailand, United Kingdom, Vietnam 65-70% No.
products
assessed
%
products
healthy
(≥3.5
stars)
%
retail
sales
healthy
2019
(≥3.5
stars) –
assessed
countries
only
% estimated
global
retail
sales
healthy
2019
(≥3.5
stars)
No.
products
assessed
%
products
suitable
% sales
from
suitable
494 56% 59% 55% 494 32% 25%

• A total of 494 products manufactured by FrieslandCampina, sold in 10 countries, covering three product categories, were included in this Product Profile (baby foods, plain tea and coffee were not assessed). The company’s sales-weighted mean HSR is 3.3 out of 5. ATNI turns this value into a score between 0 and 10, resulting in a mean healthiness score of 6.5 out of 10 for Friesland. The company ranks third out of 25 companies in this first scored element (B1.1).
• Overall, 56% of distinct products assessed were found to meet the HSR healthy threshold (HSR >=3.5). Together, these products accounted for an estimated 59% of Nestle’s retail sales of packaged food and beverages 2019 in the selected markets (excluding baby food, plain tea, and coffee). Assuming the products and markets included in the assessment are representative of the company’s overall global sales, ATNI estimates the company derived approximately 55% of its global retail sales from healthy products in 2019.

WHO nutrient profiling models (unscored): Only 32% of products assessed were found to be of sufficient nutritional quality to market to children, according to the World Health Organization (WHO) regional nutrient profiling models. These products were estimated to generate 25% of the company’s sales in 2019. More information on this part of the assessment can be found in the Marketing section (Category D) of the Index.

B1.2. Product Category Results

No.
products
analyzed
%
products
healthy
(HSR>=3.5)
Company
mean HSR
Mean HSR for
all companies
selling this
product
category
Company performance
(rank in mean HSR
compared to peers
selling products in
the same category)
Other Hot Drinks 1 0% 1.5 1.4 3rd out of 5
Dairy 483 56% 3.4 2.9 4th out of 18
Processed Meat and Seafood 10 90% 3.8 3.1 4th out of 8

• For FrieslandCampina, ‘Processed Meat and Seafood,’ was the best performing category, where a total of 10 products analyzed obtained mean HSR of 3.8 out of 5. ‘Other Hot Drinks’ (1.5) had the lowest mean HSR of all product categories included for FrieslandCampina.
• For three out of three categories assessed, FrieslandCampina’s products perform better than the mean HSR of companies selling products in the same categories.
• FrieslandCampina scores 8.3 out of 10 in this second scored element (B1.2) and ranks third out of 25 companies. This is based on its ranking compared to peers within the 16 categories, using the scoring system set out in ATNI’s methodology.

B1.3. Change in mean HSR

No. of products
analyzed in 2018
No. of products
analyzed in 2021
Sales weighted
mean HSR 2018
Sales weighted
mean HSR 2021
TOTAL 0 0 0 0

Not applicable for this company. This third scored element applies only to companies assessed in both Index’s and takes into account only those countries included in both assessments. Companies are also excluded from this scored element if overlapping countries account for less than 5% of their estimated retail sales in 2019.] included in both assessments. Companies are also excluded from this scored element if overlapping countries account for less than 5% of their estimated retail sales in 2019.] included in both assessments. Companies are also excluded from this scored element if overlapping countries account for less than 5% of their estimated retail sales in 2019.] included in both assessments. Companies are also excluded from this scored element if overlapping countries account for less than 5% of their estimated retail sales in 2019.]

Full Product Profile report

Breast-milk Substitutes /
Complementary Food Marketing

6
Rank 6 / Score 21%
Rank BMS
Marketing
Adjustment to
Global Index Score
BMS 1 BMS 2 Level of compliance
in country studies
Max. of -1.5 Philippines Mexico
6 21% -1.18 42% 0% NA Low (0%)

• FrieslandCampina is one of the six Index companies included in the BMS/CF Marketing Index. Its score is based on two assessments: BMS/CF 1 which assessed the company’s policy commitments, management systems and disclosure relating to the marketing of its BMS products, and BMS/CF 2 which assessed its marketing practices in Mexico during 2020. Its BMS/CF 2 score is solely based on the study in Mexico as the Philippines is not an official market for its BMS and CF products. The BMS/CF Marketing Index score is used to generate a proportionate adjustment to the final Global Index score.
• FrieslandCampina ranks sixth in the BMS/CF Marketing Index with a level of compliance with ATNI’s updated methodology (including WHA 69.9) of 21%.
• FrieslandCampina’s BMS marketing policy, which has not changed since the 2018 Index, is substantially aligned with The Code, though the same gaps remain as the company does not fully incorporate the recommendations in the guidance associated with WHA resolution 69.9 and continues to have weak commitments in relation to BMS lobbying. The company’s management systems are generally quite strong and have improved since 2018 as FrieslandCampina developed and shared several procedures and other documentation relating to various articles of The Code. FrieslandCampina has also published much more material since the 2018 Index which is reflected in its improved disclosure score.
• The principal reason behind the company’s lower score in the 2021 Index is due to ATNI gaining a better insight into the application of its BMS marketing policy in both higher- and lower-risk markets. Although it is applied globally covering infant and follow-on formula, including formulas for special medical purposes, up to 12 months of age, the company commits to fully uphold its policy only in markets with no relevant regulation. In markets where legal measures are in place, it defers to those regulations, both in terms of the products within their scope and the provisions relating to marketing and labeling, even where they are less stringent and comprehensive than its own policy. Thus a higher penalty was applied in the 2021 assessment resulting in an overall score on BMS/CF 1 of 42%.
• To improve its score, FrieslandCampina is encouraged to revise its policy to fully incorporate WHA 69.9 recommendations and extend its scope to growing-up milks. The company is also advised to incorporate commitments relating to responsible lobbying on BMS issues. FrieslandCampina should commit to uphold this policy in countries where local regulations are less stringent and less comprehensive in terms of product scope and/or Code provisions (associated standards and guidelines should be similarly applied).
• As in the 2018 Index, FrieslandCampina scores 0% in the in-country marketing study, being rated as having a low level of compliance with The Code in Mexico.
• To bring its marketing practices into line with The Code in Mexico, it is important that FrieslandCampina extends its policy to growing-up milks, as most of the non-compliances found were in relation to these products. In Mexico – and in all other markets – FrieslandCampina should particularly reinforce its policy stance that its BMS products should not be discounted or otherwise promoted in all physical and online retailers. It should also ensure that all labels contain the required information and instructions set out in WHA resolution 61.20 on the appropriate preparation of powdered formula.

BMS/CF Chapter Global Index 2021
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