The Nestlé Human Resources Policy

1 The nestl Human Resources Policy October 2002, Nestec Ltd., Human Resources DepartmentConcept and design: Nestec Ltd., B-COM, Corporate Identity and Design, Vevey, SwitzerlandPrinted by Neidhart + Sch n AG, Zurich, Switzerland2 The nestl Human Resources Policy4A shared Responsibility5 Dealing with People6 Joining nestl 8 Employment at nestl 9 Work/Life Balance10 Remuneration11 Professional Development14 Industrial Relations15HR OrganisationThe nestl Human Resources PolicyTable of ContentsThe nestl Human Resources Policy3 The nestl Human Resources PolicyThis Policy encompasses those guidelineswhich constitute a sound basis for efficientand effective HR Management in the nestl Group around the are in essence flexible and dynamicand may require adjustment to a variety ofcircumstances.

2 Therefore its implementationwill be inspired by sound judgement,compliance with local market laws andcommon sense, taking into account thespecific context. Its spirit should berespected under all nestl is operating on a worldwide basis, it is essential that local legislation and practices be respected to be considered is the degree of development of each market and itscapacity to advance in the management of their Human any HR Policy conflict with locallegislation, local legislation will policies are addressed to all thosewho have a responsibility in managingpeople as well as to HR professionals. The nestl Management and LeadershipPrinciplesinclude the guidelines inspiring all the nestl employees in their action and in their dealings with others. TheCorporate Business Principlesrefer to all the basic principles which nestl endorsesand subscribes to on a worldwide these documents are the pillars onwhich the present Policy has been Brabeck-LetmatheChief Executive OfficerEach employee has a distinctresponsibility in dealing with people be it as a leader of a team or as a managers and their staff are there to provide professional support in handlingpeople matters but should not substitutethemselves to the responsible prime responsibility is to contributeactively to the quality of HR managementthroughout the organisation by proposingadequate policies, ensuring their consistentapplication and coherent implementationwith as business partners.

3 The HR manager advises and offers solutions which results in positive impact on theorganisation s , she/he proposes bestpractices and provides state-of-the-artsupport and counselling to her/hiscolleagues. Together they act as co-responsible partners for all HR partnership is the key forefficiency in people communication skills of the HR staffmust be appropriate to deal with all delicatematters as they occur frequently in humanrelations issues. They gain their credibilitynot only from their professional contributionbut also through the care and the excellenceof their communication nestl Human Resources PolicyA shared ResponsibilityThe nestl Management and LeadershipPrinciplesdescribe the management style and the corporate values of the nestl Group, specifically in the area ofinterpersonal relations.

4 Their respect calls for specific attitudes which deserve to be outlined in the present Policy :_A prerequisite for dealing with people isrespect and trust. There can be no room forintolerance, harassment or discrimination of any kind as they are the expression of anelementary lack of respect. This principlesuffers no exception and is to be applied atall levels and under all and honesty in dealing withpeople are a sine qua non for efficientcommunication. Based on facts and on asincere dialogue, such transparency is theonly solid basis for boosting is to be complemented by opencommunication with the purpose of sharingcompetencies and boosting creativity. It isparticularly relevant in a flat organisation toconvey systematically all information tothose who need it to do their work no effective delegation orknowledge improvement are communicate is not only to inform.

5 It is also to listen and to engage in employee has the right to an openconversation with superiors or colleagues. _The willingness to cooperate and to helpothers is a required basis for assessingpotential candidates in view of a case of discord between an employeeand her/his superior or another employee,the possibility must be offered for a fairhearing. The HR staff will provide assistanceto ensure that the disharmony is dealt with impartially and that each party has theopportunity to explain her/his viewpointregardless of hierarchical nestl Human Resources PolicyDealing with People6 The nestl Human Resources PolicyThe long-term success of the Companydepends on its capacity to attract, retainand develop employees able to ensure its growth on a continuing basis. This is a primary responsibility for all nestl Policy is to hire staff withpersonal attitudes and professional skillsenabling them to develop a long-termrelationship with the Company.

