Unilever’s Sustainable Living brands continue to drive higher rates of growth
Six years into its ambitious Unilever Sustainable Living Plan, the company today announced its progress in building its ‘Sustainable Living brands’ as they drive value and growth for the business.
- Sustainable Living brands grew over 50% faster than the rest of the business
- Delivered more than 60% of Unilever’s growth in 2016
- 18 Sustainable Living brands in the top 40 Unilever brands, up from 12 in 2015
- Continued consumer demand driving brands with purpose
While many continue to join Unilever in efforts to build brands with purpose and sustainability at their core, Unilever’s Sustainable Living brands delivered over 60% of the company’s total growth, up from 46% last year, and grew more than 50% faster than the rest of the business in 2016.
All of Unilever’s brands are on a journey towards reducing their environmental footprint and increasing their positive social impact. Our Sustainable Living brands are those that are furthest ahead – they combine a strong social or environmental purpose, with products which contribute to achieving the Unilever Sustainable Living Plan goals.
These findings were shared with leaders from industry, government and academia gathered at Unilever’s London headquarters, to review progress on the sixth year of the Unilever Sustainable Living Plan.
Unilever’s brands continue to lead the way on sustainable living, such as Lifebuoy, Ben & Jerry’s, Dove and Hellmann’s, achieving above average growth, with high single and double digit sales over the past six years. Brands such as Axe, Brooke Bond tea and Surf also join the growing list of Unilever’s Sustainable Living brands with purpose at their core.
Paul Polman, Unilever CEO, said: “We have made great progress. Our results show that sustainability is good for business, with increasing evidence that our ‘sustainable living brands’ do better.
“There is no doubt that the Unilever Sustainable Living Plan is making us more competitive by helping us to build our brands and spur innovation, strengthen our supply chain and reduce our risks, lower our costs, and build trust in our business. It is helping Unilever to serve society and our many consumers, and in doing so, create value for shareholders.
“By continuing to work with others, we hope to mobilise a new kind of growth, one that taps into the economic opportunities that the Sustainable Development Goals present.”
As part of the efforts to scale up and progress its commitments on sustainable living, Unilever commissioned consumer research to help gain a better understanding of some of the issues that are driving people’s purchasing habits and behaviour. The research showed that over half of all consumers already buy or want to buy sustainably. One in three (33%) already purchase products with sustainability in mind, and a further 21% do not currently but would like to.
A new entrant to the Sustainable Living brands’ list is Sunlight, part of Unilever’s global Surf brand. Sunlight has made a big impact in South Africa with its new handwashing laundry powder, which uses ground-breaking SmartFoam technology to break down suds faster. In drought-affected South Africa, where women still do the majority of laundry by hand, halving the number of rinses required to wash laundry has made a real difference by liberating women’s time as well as saving water – delivering a 2.6% increase in market share in 2016.
The Company confirmed that it is on track to meet most of the 50+ targets set out in the Unilever Sustainable Living Plan. It announced it had avoided costs of over €700million through eco-efficiency measures in its factories since 2008, of which its waste programme had contributed to cost avoidance of around €250million. At the same time, Unilever has reduced risk exposure by increasing use of renewable energy in its manufacturing sites to 31.6%, and continuing to source over 50% of its agricultural raw materials sustainably by end 2016.
Unilever is committed to working to bring about transformational change throughout the whole value chain and to developing further its portfolio of Sustainable Living brands in a way that meets the needs of consumers. A detailed report on the progress made against the targets set out in the Unilever Sustainable Living Plan and Unilever’s approach to transformational change is available online.
Unilever Sustainable Living Plan Appendix:
The Unilever Sustainable Living Plan has three big goals to achieve, underpinned by nine commitments and 50+ targets spanning our social, environmental and economic performance across the value chain. Results for 2016 show:
Improving health & well-being
Health & hygiene
- Around 538 million1 people have been reached through our programmes on handwashing, safe drinking water, oral health, sanitation and self-esteem.
35% of our portfolio by volume met the highest nutritional standards, based on globally recognised dietary guidelines.
