In a recent company update, Unilever boss Hein Schumacher outlined how the business will change its sustainability and purpose strategy.
While he referred to Unilever’s reputation in sustainability as “well-deserved”, Schumacher concluded: “Our efforts are being spread too thinly. We have too many long-term commitments that failed to make a sufficient short-term impact, and the latter is what the world needs right now.”
Schumacher, who joined Unilever in July, said: “Everything we do in [sustainability] must have material impact for the benefit of Unilever, as well as for the environment and the societies we serve. I’ve concluded that the best way we can do that is by radically focusing our sustainability efforts.
He clarified that Unilever brands that have successfully demonstrated social or environmental brand purpose propositions in previous work, including Dove and Domestos, will be encouraged to continue with this approach.
“But we will not force-fit this across the entire portfolio,” he said, admitting: “For some brands, it simply won’t be relevant, and that’s OK.
“Our focus on purpose is laudable, and it inspires many people to join and stay with Unilever, so we must never lose it. But I don’t think we advance the cause of purpose by force-fitting it across every brand.”
The chief executive added: “Let me be clear, we are not walking away from sustainability. Rather, we are stepping into it in a different – and I believe, even more impactful – way.”
Schumacher stated that conversations around brand purpose have “arguably generated more heat than light” in recent times, thanks to the conflation of ‘sustainability’ and ‘purpose’, and confusion around the business case for sustainability.
Similar points were made by Unilever’s head of comms, Paul Matthews, at a PRWeek conference earlier this year, where he admitted that the business had “misstepped” within its initial attempts at purpose messaging.
This comes after a major shareholder publicly criticised Unilever for having “lost the plot” over its sustainability work in early 2022.
Focus on ‘power brands’
Unilever’s revised ESG strategy was announced alongside the release of its Q3 trading results. Schumacher admitted that he was “not happy with our overall competitiveness”, saying: “Across a number of important metrics, the quality of performance has fallen short.”
The solution, he said, lies in “confronting some harsh realities” within the business.
Despite Unilever’s global reach and broad portfolio of brands, the chief executive expressed his belief that it is failing to prioritise its strongest brands sufficiently at present.
The business is therefore set to place “an unrelenting initial focus” on its top 30 ‘power brands’ – the biggest brands by turnover, which collectively generate more than 70 per cent of Unilever’s revenue. These include Dove, Hellmann’s, Ben & Jerry’s and Vaseline.
“They represent our biggest value-creation opportunity, which means they need to be brilliantly executed and consistently supported before anything else,” said Schumacher, wishing to address the issue of having “too many projects competing for in-market execution and brand support”.
He said: “We will also ensure that our brand and marketing investment spend is more focused, with deliberate allocation behind bigger platforms; more consistent, fully funding our power brands; more digital; and more effective, increasing returns on marketing spend.”
Underpinning Unilever’s proposed strategy shifts, said Schumacher, is an overall need for “fewer things, done better, with greater impact.”
The chief executive said he expects Unilever’s ‘brand superiority’ framework to be fully operational by mid-2024.
This article originally appeared on PRWeek US.
