July 24, 2010 Md. Shahnur islam Lecturer, Department of Business Administration, ASA University Bangladesh,Dhaka Subject: Letter of Submittal. Dear Sir, I was assigned to prepare an assignment on the topic entitled " Environment for Business & Social Responsibilities, Study on............... (Unilever)". For collection of data i have investigated the relevant newspapers, information from related institutions. In my study, i have found a lot of information about the forming of Environment for Business & Social Responsibilities. I was provided necessary supports from my university and related authorities. Surely this study will enhance my knowledge and experience and work as an important source of information for future work on this topic. Finally, i would like to request you to accept my paper. Thank you in advance for your assistance and advice in this connection. Sincerely yours,
Name
Imran Hasan Kibria
Reg. No.
071-12-451
(i)
Signature
Acknowledgement This report has been prepared for Md. Shahnur Islam, Course Instructor, Faculty of business, ASAUB. i would like to thank you sir for guiding me with your superior knowledge, experience and care. I would like to thank all the people whom we interviewed at Unilever Bangladesh, for giving me their time and providing the information we needed for primary data collection. Thanking You
(ii)
Assignment on: Environment for Business & Social Responsibilities, Study on............... (Unilever)
Cores code: BUS-113 Cores title: Introduction to Business
Prepared For: Md. Shahnur islam Course instructor, Faculty of business, ASA University Bangladesh
Prepared By: Imran Hasan Kibria
Section: A
071-12-451 Batch: 10
Date of Submission 24 July, 2010
Table Of Content Introduction COMPETITIVE BUSINESS ENVIRONMENT OF THE 21ST CENTURY DYNAMIC BUSINESS ENVIRONMENT Environment for Business & Social Responsibilities of UNILEVER Kenya: Tree planting raises biodiversity profile Indonesia: Business helps kids champion environment Philippine: Unilever works for the ‘Greener Good’
1 1 3 4 6 8 10 11
Corporate image
11
Environmental issues
13
Social issues: Reformulating Unilever’s products Developing new products Conclusion Reference
18 19 20 II
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Environment for Business & Social Responsibilities, Study on............... (Unilever)
Introduction
Business environment is a set of political, economic, social and technological (PEST) forces that are largely outside the control and influence of a business and that can potentially have both a positive and a negative impact on the business. Today's world is a rapidly changing place. Developments across a range of factors will have an impact on the business or industry. The classic PEST framework (political, economic, social, and technological) identifies Unilever’s major categories of external factors that affect the ability of the organization to survive and prosper.
COMPETITIVE BUSINESS ENVIRONMENT OF THE 21ST CENTURY What will it take for businesses to succeed in the competitive environment of today and the future? It will take more than information and knowledge ahout marketplace trends; those are in ample supply. What's less common, but required, is an understanding of marketplace trends and their competitive implications. This is because understanding dictates strategy, and good strategy well executed dictates success. There are 5 main components to the competitive business environment of the 21st century, centering on economic, demographic, geographic, consumer and workforce trends. Here's an overview. 1 - THE NEW ECONOMY
If there's one word that describes the new economy, it's speed, or specifically, the faster reallocation/rationalization of human, financial and physical resUnilever’sces. Due to the easy and affordable availability of more, better and more timely information, businesses must now act in hours, days and weeks - not months or years - to reverse bad decisions, correct mistakes, abandon bad investments. As evidence of this revolution, consider the thousands of businesses that now conduct inventory reports on an ongoing basis in real time, in contrast to the quarterly inventory reports that once were the norm. 2 - THE NEW DEMOGRAPHY The biggest global demographic trend of the 21st century will be declining fertility and growth rates in all regions, and, in the second half of the century, declining populations in all of the
Western, advanced, industrialized, first-world nations, save one: the United States, Thanks to relatively high fertility and relatively high levels of immigration, total US population will grow (from 283 million today to 397 million in 2050), and not age as quickly (median age increasing from 36 today to 41 in 2050, by which time the Western world's median age will have reached 49). 3 - THE NEW GEOGRAPHY A major trend transforming American society is underway: Unilever are separating into two nations. One nation is comprised of the ten states that contain the country's engines of population growth, economic growth, demographic diversity, cultural dynamism, political power and market opportunity. The other nation is comprised of the remaining 40 states.
