Unilever saved €1.2 billion of cost due to sustainable sourcing, eco-efficiencies at factories

As a growing number of investors focus on ESG performance, Hindustan Unilever Limited's performance has demonstrated that a sustainability strategy contributes to long-term financial success and company growth. 

Unilever claims its purpose-led brands have been growing twice as fast as the rest of our portfolio. Willem Uijen, Head - Supply Chain, Unilever - South Asia, ANZ, Indonesia, Philippines, SEAT and Vietnam told Business Today, "globally, we have saved €1.2 billion of cost as a result of sustainable sourcing and eco-efficiencies in our factories." 

In May 2021, Unilever had put its Climate Transition Action Plan to a shareholder vote at its Annual General Meeting and over 99% of shareholders voted in favour of the plan to reduce greenhouse gas emissions across the company's supply chain to net-zero by 2039.

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Commenting on how India's top listed companies can contribute towards India's commitment toward climate, Uijen says, "the race to net-zero carbon emissions is picking up pace. Businesses are realising the advantages of getting ahead and the risks of being left behind. Businesses must be part of the solution. Companies should pledge and plan emission reductions drastically and transition to renewable energy to meet their energy requirements. The only way to avoid the worst possible climate outcomes is for everyone to accelerate their efforts now."

As most of the companies are putting in efforts towards adopting renewable energy, energy efficiency and recycling waste, HUL is doing a bit more. 

The FMCG giant has set 1.5?C aligned science-based targets to deliver zero emissions operations by 2030, to halve the lifecycle footprint of its products across the value chain by 2030, and to achieve net-zero emissions across its value chain by 2039. 

"We are also transitioning away from fossil fuel-derived chemicals in our cleaning and laundry products, unlocking new ways of reducing our carbon footprint. The key component of this strategy is the Carbon Rainbow, which replaces black carbon (fossil fuel) with carbon from different sources such as green (plant), purple (atmosphere carbon dioxide capture) and blue (marine)," adds Uijen.
 
But HUL's initiatives go beyond this. The company has been focusing on the key areas including water, plastic waste management and sustainable sourcing. 

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As climate change is projected to further increase water insecurity, HUL through its Hindustan Unilever Foundation (HUF) has created a cumulative water conservation potential of about 1.3 trillion litres of water across India through improved supply and demand water management and supports grassroots level interventions in more than 11,500 villages across 59 districts in 10 states and 2 union territories with almost 20 NGO partners. 

Its manufacturing operations have also reduced water consumption (in m3/tonne of production) by 54% against the 2008 baseline.

"We're cutting plastic waste by using less plastic, better plastic or no plastic at all, to transition to a circular economy. Since 2018, we have facilitated the safe disposal of more than 150,000 tons of post-consumer use plastic waste with the help of collection and disposal partners across India. This year we are taking a big step by collecting and disposing of more plastic waste than the plastic we use in the packaging of our finished products," says Uijen. 

Additionally, in partnership with Xynteo, HUL has also developed a school curriculum called 'Waste No More' aimed at creating awareness on waste management and reached out to 200,000 students.
 
Another important focus area is sustainable sourcing, where HUL has been working within the business and with external partners to eliminate deforestation from the supply chain, support human rights and tackle climate change. 

In 2020, 93% of tomatoes used in Kissan ketchup continued to be sourced sustainably and over 67% of tea in India procured for Unilever brands was sourced from sustainable sources.