Unilever procurement helps with sustainability objective

27 June 2012

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27 June 2012 | Rebecca Ellinor

Procurement and supply chain professionals at Unilever are helping the company achieve an ambitious long-term objective to double in size while reducing its environmental impact.

Pier Luigi Sigismondi, the fast-moving consumer goods company’s chief supply chain officer, says in an interview with CPO Agenda magazine that given the WWF estimates that people are currently using 1.5 planets in terms of consumption of resources, doing nothing is not an option.

“There is no way that businesses can sustain themselves for the next 20, 30, 40 years if they don’t change the way they operate. That’s why the Unilever Sustainable Living Plan is a way for us to do business.”

Last month, Unilever invited 160 strategic suppliers to meet senior managers from across the organisation. The purpose of the event was to get vendors together, present future business plans, enable them to seek and share ideas, and reward them for the efforts of the previous 12 months. The same event in 2011 generated more than 250 ideas for innovations that are being taken forward.

“We used to be very opportunistic, transactional buyers, shifting from one supplier to another to leverage a lower price; now it is different,” says Sigismondi. “We are defining business plans and looking for ways to have those long-term relationships, so suppliers come to us in a structured way to provide ideas about how to reduce cost. We also share our business plans with them so they know where to invest and become more competitive in the long term.

“For example, we have packaging suppliers that have come to us with opportunities to reduce the resin content of our packaging by as much as 30-50 per cent. That obviously has a great impact, or rather a reduced impact, on the environment and at the same time it comes in at a much lower cost, which makes it more affordable for consumers so they can buy more and we can grow sustainably.”

Significant changes have come about at Unilever since Paul Polman became CEO in January 2009. Sigismondi became a member of the Unilever executive in September that year.

Last month, the company was placed in the top 10 of the Gartner Supply Chain Top 25 for 2012.  It was the highest-placed company in the rankings to be headquartered in Europe and it was the first time Unilever has appeared in the top 10.

Click here to read the full interview.

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