Nestlé says less than 40% of its sales come from food and beverage offerings considered healthy

Dive Brief:

• Nestlé said 37% of its net sales, excluding pet care and specialized nutrition, come from products that are considered “healthy,” according to a widely used ranking platform known as the Health Star Rating system.
• The world’s largest food company said 43% of its net sales came from food and beverages that should be consumed occasionally or that should have their nutritional value improved.
• In 2022, Nestlé committed to “increase the transparency of the nutritional value of our global portfolio” by benchmarking its offerings against the Health Star Rating (HSR) system, which assesses food based on attributes such as saturated fat, sodium, sugar, protein and vegetables. Foods with an HSR score of 3.5 or more are considered to be healthier products. 

Dive Insight:

As food makers come under pressure to improve the nutritional content of their portfolios and consumers look to eat healthier, Nestlé is taking a big step to show the public how it is doing. The Switzerland-based food and beverage giant said it is the first company to disclose the nutritional value of its entire portfolio. 

Nestlé, whose portfolio includes brands such as Nesquik, Lean Cuisine and Sweet Earth, has been improving the nutritional content of its foods and beverages by lowering sodium, expanding offerings without sugar and increasing its presence in plant-based. It noted its commitment to reduce sodium in “frequently consumed products” by 2025 and 2030.

“Our focus is on improving the nutritional value of our products,” Nestlé said in its report. “We are continuously improving the nutritional profile of our products by adding more whole grains, proteins and fibers while reducing sugars, sodium and saturated fats — without compromising taste.”

Nestlé Health Science, for example, announced in 2022 that it reduced the added sugar in its ready-to-drink and powder Carnation Breakfast Essentials brand by 25%. It also recently expanded its Natural Bliss creamer into plant-based milk with an offering that combines oats and fava beans.

In a statement, Holly Gabriel, the campaign lead for consumer health at ShareAction, a climate advocacy group, praised “Nestlé’s use of a government-backed, internationally recognised nutrient profiling model [as] a welcome step forward for the company’s transparency to investors and consumers alike.”

Still, she added as one of the biggest food and drink companies in the world, Nestlé has an “outsized influence on what people eat and drink. What this disclosure worryingly shows is the company is still far too reliant on the sale of less healthy food and drink products.”

Mark Schneider, Nestlé’s CEO, told analysts during its earnings call in February, that the company has “already [made] a lot of progress regarding the reduction of sodium, sugar and saturated fats.” Still, he added there are challenges to further improvements in some areas, particularly in indulgent offerings.

“It’s clear that while the work goes on, there are limits. So enjoyment-related categories will not be turned into health-related categories,” Schneider said.

Three years ago, Nestlé discontinued its Milkybar Wowsomes lower-sugar chocolate bar that launched in the U.K. and Ireland, as it faced low sales and struggled to sustain distribution, BBC reported. The bar contained Nestlé’s sugar-reduction technology, which reduced the sweetener by 30%.

Food and beverage companies have been criticized for not doing enough to make their products healthier. A study by the Access to Nutrition Initiative in 2022 found about 70% of all food and beverages are less “healthy,” and no big CPG gets a majority of its sales from “healthier” products.

The group analyzed products and policies from the 11 largest companies in the U.S. food and beverage space, including Nestlé, PepsiCo, Coca-Cola and Kraft Heinz.

It looked at several different aspects — including product healthiness and reformulation targets, responsible marketing, access and affordability of healthy foods and labeling and lobbying to improve nutritional strategies.  The Access to Nutrition Initiative gave each of the companies a score between one and 10. Nestlé tied for fourth with 4.3.