Nestlé Faces Mounting Scandal Over Mineral Water Practices, Leadership in Question

Investigations reveal that the company had been using unauthorized techniques like ultraviolet (UV) disinfection and carbon filtration to purify water contaminated with substances such as E. coli, coliform bacteria, and pesticides. Regulations stipulate that natural mineral water must remain untreated to preserve its natural composition, making Nestlé’s actions a direct breach of these standards (Foodwatch, RFI).

While Nestlé has admitted to using these methods and has since discontinued them, the fallout has been severe. To avoid a full trial, the company agreed to a €2 million settlement and pledged an additional €1 million toward environmental restoration. However, consumer advocacy groups, including Foodwatch, criticized the settlement as insufficient, arguing that it allows the company to avoid full accountability for what they describe as decades of consumer deception. Foodwatch has since filed further legal complaints, seeking tougher penalties and a judicial investigation into Nestlé’s practices (The Times).

This latest controversy adds to an already challenging period for the company. In 2024, Nestlé experienced a sharp decline in its financial performance, with share prices dropping over 10%. Under former CEO Mark Schneider, the company struggled with operational missteps and failed acquisitions, leaving its reputation vulnerable. Schneider abruptly stepped down in August 2024, leaving his successor, Laurent Freixe, to face a mounting crisis (FT, US News).

Freixe, a Nestlé veteran with nearly 40 years at the company, has inherited what many describe as a leadership minefield. Observers are skeptical of whether he can implement the structural reforms, restore transparency, and rebuild consumer trust that Nestlé desperately needs. With the scandal highlighting systemic failures in compliance and quality control, doubts loom over whether these deep-seated issues can realistically be resolved or if the damage to Nestlé’s reputation is irreversible.

The situation marks a pivotal moment in Nestlé’s history. For decades, the company has been synonymous with global leadership in the food and beverage industry. Now, critics argue that these scandals could signify the start of a prolonged and significant decline. Freixe’s ability to navigate this crisis will determine whether Nestlé can salvage its standing—or if the company will become a cautionary tale of corporate mismanagement.