Why Unilever's employees are key for a new era of sustainability leadership
EXCLUSIVE: With environmental goals approaching a 2020 deadline and chief executive and the embodiment of sustainability leadership Paul Polman announcing his departure, Unilever’s decision to ask its 172,000 staff what sustainable business meant to them may well keep the firm in the vanguard of corporate responsibility.
For the past decade, consumer good giant Unilever has widely been regarded as a leader of the corporate sustainability movement, with departing chief executive Paul Polman having championed transparency, social sustainability and purpose beyond the firm’s products.
This level of leadership has meant that the company’s desire to “make purpose pay” has been embedded as a key part of board-level discussions for many years.
But Unilever went one step further in winter 2017, when it invited all its employees to have their say on the future of the company’s sustainability strategy for the first time.
More than 40,000 members of staff – representing the majority of the firm’s markets and departments – took part. They were asked to detail the lessons they had learned from previous green projects, and to explain what they believed the future of business leadership would look like.
The survey served as a “massive co-creation exercise” for Unilever, according to the firm’s global vice president for sustainability, Karen Hamilton, who argued that it had helped to “distribute” the responsibility for sustainability action throughout the company.
Speaking exclusively to edie ahead of her appearance at the Sustainability Leaders Forum next month (scroll down for details), Hamilton explained that conducting the survey had served to drive even more progress towards making CSR part of every employee’s remit.
“We really want everybody in the company to live our purpose, which is to make sustainable living commonplace,” Hamilton said.
“While we do have people with areas of expertise in fields such as sustainable agricultural practices, supply chains or energy efficiency – and we also have experts in R&D who are more informed about sustainable formula or packaging choices – these people are catalysts to drive bigger change across the business.
“As we start to look beyond our existing sustainability targets – many of which will be completed in 2020 – it is important for all staff to be able to have their say on the company’s future positioning in this area.”
Benefits beyond profit
Prior to the survey, Unilever had disbanded its CSR department in a bid to avoid positioning resource efficiency, energy efficiency, climate action and carbon reduction away from its main operations.
After the survey results were collated, they were shared with every Unilever employee via email and handed to the company’s key stakeholders at a meeting last Spring.
Since then, the firm has become the most sought-after consumer goods firm on LinkedIn, with Hamilton arguing that the board’s transparency and willingness to listen to worker voices had “driven engagement and attracted strong talent”.
“People are motivated to work for a company that is on a journey to becoming more sustainable – this really shows in their commitment to their role,” she said.
Hamilton’s assertions come off the back of several pieces of research revealing that millennials – who will account for 75% of the UK’s working population by 2030 – want to work for companies that have a purpose beyond their products and profits.
Deloitte claimed in 2016, for example, that 49% of millennials will refuse to work for companies that go against their personal ethics. Similarly, communications agency FleishmanHillard Fishburn (FHF) recently found that 75% of millennial workers would take a pay cut to work at a purposeful organisation.
But for Unilever, brand purpose and economic growth are starting to become interlinked. The Dutch-Anglo firm has consistently proved the business case for purpose-led sustainability, with the firm's 'Sustainable Living' brands accounting for a record 70% of turnover growth last year and growing 46% faster than the rest of the business.
According to Hamilton, this growth was driven – and continues to be spurred – by the fact that operating sustainably has led to lower operating costs, less exposure to climate risks and greater trust among consumers.
Levels of consumer trust and loyalty have proven particularly high in brands that also act as advocates for positive change. A prime example is Dove, which fronts a project aimed at boosting body confidence among young women, Hamilton told edie.
We were so proud to have @aerie join us at our #GirlCollective kickoff event in LA last weekend. We've been big fans of their #aerieREAL campaign and are excited to welcome them to our Sisterhood to raise the self-esteem of women and girls everywhere! #DayOfTheGirl pic.twitter.com/Nqz65CmXbV— Dove (@Dove) October 11, 2018
Unilever is also recording high levels of consumer loyalty for cosmetics and toiletry brand Love Beauty Planet, which is marketed on its 100% recycled packaging and vegan-friendly formulas, according to Hamilton.
“Purpose strongly contributes to the way in which brands are perceived and trusted by the millions of people who use and buy them,” she said. “That is very valuable to driving their growth.”
An ongoing journey
Despite Unilever’s leadership position in the corporate sustainability field, Hamilton highlighted the fact that the firm does not see its work in this area as complete – but as an ongoing journey, where targets and key focus areas are constantly being reassessed.
Indeed, the coming year is likely to be something of a transition for Unilever, after new chief executive Alan Jope – the company’s former Beauty & Personal Care division president – assumed his post on 1 January.
The firm is currently rethinking plans for a potential new location for its headquarters, for example, after Polman’s proposed move to the Netherlands sparked criticism among shareholders. Moreover, goals related to water consumption, manufacturing waste and carbon levels are approaching a 2020 deadline, meaning new targets are expected to be announced in the coming years.
But through this period of change, Hamilton ascertained that Unilever would continue to look beyond its operations and encourage other firms to adopt more ambitious and purpose-led sustainability frameworks.
“Although we are a large company and there’s a lot we can do within our own brands, the challenges that the world faces in terms of climate change and growing social inequality are much greater than any one company,” she said.
“We are ambitious for transformational change for the system and impact that goes beyond the scale of what any one company can deliver.”
Karen Hamilton at edie's Sustainability Leaders Forum
Unilever's global vice president of sustainable business Karen Hamilton will be appearing at Day One of edie's Sustainability Leaders Forum next month to discuss how best to communicate sustainability with consumers and staff.
The two-day event, taking place 5 & 6 February at the Building Design Centre, London, will also include debates on what the future of business leadership in regards to sustainability, CSR and energy will look like.