Global Manufacturing Sustainability Director John Maguire joins us this week to explain how Unilever’s ambition to double growth while reducing its impact on the environment is at the heart of their business model and drives their very challenging sustainability targets.
This week we announced that since 2008, the company has achieved a CO2 reduction of more than 1 million tonnes from improvements in our manufacturing and logistics operations. The reduction is the equivalent to taking 250,000 cars off the road.
Although we recognize it is an important milestone on our eco-efficiency journey, we know we still have a long way to go to achieve our ambition.
Putting sustainability at the heart of our business model in 2010 has undoubtedly been a solid starting point. Our sustainability program not only helps us to ensure best practice; it’s also an effective engine for growth. While working towards our 1 million tonnes CO2 reduction, our sales grew by 26 percent, from €40.5 billion in 2008 to €51.3 billion in 2012. We’re finding that achieving global business growth in Unilever does not have to cost the earth.
Reducing Energy Usage
Like other FMCGs, we are operating in a market where energy prices continue to climb, resources are scarce and climate change presents us with many challenges and opportunities. Our primary focus is to reduce energy and where possible buy energy from renewable sources. In Europe, U.S. and Canada, we are already purchasing 100 percent of the electricity we consume from renewable sources.
While we are proud of the progress we have made, the next challenge is: how can we reduce our energy usage further while increasing our use of renewable energy sources?
Leveraging Our Global Scale
Our strategy of design once and deploy globally enables us to take a more cost effective approach to capital investment for the new eco-efficiency projects we are introducing across Unilever sites. We leverage our global scale by selecting ideas with the best financial and eco-efficiency payback and then implement them globally.
Like sourcing cost efficient renewable energy from biomass boilers. Biomass boilers have the double benefit of reducing bio-waste and helping us reach our 40 percent renewable energy target.
Only a few weeks ago, I visited our Boksburg factory in South Africa where we use the waste sunflower husk produced as a by-product and use it to generate heat energy in a biomass boiler. This significantly reduces the amount of energy, which would otherwise be produced from coal and is a good example of a circular value chain. This is just one of the 30 biomass units we have across the globe supplying more than seven percent of our renewable energy, with six more planned for this year in Latin America, Africa and Asia.
Investing in New Technology
While our strategy provides us with a clear roadmap to achieve some of our eco-efficiency targets, others are still very much a work in progress. Where possible we look to introduce new cost efficient technology into our factories and offices such as solar day lighting and motion-sensitive LED lighting.
Love it or hate it, we use waste from the Marmite production process to power the factory that makes our divisive yeast extract. Marmite, itself a by-product of the brewing industry, is made at our Burton, U.K. site, where inevitably some sticks to the sides of the manufacturing equipment.
This residue, of which there is about 18,000 tonnes a year, needs to be cleaned out of pipes to prevent them from clogging and to maintain hygiene. We put the waste residue into an anaerobic digester, where It is eaten by bugs who give of methane that is then burnt to create energy.
Involving Our Global Factory Workforce
And our employees continue to play a crucial role. This year we have created a "small actions big difference" fund to encourage suggestions from our global factory workforce – with the stipulation that ideas have to result in delivering an eco-efficiency improvement as well as a good financial return.
In addition, we also plan to launch an employee engagement campaign to increase the number of people who get involved in sustainability improvements. This program will launch on the day we release our second year progress report of the Unilever Sustainable Living Plan on April 22nd.
Tackling Our Water Challenges
We have made good progress in reducing the amount of water abstracted by our manufacturing sites. Since 2008, we have saved the equivalent of around 1.5 liters of water for every person on the planet. However, our future targets for reducing water usage during our manufacturing process are going to be very challenging.
Currently, we have invested in effluent recycling projects at four of our sites in South Asia. At our Indian manufacturing sites we are using rainwater for factory utilities such as cooling towers, boilers, manufacturing processes (following treatment) and toilet flushing. Our focus now will be to give more emphasis to factories in water scarce locations.
By 2020, we aim for water abstraction by our global factory network to be at or below 2008 levels, despite significantly higher volumes. This represents a reduction of approximately 40 percent per ton of production.
New Technology Without Changing Consumer Behavior
Further, to reduce water use, Unilever needs to develop new products and tools, which help people use less water. But we have learnt that while creating new product technology is important, it is not enough. We still need to motivate people to adopt the new water-saving behavior such as using less water when rinsing laundry by hand and changing habits in the shower.
We cannot do this alone. In the end it will require water pricing and water metering alongside consumer education to drive the right behaviors. At that point we will need to be ready with products and tools that help people make their water go further.
There is still much for us to do, but overall, we’re proud of the progress we have made so far on our manufacturing eco-efficiency targets. Next week, we will launch the second year progress report of the Unilever Sustainable Living Plan.
Previously: Sustainable Sourcing: Unilever Challenges Its Own Value Chain
About the Author
Based in Surrey, John Maguire is responsible for defining and implementing the long-term sustainability strategy for Unilever’s manufacturing sites globally. His team supports Unilever sites across the globe, helping them achieve the very challenging targets set under the Sustainable Living Plan. John has more than 30 years experience in the Supply Chain of FMCG Companies with previous roles involving managing operations in factories within the confectionery, foods, printing and packaging sectors