PETALING JAYA: Nestle (Malaysia) Bhd is not planning to raise product prices for the remainder of the year. Chief executive officer Juan Aranols says any adjustments to pricing remained a “last resort” because of the impact on Malaysian households’ purchasing power.
“We have recently very explicitly said that we are not planning for price increases in the balance of the year, and that remains totally valid,” he said after its Nestle Sustainability, Connected” event yesterday.
Aranols said Nestle Malaysia had been able to maintain uninterrupted product supply despite the Middle East crisis through business continuity plans developed over several years.
He said the company had alternative suppliers that could be activated when its primary sources encountered disruptions.
“If you have one problem with supplier A, you have alternatives to move on quickly and activate them, so you move to B or C,” he said. Aranols added Nestle Malaysia was not experiencing shortages of raw materials for its manufacturing operations.
Meanwhile, the company has reduced its greenhouse gas (GHG) emissions by 31% from its 2018 baseline, surpassing its interim target of a 20% reduction by 2025.
Aranols said the improvement reflected a broad range of measures covering factories, logistics, agricultural supply chains, renewable electricity and manufacturing efficiency.
“It is not just about reducing the carbon impact of our factories or logistics, but also addressing the agricultural and farming supply chain,” he said.
He noted dairy farming and rice production could contribute substantially to methane and other GHG emissions.
The company is also reducing water and energy consumption for each unit of product manufactured while working with suppliers to lower emissions across global commodity supply chains.
Aranols declined to provide a specific figure for the investments required to meet Nestle Malaysia’s climate goals, describing the programme as a continuing, long-term effort.
He said the adoption of more sustainable materials could initially cost more, as seen when the company moved from plastic to paper straws, although costs could fall as production scales and more suppliers enter the market.
“This is not about the bottom line: it is about the future and the resilience of supply chains,” he said. Aranols warned climate change could make agricultural harvests more volatile and reduce the predictability of food supplies.
Nestle Malaysia is targeting a 50% reduction in GHG emissions by 2030 before reaching net-zero emissions by 2050. The company said the 31% reduction was supported by its transition to 100% renewable electricity, manufacturing improvements, regenerative agriculture, sustainable sourcing and circular packaging initiatives.
