Case study Unilever: Implementing and measuring corporate sustainability

Co-headquartered in London, England and Rotterdam, the Netherlands, Unilever is among the world's largest consumer-goods companies.1 With a turnover of 53.7 billion in 2017 and with more than 400 brands focused on health and wellbeing, hardly any other company touches so many people's lives in so many different ways. In 2010 Unilever launched a ten-year Sustainable Living Plan. The plan focuses on three overall dimensions: improving health and wellbeing (focusing on health and hygiene and improving nutrition), reducing environmental impact (focusing on greenhouse gases, waste. and packaging, among others) and enhancing livelihoods (focusing on fairness in the workplace, opportunities for women and inclusive business). With this plan Unilever, whose global brands include Dove, Omo, Knorr and Lipton, aims to achieve several key goals before 2020, including: changing the hygiene habits of 1 billion people in Asia, Africa, and Latin America so that they wash their hands with Lifebuoy soap at key times during the day, helping to reduce diarrheal disease, the world's second-biggest cause of infant mortality. making safe drinking water available to half a billion people. improving livelihoods in developing countries by working with Oxfam, Rainforest Alliance, and others to link more than 500,000 smallholder farmers and small-scale distributors into its supply chain. As an overall goal, Unilever wants to halve the environmental footprint of its products. A couple of years on from launching its sustainability plan, Unilever claims that brands that have made sustainability central to their brand proposition or product innovation have accelerated sales. 'Sustainability is contributing to our virtuous circle of growth. The more our products meet social needs and help people live sustainably, the more popular our brands become and the more we grow. And the more efficient we are at managing resources such as energy and raw materials, the more we lower our costs and reduce the risks to our business, and the more we are able to invest in sustainable innovation and brands', says Paul Polman, CEO of Unilever.

Implementation of the sustainability plan Hardly any other company has a sustainability plan as wide and deep as Unilever's. However, just having a plan for sustainable living moves nothing unless it is implemented. That is, the plan needs to be turned into action assignments in order to ensure that the stated objectives are accomplished. While the plan considers the what and why of marketing activities, implementation addresses the who, where, when and how. As part of Unilever's effort to embed and implement sustainability into its brand marketing, the company has developed a range of activities. Its plan includes 60 targets with timetables, such as: adding a week-long sustainability marketing initiative into its training program for all new brand managers; joining with a group of more than 40 partners to launch Global Forest Watch - a dynamic online monitoring and alert system to help protect forests worldwide; extending sales of its low-cost in-home water purifier, Pureit, from India to other countries; Pureit sells for just 35 and removes bacteria, viruses, parasites and other pollutants from water; innovating new products: as an example, Unilever's researchers are working to develop a laundry detergent that can clean clothes in just a few minutes at any temperature; launching its first consumer-facing brand campaign, using Project Sunlight to spread its sustainability message; the company wants consumers to perceive the Unilever brand as a trustmark for sustainable living. Measuring the sustainability plan While Unilever's sustainable living plan needs to be implemented, it also needs to be measured. Naturally, it may be hard to measure the direct financial success of the entire plan, although Polman is in no doubt about its success: 'Sustainable solution - it drives our top line, it drives our costs out, it motivates our employees, it links up with retailers', he says.2 It is also difficult to bring consumer on board.3 As an example of how Unilever intends to measure the impact of the sustainable living plan, the company has developed a metric that measures the greenhouse gas (GHG) emissions associated with the life cycle of a product on a per-consumer-use basis, e.g. the GHG impact of drinking a single cup of tea: Greenhouse gases per consumer use = CO2 equivalents across the product life cycle (grams) Using this metric, Unilever has set a baseline by calculating the GHG emissions across the life cycle of more than 1,600 representative products. The calculation covers 70 per cent of the company's volumes. So far, the results suggest that manufacturing and transport represent just 5 per cent of Unilever's total GHG impact, while sourcing of raw materials and consumer use together account for over 90 per cent. The analysis also highlights that the product categories that make the largest contribution to the company's GHG footprint are those where the consumer requires heated water - showering, washing hair and laundry. Among the company's targets, Unilever aims to halve the GHG impact of the company's products across the life cycle by 2020, halve the water associated with consumers' use of the company's products and halve the waste associated with disposal of the company's products. Unilever also joint the World Economic Forum 2030Vision.

Questions

1. Advise Unilever on how it could extend its sustainable living marketing activity.
2. What will it mean for Unilever to establish the brand as a trust mark for sustainable living and what effects could be reached? Will the consumers catch on?