4 - THE NEW WORKFORCE Don't be misled by the current spike in unemployment - the trend over the next 20 years is one of worker shortage, particularly of skilled workers. A slower-growing workforce makes this future probable: less than 20 million new workers will be added to payrolls over the next 20 years, compared with the 38 million that bave been added over the past 20 years. As soon as 2006, according to the Bureau of Labor Statistics, there will be 151 million jobs in the US economy, but only 141 million workers in the labor force. 5 - THE NEW CONSUMER Today's consumers want it all: low price, high quality, convenience, a wide range of options. They have learned to expect it all, and manufacturers, retailers and service provider are learning to supply it all. These changes are structural and permanent, underpinned and reinforced by other major trends such as more highly educated consumers (from mass markets to mass savvy), and the mainstreaming of affluence (as evidenced by the huge and growing markets for cell phones, plastic surgery, sushi, good coffee, good wine, etc.). Businesses that understand these trends will be able to exploit them, to base their strategies, plans and actions upon a future whose components are already visible. To succeed in the competitive environment of the 21st century, they know they will be required to:
* respond to marketplace conditions more quickly, structuring their enterprises for maximum effectiveness and productivity; * Design products and services that will be in demand by growing markets;
DYNAMIC BUSINESS ENVIRONMENT The positive and competitive business environment prevailing throughout Chile is the result of the design, adoption and implementation of a series of public policies aimed at the simultaneous promotion of: •
A macroeconomic management that is both serious and responsible.
•
Higher levels of economic openness and international integration.
•
Sound institutions and a society fabric enjoying higher degrees of fairness, while advocating that all individuals alike should gain access to the benefits of economic development.
According to a Survey issued in 2004 and focused on Business Environments, it contains a forecast on the best places to conduct business in the next five years (period 2004 – 2008). Chile was rated then as the first noteworthy market of this kind in Latin America with a mark of 8.05 in a 1-to-10 scale. This ranking, projected on a world league, puts Chile as country # 17 amid the 60 countries included in the survey. The analysis took into account the following factors: •
The degree of political and economic stability,
•
The type of policies concerned with the development of private business initiatives,
•
The foreign investment regime,
•
The tax system,
•
The labor market conditions.
Environment for Business & Social Responsibilities of UNILEVER
In the 1890s, William Hesketh Lever, founder of Lever Bros., wrote down his ideas for Sunlight Soap – his revolutionary new product that helped popularize cleanliness and hygiene in Victorian England. It was ’to make cleanliness commonplace; to lessen work for women; to foster health and contribute to personal attractiveness, that life may be more enjoyable and rewarding for the people who use Unilever’s products’. This was long before the phrase ’Corporate Mission’ had been invented, but these ideas have stayed at the heart of Unilever’s business. Even if their language - and the notion of only women doing housework – has become outdated. In a history that now crosses three centuries, Unilever’s success has been influenced by the major events of the day – economic boom, depression, world wars, changing consumer lifestyles and advances in technology. And throughout they’ve created products that help people get more out of life – cutting the time spent on household chores, improving nutrition, enabling people to enjoy food and take care of their homes, their clothes and themselves. In the late 19th century the businesses that would later become Unilever were among the most philanthropic of their time. They set up projects to improve the lot of their workers and created products with a positive social impact, making hygiene and personal care commonplace and improving nutrition through adding vitamins to foods that were already daily staples. Today, Unilever still believes that success means acting with ’the highest standards of corporate behavior towards their employees, consumers and the societies and world in which Unilever live. Over the years Unilever’ve launched or participated in an ever-growing range of initiatives to source sustainable supplies of raw materials, protect environments, support local communities and much more. At the beginning of the 21st century, Unilever’s Path to Growth strategy focused on global highpotential brands and their Vitality mission is taking us into a new phase of development. More than ever, their brands are helping people ’feel good, look good and get more out of life. Unilever began operations in Poland in 1991, and today sells numerous products including the very recognizable brands of, Rama Margarine, Lipton Tea, Algida Ice Cream, Knorr Soups and Sauces, Dove, Timotei, Signal Tooth Paste, Domestos, Sunsilk, Hellmanns, and CIP Detergent. Today, most products sold in Poland are produced in four major Polish production facilities and staffed by over 2,700 Polish workers. Unilever are proud to welcome Unilever to Unilever’s Foundation. Unilever look forward to working with National Chairman and CEO Chris D. Bull, Corporate Relations Manager Wojciech Tomczak, and all of the great folks at Unilever, in making life in Poland better for everyone.
