Unilever’s Partner to Win Program Motivates Sustainability Among Suppliers
Based in London and one of the largest multinational companies on the planet, Unilever produces a vast array of consumer goods and is behind some of the world’s most recognizable brands: Lipton, Vaseline, Dove and Hellmann’s. It has operations in more than 100 countries and sales in 190 nations, where consumers buy 170 billion units of its products every year. The company has more than 171,000 employees.
But in addition to its size, Unilever has proven to be a responsible corporate leader. In 2011, research firm GlobeScan and think tank SustainAbility jointly rated Unilever number one on their list of Global Corporate Sustainability Leaders, and the FTSE4 Good Index Series gave Unilever a top environmental rating of 5.
As part of its commitment to protecting the planet, Unilever in 2011 initiated the Partner to Win program, designed to encourage its suppliers and partners to “double the size of their business while reducing the environmental impact.”
Recently, the company announced its second annual Partner to Win honorees, giving its suppliers a coveted stamp of approval.
Including Winning Through Sustainability, Unilever granted awards in the following categories: Winning Through Innovation, Winning Through Capacity and Capability Development, Winning Through Business Integration and Winning Through World Class Enterprise Support.
In an interview with Flip Dötsch, Unilever’s corporate media relations manager, he said, “Partner to Win is our way of working with our suppliers and our concept of building value relationships with selected key suppliers in order to achieve mutual growth for both partners. In cases where we can capitalize on our common strengths and capabilities, we will formalize those aspirations in a Joint Business Development Plan.”
Dötsch explained that in 2011, Unilever’s suppliers invested an estimated 1.3 billion euro ($1.62 billion) in additional industrial capacity to support growth. He said nominees for the Partner to Win awards have come from the annual Supplier Summit that Unilever holds; companies are asked to submit their success stories to Unilever in the five categories.
In the area of Winning Through Sustainability, the consumer-goods giant “recognizes suppliers that have made an outstanding contribution to Unilever’s sustainability agenda, with particular emphasis on the delivery of sustainable sourcing. This includes suppliers that have worked to deliver the triple bottom line of people, planet and profit through social, economic and environmental activities, resulting in a positive impact on customers, consumers, the market or industry.”
Unilever Supplier Metsä Board
Wins Award for Packaging Board
One of this year’s winners in the sustainability category was Metsä Board, a company based in Finland that has become Europe’s leading producer of “fresh forest [fiber] cartonboards.” Unilever gave its Partner to Win award to Metsä Board for its development of lightweight and sustainable products and its significant contribution to Unilever’s consumer-goods packaging.
In a statement, Metsä Board’s senior vice president and head of paperboard, Pasi Piiparinen, said, “Using a lighter-weight board can reduce the carbon footprint of a carton significantly. “When scaled up across a wide range of fast-moving consumer goods products, with global distribution, the potential for reducing environmental impact is quite dramatic.”
I reached Piiparinen about the award and his company’s plans for the future.
“We are delighted with the award and see it as high recognition of the work we have done to develop lightweight boards, as well as our progress in many different fields of sustainability across the whole Metsä Group,” said Piiparinen.
Metsä Board’s primary business areas are high-performance paperboard and paper for consumer and retail packaging, graphics and office end-uses. The company’s paperboard is mainly used for the packaging of beauty-care and health products, food, cigarettes and consumer durables.
Piiparinen explained that the lightweighting of product packaging saves packaging material, which in turn means significant annual cost savings as well as less waste at the end of the packaging value chain. “Metsä Board’s lightweight boards have been developed for many years now, and the work continues,” Piiparinen said. “The lighweighting is made possible by the use of fresh forest fibers as well as the technology and know-how that we have in use. The strength properties of our lightweight boards are not compromised — they provide the requisite thickness and stiffness at lower basis weights.”
He continued, “The wood we use is sourced from sustainably managed forests. Wood is a renewable raw material, and our boards can be recycled, incinerated for energy or composted at the end of the life cycle. Our boards comply with international safety standards, and all raw materials are traceable.”
Metsä Board is part of the Metsä Group, a forest industry group whose sales totaled $7 billion in 2011 and employees number 12,500, conducting business in 30 countries.
I asked Piiparinen about his company’s future plans, and he told me about an ambitious project in Finland. “Metsä Board is taking part in a project to build a bio power plant next to our mill in Kyröskoski,” he said. “The plant will reduce yearly emission of carbon dioxide by approximately 100,000 tons, which equals the annual emissions of about 60,000 cars.”
“Also, the work to make our boards even lighter continues, as we look at our energy efficiency on a continuous basis.”
Unilever Highlights Its Green Progress
Dötsch is firmly aware of Metsä Board’s role in helping Unilever grow sustainably. “By producing stronger, lighter-weight and sustainable packaging, it helps us to reduce [carbon dioxide emissions] from production and transport,” he said. “It also helps with our commitment to source 75 percent of the paper and board for our packaging from certified sustainably managed forests or from recycled material by 2015, reaching 100 percent by 2020.”
He talked more about Unilever’s goal of sustainably sourcing all of its raw agricultural materials by 2020, which seems an ambitious goal. But he was bullish. “We have made good progress on our top 10 ingredients, which account for two-thirds of our agricultural volumes. In 2011, 24 percent of our agricultural raw materials were sustainably sourced, up from 14 percent in 2010,” he noted.
Dötsch highlighted some areas of Unilever’s materials supply chain where the company has made the most progress:
- Palm oil. Unilever will make 64 percent of its palm oil purchases from sustainable sources by end 2011, compared to 37 percent in 2010. The firm will reach 100 percent by end of 2012 and announced a new target (see press release).
- Paper and board. An estimated 60 percent of the material the company uses comes from certified sustainably managed forests or from recycled material.
- Tea. Twenty-eight percent of the tea the company purchases is from Rainforest Alliance-certified farms.
- Food. A quarter of the herbs and vegetables in Unilever’s supply chain is from sustainable sources (self-verified against the Unilever Sustainable Agriculture Code).
Unilever’s other sustainability honorees in Partner to Win are the Kenya Tea Development Co., for its sustainable agriculture practices, and Agraz, a Spain-based multinational tomato producer that embraced sustainability throughout its business.
In speaking with Green & Clean, Dötsch emphasized the importance of Unilever’s suppliers, not just for growth but for innovation. Said Dötsch: “Half of Unilever’s innovation pipeline now comes from our suppliers. From last year’s Supplier Summit alone, more than 250 innovation ideas were taken into joint development programs. This demonstrates the strength and commitment of our partnerships and the progress we are making.”
Unilever has recently made inroads in China. According to an article in the China Daily newspaper, the company is teaming up with another consumer-goods giant, Procter & Gamble, to build a new toothpaste plant in the Anhui province. The plant will be located in Unilever’s Hefei industrial park/production base and will cover an area of 118,400 square feet.
And while that’s clearly an economic move, there are environmental ones, too. Unilever has invested more than 14 million yuan ($2.2 million) in wastewater recycling facilities at Hefei.
With this project, 1,300 tons of reclaimed water can be processed every day, savings 23 tons of water per year. In addition to the water recycling project, Unilever has introduced a biomass furnace that can potentially reduce greenhouse gas emissions by 15,000 tons annually.
So clearly, Unilever is a company that takes its position as a global sustainably leader seriously.