More than any other big-company CEO, Paul Polman is serious about sustainability. Polman is serious about pretty much everything, actually. He’s serious about a vast array of problems facing the world, ranging from climate change to malnutrition to obesity to water scarcity to inequality to human rights to global governance, and he’s serious, of course, about his company and its long-term financial performance and especially about its ability to help solve any and all of those problems. He can, and will, pontificate about topics like the UN Millenium Development Goals, the important message of Global Handwashing Day, the social mission of brands like Dove and Lipton and Ben & Jerry’s.
A fun guy? Not really. A fascinating guy? Yes.
I spent time with Paul Polman, as well as other executives at Unilever–including US president Kees Kruythoff, global marketing head Keith Weed, sustainability honchos Gail Klintworth and Jonathan Atwood–while researching a story on the company for FORTUNE. It appears in the June 10 issue of the magazine, under the headline Unilever’s CEO Has A Green Thumb. (The story is behind a pay wall, for now.)
I thoroughly enjoyed getting to know Unilever, which takes a uniquely expansive view of its role in the world. Far more than IBM, GE, Walmart or any other big company, Unilever puts sustainability at the core of its business — its strategy, its operations, its R&D and its marketing. (Patagonia, a much smaller, privately held firm, strikes me as similarly driven by broad concerns.) Polman’s theory, put simply, is “to put the challenges facing society smack in the middle of the business.” So Lifebuoy soap helps prevent the spread of disease in poor countries. Dove stands for the self-esteem of women. Lipton’s sustainable supply chain will help tea growers earn a livelihood. Operations, of course, are efficient, and the global supply chain of tea, tomatoes, onions, etc. aims to become sustainable.
In Port Sunlight, a tidy little suburb of Liverpool where the company got its start back in the 19th century, I visited a research and development lab where some of the scientists are focusing on coming up with laundry soap that can clean clothes using very small amounts of water, at any temperature. Much of the R&D at Unilever, in fact, revolves around planning for what the company expects to be a resource-constrained world.
Will the strategy pay off? So far, Unilever under Polman has done very well, outperforming consumer-products giant Procter & Gamble. But whether the firm’s financial results are driven by its focus on sustainability is very much an open question; more likely, it’s a result of the fact that Unilever has a strong commitment to emerging markets, which have been growing more than the US and EU.
There is, however, one way in which I’m convinced that Polman’s determination to make Unilever a better company has paid off on the short run, and that is with its employees. People I met, as best as I could tell, come to work at Unilever with energy and a strong sense of purpose. That’s invaluable. As Polman told me, proudly, Unilever is one of the five most searched-for employers on LinkedIn, behind Google, Apple, Microsoft and Facebook. That’s impressive.
Here’s how my story begins:
Paul Polman calls himself a “hard-core capitalist.” Sometimes you have to wonder. The day he became the chief executive of Unilever in 2009, Polman said the consumer products giant would stop providing earnings guidance and quarterly profit reports. “I figured that the day they hired me, they can’t fire me,” he says, “so that was probably the best moment to do that.” The stock fell and analysts grumbled. Not long after came word from the CEO that Unilever, whose brands include Dove, Lipton, Hellmann’s, and Ben & Jerry’s, was determined to tackle big social and environmental problems like climate change, disease, and poverty. “If you buy into this long-term value model, which is equitable, which is shared, which is sustainable, then come and invest with us,” Polman told investors. “If you don’t buy into this, I respect you as a human being, but don’t put your money in our company.” Shareholder return, he insists, cannot and will not trump nobler aims. “Our purpose is to have a sustainable business model that is put at the service of the greater good,” he says. “It is as simple as that.”
This sounds like the boilerplate that fills corporate responsibility reports, but Unilever, which has headquarters in London and Rotterdam, has gone beyond big U.S. Companies like GE, IBM and Wal-Mart by putting sustainability at the core of its business. In a 2010 manifesto called the Sustainable Living Plan, Unilever promised to double its sales even as it cuts its environmental footprint in half and sources all of its agricultural products in ways that don’t degrade the earth by 2020. The company also promised to improve the well-being of 1 billion people by, for example, persuading them to wash their hands or brush their teeth, or by selling them foods with less salt or fat.
The Fortune story goes on to talk about Polman’s background (he once wanted to be a priest), the company’s paternalistic past and Unilever’s commitment to a water-purification product called Pureit that has little chance of ever making a profit. I hope you’ll find a copy of the magazine and enjoy the story.