Thursday, October 24, 2013

Unilever: A Sustainable Corporate Giant

Unilever is an international consumer goods giant that is engaged in a wide range of sustainability initiatives. The company manufactures everything from ice cream to soap and in 2013 they announced that they had managed to make massive cuts in their carbon emissions, use less energy, significantly reduce waste, minimize water consumption, and increased the amount of sustainably sourced raw materials.

Sustainability at the Core

At Unilever sustainability is embedded in their core business strategy.  The company’s sustainability director for manufacturing, John Maguire, said in a statement: "Eco-efficiency isn’t just about reducing the environmental footprint it also makes good business sense..."

In an April, 2013 report, the company described how brands that "have made sustainability central to their brand proposition or product innovation have accelerated sales during 2012."

Paul Polman's Sustainability Leadership

Paul Polman, CEO of Unilever is an undisputed green leader among corporate behemoths. Polman's comprehensive sustainability philosophy has embedded sustainability into Unilever's DNA. As Polman explained, “we are not out there just to make money, but to satisfy consumer needs and doing it well, we will make money.” He also said, “If you buy into this long-term value-creation model, which is equitable, which is shared, which is sustainable, then come and invest with us. If you don’t buy into this, I respect you as a human being, but don’t put your money in our company.”

Polman believes that if businesses don’t act responsibly, they will be ‘thrown out of office’ by the consumers.
While most businesses are concerned about how they can use society and the environment to be successful, under Polman's stewardship, Unilever changed the paradigm and focused the company on how they can contribute to society and be successful.

Sustainable Living Plan

Unilever’s Sustainable Living Plan includes more than 50 social, economic and environmental targets such as its goal to reduce by 50 percent the company’s greenhouse gas emissions, water and waste. 

In 2010, Unilever’s Sustainable Living Plan, set the ambitious goal of doubling its business while halving the environmental footprint of its products and boosting its positive social impact

 sourcing 100 percent of agricultural raw materials sustainably, all by 2020. 

Sustainably Sourced Raw Materials

Under the Sustainable Living Plan Unilever plans to source all of its agricultural raw materials from sustainable sources by 2020. Currently, more one-third (36 percent) of its agricultural raw materials products come from sustainable sources which exceeded their goal for 2013. The company has also committed to sustainably sourcing 100 percent of its paper and board packaging by 2020.

Unilever doubled the amount of the palm oil it draws from sustainable sources in 2010. According to Unilver’s most recent sustainability report, the company now sources 100 percent of palm oil from sustainable sources, and it is making significant progress on the sustainable sourcing of sugar, cocoa, vegetables and sunflower oil.

Unilever and its partners are also behind an initiative titled Tea 2030, a project aimed at developing sustainability innovations to help secure the industry’s long-term future. The company helped to train 450,000 tea farmers in sustainable practices, of whom over 300,000 have achieved Rainforest Alliance certification.

After years of collaboration with Solazyme, Unilever recently agreed to buy at least 10,000 metric tons of algal oil from the renewable oil and bioproducts company. Delivery will begin early in 2014 and the relationship between the two companies is expected to expand going forward.

Carbon Reduction

The company has reduced its CO2 emissions by 838,000 tonnes in its manufacturing activities and improved efficiency in its logistics operations which helped the company to cut an additional 211,000 tonnes of C02 since 2008.

Waste Reduction

In 2012, more than half of Unilever’s factories achieved the goal of sending no waste to landfill. The early achievement of this target prompted the company to advance its zero waste goal by five years (2015 rather than 2020). By the end of 2015, Unilever’s 252 factories worldwide will not send any non-hazardous waste to landfill. The key drivers of their success are recycling and reuse.

Unilever is not just highlighting its own efforts it is reaching out into the communities they serve and making environmental heroes out of consumers. This is the thinking behind its food waste initiative which is helping families reduce their household waste while saving money on food bills. The company is using the results of this initiative to inform future brand marketing and behavior change campaigns.

Sustain Ability Challenge

To accomplish their ambitious sustainability goals Unilever launched a campaign titled the "Sustain Ability Challenge," which is part of the company’s Sustainable Living Plan. Challenge is intended to engage with civil society, companies, government and other key stakeholders to develop new models of collaboration and study consumer behavior so that they can move to the next level in sustainable living.

More than 2,200 sustainability leaders and experts, representing 77 countries, registered for the first Unilever Sustainable Living Lab, a 24-hour live, online dialogue that ran from April 25th to 26th. Discussion topics included sustainable sourcing; sustainable production and distribution; consumer behavior change; recycling and waste.

Partner to Win 

Unilever’s Partner to Win program works closely with suppliers to increase sustainability and among other things, the program supports carbon-reduction. One of the joint ventures that are part of this program involves Unilever's partnership with DHL. They are engaged in a series of initiatives designed to increase sustainable practices including developing technology to improve carbon efficiency and reduce waste within global logistics operations.

Help a Child Reach 5 

Unilever's efforts range from global in scope to smaller more regional programs. The Help a Child Reach 5 campaign was launched by Unilever's Lifebuoy brand. This program aims to end preventable deaths of children under five through the simple act of improving hand-washing behaviors in India. This program has been significantly expanded of late.

Unilever is not only being more environmentally and socially responsible they are also seeing significant growth. They are well on their way to achieve their goal of being more socially responsible and cutting their environmental impact in half all while doubling the size of the company.

Awards Recognition and Ratings

Unilever is consistently ranked among the most sustainable companies in the world. They recently  led the Tomorrow’s Value Rating 2013 (TVR), which recognizes companies that increasingly demonstrate “clarity of vision and innovation in their pursuit of a sustainable business model.” 

For the second year in a row, Unilever is the top-rated company in terms of its global warming commitments, according to the Climate Counts 2012-2013 Annual Company Scorecard Report, published in December 2012.

© 2013, Richard Matthews. All rights reserved.

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