When Unilever’s Sustainable Living Plan was launched in 2010, many thought the three overarching goals, to achieve by 2020, were challenging:
· cut by 50% the environmental impact of its products in terms of water, waste, and greenhouse gases;
· enhancing livelihoods for millions; and
· improve the health and well-being of one billion people across the world.
Those top-level targets were backed up by commitments including improving the nutritional standards of food products, that emissions from energy from factories would be at or below 2008 levels despite significantly higher volumes and that 100% of agricultural materials would be sourced sustainability.
Many people internally saw this as a huge challenge, but since then, the firm has largely met its goals and has certainly become a global leader in sustainable business. Whilst not every target has been achieved in full, Unilever was ranked as the leading global corporate sustainability leader for an amazing eighth year in a row in the 2019 GlobeScan/SustainAbility Leaders Survey, and is also a Dow Jones Sustainability Index Leader.
So, there were plenty of topics for discussion when we spoke to Dave Ingram, the Chief Procurement Officer of the firm. He has been in the CPO role since April 2019, but is a Unilever veteran, having filled operational and supply chain roles all over the world for more than 30 years, although his Scottish accent is still evident.
“That initial set of targets seemed almost impossible, and were way ahead of what we could have set. But really, you will never move past your current thinking if you don’t start with ambitious goals, and that really required us to go well outside our comfort zone. And that's become a really good internal benchmark for knowing we're on the right track. In reality, we have probably hit 80-90% of the goals, which was way beyond expectations, given where we were starting from”.
Stephanie Schmid was also part of our discussions; she has a very interesting role. “I lead on strategy and communications which includes supporting the sustainability programme in procurement. That includes ensuring it is implemented with rigour, as well as talking about it, explaining why we are doing it and getting people excited, internally and externally”.
How does Ingram see the procurement function? “We want to contribute in bringing purpose to the centre of the brand, be the number one partner of choice for innovation from our supply chain, and also deliver great value to the business”.
In 2019, Unilever reviewed its sustainability commitments, “looking at how each brand lives the purpose, in terms of the product, the packaging, the advertising”. Now, there are 15 long-term commitments, with the overarching aim that - “brands grow, companies last and people thrive”.
So, procurement has to work with purpose if it is to support those wider goals. “It has to be real if we’re talking about what we’re doing in our advertising, for instance”, Ingram says. “It has to be impactful and meaningful, it can’t just be about getting the right certifications”. But it is not just about the consumer drivers for sustainability; staff are important stakeholders too.
“Of course, we still have to deliver value, and savings. But when people retire and review their contribution, they rarely say, “I’m glad I saved a lot of money”. Staff want to feel they’re here for more than that, they want to go beyond savings, to buy better and more responsibly”.
“Sometimes it would be cheaper to move away from a sustainability position – we may be spending more than the competition. It might be tempting to look for the saving in that given year”. But that temptation is resisted if it goes against the principles.
“Tea is a good example. We have stayed with our smallholders, the growers, even though we’ve been challenged by NGOs and charities, because those small growers are not always part of a certificated scheme”. It would be cheaper for Unilever just to pull out of buying tea from certain small countries altogether, Ingram explains. “But we commit, we stay, and try to drive change and improvements with them as partners. Sustainability come first and foremost – we simply won’t take actions just to save money”.
(Part 2 next week).