Unilever Business Strategy 2008 Unilever identifies personal care for future sales growth and profitability Unilever, the Anglo-Dutch company recently has identified its personal care segment as its fastest-growing business and a key to achieving sustainable profitable growth. Unilever is one of the world’s leading suppliers of fast moving consumer goods across Foods and Home & Personal Care categories. However, for many years, rivals like Procter & Gamble Co. (P&G), which have been more creative in introducing new products, have outperformed Unilever. Last year, Unilever reported an increase in personal care sales by only 1.4 per cent to €11.30bn while overall turnover rose 1.4 per cent to €40.2bn. The personal care segment will be a priority area in 2008 to Unilever for creation of future sales growth and sustaining profits from increasing raw material costs.
External Pressures and Organizational Restructuring Key concern areas like high material costs, adverse exchange rates and macroeconomic worries could hamper Unilever's performance. Unilever has already announced steps to improve its performance in 2008. These include reducing 20,000 jobs across its divisions and combining its Home & Personal Care and Foods into a single category structure. In February 2000, Unilever had announced a five-year growth strategy called ‘Path to Growth’, directed towards bringing a significant improvement in its performance. In 2001, the Path to Growth Strategy had led to organizational restructuring in the form of two global divisions being formed – one for Foods and one for Home and Personal Care.
Restructuring at Unilever In February 2008, Unilever's CEO Patrick Cescau had announced that it was streamlining its management structure in keeping with its strategy of focusing on developing markets and promoting executives with experience in those territories. It’s Central and Eastern Europe division would be included in an enlarged Asia, Africa and Central and Eastern Europe unit , thus centralizing management of emerging economies that shared similar consumer traits and potential for growth. Unilever also combined its home and personal-care and foods units into a single division as a part of the company's continuing effort to raise its profitability by becoming leaner and more agile.
Kenya: Tree planting raises biodiversity profile One of the main threats to the country's tea industry is deforestation - Unilever have been working with local environmental groups to protect Kenya's delicate biodiversity.
Protecting biodiversity The rich volcanic soils of Kenya's Rift Valley, coupled with the country's cool air and moist tropical climate, create the perfect environment for tea to grow. Tea plants require regular rainfall of 1200-2000 mm well distributed throughout the year to produce their best leaves. The country's forests have always been one of the key factors in ensuring that Kenya's rainfall patterns remain stable as they improve the efficiency of water catchments, so the risk of deforestation is a serious one.
Why are trees so important? Indigenous trees have been lost mainly through firewood collection and it is estimated that Kenya needs to plant 100 million trees a year to restore the lost and declining forests. As well as improving water catchments, they provide habitats for birds and insects, shade for animals and recreation and medicines for local people. For example Warburgia ugandensis is used to treat chest pains and coughs and Syzygium aids diabetes and high blood pressure and also provides food for bush babies.
Preserving Mau Forest Unilever Tea Kenya teamed up with Friends of the Mau Watershed (FOMAWA), an environmental charity set up to reverse the rapid depletion of the Mau Forest which counts among the five largest water catchments in Kenya. In the nearby Kericho region, the tea industry and around three million local people depend on the forest. Each year Unilever contribute around 240 000 Kenyan shillings (around €2 800) to FOMAWA to fund a field worker, whose job is to promote tree planting in schools and farms in the area. His work also entails creating awareness of the need to protect indigenous forests. Since December 2003, Unilever have also been supporting the conservation organisation WWF, which runs conservation programmes in the Mau Forest and other important forest ecosystems.
