Issue: Getting Nestlé Waters' Green Story Out

What do you do when you're a company that believes it's always been environmentally responsible and yet environmentalists are calling for you to step up your actions and play a greater role in sustainability? And what do you do when you reach the limit with your most visible effort? Those are the challenges facing Nestlé Waters North America, best known for its Poland Spring brand of bottled water.

"Being environmentally responsible is part of our DNA and has been in the 30 years that I've been with the company," contends CEO Kim Jeffery. "Obviously, protecting the source of our product is important to us. We wouldn't have a long-term business otherwise."

He concedes, though, that for many years the company never felt a need to tout its environmental bona fides, and that the company found itself having to rethink that strategy. The light bulb moment came on what Jeffery describes as a sleepless night a couple of years ago when Wal-Mart (WMT) announced its plans to "go green." "They were talking about what they were going to do, and when I thought about it, I could name 10 things that we had done [along the lines of going green] but no one knew about them." Among those efforts: continually working with vendors to reduce the plastic content of its Poland Spring, Deer Park, and other spring water brand bottles, building LEED-certified (Leadership in Energy and Environmental Design) factories, and working collaboratively to seek comprehensive recycling solutions

Part of the reason Nestlé Waters wasn't touting its environmental efforts, according to Jeffery, was that he and the rest of management considered such actions business as usual. "For us at Nestlé Waters, sustainability is a continuous process and has led me, like many others, to view it not as a destination, but rather as a journey," he says.

Getting Proactive

Yet as Corporate America, the media, shareholders, and consumers have all begun to place a higher premium on sustainability, and individual companies' transparent efforts in that direction, it was critical the Nestlé Waters become more proactive in relating its message and pushing the envelope with its bottles and packaging. "For years, I thought it was enough to take good care of our lands, protect our spring water resources and comply with regulations," says Jeffery. When he realized that is wasn't enough, he engaged his entire team to think "as creatively and as boldly as possible" about all the parts of the business where they could be greener.

To that end, the company first mapped its carbon footprint and found that the biggest impact was coming from the plastic resin Nestlé Waters North America purchased from vendors to bottle its water. Jeffery and his team were thrilled to realize this. "It meant that our decade-long drive to reduce the weight of our packaging had material, dollar, and now carbon emissions savings." In 2007 alone, the company took another 15% out of the weight of its bottle, saving some 65 million pounds of resin, and has reduced its energy production costs by 10%.

By 2010 the company plans to reduce plastic in its half-liter bottles—already the lightest on the market—by yet another 15%, while continuing to reduce its environmental footprint in the areas of transportation, production, and water use. Stepping up these efforts are critical as the company thinks the further 15% weight reduction for that bottle will be as far as it can go. Also, Jeffery is acutely aware that the bottled water industry is criticized because some 75% of water bottles aren't recycled. "That's bad for business, bad for the environment, and wasteful."

Taking on Recycling

He points out that PET (polyethylene terephthalate) beverage bottles account for less than 1% of all municipal waste in the U.S. and water bottles comprise just one-third of 1% of the waste stream. And while the company can control the packaging of its water and the weight of the bottles, it can't control what happens to the product once it's in consumers' hands. Nevertheless, he believes that it's his responsibility to help tackle the recycling issue.

"I've become an outspoken advocate of comprehensive recycling initiatives to recover all—and I mean all—recyclable containers in our society. I won't be satisfied until we reach our goal, no matter how long it takes." With the American Beverage Assn., the company is working on a model recycling program in Hartford, Conn., to improve recycling rates among citizens. Once the results of that program are measured, it's hoped that the program can be replicated in other cities.

Jeffery says the vigilance is worthwhile. "These efforts have saved us money, created better work environments, and have helped to create a culture of sustainability within our company. Eventually, we trust the marketplace will recognize and reward our efforts."