Paul Polman, CEO Unilever, talked with Harvard Business Review (HBR) about his company’s sustainability efforts as part of The Future Economy Project, an HBR initiative that shares real-world lessons on sustainability leadership for all. The interview also addresses Unilever's commitment to the Sustainable Development Goals:
HBR: You are, I believe, the only CEO to ask that all new products demonstrate that they contribute to meeting one or more of the UN Sustainable Development Goals. Is that really the role of business? And what has resulted from that mandate?
Polman: As a consumer goods company, the best way we can bring our purpose to life is through our brands and by leveraging our operating model. As a company of 170,000 employees, with 2.5 billion consumers who use our products on any given day, we touch many lives.
The SDGs can be seen as a scorecard on how well the world is doing and also as an enormous opportunity to address some of the world’s biggest challenges. We are getting to the point that, in each of the opportunities identified (be it food security, education, climate change, sanitation, or gender equality), the cost of not acting is becoming higher than the cost of action.
For example, the cost of conflict prevention and wars is estimated at 12% of global GDP, whereas implementing the SDGs only costs 3%–4% of GDP per year. At a time when we need jobs and growth, we have the plan already given to us — more important, a plan agreed upon by 193 countries in September 2015 in New York.
Brands that help solve problems are relevant and accepted. Not surprisingly, the stronger this purpose, the better the brands do. Our sustainable living brands are delivering more than 60% of Unilever’s growth and growing over 50% faster than the rest of the business.
It is very simple: We are orienting our brands to serve the underserved, something we know how to do. And when we do it well, we are rewarded with stronger business results. It requires having a ruthless external focus and caring enormously about the consumers we serve. But above all, it requires us to simply put the interest of others ahead of our own.
"The purpose of business is first and foremost to serve society. It is, after all, not possible to have a strong, functioning business in a world of increasing inequality, poverty, and climate change. The good thing is that, next to our moral obligations to address the global challenges, there is an enormous business opportunity. That’s the equally exciting part."
For the full interview, see https://hbr.org/2017/11/the-future-economy-project-qa-with-paul-polman