Unilever’s alliance is co-ordinated primarily through WWF's Corporate Club of Eastern Africa, which aims to harness the support of other companies in the region. The Club's activities include rehabilitating degraded forest areas, supporting communities to establish tree nurseries and raising environmental awareness. "The Club target now is to carry out farmer-friendly conservation approaches and provide alternative sources of income to ease pressure on the Mau Forest," explains Dr Kwame Koranteng, WWF's regional representative. Unilever are also working with WWF to raise environmental consciousness among Unilever’s staff and business partners in Kenya, as well as taking steps to improve Unilever’s environmental practices.
Trees 2000 To mark the millennium Unilever established Unilever’s Trees 2000 project. This aims to increase biodiversity, complement existing conservation and environmental protection programmes, and provide an amenity for staff and the neighbouring community. By the end of 2007, nearly 250 000 trees had been donated to the local community. Seven tree nurseries, including one on Unilever’s Kericho Chebown tea estate were set up to house over 320 000 seedlings. These were subsequently planted on Unilever’s estates, where Unilever have set aside 14% of Unilever’s land as natural forest or conservation areas. Altogether, by the beginning of 2008, Trees 2000 has contributed 620 000 trees to Kenya's landscape.
• Indonesia: Business helps kids champion environment Unilever Indonesia has taken its commitment to 'greening' the country's capital city, Jakarta, one stage further with the launch of the 'Jakarta Green School' programme.
Young 'agents of change' will have far-reaching impact The programme, which is also supported by a network of government, NGO and media partners, aims to turn Indonesian elementary and junior school students into environmental champions -
giving them the skills and awareness to 'clean up' not just their schools but their family homes and neighbourhoods too. As part of the initiative, Unilever and partners have provided 59 schools, and around 120 students and teachers, with training in environmental management, recycling, fundraising and leadership. Working together with their teachers, students then used their new skills to develop specific solutions for environmental issues within their schools.
Prize-winning teams The three most successful schools (for both elementary and junior schools) were announced last month - securing prize money of IDR 18 million (approximately €1300). The judging was based on student participation rates, greening, recycling and waste reduction. As a city, Jakarta faces acute environmental problems, including poor air quality, traffic congestion and flooding due to poor drainage - which means there's an urgent need for initiatives like 'Jakarta Green School'.
Agents of change "Understanding and concern for the environment should be developed from an early age so that environmental problems can be recognised and prevented as early as possible," says Josef Bataona, Director of Human Resources and Corporate Relations. "Unilever hope teachers and students will become agents of change within the surrounding neighbourhoods, so that the impact of their work can spread to more communities and schools." The programme represents a natural extension of Unilever Indonesia's existing 'Jakarta Clean and Green' initiative. Since 2006, the project has helped women become green entrepreneurs by recycling waste into trendy accessories, as well as teaching local citizens composting techniques.
