Why doing good is good for business

“It was the best of times, it was the worst of times.” These words from the opening lines of Charles Dickens’ A Tale of Two Cities, inspired a presentation from Unilever’s President of Europe, Jan Zijderveld to the Kerridge & Partners 2017 Leadership Conference.

The world is on the move and businesses should be at the helm, said Zijderveld by video link from the Netherlands, to an audience of more than one hundred of New Zealand’s top leaders. Amidst the massive change and disruption that businesses face today, sustainability is fast becoming a common thread.  This is driven by the appreciation that we are consuming the planet’s resources much faster than they can be replaced, and the growing demands and expectations of today’s consumers that businesses need to be responsible and ethical.

“There has never been a better time to make a difference, but what can businesses do to be more sustainable?” he asked.  Zijderveld has been credited with re-energising the 53bn Euro ($93bn) conglomerate’s business in Europe, driven by a strong conviction that businesses need to understand and better serve the needs of communities.

Unilever has a proud history of looking after its workers and their communities, dating back 130 years. The Anglo-Dutch company now operates in 190 markets and has 169,000 employees worldwide, but its founders built up the business producing products such as Sunlight Soap, to make hygiene more accessible and Blue Band margarine to make a difference to the everyday diet of working people.  The ultimate expression of company paternalism was the creation of Port Sunlight – a village in the North West of England – named after the soap.  It was built by the Lever Brothers (later part of Unilever) to accommodate soap factory workers. Now a conservation area, the village has 800 houses, a hospital, schools, a concert hall, open-air swimming pool and the impressive Lady Lever Art Gallery.

Zijderveld said: “Everything big like this starts small. Unilever did not start out as a 53bn Euro company. It became big because of success, and more consumers buy if you are relevant. Doing well by doing good starts with you. Privileges come with responsibilities. Our aim is to try to mobilise the world big or small, to reach a ‘tipping point’”. He quoted the late Sumantra Ghoshal, founding Dean of the Indian School of Business, Hyderabad: “Leaders are not paid to preside over the inevitable, they are paid to make happen what otherwise would not have happened.”

Unilever’s sustainability plan began eight years ago and the move has had lasting effects.  Today, 31.6% of its total energy comes from renewable sources, which means less risk to the business, its ‘Sustainable Living’ brands grew 50% faster than the rest of the business and other sustainability initiatives have saved 700m Euros in costs since 2008.

Unilever buys one company a week and it is discovering that the most successful ones are those with sustainable practices as part of their DNA. These may be small companies, but they have a clear purpose at their core and they are all about honesty, integrity and treating people with respect. According to Zijderveld, “you should be able to write down what a company believes in without having to refer to the brochure. As leaders, we need to tell stories of what we believe in.”

Zijderveld added that partnerships with downstream businesses could make the sustainability journey more achievable and that New Zealand could play a unique role. “We have to get into partnerships because we cannot address it alone,” he said. “NZ has a unique role to play and could position itself in the world as a sustainable country. Exports and tourism are based on a clean, green image, and we need to make sure we deliver on that promise.”

Jan Zijderveld is a graduate of the University of Waikato. He spent his formative years in New Zealand and still has close family ties here.

We congratulate Jan, who was named global CEO of Avon Products Inc on 5 Feb 2018