Unilever exec, Marketing & Advertising News, ET BrandEquity

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Unilever says on its website that its 400 brands are “on a global mission to do good.” Many support social or environmental causes, such as recycling plastics in the case of Hellmann’s mayonnaise.

Activist investor Nelson Peltz is “supporting” a plan by consumer goods maker Unilever to decarbonise its five newly created business units, as part of its sustainability strategy, a Unilever executive told Reuters.

Earlier this year, the maker of Knorr bouillon cubes and Magnum ice cream criticized the importance it places on the social purpose of brands. It has set itself a goal of net zero emissions by 2039.

Analysts said backing from Peltz, who joined Unilever’s board in July, will make it easier to continue the strategy. The investor, whose hedge fund Trian has built a roughly 1.5% stake, has a track record of building stakes in consumer-focused companies and influencing strategy.

“He (Peltz) and the rest of the board are very supportive of the work we’re doing,” Rebecca Marmot, Unilever’s chief sustainability officer, told Reuters.

Trian declined to comment.

In May, Trian said he would work with Unilever’s management and board “to help drive Unilever’s strategy, operations, sustainability and shareholder value for the benefit of all stakeholders”. .

The hedge fund supports sustainable investing and believes that “consideration of ESG (environment, social and governance) factors improves our overall investment process” and “can encourage portfolio companies to implement initiatives related to ESG,” according to its website.

Unilever says on its website that its 400 brands are “on a global mission to do good.” Many support social or environmental causes, such as recycling plastics in the case of Hellmann’s mayonnaise.

Not all investors were supportive.

Terry Smith, who owns around 0.85% of the company’s shares through his Fundsmith vehicle, in January accused Unilever of being “obsessed with displaying its sustainability credentials publicly at the expense of a focus on business fundamentals.

Smith declined to comment for this story.

MAJOR INVESTORS

Marmot, who has been in the role for more than three years, has spoken to more investors than before. Where previously she was primarily aimed at “specialty” sustainability investors, she now enters “a lot of conversations with BlackRock and all the major investors”.

Shares of Unilever have underperformed rivals including Procter & Gamble and Nestle over the past year, reflecting what one investor called “low sales growth due to their portfolio mix”. Unilever has come under fire for retaining some brands that have seen slow growth in recent years, particularly in its food business.

Asked what she thinks of investors who want Unilever to focus less on sustainability, Marmot replied: “Well everyone is entitled to their own opinion…that’s a strange approach to say that we are doing too much.

“We are now going through the process – and it is an ongoing project that I am working on at the moment – ​​of establishing a decarbonization plan for each of our five business groups,” she added.

The five business groups are Beauty & Wellbeing, Personal Care, Home Care, Nutrition and Ice Cream.

Marmot said the process – which the board supports “100%” – would affect the way Unilever runs its factories, develops products in R&D and works with its suppliers.

Meanwhile, shareholders are paying attention to increased scrutiny from financial watchdogs in the United States and Europe on how companies report on their impact on the environment and on societies around the world.

“Companies that act ethically tend to generate shareholder returns over the long term and that’s primarily what concerns me,” said Jack Martin, fund manager at investor Oberon Investments.

“They make a lot of goods, so if they can reduce their carbon footprint and be more sustainable, I think the stock will trade at a premium.”

UPro will also launch a digital distribution channel through its website to reach small operators in India.

On July 5, Ben & Jerry’s sued Unilever, owner of the Burlington, Vermont-based company, to try to prevent the sale of its Israel business to local licensee Avi Zinger.

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