Philippine: Unilever works for the ‘Greener Good’ The campaign to conserve the environment continues to get stronger, especially with the help of top organizations that take the advocacy to heart by implementing concrete, replicable measures.In the business sector, Unilever Philippines has been at the forefront of environmental campaigns, working with other groups to create a lasting "green" impact.In the recent Earth Day celebration, the multinational corporation’s Philippine office was recognized for its green projects. At the first Zero Basura Olympics—a competition that showcased the best "green" practices—it was one of two companies declared Grandmaster awardees. It was also declared the Green Technology Champion. The recognition came in light of Unilever’s pioneering effort of having shredded plastic packaging recycled into bricks and pavers that help build community homes. "Being a global business means recognizing Unilever’s bigger role in caring for the environment. This is something all of us in Unilever will not compromise," said Ali Gokcelik, vice president for Supply Chain, Unilever Philippines. "Unilever aims to bring vitality to communities with (Unilever’s) products and services…so the environmental agenda is a priority all the time… Unilever commit to ensure that Unilever’s operations do not pollute and (that Unilever’s operations) encourage others in the community to do the same." The Zero Basura Olympics aims to inspire more organizations to implement comprehensive programs that will positively impact the environment. It also aims to showcase such efforts so that the public may be aware of greener alternatives and help them make greener decisions. Following the declaration of winners for the business sector, the organizers will confer awards on local governments and NGOs. The Zero Basura Olympics is a project of the Philippine Business for Social Progress, Philippine Business for the Environment, Earth Day Network Philippines, Pollution Control Association of the Philippines, Department of Environment and Natural Resources, National Solid Waste Management Commission.The award affirms Unilever’s commitment to caring for the environment through comprehensive, long-range and sustained efforts. Apart from the plastic sachet project, the company has been showcasing its concern for nature through long-standing multi-sectoral partnerships in various water initiatives .Every contribution is vital in the fight against climate change—this is the idea behind the 10 Million Movement (10MM) which Unilever supports. The advocacy hopes to encourage everyone— individuals and groups alike—to commit to doing something for the environment and register it
online."Unilever really feel that Unilever are running out of time. Unilever cannot be waiting for one project to be fully successful before you launch the other. The idea is to have a layering of projects which will hopefully address most of these environmental concerns," said Chito Macapagal, vice president for Corporate Affairs of Unilever Philippines. "Filipinos working together can actually make a difference and all Unilever need is to focus on doing a few key things in a collective manner, regularly. That’s what the 10MM stands for."
Corporate image Unilever claims that corporate social responsibility is at the heart of its business.However, the transition to a responsible and sustainable company is ongoing and Unilever has attracted a variety of criticisms from political, environmental and human rights activists on not achieving the high aims it communicaties on a number of topics.
Environmental issues Palm oil
Unilever has been criticised by Greenpeace for causing deforestation, Unilever was targeted in 2008 by Greenpeace UK, which criticised the company for buying palm oil from suppliers that are damaging Indonesia's rainforests. Unilever, as a founding member of the Roundtable on Sustainable Palm Oil, responded by publicizing its plan to obtain its palm oil from sources that are certified as sustainable. In Côte d'Ivoire, one of Unilever's palm oil suppliers was accused of clearing forest for plantations, an activity that threatens a primate species, Miss Waldron's Red Colobus. Unilever intervened to halt the clearances pending the results of an environmental assessment. On 07/04/2010 Unilever announced that it has secured enough GreenPalm certificates of sustainable palm oil to cover the requirements of its European business; as well as those of its business in Australia and New Zealand. This is part of Unilever’s overall commitment to buy all its palm oil from certified sustainable sources by 2015.GreenPalm is a certificate trading programme, endorsed by the Roundtable on Sustainable Palm Oil (RSPO),
which is designed to tackle the environmental and social problems created by the production of palm oil. By selling certificates through the GreenPalm programme, palm oil producers can earn more for their crop through sustainable farming. Rainforest Alliance
Unilever, the world's largest tea company, is to revolutionise the tea industry by committing to purchase all its tea from sustainable, ethical sources. It has asked the international environmental NGO, Rainforest Alliance, to start by certifying tea farms in Africa.Lipton, the world's bestselling tea brand, and PG Tips, the UK's No.1 tea, will be the first brands to contain certified tea. The company aims to have all Lipton Yellow Label and PG Tips tea bags sold in Western Europe certified by 2010 and all Lipton tea bags sold globally by 2015. This is the first time a major tea company has committed to introducing sustainably certified tea on such a large scale and the first time the Rainforest Alliance, better known for coffee certification, has audited tea farms.It has the potential to reassure consumers about the source of the tea they enjoy drinking so much; to improve the crops, incomes and livelihoods of nearly 1 million people in Africa and, eventually, up to 2 million people around the world; to protect the environment from a further drain on its resource and to provide us with a means by which Unilever can differentiate Unilever’s brands from those of Unilever’s competitors."
