Ethos believes that the information published by the company regarding the filtered water scandal in France is insufficient. In view of the ongoing investigations and proceedings, shareholders should not grant discharge to the board of directors for the year 2024. Ethos also recommends opposing the remuneration report and the sustainability report.
2024 has been an eventful year for Nestlé. While the financial results did not meet expectations and the CEO was replaced, the company also had to deal with a major health scandal. In January 2024, several French media outlets revealed that Nestlé Waters had been illegally filtering the water sold by several of its brands in France and Switzerland, in some cases since the 1990s, and continuing to sell it as ‘natural mineral water’.
Following these revelations, the company confirmed that it had used activated carbon filters and treatments that did not comply with French regulations. In September 2024, Nestlé Waters reached a settlement to avoid a trial and paid a fine of 2 million euros for illegal drilling and unauthorised treatment of its mineral water. However, an investigation is still ongoing following complaints filed by the association Foodwatch. The Luxembourg public prosecutor's office has also announced the opening of an investigation, while the French Senate has set up a commission of inquiry that has already heard the CEO of Nestlé Waters on 19 March 2025 and the group CEO on 9 April.
In its voting recommendations, Ethos criticises the company's lack of transparency on this matter. ‘Nestlé does not provides any information to its shareholders, neither in its annual report, nor in its financial statements, despite having paid a fine of two million euros last year,’ regrets Vincent Kaufmann, CEO of the Ethos Foundation. This is problematic because, as shareholders, we have the right to know what the internal responsibilities are, but also what the risks the company has taken and what measures have been implemented to prevent this from happening again in the future.’
Ethos is pleased that the CEO of Nestlé Mr. Freixe announced on 9 April 2025, under pressure from the French Senate, that he would launch an internal investigation to better understand the origins of this fraud.
However, in view of the seriousness of the facts, the lack of transparency and the ongoing investigation, Ethos recommends opposing the discharge of the board of directors for the 2024 financial year (item 2 of the agenda). Shareholders should retain their rights until the full extent and responsibilities of this fraud have been established.
With regard to the other items on the agenda, Ethos recommends that Nestlé shareholders oppose the remuneration report, which it considers to be insufficiently transparent (item 1.2), as well as the CHF 70 million budgeted for the remuneration of members of the executive management in 2026 (item 5.2). Ethos is opposed to the election of the CEO as a permanent member of the board of directors (point 4.2). Finally, as in the previous year, Ethos recommends opposing the 2024 sustainability report (point 1.3), particularly because it does not mention the recent scandals concerning filtered water and Buitoni pizzas, but also because Nestlé insists in holding a vote that is only advisory and non-binding.
