M: Business 3rd Edition by O. C. Ferrell, Geoffrey Hirt, Linda Ferrell

Exercise 4

Social media can have an ugly side, as Nestlé found out firsthand after an attack launched by environmental organization Greenpeace. It started after Greenpeace discovered that Nestlé was sourcing a portion of its palm oil (an ingredient used in its chocolate bars) non sustainably.

The problem from Greenpeace’s perspective is that many palm oil producers destroy rain forests in order to grow the plants from which the oil is harvested; it is argued that this action increases global warming and threatens orangutan populations.

Greenpeace began its attack by releasing a report, protesting outside Nestlé’s headquarters, and launching a video on YouTube. Greenpeace altered Nestlé’s Kit-Kat logo to read Killer. Although Nestlé forced Greenpeace to pull the video, thousands of protesters had already shared it via their Facebook and Twitter accounts. The commentary on Nestlé’s Facebook page and Twitter feed was scathing. Worse yet, the news had gone viral, making it nearly impossible for Nestlé to contain.

Nestlé responded by severing ties with the company in question and promised to do a thorough audit of all third-party suppliers. It made a commitment to source 50 percent of sustainable palm oil by 2011 and 100 percent by 2015. Nestlé also partnered with The Forest Trust to create responsible sourcing guidelines. Despite its response, Nestlé continued to get hammered in the press for its initial handling of protesters.

As this situation demonstrates, the relative newness of social media has left many companies with their guard down. In the future, Nestlé and other businesses should consider using social media not as a way to quench negative publicity, but as a method to address consumer concerns.

Did Nestlé handle the protests appropriately?

Step 1 of 2

FMCG giant N, has responded to the palm oil protest appropriately, stressing their commitment to eliminate deforestation from global supply chain. The company has committed to source palm oil responsibly by ensuring that none of their product is associated with deforestation.