Dumping of chemical waste
Greenpeace accused Unilver of double standards for allowing its Indian subsidiary, Hindustan Lever, to dump several tonnes of highly toxic mercury waste in the tourist resort of Kodaikanal and the surrounding protected nature reserve of Pambar Shola, in Tamil Nadu, Southern India. The mercury is a rest product of the Hindustan Lever factory which manufactures mercury thermometers for export, mainly to the United States.
Social issues: Race and advertisements
Hindustan Unilever, had been showing television advertisements for skin-lightening cream, Fair and Lovely, depicting depressed, dark-skinned women, who had been ignored by employers and men, suddenly finding new boyfriends and glamorous careers after the cream had lightened their skin. The Austrian branch of Unilever (Eskimo) is producing and marketing an ice-cream under the name Mohr im Hemd. "Mohr" (moor), is a colonial German word for African or black people, has a heavily colonialist and racist connotation., "Mohr im Hemd" (moor in the shirt) is a traditional Austrian chocolate speciality which refers to naked, "wild" Africans. Unilever refutes any racist intentions and claims that it has tested the name in broad market studies in Austria without any critical feedback.On 22 April 2010, Unilever distanced itself from the far-right British National Party, after a jar of Marmite was featured on a BNP election propaganda film. The company statement said: "It has been brought to Unilever’s attention that the British National Party has included a Marmite jar in a political broadcast shown currently online. Unilever want to make it absolutely clear that Marmite did not give the BNP permission to use a pack shot of Unilever’s product in their broadcast. Neither Marmite nor any other Unilever brand is aligned to any political party. Unilever are currently initiating injunction proceedings against the BNP to remove the Marmite jar from the online broadcast and prevent them from using it in future." Sexism in advertisements
The Campaign for a Commercial-Free Childhood criticized Unilever for the 2007 Axe marketing campaign, which they considered sexist. Unilever's response is that the Axe campaign is intended as a spoof and "not meant to be taken literally". Unilever has launched the Dove "Real Beauty" marketing campaign, which encouraged women to reject the underfed and hyper-sexualized images of modern advertising in 2007. Child labor
Hindustan Unilever has been accused of making use of child labour, among others. Relief support
On 15 January 2010, Unilever donated a $500,000 monetary donation to the victims of the devastating earthquake in Haiti, through its global partnership with the United Nations World Food Programme (WFP).
Material issues Sustainability is now central to Unilever’s business strategy. Sustainable sourcing of key agricultural raw materials and designing products for a resource-constrained world are critical to Unilever’s continued business growth and success. Unilever are embedding the management of sustainability issues within core business functions such as supply management, category management and marketing. Unilever’s activities and reporting focus on Unilever’s most significant or ‘material’ issues. Unilever define materiality by the degree to which an issue is aligned with Unilever’s business, brand portfolio angiography the extent of Unilever’s influence on the issue the potential impact on Unilever’s operations, Sourcing or consumers the importance of an issue to Unilever’s key stakeholders. This enables us to develop appropriate strategies and policies based on Unilever’s tracking of current and emerging trends.
Governance and management: Independent oversight: A Board committee of Non-Executive Directors– the Corporate Responsibility and Reputation Committee – is charged with ensuring that Unilever conduct Unilever’s business responsibly. It ensures that Unilever’s Code of Business Principles and Business Partner Code remain fit for
purpose and are properly applied. The Board’s Audit Committee considers the application of the Code of Business Principles as part of its remit to review risk management.
Governance of Unilever’s codes: The Corporate Responsibility and Reputation Committee is responsible for the oversight of both codes.
