Business 12th Edition by William Pride,Robert Hughes,Jack Kapoor

Exercise 3

Can a corporate giant build its business on the basis of being green and clean? By 2020, Unilever aims to double its revenues while cutting its environmental footprint in half and educating one billion people about how to live healthier lives. Although these are aggressive goals, the Anglo-Dutch company has considerable resources available to implement its plans. Unilever rings up $62 billion in annual sales of a wide range of foods, household cleaners, and personal care products under such well-known brands as Axe, Ben Jerry's, Dove, Lipton, Lifebuoy, Skippy, Suave, and Surf. It has 170,000 employees and operates in 100 countries, with more than half of its revenues coming from developing nations. Every day, all over the world, 2 billion people use one (or more) of its products.
Unilever's managers see great profit potential in actively managing the environmental and social impacts of its products to meet the needs of consumers in all markets and at all income levels. "We are advocating a business model that gives to the environment and society," explains CEO Paul Polman. "That is the essence of sustainable growth."
Before setting specific green and clean goals, Unilever's managers spent years studying the eco-effects of its products and talking with customers, suppliers, government officials, and non-profit specialists about population growth, natural resources, and human health. They set up programs to develop and test efficient, eco-friendly ways of manufacturing products and obtaining raw materials. They also took a close look at how they might address challenges such as providing clean drinking water for billions of people and preventing the spread of disease.
Out of this research came a comprehensive plan called the Unilever Sustainable Living Plan. It included a detailed timeline for dramatically reducing Unilever's energy and water usage, getting raw materials from sustainable sources, and slashing emissions and waste. As one example, the company set a deadline for obtaining all of its palm oil from certified sustainable sources (and achieved that goal three years early). Meanwhile, Unilever's product development experts began devising new products to address common consumer needs in earth-friendly ways. For example, for areas where water is scarce, they developed a shampoo to be used without water and laundry products that clean with a single rinse.
Unilever's research also pointed to the need for educating consumers about simple steps they can take to stay healthy, such as washing their hands. The company found that the first step is to explain why people should take a particular action (wash with soap to stop disease from spreading). Next, show them how easy it is to take action (by buying and using soap), outline the benefits (keeping families safe from germs), and make them feel good about taking action (to keep family members healthy). Finally, encourage people to continue this action over and over again (for example, by reminding children to wash before meals). Following these five steps, Unilever has already educated 35 million people in developing nations about the benefits of washing hands-while promoting the company's Lifebuoy soap brand at the same time.
In the process of moving toward its sustainability goals, Unilever has developed tools and techniques that it is now sharing with other companies and with suppliers. Its free, downloadable Cool Farm Tool, for instance, enables farmers to calculate the level of greenhouse gas emissions from their farming and livestock activities. Using this calculation as a baseline, farmers can then experiment with different ways of reducing emissions while improving agricultural yield. This is yet another way that the company's plan "can unleash innovation which will help us grow," says the head of Unilever's business in India.
Questions
Do you agree with Unilever's approach of promoting its Lifebuoy soap brand in programs to teach consumers about handwashing? Explain your answer.