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Sustainability and growth, the Unilever way

GOKUL KRISHNAMURTHY
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Paul Polman, CEO, Unilever
Business Line Paul Polman, CEO, Unilever

Paul Polman, CEO, Unilever, is as serious about sustainable sourcing, reduced emissions and saving water as he is about doubling the consumer products giant's global turnover by 2020. It's obvious that India, one of the emerging markets that collectively contribute 53 per cent to Unilever's turnover, is expected to be a driver of this growth.

In conversation with the media on a four-day visit to India, Polman reiterated his commitment to Unilever's ‘Sustainable Living Plan', and outlined his road-map for growth. He foresees consumers embracing products and brands from responsible companies, especially in a highly volatile environment. Surely, he couldn't have foreseen the quake and tsunami that have ravaged Japan when he spoke about climate change. But the relevance of what he said is better understood now, after the disaster. Excerpts:

A Sustainable Living Plan

Last year's results were the best in about 30 years. As we got these results, we also launched the new vision, the Unilever Sustainable Living Plan, which is very relevant for India as well.

We are using resources well beyond the capacity of what the earth can generate. The WWF estimates that we are using 1.3 times the capacity of this earth. And this is before two billion new people come in, mainly in this part of the world (emerging markets), before living standards improve. The stress on the system is enormous. Also, the system has never suffered so many shocks — of droughts, floods, the events happening in West Asia … These are only going to increase the volatility unless companies wake up to these problems: of climate change, poverty, malnutrition.

The Unilever Sustainable Living Plan sets a very audacious ambition of doubling our turnover, while minimising our environmental impact. The agricultural materials that we buy will be sustainable over the next 10 years. A billion people more than currently will have access to health and nutrition by our brands and our activities. Our environmental impact, across the entire supply chain, will be the same or less than what it is today. I believe it will be increasingly relevant, not just for the world, but also for consumers basing decisions on which companies they want to buy their products from. Increasingly, that will be a driver of choice.

With the inability of governments to take charge of the issues we have, consumers will take charge. We see it happening with social networks, we see it happening in West Asia.

On Rise in Input Costs

What we must do is separate the short term, which is the coming six months, from the long term. Our long-term strategy is solid; we don't see any reason to change that.

I'd say input cost fluctuation is not as bad as 2008. There is going to be six months of uncertainty. I call Harish (Manwani, President, Asia Africa, CEE, Unilever, and Chairman, Hindustan Unilever Ltd) Mr CNN. Every time I switch on television, one of his countries is on there. And it's always something you didn't expect. An earthquake here, a flooding there, a government moved out without anyone expecting that — we live in a very volatile and uncertain time. But our company, with its agility, with its solid strategy, strong brands, is well placed to deal with it.

(This article was published on March 16, 2011)
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