Unilever Scales down its Sustainability Commitments: Good Move or Green Deception?
| Case Code: CSRS019 Case Length: 16 Pages Period: 2018-2024 Pub Date: 2025 Teaching Note: Available |
Price: Rs.500 Organization: Unilever Industry: - Countries: United Kingdom Themes: Corporate Responsibility, Sustainability,Business Ethics,Socially-responsible ,Business Practices |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Embedding Sustainability
Polman’s vision was to make Unilever a “truly purpose-driven company”. He made sustainability the core of the company’s corporate strategy, embedding it in every stage of the value chain. As part of a bold makeover, Polmon scrapped the CSR department, instructing Unilever’s 169,000 employees to instead embed the company’s extensive social commitments into their business targets. He began acquiring brands known for their ecological credence such as Seventh Generation and Tazo Tea..
Purpose Beyond Profit
Polman stepped down as CEO of Unilever in December 2018. The move came after an investor revolt forced him to scrap a plan to move the company’s headquarters from London to Rotterdam. Unilever had been operating with dual headquarters – one in London (Unilever PLC) and the other in Rotterdam (Unilever NV). In March 2018, Polman announced a plan to create a single structure for the company in the Netherlands. According to some industry observers, a failed hostile bid by Kraft Heinz also played a key.
Rowing Back on Sustainability Targets
In July 2023, Unilever appointed Schumacher as its new CEO. In October 2023, soon after his appointment, Schumacher presented a “Growth Action Plan” that focused on three goals: faster growth, productivity and simplicity, and performance culture. Schumacher outlined three key shifts as part of the Growth Action Plan, emphasizing a more focused approach to sustainability priorities, urgency in driving long-term actions, and systemic advocacy beyond direct control (See Exhibit V). These shifts were part of Unilever’s commitment to addressing persistent sustainability issues, including climate change, nature conservation, plastic waste reduction, and livelihood improvement.
The right move?
According to some analysts, Unilever’s pushback on certain ESG goals marked a major shift for the consumer giant that had built its corporate strategy on climate-related goals for more than a decade. While some investors considered Schumacher’s decision to dial down some of Unilever’s sustainability goals as recanting the decade-long work of his predecessors Polman and Jope, others felt it was a step in the right direction to reduce greenwashing and practically setting achievable sustainability goals..
Exhibits
Exhibit I: Unilever: Key Financials (2016-2018)
Exhibit II: Unilever Sustainable Living Plan: Progress (2010 to 2020)
Exhibit III: Unilever Stock Price Chart (Jan 2020-July 2024)
Exhibit IV: Unilever Consolidated Income Statement (2021-2023)
Exhibit V: Unilever Growth Action Plan
Exhibit VI: Unilever: Revised ESG Goals
Exhibit VII: Unilever – Consolidated Income Statement
Exhibit VIII: Unilever: Performance of Business Groups
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