6 Therefore the potential for professional development is an essential standard for new member joining nestl is tobecome a participant in developing asustainable quality culture which implies a commitment to the organisation, a sensefor continuous improvement and leaves noplace for , and in view of the importance ofthese nestl values, special attention will bepaid to the matching between a candidate svalues and the Company , a clear communication of theseprinciples and values from the very beginningof the recruitment process is who are not willing to adhere to the Corporate Business Principlesand/or tothe nestl Management and LeadershipPrinciplescannot be part of the Company, as both these documents express the basicvalues and principles of the , for managerial positions specificleadership qualities and business acumenwill be wishes to maintain and develop its reputation as an employer of high with universities, attendance atrecruitment events and other contacts are to be undertaken so as to ensure goodvisibility of the Company vis- -vis relevantrecruitment sources.

7 Particular care will be given to the treatment of eachcandidacy regardless of the outcome of the selection process. Even when promoting employees intensivelyfrom within the organisation, it is the role of management and HR to keep an eye onvaluable candidates from outside and tobenchmark internal skills with external nestl 7 The nestl Human Resources PolicyWhilst adequate recruitment tools mayimprove the hiring process, it is understoodthat the decision to hire a candidate remainsin the hands of the responsible managersupported by the HR staff. Under nocircumstances should the decision to hire or not to hire be left in the hands of anoutside consultant or expert. As mentioned in the nestl Management and Leadership Principles, only relevant skills and experience and the adherence tothe above principles will be considered in employing a person.

8 No consideration willbe given to a candidate s origin, nationality,religion, race, gender or age. It is as important to hire the right person as it is to integrate newcomers in theorganisation so that their skills andbehaviour can merge smoothly with thecompany culture. Whereas from newemployees it is expected to respect ourcompany s culture, it is accordingly requiredfrom all employees to show an open mindtowards new ideas and proposals comingfrom nestl Human Resources PolicyThe Corporate Business Principlesoutline the Company s commitment to fully endorseand to respect a series of principles andinternational conventions concerningemployee s rights, the protection of childrenagainst child labour and other importantissues. These principles are to be respectedeverywhere and under all management will implement thenecessary processes to ensure that theseprinciples are enforced at all who are not abiding with the Corporate Business Principlesand the nestl Management and LeadershipPrinciplescannot be maintained inemployment and will be requested to leave the our main suppliers and providers of outsourced services should be informedof the Corporate Business Principlesand should comply with provides a working environmentwhich protects the health and welfare of the employees according to the highestaffordable standards of safety, hygiene andsecurity.

9 Each employee should not onlycare for her/his own safety but also that ofher/his colleagues. Therefore, suggestionsfor improvement are welcome and will be given prime the same way that no discrimination forreason of origin, nationality, religion, race,gender or age will be tolerated when joining nestl , no such discrimination willbe tolerated towards nestl s , any form of harassment, moralor sexual, will not only be prohibited butactively tracked and eliminated. Internalrules and regulations will explicitly deal withdiscrimination and harassment issues so as to obtain the best possible considers that it is not enough toavoid discrimination or harassment. It is essential to build a relationship basedon trust and respect of employees at alllevels. Therefore, it is indispensable for eachmanager to know how her/his employeesfeel in their work.

10 In larger units it may be necessary to organise such feedback on a regular basis, using internal surveys or other valuable favours a Policy of long-termemployment. Whenever, an operation/activity cannot be maintained within theNestl sphere, reasonable steps will be undertaken to avoid overall loss ofemployment by identifying an externalbusiness willing to take over activity from nestl , whenever this is this is not possible, a closing down maybe unavoidable. It will be handled in full respect of local legislation and of theCorporate Business Principles. A social planwill be elaborated taking into account thelegitimate interests of the concerned efforts will be deployed toreduce, as much as possible, the negativesocial impact of such a at nestl 9 Work/Life BalanceAt nestl we believe that the employee s private and professional life should have a good balance.