Executive management: The Unilever Executive, led by Unilever’s Chief Executive Officer, is responsible for implementation of the codes, supported by the Corporate Code Committee and Unilever’s global code compliance organization. The Executive is supported in matters of sustainability by Unilever’s Corporate Responsibility, Issues, Sustainability and Partnerships (CRISP) leadership team. External insights: Unilever’s strategy benefits from the insights of the Unilever Sustainable Development Group (USDG) – five external specialists in corporate responsibility and sustainability who guide and critique the development of Unilever’s strategy. To ensure alignment between these groups, both Unilever’s CRISP team and the USDG are chaired by a member of the Unilever Executive. Specialist input: Specialist teams within Unilever support this work, such as Unilever’s Environmental Impact Team, Unilever’s Safety and Environmental Assurance Centre, the Global Health Partnerships Group and the Sustainable Agriculture Steering Group. These teams also obtain external input, for example through the Sustainable Agriculture Advisory Board.
Responsible marketing
Unilever take a responsible approach to marketing and advertising. Unilever’s Food and Beverage Marketing Principles guide Unilever’s communication to consumers. They prohibit any advertising to children under the age of six and restrict advertising to children between the ages of six and 12 to products that meet strict nutritional criteria. The principles apply across all Unilever’s markets and Unilever are making progress in implementing them. Unilever have participated in industry-wide pledge son marketing to children in the EU, Canada, Mexico, Australia, Brazil, Russia, Thailand and the US. These pledges are in line with Unilever’s own commitments. Accurate health claims on products are essential to building consumer trust. Unilever’s process for reviewing and making claims ensures that they are based on rigorous scientific evidence. In 2009 the European Union formally approved two of Unilever’s claims. The first was that plant sterols, the active ingredient in Flora/Becel proactive products, are proven to lower blood cholesterol, and that high cholesterol is a risk factor in the development of coronary heart disease. Also approved was the claim that essential fatty acids are needed for children’s normal growth and development, enabling products such as Rama and Blue Band to reinforce this health message. However, Unilever did not gain approval for Unilever’s claim that black tea helps to focus attention. As the EU health claims process is new, Unilever are still learning the best way to provide claims evidence and plan to re-submit strengthened data. Unilever’s approach to sustainable packaging involves: •
considering the whole product, not just
The packaging •
adopting leading-edge design techniques
And choosing materials to minimize impacts •
working with others, through advocacy and
Partnerships, to strengthen the recycling and recovery infrastructure. This approach is underpinned by Unilever’s five principles: remove, reduce, reuse, renew and recycle. The environmental impacts of different materials vary significantly, so Unilever consider the impacts at each stage of the lifecycle. Unilever’s products reach consumers through a diverse network of retailers. Around a fifth of Unilever’s sales are channeled through ten major retail customers, such as Wal-Mart, Carrefour and Tesco. In developing and emerging markets
Unilever also rely heavily on distributors, wholesalers, small independent outlets and kiosks. In these markets, Unilever have found that Unilever can serve more consumers and increase Unilever’s market penetration through innovative distribution channels. Shakti in India is one such initiative. It is a micro-enterprise programme that creates opportunities for women to sell Unilever products door to door in rural areas. By the end of 2009, over 45,000 entrepreneurs were selling products to 3 million consumers in100,000 villages. Aparajita is a similar initiative running in Bangladesh, in partnership with CARE International. In 2009 3,000 women sold Unilever products to 1.8 million household sthrough sales hubs set up by CARE. In 2010,Unilever aim to increase this to 10,000 women covering a total of 6 million households. Similar initiatives also run in Sri Lanka, the Philippines and Vietnam.