Reducing environmental impact
The greenhouse gas impact of our products across the lifecycle has increased by around 8% per consumer use since 2010. In 2016 we refreshed our strategy and extended this target to 2030.
The water associated with the consumer use of our products in water-scarce countries has decreased by around 7% per consumer use since 2010. We have sharpened our strategy and are accelerating our efforts to develop water-smart products which meet consumers’ needs, such as products which enable people to wash and do laundry well.
The waste associated with the disposal of our products has reduced by 28%2 since 2010
- 51% of our agricultural raw materials were sustainably sourced (2015: 60%)
- This includes 48% as physical sustainable sources (2015: 39%) and 3% in the form of certificates used mainly in soy and sugar (2015: 3%)
- We continue to evolve our sourcing policies to make sure we are having the greatest impact. We have therefore moved away from GreenPalm certificates for palm oil towards what are called ‘physical certified sources’. GreenPalm certificates accounted for 18% of our sustainably sourced agricultural raw materials in 2015. Had we continued to buy GreenPalm certificates our overall sustainable sourcing performance in 2016 would have been 66% – a 6% improvement on the previous year as we increase our purchasing of sustainable physical agricultural raw materials.
Fairness in the workplace
- 67% of procurement spend through suppliers meeting mandatory requirements of our Responsible Sourcing Policy
- We continued to embed human rights with a focus on 8 salient human rights issues documented in our 2015 Human Rights Report. A new report will be issued in 2017.
- Total Recordable Frequency Rate for accidents improved to 1.013 per million hours worked (2015: 1.12)
- Engagement score among 6,228 employees surveyed in 2016 was 76% (2015: 77%)
Opportunities for women
- We enabled around 920,000 women to access initiatives aiming to promote their safety, develop their skills or expand their opportunities.
- % of persons of each sex who were Unilever managers was 54% male and 46% female Inclusive Business4
- Enabled around 650,000 smallholder farmers and 1.5 million small-scale retailers to access initiatives aiming to improve their agricultural practices or increase their incomes. This is down from 1.8 million retailers in 2015, following a re-scoping of stores that can benefit from the Perfect Store programme in India.
Progress in manufacturing
Progress by end 2016 (vs 2008 baseline):
- Avoided costs of over €700m
- Reduced GHG by 43%5 per tonne of production. Compared to 1995, this represents a 66% reduction in absolute terms
- 31.6% of our total energy use (compared to 15.8% in 2008), and 63% of all grid energy used, generated from renewable resources
- 1.1 million GJ of the energy used in our manufacturing was generated from coal, which is 4% of our total energy use. 13 of our manufacturing sites used energy generated from coal
- Reduced water by 37%6 per tonne of production. Compared to 1995 this represents a 77% reduction in absolute terms.
- Zero non-hazardous waste to landfill across our global factory network by end 2014
R&D spans across the whole value chain at Unilever and helps to drive our USLP commitments. With over 6000 R&D people globally, their aim is to make existing products and portfolios more sustainable, as well as looking for disruptive solutions that will bring completely different products on the market.
Health & hygiene
- Lifebuoy: Lifebuoy Clini-Care 10 range: delivers breakthrough technology in germ protection with Activ Naturol Shield™. We developed this formula because each year germs become stronger, causing illnesses to become more severe and harder to treat. Activ Naturol Shield not only provides better antimicrobial efficacy against ‘gram negative’ bacteria - which cause stomach and respiratory infections - but also against ‘gram positive’ bacteria, which cause skin and eye infections.
- Pureit Ultima RO+UV with Oxytube tackles pesticide residues was launched in 2016. Compared to washing with water, Pureit Ultima delivers up to 15 times better pesticide removal on leafy vegetables, and up to 2.5 times better cleansing on normal fruit and vegetables.
- Vegan Hellmann’s mayonnaise; Ben & Jerry’s non-dairy ice cream, meeting the consumer demand for plant-based alternative formats; Flora Freedom dairy-free spread – these are all good for reducing GHG too.
