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Meet Paul Polman: the “stand-out CEO” transforming the world’s food systems
When Paul Polman took over as chief executive of food-giant Unilever at the end of 2008, the company needed a radical overhaul. Global food systems had come to epitomise the broken nature of our WILD (Wasteful, Idle, Lopsided and Dirty) economy, with around one third of all food produced going to waste, farmers kept poor and huge sections of the global population undernourished (even as many millions suffered health complications due to excess consumption).
“I could not think of a more broken system than our food system,” Polman says. “We can’t have unlimited growth on a finite planet, and anything you can’t do forever is by definition unsustainable.”
Polman immediately set about transforming the company, turning Unilever into a beacon of change across the food industry, and building-in resilience against the impacts of climate change. It proved a far-sighted decision, with Unilever seeing strong return on its investment in sustainability. It’s a process that Polman says other companies must engage in if they are to avoid “the graveyard of dinosaurs”.
Sustainability brings growth
“At the time, we were probably already the best in the industry for sustainable sourcing,” Polman says. “We had created the roundtable for sustainable palm oil, the roundtable for sustainable soy, the marine stewardship for sustainable fisheries. But, despite that, only 10% of our products were sustainably sourced. So, we set ourselves an objective of having 100% sustainably sourced [production] – of decoupling our growth from environmental impact.”
This ambitious commitment was backed by social pledges. Five million jobs were created for small-holder farmers, living wages were brought in, human rights standards were adhered to, and gender parity was achieved across the value chain.
The result? “What we found was because we increasingly moved to sustainable sourcing, our value chain is actually more resilient,” Polman says. “Some of the Unilever brands that have taken on this higher purpose of reducing food waste, or helping farmers create livelihoods, or protecting our biodiversity, these brands are growing faster and are more profitable.”
Polman estimates that for every dollar Unilever invested in transitioning towards sustainable food production, the company saw a USD 15 to USD 18 return. Shareholders also felt the benefit, with a 300% return over the decade Polman was in charge.
A lifetime of commitment
Paul Polman’s turnaround of Unilever’s fortunes saw him labelled “stand-out CEO of the past decade” by the Financial Times. His shift to sustainable models is testament to his belief that in a world of finite resources there is no growth without sustainability, and that businesses should be a social force for good.
In 2015, Polman co-authored the UN’s Sustainable Development Goals. Since then, he has worked with companies to push the 2030 development agenda, a set of targets for governments to make the world a better place.
After stepping down as CEO of Unilever in 2019, Polman released his first book – “Net Positive: How Courageous Companies Thrive By Giving More Than They Take”. In it, he outlines the secrets to Unilever’s success, and argues that in the years to come the companies that prosper will be those that contribute to social equality and to tackling the climate challenge.
A threat to the planet
Paul Polman’s foresight was in recognising early that in order for businesses to succeed for the long-term, corporate sustainability is a necessity not a luxury. He was also quick to recognise that global food systems had come to be a threat to both planetary and human health.
The shift towards sustainable production is one part of the essential transformation of food systems that must take place if we are to sustainably feed a global population projected to reach 10 billion by 2050. To achieve this, regenerative farming techniques must combine with new farming technology, new distribution models, and a widespread change in diets. A sharp reduction in meat consumption will lead to smaller food-related greenhouse gas emissions and smaller land and water footprints.
It’s a shift that needs to come sooner rather than later. Of the nine planetary boundaries that regulate the stability and resilience of the earth’s system, four have already been crossed, and those that remain are coming under growing pressure.
A brighter future
There are, however, many reasons for hope. Within food systems a growing consumer interest in sustainability is being seen in the growth of the “alternative proteins” market. Plant-based “fake meat” – plant-based products made to be near indistinguishable from meat – are now a staple of supermarket shelves. And cultivated, or lab-grown, meat is expected to hit price parity with traditionally raised meat by 2040 at the latest, giving consumers a way to eat meat with minimal environmental impact.
Paul Polman believes that new technologies will be a key factor in transforming both food systems and the wider economy, and that young people will be a driving force behind the change.
“I’m hopeful because of the technology that develops, and because of the young people and their passion and their purpose. A lot of money will be transferred to the next generation, and the Gen Zs and millennials are definitely more engaged and looking for solutions, and also more willing to change their habits.”
Hope comes, too, in the straightforward choice now facing businesses.
“I think more people are starting to realise that the cost of not acting is higher than the cost of acting,” Polman says. “Now the only way to get a long-term decent return is to get your business to move in a more sustainable, equitable direction. The companies that are doing that are positioning themselves very well for the future. The companies that don’t are increasingly heading for the graveyard of dinosaurs, and that is not where you want to be.”
Important information
This document is issued by Bank Lombard Odier & Co Ltd or an entity of the Group (hereinafter “Lombard Odier”). It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a document. This document was not prepared by the Financial Research Department of Lombard Odier.
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