Abstract

This case is about the unethical business practices followed by Nestlé in its baby food products across the world. A report by International Baby Food Action Network (IBFAN) and Public Eye, a Swiss investigative agency, reported that Nestlé’s baby food sold in India and some other countries in Asia, Latin America, and Africa contained high levels of added sugar. The report also stated that Nestlé was selling the same baby food without added sugar in developed countries such as the United Kingdom and Germany. The case discusses the growth of Nestlé from its humble beginnings in 1866 into one of the largest Food and Beverages companies in the world. The baby food controversy details are put forth in the case along with the particulars of the double standards practiced by Nestlé in adding sugar in baby foods only in some countries and its unethical marketing practices. The ill effects of added sugars in baby food are discussed in the case with analysts/experts expressing their viewpoints. The next part of the case deals with the previous controversies in which Nestlé was involved. The case ends with details of the action taken by various countries and agencies against Nestlé and of the company’s plans for the future. According to analysts, the controversy was expected to affect Nestlé’s revenues in the future.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Discuss the importance of ethical advertising for a business.
• Analyze the impact of the legal environment on business.
• Evaluate the negative consequences of unethical practices by multinational companies, especially in emerging markets.

Keywords

Ethical advertising; unethical business practices; impact of legal environment; Nestle; baby food; Cerelac; Nido; IBFAN; Public Eye