October 25, 2014

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People Get Sustainability, Business (and Marketers) Don't: 20 Minutes with the CEO of Unilever

"Consumers are speaking out everyday but we don’t want to see it. Then we say the consumer doesn't want to change."

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By Aman Singh

Last month, Unilever CEO Paul Polman was in town – New York – to receive the Lifetime Achievement award from the Rainforest Alliance. As Rainforest Alliance President Tensie Whelan put it, "Paul has made several lifetimes of difference by leading Unilever to become a game changer."

The company’s work with the Rainforest Alliance is well known – by setting targets like sourcing 100 percent of its palm oil sustainably, Unilever has made it easier for other companies to follow suit and helped complex supply chains become comfortable with change and collaboration.

And, the company hasn't stopped at palm oil.

Today, roughly 50 percent of the company's tea originates on Rainforest Alliance Certified farms as it works toward sourcing 100 percent of its raw agricultural materials from sustainable origins (that figure currently stands at 48 percent).

Having recently interviewed Unilever's Marketing Chief Keith Weed on the company’s refreshed goals and commitments, the opportunity to now discuss sustainable development from the vantage point of the outspoken CEO was tempting. We caught up over a quick phone call:

The Unilever Sustainable Living Plan:

"When we launched it we said we don’t have all the answers. One of the reasons why we are working so wellUnilever CEO Paul Polman with Rainforest Alliance is because we share common goals. Take tea for example: Standards are driving up fast in an industry that’s not easy to standardize. [This is where the] scale of Rainforest Alliance is significant – and essential for the USLP to come alive.

"[Its] only been a year since the Rana Plaza fire happened. Those 1,050 women worked in conditions that were little more than modern day slavery. We're determined not to let that happen in our supply chain. So we've put some goals to match our resolve. We're going to help more women gain access to training and land rights. The transformation can be substantial."

Pushing forward in the absence of political will/action:

"In the absence of politicians, we need to move faster. Climate change is a great opportunity for business. Report from the White House is an encouraging sign. Needle is starting to move in the U.S. The tornadoes and hurricanes are starting to drive the message home for people.

"Besides, this is probably the only opportunity we'll have. The Millennium Development Goals, for instance, are due to be completed next year – the urgency cannot be watered down."

The most critical challenge for business:

"The biggest challenge is [that] we cannot scale our ambitious goals alone. It's a major challenge to create the right partnerships and increasingly difficult to get the political sector to participate. How do you create size and scale in a vacuum?"

The changing role of marketers:

"I always say, don’t blame the consumers. There are many examples where consumers are leading business, especially the young ones. They're changing our lives and systems.

"Consumers are speaking out everyday but we don’t want to see it. Then we say the consumer doesn't want to change. If we can tap into the enormous movements, we can create change much faster. That’s the job of the modern day marketers. Their job has changed. It doesn’t work any more to push consumption. We need a new model and get companies to adjust their Responsible entrepreneurs with questionsmarketing strategies as well as their job roles."

People get it, business doesn’t:

"I spend a lot of time on how to develop leaders who can lead us through partnerships, with purpose, can think long term and beyond 2020. On my way back from Abu Dhabi last month, I was reading an article that reported university students rebelling against the way economics [is being taught]. If teachers are teaching Milton Freidman's theories, who is going to change the economy? For my kids, sustainability is the new normal. They don’t want to watch TV or buy the newest gas-guzzling car. Their generation is already thinking differently. Yet, marketers keep saying consumers don’t want it.

"Our understanding of consumers [and consumption] is too narrow. We need to get much closer to consumers. If we go to any of the emerging markets – 81 percent of the world's population lives outside the U.S. and Europe – most of the growth is occurring in climate stretched areas today. They might not understand Rio+20 or climate change language but they know that weather patterns are changing, water is decreasing, etc."

From mindless to mindful consumption:

"Marketers should switch from asking whether consumers are willing to pay for something to which consumer doesn’t want less poverty, more education, a healthier world with cleaner air and better nutrition.

"We just need to be astute about solutions. Look at the Edelman survey – consumers expect more and more from business, and if business understands this, it is a wonderful time. Children die from diseases which we can solve with hand washing – new market – marketers should be very excited by this. But that connection is not there."

Three actions to change the world:

"We must get out of short termism because lots of solutions are long term [climate change, access to education, water shortage, etc.] – and we can only solve them if we invest over longer periods and evaluate the social and economic capital. Then business people can optimize these. For example, 40 of the top 100 companies are already pricing carbon internally. They’ve committed to stay within these limits. Business is leading because they see the cost of action vs. inaction. We have now 40 countries that are pricing carbon including China. We have 20 other countries that are putting a tax on carbon. The system is starting to move.

"We need to give politicians Unilever Sustainable Livingconfidence that this [focus on sustainable development and long termism] will not kill jobs or stifle growth. The exact opposite is in fact true but we need to provide the proof points.

"We need to get companies to adopt integrated reporting quickly as well as become comfortable with transparency. It's going to take much more than a nine-to-five job to bring all of this together. We need leaders and we're short on them."

If this was his last interview as the CEO of Unilever:

"We can use our scale to transform systems and change. We need to create a better place than the one we were born in. Ninety-nine percent of people are not in a position to make a difference. We can. We need to force change – it's our duty to leave the place in a better place. I hope this drives Unilever and everyone else."

The opinions, beliefs and viewpoints expressed by CSRwire contributors do not necessarily reflect the opinions, beliefs and viewpoints of CSRwire.

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