The strategy companies use to build long-term value via environmental, social, and governance (ESG) aspects is known as corporate sustainability. Fundamentally, business sustainability is striking a balance between social responsibility, environmental preservation, and economic growth.
Sustainability has become a significant component of a company’s strategy as the emphasis on social justice, resource depletion, and climate change grows globally. It affects not just the financial success of a company but also its reputation, staff engagement, and consumer loyalty.
The majority of the top 250 businesses, in terms of revenue, now report on sustainability. Around 96% of the G250 companies reported in 2022, which is the same percentage as in 2020. On the other hand, the N100 companies grew steadily, with 79% reporting on sustainability in 2022 compared to 77% in 2020. N100 is a group of revenue companies across 49 countries selected in the study.
Corporate sustainability can take many different shapes depending on the sector, the size of operations, and the unique issues a firm encounters. Today, we’ll examine Unilever’s practices as one instance of corporate sustainability.
Unilever’s Commitment to Sustainable Living
Due to its dedication to incorporating social and environmental objectives into its business strategy, Unilever is acknowledged as a pioneer in sustainability. Launched in 2010, the company’s strategy—known as the “Unilever Sustainable Living Plan” (USLP)—sets high goals to promote growth while lessening its environmental impact.
The company has now switched from the USLP to the Compass Strategy and then the Climate Transition Action Plan. However, the goals of these plans have always focused on sustainability. For this article, we will stick to USLP because it was a 10-year-long plan from 2010 to 2020 and has had great success.
The USLP demonstrates how a sizable, intricate company can incorporate sustainability into every aspect of its operations. Therefore, this effort is a great case study for corporate sustainability.
The three primary pillars of Unilever’s approach are livelihood enhancement, environmental impact reduction, and health and well-being improvement. Every one of these domains is closely linked to the wider objectives of sustainable development. This ensures that the expansion of businesses does not equate to the deterioration of society or the environment.
Following this as an example, many companies can enter into corporate partnerships with organizations that can help them reduce their carbon footprint. For example, plastics in the oceans around the world are a major concern not only for marine life but also for human beings.
A BBC article states that there were an estimated 15 trillion plastic pieces in the oceans in 2005. However, the number has now increased to over 171 trillion pieces. If nothing is done about this, scientists predict that the number may increase by three times by 2040. The Great Pacific Garbage Patch is home to several sizable floating heaps of plastic debris. However, the Mediterranean Sea has the largest concentration of this material in the ocean.
Through corporate partnerships, businesses can work with organizations to remove plastics from oceans. There are many ways to approach this, as suggested by 4Ocean. For instance, you can determine how much plastic is used in your products or services. You can then remove an equivalent amount of plastic from the oceans to ensure neutrality. Alternatively, you can simply remove one pound of plastic from the ocean for every:
- Product sold
- Customer onboarded
- Shipment processed, etc.
Why is Unilever considered a leader in corporate sustainability?
Unilever incorporates social, environmental, and economic sustainability into its business strategy through several projects. It is well known for its initiatives in fields including public health improvement, carbon emission reduction, and sustainable sourcing. For instance, the Unilever Sustainable Living Plan is a long-term strategy launched in 2010 and followed till 2020.
Unilever’s Plan to Improve Health and Well-Being
Unilever announced a goal to enhance the health and well-being of over one billion people by 2020 as part of its USLP. To do this, the firm has created products that support improved nutrition, cleanliness, and health outcomes. These products were particularly promoted in poor nations where access to clean water, hygienic conditions, and important nutrients may be scarce.
A prime illustration of this is the Lifebuoy soap project. An initiative to promote handwashing was started by the Unilever brand Lifebuoy. The goal was to stop the spread of preventable illnesses, including respiratory infections and diarrhea.
Diarrhea is one of the more common illnesses in underdeveloped countries compared to industrialized ones. Research indicates that the condition is more common in children in the first two weeks of life. There is a 13% prevalence rate among children in their first two weeks in Ethiopia. Moreover, the prevalence rate increased to between 18% to 31% for children under five years.
This campaign raises awareness among the populace in developing nations of the value of washing hands with soap. Through encouraging improved hygiene habits, Unilever was able to develop its market and enhance public health. It demonstrated how corporate social responsibility and commercial success can coexist.
How does Unilever contribute to improving global health?
Unilever develops products that support nutrition and hygiene in order to boost health and well-being, especially in underprivileged communities. For example, their Lifebuoy soap campaign teaches people how to wash their hands to prevent infections. In order to provide consumers with healthier alternatives, Nielsen has redesigned some of its food products by reducing the amount of harmful substances.
Reducing Environmental Impact
An essential component of Unilever’s sustainability strategy is its dedication to minimizing its environmental effects. The corporation wants to use fewer resources and produce less trash in order to divorce its growth from its environmental impact. This goal is addressed by several programs, such as those that minimize water usage, lower carbon emissions, and support sustainable raw material procurement.
The effort made by Unilever to get palm oil sustainably is one of the notable accomplishments in this field. It is found in 50% of everyday use products. Native to Western Africa, it is now widely grown in Malaysia and Indonesia as well. Although palm oil is a significant component of many consumer goods, its production has been connected to social exploitation, biodiversity loss, and deforestation.
In retaliation, Unilever pledged that by 2019, all of its palm oil will come from verified sustainable sources. The firm changed the palm oil industry by promoting ethical agricultural methods that save trees and the communities that depend on them. It did this by collaborating with suppliers and non-governmental organizations.
Unilever also places a lot of emphasis on water conservation, especially in areas with limited water resources. Water-efficient goods like “Love Home and Planet” detergents, which take less water to rinse away, have been created by the firm.
To reduce the amount of water consumers use while using its goods, Unilever also optimizes water use in its manufacturing processes. These initiatives highlight how businesses may innovate to utilize fewer resources and do the least amount of damage to the environment.
How is Unilever decreasing its environmental footprint?
At Unilever, we strive to use resources as efficiently as possible, reduce carbon emissions, use less water, and support sustainable sourcing. As an illustration, it pledges to get all of its palm oil from verified sustainable sources. This encourages ethical agricultural methods and lessens the loss of forests.
Enhancing Livelihoods
Sustainability includes people’s well-being at every stage of the value chain, not only the preservation of the environment. Unilever is dedicated to improving the quality of life for millions by supporting programs that advance equitable opportunity, fair labor standards, and inclusive development.
Working with smallholder farmers is one major initiative Unilever is undertaking in this field. Millions of people in developing nations make their living from agriculture. However, many do not have access to the markets or training that would increase their income and productivity.
To encourage sustainable agricultural techniques and increase yields, Unilever collaborates with smallholder farmers, especially those who cultivate essential components. By helping these farmers, the business guarantees a steady supply of raw materials and promotes rural development and the fight against poverty.
In addition, Unilever is a fervent supporter of gender equality in its supply chains and among its employees. Since empowering women may significantly influence society and the economy, the organization has committed to providing opportunities for women.
For instance, Unilever has created initiatives to assist female entrepreneurs in developing economies as they establish small enterprises and turn into Unilever product distributors.
Corporate sustainability is not a one-size-fits-all notion, and its effective implementation depends on the individual difficulties and possibilities an organization encounters. Unilever serves as a prime example of how a business may combine sustainability with development and profitability in its core activities.
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