Unilever Should Know That Purpose Isn’t Strategy
The consumer goods group wants all its brands to convey a broad benefit to society. That may be shrewd marketing — but is it a corporate strategy?
Unilever’s purpose-led strategy. Clever marketing? Or greenwashing?
Photographer: JASON ALDENPugnacious Terry Smith is throwing punches again. The Mauritius-based fund manager has lambasted consumer-goods giant Unilever Plc for its public posturing. It’s not just that autonomous subsidiary Ben & Jerry’s is to stop selling ice-cream in Jewish West Bank settlements and areas of east Jerusalem. “More ludicrous,” Smith says, is the company’s attempt to define the purpose of Hellmann’s mayonnaise. Isn’t the answer salads and sandwiches? Not for Unilever Chief Executive Alan Jope, who expects his condiments to serve a higher societal purpose.
You can see why investors are concerned. Paul Polman, Jope’s predecessor, became big business’s chief advocate for sustainability. Under his leadership, Unilever’s performance was so lackluster that the company attracted an unwanted bid from Kraft Heinz Co. The takeover failed but identified a vulnerability — the perception among shareholders that purpose had gotten the better of profit.