Page 12 - THE SOUTH CHINA BUSINESS JOURNAL
P. 12
ver Story
Q In a September 13, 1970 interview with the New York Times Magazine, Noble Laureate
Milton Friedman suggested that “The Social Responsibility of
Business is to Increase its Profits”. Your leadership in fully
decoupling Unilever’s growth from its overall environmental footprint and increasing
its positive social impact through the Unilever Sustainable Living Plan seems to go
counter to Mr. Friedman’s vision of the role of business. Your approach seems to be
revolutionary. Please share with us your vision on the role of business in the society and how your methods
will achieve positive results for your shareholders?
A The world has significantly changed since the 1970s. Inequality
has grown and the health of the planet has considerably
deteriorated. These tragedies are not fully addressed with a free
market system.
The threat to our planetary boundaries in particular grows
more evident every year. The U.N. Intergovernmental Panel
on Climate Change (IPCC) recently warned that if we do not adopt “rapid and far-
reaching” changes to stem climate change for example, then the earth’s ecosystem
could be irreversibly damaged.
The impetus for change is clear. Business cannot continue ‘as usual’ and be a
bystander to a failing system. It is not possible, after all, for business to thrive when
systems around it are failing.
To that end, Unilever's Sustainable Living Plan (USLP) is a concerted effort to
decouple our company's growth from its environmental footprint and to play a
positive and proactive role in society's well-being. Less negative or CSR is simply not
good anymore. We need to be sure that companies that want to be around long term
have a positive overall impact on society.
It is also the biggest economic opportunity. It requires focus on the people we serve
and by doing this well shareholders will ultimately benefit. Shareholder return is
a result of these things not an objective. Companies that myopically focus on the
shareholder can perhaps optimize short term return, but evidence increasingly
suggests it is endangering their long term existence.
We have long believed that this is the only acceptable business model for Unilever
and we have sought to bring this to life by focusing on three bold, measurable targets:
improving health and well-being for more than 1 billion people; reducing Unilever's
environmental footprint by half; and enhancing livelihoods for millions. Using the
scale and size of Unilever to drive transformative change where needed.
Our vision for a new way of doing business – one that delivers growth by serving
society and the planet – is strongly aligned with the Sustainable Development Goals
(SDGs) in a bold effort to maximize our impact.
The approach is working: our sustainable brands have grown 46% faster than the rest
of our business and delivered 70% of its turnover growth. At the same time, we have
helped more than 600 million people improve their health and hygiene and increased
the sustainable sourcing of our agricultural raw materials six-fold.
And yes, ultimately it’s good for shareholders as well as have also delivered a total
return to our shareholders over the last ten years of close to 300% and a 19% return
on invested capital. The development agenda is an exciting agenda.
8 AmCham South China
Q In a September 13, 1970 interview with the New York Times Magazine, Noble Laureate
Milton Friedman suggested that “The Social Responsibility of
Business is to Increase its Profits”. Your leadership in fully
decoupling Unilever’s growth from its overall environmental footprint and increasing
its positive social impact through the Unilever Sustainable Living Plan seems to go
counter to Mr. Friedman’s vision of the role of business. Your approach seems to be
revolutionary. Please share with us your vision on the role of business in the society and how your methods
will achieve positive results for your shareholders?
A The world has significantly changed since the 1970s. Inequality
has grown and the health of the planet has considerably
deteriorated. These tragedies are not fully addressed with a free
market system.
The threat to our planetary boundaries in particular grows
more evident every year. The U.N. Intergovernmental Panel
on Climate Change (IPCC) recently warned that if we do not adopt “rapid and far-
reaching” changes to stem climate change for example, then the earth’s ecosystem
could be irreversibly damaged.
The impetus for change is clear. Business cannot continue ‘as usual’ and be a
bystander to a failing system. It is not possible, after all, for business to thrive when
systems around it are failing.
To that end, Unilever's Sustainable Living Plan (USLP) is a concerted effort to
decouple our company's growth from its environmental footprint and to play a
positive and proactive role in society's well-being. Less negative or CSR is simply not
good anymore. We need to be sure that companies that want to be around long term
have a positive overall impact on society.
It is also the biggest economic opportunity. It requires focus on the people we serve
and by doing this well shareholders will ultimately benefit. Shareholder return is
a result of these things not an objective. Companies that myopically focus on the
shareholder can perhaps optimize short term return, but evidence increasingly
suggests it is endangering their long term existence.
We have long believed that this is the only acceptable business model for Unilever
and we have sought to bring this to life by focusing on three bold, measurable targets:
improving health and well-being for more than 1 billion people; reducing Unilever's
environmental footprint by half; and enhancing livelihoods for millions. Using the
scale and size of Unilever to drive transformative change where needed.
Our vision for a new way of doing business – one that delivers growth by serving
society and the planet – is strongly aligned with the Sustainable Development Goals
(SDGs) in a bold effort to maximize our impact.
The approach is working: our sustainable brands have grown 46% faster than the rest
of our business and delivered 70% of its turnover growth. At the same time, we have
helped more than 600 million people improve their health and hygiene and increased
the sustainable sourcing of our agricultural raw materials six-fold.
And yes, ultimately it’s good for shareholders as well as have also delivered a total
return to our shareholders over the last ten years of close to 300% and a 19% return
on invested capital. The development agenda is an exciting agenda.
8 AmCham South China