- Gluten free Knorr bouillon
- We have partnered with the European Vegetarian Union (EVU) - in 2017, EVU’s logo will be added to around 500 of our products, including Hellmann's, Flora and Knorr.
- In 2014, we achieved our target for all our children’s ice creams to contain 110 kilocalories (kcals) or less per serving. We applied our learnings to all our packaged ice cream portfolio, and in 2015 met our target to ensure that at least 80% of our packaged ice creams do not exceed 250 kcals per portion. In 2016, 91% of our packaged ice creams did not exceed 250 kcals per portion.
- Climate-friendly freezers: By the end of 2016, we had purchased around 2.3 million freezers using natural refrigerants (hydrocarbons). The freezers are also around 10% more energy efficient. Our latest and most energy efficient freezers reduce energy use by over 60% compared to our 2008 baseline.
- Sunlight (global Surf) Smartfoam technology as outlined above
- Suvidha Centre – Our R&D team applied circular economy principles to our new pay per use community centre offering safe drinking water, flushing toilets, clean showers and laundry facilities, in one of Mumbai’s largest slums. The Suvidha recycles water used for washing to flush the toilets – bringing environmental benefits as well as hygiene. Launched on World Toilet Day 2016.
- Ground-breaking new technology to recycle sachet waste. This technology, called CreaSolv® Process aims to tackle the industry-wide sachet waste issue.
- Compression injection technology to reduce the plastic in many of our tubs. this innovation has cut plastic use in some of our plastic food tubs in Europe by up to 7%, saving 12.5 tonnes of plastic in 2016 without impacting the quality of the product packaging.
- Recently launched black TRESemmé bottles in North America containing 25% recycled content
- Commercialising MuCell™ moulding technology has allowed us to reduce the plastic component in bottles by up to 15% versus the previous bottle
- In 2015, we relaunched Sunsilk in Brazil with lighter shampoo and conditioner recyclable bottles. Through designing lighter caps, reducing the number of cap designs from ten to four, and reducing the variety of bottle sizes manufactured from 44 to 22. We are rolling out this innovation to other regions. By the end of 2016 we had saved almost 5,000 metric tonnes of plastic.
- PLA teabags on Brooke Bond
- Launched Hellmann’s easyout mayo (2015)
- Hellmann’s organic mayonnaise is made with only the finest organic ingredients, like organic cage-free eggs, and contains no artificial flavours or preservatives
CreaSolv® is a registered trademark of CreaCycle GmbH
This announcement may contain forward-looking statements, including ‘forward-looking statements’ within the meaning of the United States Private Securities Litigation Reform Act of 1995. Words such as ‘will’, ‘aim’, ‘expects’, ‘anticipates’, ‘intends’, ‘looks’, ‘believes’, ‘vision’, or the negative of these terms and other similar expressions of future performance or results, and their negatives, are intended to identify such forward-looking statements. These forward-looking statements are based upon current expectations and assumptions regarding anticipated developments and other factors affecting the Unilever Group (the “Group”). They are not historical facts, nor are they guarantees of future performance.
Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. Among other risks and uncertainties, the material or principal factors which could cause actual results to differ materially are: Unilever's global brands not meeting consumer preferences; Unilever's ability to innovate and remain competitive; Unilever's investment choices in its portfolio management; inability to find sustainable solutions to support long-term growth; customer relationships; the recruitment and retention of talented employees; disruptions in our supply chain; the cost of raw materials and commodities; the production of safe and high quality products; secure and reliable IT infrastructure; successful execution of acquisitions, divestitures and business transformation projects; economic and political risks and natural disasters; the effect of climate change on Unilever's business; financial risks; failure to meet high and ethical standards; and managing regulatory, tax and legal matters. These forward-looking statements speak only as of the date of this announcement. Except as required by any applicable law or regulation, the Group expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Group's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Further details of potential risks and uncertainties affecting the Group are described in the Group's filings with the London Stock Exchange, Euronext Amsterdam and the US Securities and Exchange Commission, including in the Annual Report on Form 20-F 2016 and the Unilever Annual Report and Accounts 2016.