Last month, when news broke that Unilever would begin the search for Paul Polman’s successor, it sent shockwaves through the business world. As the poster child for Purpose in business, what would this mean for the future of businesses that aim to grow while prioritizing sustainability?
Over the years, Polman has been one of the most vocal, determined and passionate advocates for businesses embracing their responsibility to do more than simply make a profit. As he famously said at the launch of Unilever’s Sustainable Living Plan: “We cannot choose between [economic] growth and sustainability — we must have both.”
The data to prove his vision is compelling. Under Polman’s guidance, Unilever has thrived by staying true to its Purpose, realizing tremendous business benefits in the form of efficiencies, growth and employee engagement and retention. The company has attained effectiveness through eco-efficiency measures in its factories, resulting in avoided costs of over €700 million — its waste program alone contributed to cost avoidance of around €250 million. Its portfolio of Sustainable Living brands has grown 50 percent faster than the rest of the Unilever business — and delivered more than 60 percent of Unilever’s overall growth in 2016. And employees are liking what they see — 90 percent of employees are proud to work for Unilever and the company is the number-one most searched fast-moving consumer goods brand on LinkedIn.
But let’s get to the hard numbers: shareholder return. Since the launch of the Sustainable Living Plan, Unilever has seen a 290 percent total shareholder return. In fact, financial experts in 2017 are projecting the Unilever stock may actually outperform the FTSE 100, with EPS that is forecasted to rise at an average rate of 15 percent per annum over the next two years. This may explain why 70 percent of shareholders have held their shares more than seven years — and 60 percent of the company’s top 10 shareholders have held shares for five years or more.
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Although Polman has certainly made a strong case for Purpose, he is not alone in the journey. As the CEO begins to think of life after Unilever, let’s take this time to examine — and celebrate — other leaders in the journey toward better business with greater impact:
- Marc Benioff, CEO, Salesforce: Within a year of founding Salesforce in his rented San Francisco apartment, Benioff had established his “1-1-1 model” of integrated philanthropy. Now, the company with $10 billion in revenue and ranked as the World’s Most Innovative Company by Forbes has “given more than $168 million in grants, 2.3 million hours of community service, and provided product donations for more than 32,000 nonprofits and higher-education institutions.” Benioff has also used his corporate bully pulpit to advocate for issues such as equal pay and gender identity equality.
- Rose Marcario, CEO, Patagonia: A business veteran with 25 years in corporate finance under her belt, Marcario is the force behind some of the outdoor retail brand’s boldest moves — including most recently suing the President of the United States and Patagonia’s wildly successful 100% for the Planet Black Friday effort. But Marcario isn’t afraid to go under the hood as well; in her role as CFO, she led a rigorous review of Patagonia’s supply chain.
- Larry Merlo, CEO, CVS Health*: Just three years into his tenure as CEO, Merlo made a landmark decision — to eliminate tobacco sales in all CVS Health stores — at a potential loss of $2 billion in revenue. The company explained that selling cigarettes conflicted with its Purpose of helping people on their path to better health. The move paid off in a big way — CVS Health announced a nearly 10 percent increase in revenue following the announcement. And, on the one-year anniversary of the decision, in states where CVS has a market share greater than 15 percent, there was a 1 percent decrease in cigarette pack sales, totaling 95 million fewer cigarette packs sold overall. More recently, CVS Health has been at the forefront of tackling the opioid crisis by limiting opioid prescriptions to a seven-day supply.
- Daniel Lubetzky, Founder and CEO, KIND Snacks: Since founding KIND Snacks in 2004, Lubetzy has guided the “not-only-for-profit” company on a KIND Movement to make the world a little kinder. Lubetzky has also waged a war against unhealthy eating and sugar content in food, most recently contributing $25 million to the Feed the Truth effort aimed at more transparency behind nutrition research, information and policy. And in his “spare time,” Lubetzky, a Mexican immigrant and the son of a Holocaust survivor, founded or co-founded three organizations dedicated to deepening impacts: PeaceWorks Inc., Maiyet and the OneVoice Movement.
- Eileen Fisher, Founder and President, EILEEN FISHER: In 2015, Eileen Fisher launched a bold new vision for her company: Vision2020 — to attain 100 percent sustainability in its practices by the year 2020. The effort includes progressive elements such as not only being carbon neutral by 2020, but carbon positive, and collaborating with others in the industry to adopt bluesign® textile technologies. While acknowledging the effort would not be easy, the campaign hinged upon the simple but aggressive rallying cry, “No Excuses” and ladders up to Fisher’s belief that “we can use business to change the world, literally.”
In Polman’s own words to the Financial Times in September 2016, he ruminated: “It shouldn’t be difficult to find someone better than me.” And while many in the industry may disagree with his sentiment and be sorry when one of the biggest heroes in corporate responsibility moves on, the bench strength of Purpose-driven CEOs runs deep and wide.