Reformulating Unilever’s products Through Unilever’s Nutrition Enhancement Programme Unilever have reviewed the nutritional quality of Unilever’s portfolio of 30,000 products, equivalent to around 22,000 formulations, to make reductions in saturated and trans fat, sugar and salt. Over the past five years, this work has allowed us to make reductions in all these nutrients across the portfolio. Examples include in Brazil, Unilever’s soy-based drink brandies was reformulated to contain 36%less added sugar Hellmann’s/Calvé/Amora Light mayonnaises contain half the calories of the regular versions in Germany, calories in Rama soft margarine were reduced by more than 10%.In 2005, just over a third of Unilever’s products wherein line with internationally accepted guidelines for saturated and trans fat, sugar and salt. By the end of 2009, around 44% met these guidelines. Unilever will continue to explore further improvements. But Unilever recognize that having implemented the biggest and easiest changes, future reductions will be more difficult and in some cases are dependent on new technologies becoming available. Salt reduction It is estimated that reducing salt by as little1 g per day can reduce strokes by 5% and heart attacks by 3%. The World Health Organization recommends a daily in take of 5 g. In 2009 Unilever set product benchmarks to achieve a dietary intake of 6 g salt per day by the end of 2010, with the ambition to further reduce to 5 g salt per day by the end of 2015.Against Unilever’s mid-2009 baseline, 76% of Unilever’s portfolio met Unilever’s 2010 benchmarks. Unilever have made good progress, with salt content reduced by: 10-15% in powdered soups in Europe and South America since 2005 25% in Knorr Sidekicksside dishesin Canada25% across Unilever’s Knorr recipe kits in South Africa. In
making these changes, Unilever cannot lose sight of consumer taste preferences. Blind tasting shows that consumers often prefer well-salted products to those with reduced levels. If Unilever do not take consumers with us, they may switch to competitor products with a higher salt content. Gradual reductions may be one solution. In Israel, for example, Unilever have successfully reduced sodium content in Unilever’s products by 5-10% year on year since 2004.
Developing new products: Part of Unilever’s innovation efforts focus on products that make a positive contribution to people’s diets such as helping to reduce cholesterol or increasing the intake of important nutrients like calcium. Unilever’s R&D pipeline increasingly seeks specific nutritional or health benefits. For example, Hellmann’s Light and Extra Light mayonnaises use patented citrus fiber technology to give them a smooth and creamy taste with 60-90%less oil.
CONCLUSION:
Unilever know that if Unilever are to achieve their ambitious growth objectives Unilever must reduce the total environmental impact of the business. Our commitment extends right across our value chain – i.e. from the sourcing of raw materials through our own production and distribution to consumer use and eventual disposal of residual packaging. Unilever fully recognize that Unilever will need to develop a new model for business growth. Unilever are embarking on a long-term programme of work with our suppliers, customers and other partners to realize this goal. With our portfolio of strong brands, presence in emerging markets and long-standing commitment to shared value creation, Unilever believe Unilever are well placed to deliver on this ambition. Over 100 years ago, our founders not only created some of the world’s first consumer brands, they also built a business with strong values. Unilever have continued to update our vision as the world has changed. In the 1990s Unilever formally integrated sustainability factors into our strategy. Then, in 2005, Unilever started to embed this agenda into our product brands using a process called Brand Imprint. Since then Brand Imprints have been completed across all our product categories. Social and environmental considerations are now integrated into the innovation and development plans of our major brands. At the same time, Unilever are also evolving our approach to corporate branding. Unilever are starting to consider how they make Unilever’s corporate commitments and activities more visible and relevant to their consumers.
Reference: 1) Legal environment of Business, Ahamuduzzaman, Khan & Yazdani ISBN: 984300-002545-9
2) Business research Methods, William G. Zikmund, Eighth Edition, ISBN: 981243-143-8 3) Marketing Management, Kotler, Keller, koshy & jha, 13th Edition, ISBN: 978-81317-1683-0 4) Introduction To Business, Gareth R. Jones, ISBN: 978-007-125299-7 5) http://www.unilever.com/ 6) http://en.wikipedia.org/wiki/Unilever 7) http://www.unileverusa.com/sustainability/environment/ 8) http://www.unileverusa.com/sustainability/environment/ 9) http://www.fcsr.pl/fcsr_eng_nasipartnerzy_unilever.html 10) http://www.unilever.com/mediacentre/news/business-helps-kids-championenvironment.aspx 11) http://www.maplecroft.net/pdf/Unilever2004.pdf 12) www.google.com 13) http://www.unileverbestfoods.com/careers/meetourpeople/lifeatunilever/index.asp x?video=tcm13-138080 14) http://www.article13.com/A13_ContentList.asp? strAction=GetPublication&PNID=1359
