Unilever CEO on Sustainability: ‘Uncomfortable Targets’ Necessary

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Unilever introduced its 10-year Sustainable Living Plan in 2010 and just released its first progress report to regulators, organizations and other partners.

Unilever made a challenge to itself that not many other manufacturers have been willing to match. The idea, as the Guardian notes, is to take “responsibility for the environmental footprint of its products right across the value chain, from the sourcing of raw materials all the way through to the consumer’s use of products to cook, clean and wash.”[more]

The report showcases successes, such as the 64% of palm oil it’s now sourcing sustainably, and that there has been “good progress in reducing saturated fat and eliminating trans fat in products,” the Guardian notes. Plus, all of the electricity purchased in Europe is now from renewable sources and “35 million people have gained access to safe drinking water from (Unilever’s) Pureit since 2005,” the paper reports.

The Guardian highlights the company’s sustainability goals that Unilever can’t control because they require the participation of consumers, such as “reducing the use of heated water in showering and washing clothes, and encouraging people to eat foods with lower salt levels.”

“In a world where temperatures are rising, energy is increasingly expensive, sanitation is worsening and food supply is less secure, business needs to be part of the solution, not the problem,” said Unilever CEO Paul Polman in a statement. “At Unilever, we believe our future success depends on being able to decouple our growth from our environmental footprint, while at the same time increasing our positive social impacts.”

Polman says the global CPG company’s goals remain ambitious and daunting, to be sure, but “uncomfortable targets” need to be in order to make actual change. He also points out that “Business has to decide what role it wants to play. Does it sit on the sidelines waiting for governments to take action or does it get on the pitch and start addressing these issues?”

The report further notes:

As a business we cannot choose between growth and sustainability. We need to grow if we are to have the resources to invest in renewable energy, sustainable agriculture and product innovation.

The Unilever Sustainable Living Plan is helping drive both growth and profitability.

The brands which are building sustainability into their offer all performed well. For example, Lifebuoy, our concentrated liquid detergents and Comfort all grew double digit in 2011.

The eco-efficiency programmes in our factories have continued to deliver good levels of savings.

Our efforts to reduce the amount of packaging we use have also cut costs.

In 2011 Unilever’s underlying sales growth was 6.5%, its market shares improved and its operating margin was broadly stable.

We see no conflict between sustainable consumption and profitable growth: they are mutually supportive.

EMBEDDING SUSTAINABILITY

Only by embedding sustainability into our business will we succeed in reaching our targets. We are doing this in a number of ways.

  • Our business strategy now includes sustainability at its heart.
  • We are measuring progress. Our brand and functional teams all have sustainability scorecards. These are reviewed quarterly by the Unilever Leadership Executive.
  • We are starting to link progress to reward. An increasing number of managers, from the CEO downward, have sustainability goals as part of their compensation.
  • We are building sustainability into innovation. We have a set of tools to evaluate the environmental impacts of new products.
  • We have appointed 65 sustainability champions to cover every key function, category and country across the business.
  • We are building expertise in behavior change. Unilever’s Five Levers for Change methodology helps our brand and R&D teams design effective programmes.

Watch Unilever’s video on its Five Levers for Change philosophy below, and find more of its sustainability videos on its YouTube channel:

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