Paul Polman, CEO, Unilever: Winning with Purpose
Business has been a powerful force in improving the lives of millions of people on our planet – whether through product and service innovation, job creation or new opportunities for suppliers and distributors. Yet, I believe business can do so much more. As the Occupy movement has highlighted, huge inequalities remain – and companies such as mine, need to think deeply about how we can be successful in a way that tackles the fundamental social and environmental challenges of our age.
I believe in capitalism, but I also believe we have to rethink it. We need a new sustainable and equitable model of capitalism. Consumers clearly want that too, and businesses that do not respond are at risk of being put out of business.
While many business are responding – reporting on their impacts, and thinking about how they can do business in new ways – far too few are giving this the attention it deserves. In large part, this is driven by a dominance of short-term profit expectations in the investment community. But where it is working best, it is being driven by passionate innovators who are not afraid to go against the stream.
I am impressed by the depth of innovation demonstrated by members of Business Fights Poverty – whether from business, or from organisations working with business – who are finding new ways to harness business for good. You are the vanguard of an emerging movement helping forge this new path.
For our part, Unilever, has created its Sustainable Living Plan – our ambitious strategy to drive growth in our business in a way that embeds sustainability at its heart. The Plan sets out over 50 social, economic and environmental targets to be achieved across our business, 180 markets and hundreds of brands by 2020. Importantly, the Plan starts with, but also goes beyond, our factory gates. The sourcing of raw materials and the use of our products by the consumer at home have a far larger footprint. We recognise this and so our Plan is designed to reduce our impacts across the whole lifecycle of our products.
In the Plan, we commit to doubling our sales while halving the environmental impact involved in the making and use of our products. We will help more than 1 billion people take action to improve their health and well-being, including through our Lifebuoy handwashing programme that will help reduce diarrhoeal disease, the world’s second biggest cause of infant mortality. We will source 100% of our agricultural raw materials sustainably, compared to 10% in 2010 (including by 2015, 100% sustainable palm oil). We will create opportunities for over half a million smallholder farmers and small-scale distributors in our value chain in emerging markets (markets that now account for half our sales, and 75 to 80 per cent of our growth). We will make safe drinking water available to half a billion people by extending sales of our low-cost in-home water purifier, Pureit, from India to other countries.
Implementing these targets is not something we can do alone, and we are working with a variety of partners, including suppliers, governments and NGOs. Above all, we will work in partnership with our customers. Over two-thirds of greenhouse gas emissions and half the water used in Unilever products’ lifecycle come from consumer use, so helping consumers better understand how they can make a difference will be key. By halving the total carbon, water and waste impact of our products, primarily through innovation in the way we source, make and package them, we can help people make a small difference every time they use them. Ultimately we will only succeed if we inspire billions of people around the world to take the small, everyday actions that add up to a big difference. And as our products are used 2 billion times a day in nearly every country in the world, that adds up to a potentially huge difference – contributing to enabling us all to live more sustainably.
I see no conflict between Unilever achieving its sustainability goals and growing its business. In fact, for us, sustainability is a long-term business strategy and a fundamental part of our new operating model. If we are in sync with consumer needs and the environment in which we operate, and take responsibility for society as well as for our employees, then our shareholders will also be rewarded.
The result of our new approach is that we are growing and our share price is doing well. It is energising our employees, deepening our customers’ engagement with our brands, driving innovation, growing our markets and reducing costs.
The more we can demonstrate the business case for sustainability to others, and the importance of replacing short-termism with long-term vision, the more we can be a galvaniser in this world for good. I want to help shine a light on the importance of reconnecting business with a sense of purpose, and on the unsung heroes who are pioneering this new path. I would welcome your ideas and encourage you to share your own stories.