The Secret To UNILEVER ‘s Success
Prevalent in over 190 countries, Unilever is one of the oldest multinational companies. It is the world’s largest consumer goods company according to a report in 2012. Their main products for sale include food, beverages, cleaning agents and personal care products. And above all, Unilever remains Europe’s seventh most valuable company.
A chat with the CEO of Unilever, Paul Polman unravelled quite a few things about how Unilever is enjoying its success ride.
Unilever launched a project Unilever Sustainable Living Plan (USLP) in the year 2010. The launch was an absolute success as the company promised to double in size, and at the same time halving its environmental footprint. Unilever has major plans and targets which they are set out to achieve by the year 2020.
Unilever reaches out to over 2 billion people a day, using products ranging from supplementary food to deodorants. We’re thinking, could sustainability be the key to Unilever’s success?
Paul Polman was interviewed to get his views on a business that is sustainable and how he sees the Unilever Sustainable Living Plan as a key driver of success for Unilever. The steps to its success have been incorporated in a few steps…
- First of all, Paul Polman explains that Unilever has not just indulged on thinking – “how can I be sustainable?” Instead, they focussed on a wider and more compassionate scale. That is, their chief question was how the business could contribute to a sustainable future.
Polman’s exact words were,
“Most businesses operate and say how can I use society and the environment to be successful? We are saying the opposite – how can we contribute to the society and the environment to be successful?”
What every businessman should know is that always ask the right question to yourself. Shift from “How can my company be sustainable?” to “How can my company lead to a sustainable future?” The two thoughts could be similar to many, but if you think deeper, you can spot the subtle difference.
After you ask yourself the right question, you must also decide if you want your business to be short-term. It is true there are businesses that are purely fuelled by a fascination with short-term profit maximisation. But this short-termism means that businesses are missing out on an opportunity to build resilience into the business, and secure its medium and long-term success.
Unilever has worked through the longer term implications of global trends for its business. The USLP targets are responses to these implications and are designed to ensure that Unilever is in business next year, and into the next decade.
- No business can be run on its own. For that matter, Unilever is clear that it can’t deliver a sustainable future on its own. Paul Polman is consistently clear on this,
“The issues that we are facing, issues of food security climate change obviously are issues that cannot be solved at the level that they have been created; we really need a step change…companies like ours…need to work with multiple stakeholders”.
Tea workers and access to safe drinking water. Source: study of tea farms in Kenya, Ochieng, et al. 2013
Unilever realises the importance of partnerships, from helping establish the Marine Stewardship Council in 1997 to working with the Rainforest Alliance; to certify the tea it sells across multiple geographies, Unilever has consistently engaged with others to boost its progress towards sustainability.
- Unilever embedded its USLP targets in their work as well. Unilever has also started to provide its people with the tools, skills and knowledge to be able to deliver the USLP. Paul Polman explains,
“It also gives a tremendous purpose to what we are doing as a business that creates an enormous energy here and employee engagement that I’m sure will explains half of the growth that we will be producing”.
- Unilever did not wait for its consumers to demand for more sustainable products. Instead, it decided not to wait, and ensures that sustainability is pro-actively brought to the millions of people that buy Unilever products as a real priority. He says,
“but they are ready for it I can tell you, increasingly so, and it’s no longer a developed market phenomena – it’s rapidly becoming a global phenomenon…We are basically trying to turn this company over to the consumer at the end of the day.”
Unilever is trying to change the external system in a way that, in the end, will reward sustainability.
“I am on the record for saying I don’t really work for the shareholder I work for the consumer and the customer, but I firmly believe that in doing so we will have a business model that is successful and that will benefit the shareholder long term as well. It’s the only way; if I was only focused on the short term shareholder return I think I would undermine this business model.”
Paul Polman is clear, Unilever needs to influence and engage suppliers, consumers and legislators to create the conditions where a sustainable consumer goods industry is possible.
There are only a few companies that have a positive force for sustainability. Gaias Homes in India is one such company I am happy and proud to personally know, which ensures to incorporate sustainability in its work and thus contributing to the greater good for the future.
Making Eco homes, cleaning up the environment at the same time is not exactly a piece of cake. But the beauty of it is that Gaias Homes makes it look so easy, so gracefully.
We need more companies like Unilever and Gaias Homes that have a positive vision to make our future better, sustainably.