Unilever’s ‘Sustainable Brands’ Outperform Others
(3BL Media/Justmeans) – Many companies continue to be skeptical about the business viability of creating more sustainable products. Those who are less enthusiastic about the idea of achieving competitive advantage through sustainability can draw some inspiration from those who are reaping the benefits of building brands with a positive social and environmental impact.
At Unilever, sustainable living brands are driving growth as consumers increasingly reward brands that deliver social benefit. The company’s research shows that 54 percent of consumers want to buy sustainably, and many already are. Unilever defines sustainable living brands as those that integrate sustainability into both their purpose and products such as improving health, well-being or nutrition, reducing environmental impacts or using sustainably sourced ingredients.
According to the Unilever Sustainable Living Plan (USLP) annual progress report, about half of Unilever’s growth in 2015 came from its sustainable living brands, which grew 30 percent faster than the rest of the company’s business. The company’s five biggest brands – Knorr, Dove, Dirt is Good, Lipton and Hellmann’s – are all sustainable living brands.
Sustainability is no longer a niche issue for the company. Unilever CEO Paul Polman said that there is no trade-off between business and sustainability. It is creating real value for the company. The company is on track to meet the majority of the 50-plus targets in its USLP. One of the goals is to halve the environmental footprint of the making and use of Unilever’s products by 2020.
In 2015, Unilever reduced its manufacturing CO2 emissions from energy 39 percent per metric ton of production compared to 2008 levels. The company also reduced its manufacturing water use by 27 percent per metric ton of production, compared to 2008. In manufacturing, Unilever reduced its waste by 97 percent per metric ton of production, compared to 2008. This effort has contributed $227 million in cost-benefits to the company.
Unilever says the consumer use phase of its value chain is a constant challenge to meeting its 2020 goals, and reducing the environmental impact associated with consumers’ use of its products will require wider systems change. To this end, the company plans to increase its efforts to design products that are less carbon and water intensive, and work with partners to help consumers understand how they can reduce their environmental footprint.