Unilever CEO: “Don’t stay on the sidelines”

As a global consumer products giant, with $44 billion euros [nearly $60 billion] in 2010 revenues, Unilever has a big impact on how and what people buy. Two billion consumers use a Unilever product on any given day. If you use Lipton Tea, eat Hellman’s mayonnaise or Ben & Jerry’s ice cream or use Dove or Lifebuoy soaps or  Suave hair products, you’re among them.

Paul Polman, Unilever’s CEO, embraces the idea that his company can make the world more just and sustainable. Unilever buys about 4-5% of the world’s palm oil, so it has promised to purchase all its palm oil from certified sustainable sources by 2015. It buys about 7% of the world’s tea, making it the world’s largest buyer, so Unilever aims to have all the tea in all Lipton tea bags sourced from Rainforest Alliance Certified™ estates by 2015, and 100% of its tea sustainably sourced by 2020.

“We have to take that responsibility,” Polman said today (Nov. 22) during a webcast called Sustainable Living: Mainstream or pipe dream?  The webcast, organized by the Guardian Sustainable Business, was held a year after Unilever released its sweeping Sustainable Living Plan, in which it promised to cut the environmental footprint of its products in half, help more than 1 billion people take action to improve their health and well-being, and source 100% of its agricultural raw materials sustainably. [See my 2010 blogpost, Unilever's big, broad, bold sustainability plan.]

But there are limits to what even a big company can do, so Unilever has begun thinking seriously about how to change consumer behavior around sustainability. Today, it released a new report called Inspiring Sustainable Living [available for download] which identifies five levers for change: Make it understood, make it easy, make it desirable, make it rewarding, make it a habit.

Paul Polman

This approach, Polman explained, recognizes that Unilever can’t transform itself into a more sustainable enterprise without the help of consumers. People need to shop more consciously–ideally, giving preference to products that are sustainable sourced–and take steps conserving water and energy at home and at work.

“Don’t stay on the sidelines,” Polman said. “It really comes down to small actions and big differences. Together, we can do it.”

The Unilever webcast delivered mostly generalities, so in a brief phone interview afterwards, I asked Polman for a couple of  examples of how the company is moving towards a  more sustainable model of consumption.

He told me that Unilever is committed to working with small farmers, as a way to guarantee a steady supply of the commodities it needs, to promote sustainable agricultural practices and to help poor farmers earn a better living. “We’ve made a commitment to create livelihoods for 500,000 smallholder farmers,” he said. That’s a big number. In Indonesia, for example, Unilever operates a development project with about 7,000 farmers, half of them women, who grow black soybeans, a key ingredient for a sweet soy sauce that the company sells in Asia. The company provides the farmers with technical assistance, a guaranteed market and financing if needed.

Polman also talked about the company’s commitment to selling Lifebuoy soap and promoting good hygiene–parallel goals. “We’ve rolled out a campaign in schools, in emerging markets, and the challenge is to get children to develop proper habits.” Today’s report on consumer behavior explains:

Lifebuoy soap’s handwashing campaigns run over a minimum of 21 days to encourage repetition of behaviour in relevant settings every day. During each day of the programme, children participate in activities designed to deliver the handwashing message in an engaging and memorable way. Comic books, posters, quizzes and songs all work to remind them about the message of handwashing at key occasions. Compliance is also tallied on a daily sticker chart with the help of mum and teachers, to reinforce the behaviour.

Is this corporate responsibility? Or good marketing? Or both?

There’s more to say about Unilever’s efforts, but I’ll conclude with a couple of thoughts. First, Polman to his credit is trying to bring investors along with the plan. The company doesn’t give quarterly earnings guidance, and makes clear that its focus is on the long-term. On its investor center webpage, Unilever reports not only on financial metrics but on water usage and greenhouse gas emissions–a sign that sustainability matters.

Second, it’ll be interesting to see if consumers give Unilever credit for this work. That’s a challenge because Unilever’s numerous consumer brands differ from its corporate brand. Polman is optimistic, telling me that the company scored high in a recent UK survey of responsible brands. “We were third on the list, even with the Unilever brand, and the only one on the top 10 that was not a branded product itself,” he said.

David Jones, the CEO of advertising and marketing giant Havas, who joined in the webcast, said today’s consumers “know more about companies than ever and they have a tool, social media, to push them.” Perhaps optimistically, he added: “In the future, those business leaders who are the most socially responsible are the ones who will succeed.”

Polman, too, said consumers pay close attention to brands online, noting that millions visit the Ben & Jerry’s website.

“People are interested in when Jerry goes to the toilet every day,” Polman said, with some amazement.

“Are you?” asked moderator Jonathan Porritt.

“I’m definitely not,” replied Polman. “I’m interested in how much water he uses when he flushes.”

There’s a good CEO for you–right on message.

Here’s a video from Unilever about its five levers for behavioral change.

Comments

  1. Marc,
    What is the criterion for these various “certifications?”

    Does it include peer review scientific study?

    Does it consider the autonomy of the nations that are impacted?

    What do you think Unilever would do if a NGO that provides certification recommended actions that were dubious or incorrect with regards to sustainability? Would they fight the fight or just calculate that they would get favorable press for engaging in “certified actions” regardless of their effectiveness?

    Has anyone even explored the relationship between these organizations and corporations such as Unilever in the manner that Exxon and a trade group would be properly vetted?

    Is there anything less transparent and democratic than this whole process of certification?

    Stuart

  2. Stuart, these are good questions, and there’s an easy answer to the last one–the process of certification is transparent and, yes, democratic, at least in the sense that there are many parties at the table–companies, NGOs, often government agencies and the groups affected. The model for this, I believe, was the Marine Stewardship Council which certifies and labels fisheries. Many certifications are quite controversial–there are battles over wood/paper between two warring groups, Fair Trade is another where there is debate, even USDA Organic which is one of the few govt certifications–and arguably they can lead to consumer confusion. But generally speaking, this approach — which is an attempt to induce consumers to reward companies with more sustainable supply chains — seems to be working well.

    Better than government regulation, I’m sure you’d agree.

  3. Ed Maibach says:

    Unilever’s “five levers for change” — although they may strike some as being too cute by half — are actually well grounded in communication and behavior change research. A leading expert in social marketing — Bill Smith — promotes “make it easy, make it fun and make it popular” as the formula for effective population behavior change initiatives. Chip and Dan Health — in Made to Stick — recommend communicating in ways that are Simple, Unexpected, Concrete, Credible, Emotional and based in Stories. I often counsel climate scientists and other science-based experts that the key to effectively sharing what they know with the broader public is “simple clear messages, repeated often, by a variety of trusted sources.” In the academic literature, I have promoted a “people & places framework” which specifically seeks to illuminate the individual, social network, community and place-based levers (products/services, physical design, policies, and media/cultural messages) of population behavior change. It is nice to see one of the world’s largest corporations looking to the behavior change literature for guidance in how to move humanity toward sustainability.

Trackbacks

  1. [...] of 88 out of 100, and Nike, with a score of 85, which topped the list last year. (See my blogposts, Unilever CEO: Don’t stay on the sidelines and Nike: Running towards sustainable [...]

  2. [...] of 88 out of 100, and Nike, with a score of 85, which topped the list last year. (See my blogposts, Unilever CEO: Don’t stay on the sidelines and Nike: Running towards sustainable [...]

  3. [...] the plan, as well as the thinking behind it, as I’ve written before. (See my 2011 blogpost, Unilever CEO: Don’t stay on the sidelines) To see for yourself, you can download the progress report [...]

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