SUSPENSION OF NESTLÉ S.A. (RSPO MEMBERSHIP NO. 4-0055-09-000-00) DUE TO BREACH OF THE CODE OF CONDUCT FOR MEMBERS OF THE RSPO

With reference to the above, we regret to inform you that membership of Nestlé with the Roundtable on Sustainable Palm Oil (RSPO) has been suspended, effective from the date of this announcement, in accordance to Clause 5.5 of the RSPO Code of Conduct for Members 2017, and as approved by the RSPO Board of Governors at its meeting on 27 June 2018.
The reason for this suspension is due to breaches of the RSPO Statutes and Code of Conduct for Members 2017, outlined as follows: Nestlé has not submitted the ACOP report for 2016, and for 2017 submitted the ACOP report without a time-bound plan. It is compulsory for members to communicate their commitment by submitting the ACOP reports annually as required under the Code of Conduct for Members 2017 as follows:

Clause 2.2 – Members are required to report annually on progress against this Code.

Clause 3.6 – In the required Annual Communication on Progress (see 2.2), existing RSPO members are required to specify steps taken last year, specific steps intended for the coming year and for the long term in the form of a time-bound plan of working towards producing or buying certified sustainable palm oil, applying any or a combination of the RSPO approved supply chain mechanism and relevant to the scope of the member's operations (e.g. specifying volume or percentage targets, or a commitment to above-average proportions of trade or investment volumes in comparison to production or demand trends).

Clause 3.8 – Subsequently, members need to report progress against the time-bound plan annually as part of the mandatory progress report.

Nestlé was given the opportunity to complete its ACOP report for 2017 through active engagement, and has declined to submit a time-bound plan.

We would like to also notify that Nestlé has unpaid overdue membership fee of €2,000 and non-payment of membership fees is a breach of the RSPO Statutes as per Clause 8(b)(ii) of the RSPO Statutes 2017.

As a result of this suspension, the following privileges shall be revoked:

• Voting rights at RSPO General Assemblies
• Becoming or to continue being members of any Task Forces or Working Groups in RSPO
• Claiming of membership and use of certified sustainable palm oil

As several of Nestlé facilities are RSPO Supply Chain certified, membership suspension will result in suspension of certification. This certification suspension extends to all its subsidiaries and covers all facilities as per RSPO records as follows:

1. Nestlé Australia (up for renewal in November 2018)
2. CPUK Bromborough (up for renewal in September 2019)

We will grant Nestlé a period of 30 days (from the date of this letter) to communicate its suspension to its customers, thus allowing them to seek alternatives. After this 30 day period, Nestlé certificates will automatically cease to be valid and trading of CSPO will no longer be available via PalmTrace.
Suspension of Nestlé’s membership and certification will be posted on the RSPO website and it will be communicated to its respective Certification Bodies (CBs) for further action.

We hereby request that Nestlé fully comply and commit to the RSPO Statutes and Code of Conduct for Members 2017 by 20 July 2018. The suspension will only be lifted and certification reinstated once RSPO is satisfied that this has been fulfilled. Failure to comply will result in membership with the RSPO being terminated.