Nestlé Infant Formula

MG 660 Strategic Marketing

Jorge J. Zavala

Week 10

Nestlé Infant Formula

Business ethics is the study of proper business policies and practices regarding potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate social responsibility (CSR) and fiduciary responsibilities. Business firms have a responsibility to put the wellbeing of everyone involved at the forefront. Companies that place earnings before their CSR will face many problems. This is shows in the boycotts on Nestlé in the late 1970s.

In 1877, Anglo-Swiss added milk-based baby foods to their product line; the following year, the Nestlé Company added condensed milk to theirs. This made the firms direct rivals. In 1905 the two companies merged to to form the Nestlé and Anglo-Swiss Condensed Milk Company. A name they retained until 1947 when they acquired Fabrique de Produits Maggi SA to become Nestlé Alimentana SA'.  

While the use of infant formula has many merits, there are many risks to consider from its use. This is especially true in third world countries. In general, the female body stops producing milk after a short while of not breastfeeding. When a mother who has been using free formula samples cannot buy more, she will not be able to adequately feed their child. In the third world, they face challenges that severely impact infant health when formula feeding. First, a lack of proper refrigeration leads to improperly stored mixed and unmixed formula. Second, clean water is not readily available which leads to diarrhea and other diseases for infants. Third, poor education and low income often leads to mixing the formula in improper ratios which leads to greatly reduced nutrition.

Despite the risks, some manufacturers heavily marketed infant formula and bottle feeding. The promotions depicted happy, healthy infants and mothers along with baby books and free formula samples from maternity wards. Some even used “milk nurses” who were assigned to wards and paid commissions to get new mothers to use formula to feed their newborn babies. The mothers were not informed of the irreversible nature of bottle-feeding vs. breastfeeding.

In the early 1970s, physicians practicing in these places began voicing their reservations. For one, Dr. Derrick Jelliffe, the then director of the Caribbean Food and Nutrition Institute, called for United Nations to add formula promotion methods to its agenda for several UN meetings. Journalist Mike Muller brought the issue to public awareness with a series of pamphlets and articles in the New Internationalist in the 1970s. One pamphlet in Great Britain depicted formula as a baby killer, another, published in Switzerland, was called “Nestlé Kills Babies.” Nestlé sued in 1975, which resulted in extensive media coverage.