“Robert Zoellick – president of the World Bank – described it as a ‘threat to global growth and social stability’. I couldn’t agree with him more,” said Polman, who outlined Unilever’s Sustainable Living Plan, which forms the blueprint for the company’s future strategy.
The plan includes doubling the size of Unilever’s business while reducing its overall environmental footprint. Polman highlighted that there’s now only one agenda for the industry: “Growth & sustainability have to be parts of the same whole.”
“For big companies such as Unilever,” he said, “this means developing new business models which allow us to continue to grow but within the finite resources of a fragile planet. To do this will require us to manage the business for the long term. That’s why we’ve stopped giving guidance to the (financial) markets, stopped giving quarterly profit updates, and stopped reacting to the short-termism of so much of the financial community. We have made it clear to investors that if they are to make a quick return, then maybe Unilever isn’t the best place to put their money. If, however, they’re investing for the future and are prepared to stay with us over the long-term, then we’ll deliver for them good, predictable and sustainable returns.”
These are brave words from the CEO of the world’s eighth largest player in the food and beverage industry tables (down from fourth place in 2009). The same approach has been taken with Unilever employees who now have compensation schemes that are weighted towards medium- and long-term results rather than short-term.
Polman pointed out that a sustainable strategy can be a profitable one and stressed that the company’s sustainable practices haven’t been achieved at the expense of the bottom line. He gave sustainable palm oil as an example, which he said gave greater yields (10 tonnes per acre) compared with un-sustainable palm oil supplies, which contribute to deforestation, that yield only 2.5 tonnes per acre.
“Business growth is crucial to economic development and social progress,” he said. “It’s this growth which has, over the past decade, helped to lift nearly a billion people in China and India out of hunger and poverty. But we need to grow differently. We’re living off the Earth’s capital, not the interest. We can’t go on this way. It’s like the farmer eating his seeds. We will have to do things differently in the future.
“This change isn’t some minor evolution of corporate social responsibility. It has nothing to do with the philanthropic programmes or cause-related marketing campaigns that are common in many large organisations. What I’m talking about is a completely new way of managing the company; one where sustainability is embedded in every business function and process; where it’s an integral part of the business strategy; and where it’s the responsibility of everyone from the CEO to the most junior brand manager. The Sustainable Living Plan is Unilever’s blueprint for this new future.”
On behalf of the seven London livery companies that have pooled their resources to host the lecture every year for the past decade, Her Royal Highness, Princess Anne gave the vote of thanks to Paul Polman for his lecture and urged all to practice moderation in our own consumption.
Claire Rowan is managing editor of Food & Beverage International magazine. Subscribe here.
© FoodBev Media Ltd 2019