Covid has shown sustainable biz model is crucial for future growth: HUL CMD

The Covid-19 pandemic led disruptions have further reiterated the importance of an all-inclusive sustainable business model that can take care of the millions who have been left out, said Sanjiv Mehta, chairman and managing director, Hindustan Unilever.

Speaking at the foundation day ceremony of the All India Management Association (AIMA), Mehta called for an 'humane model of business' that has potential to insulate a large section of population that are on the verge of losing employment due to the technological changes about to unfold.

“Unilever has always been a believer in multiple stakeholders model and so am I. A human centric business achieves greater and lasting success. They adapt better in managing teams and retaining a diverse network of employees and remain innovative”, he said.

Millions have suffered financially due to the pandemic and it may continue to impact people with limited or no resources as the crisis has initiated many technological changes. According to Mehta, it is likely that millions more could lose current jobs due to new technologies. To mitigate the impact, Unliever has committed to reskilling and upskilling all its employees. It aims to help equip 10 million young people with essential skill sets to prepare them for job opportunities in the current decade.

“Develop a human centric organization. The economic fallout of the Covid-19 (pandemic) has exasperated severe inequalities across the world. A large section of the population has little or no saving, millions have faced devastation as unemployment and hunger rates have spiked throughout the crises. Despite the economic downturn the stock markets have surged. It is abundantly clear that there is a profound disconnect here.”, he said.

At a time when lack of sufficient income is haunting a large scale of the workforce – with many losing jobs and undergoing salary cuts – Unilever is focusing on providing enough income for sustenance to all its suppliers and partners. According to Mehta, instead of focusing on minimum wage, the fast moving consumer goods major has set a target of ensuring at least 'living wage' and not just minimum wage to everyone, who directly provide goods and services to the company, by 2030. “People need care and just a battle cry”, he said.

With vaccines rolling out, the firm is looking forward to re-engaging with all possible stakeholders. But uncertainties persist. “The world will be defined by a state of uncertainty and unease. We will have to steer our companies through the unknown. Transformation is hard work and not easy but in a world of unprecedented disruption, it is an imperative”, Mehta said referring to the need for changing tracks towards sustainable practises across all business verticals.

According to him, the current pandemic has shown that reversing unsustainable practises is now crucial for businesses to prosper. And Unilever is preparing to hit both the goals through an environment friendly business model that delivers superior value to its stakeholders.

“Unilever is challenging itself to higher standards like deforestation-free supply chain by 2023. We need to actively reverse the damage we have done over several decades. For example, Unilever has made sustainability a business goal. We are committed to net-zero emission from all our products by 2039 – from the sourcing of materials used up to the point of sale of products. Also to transition away from fossil fuel derived chemicals, clearing and laundry products by 2030. We are looking at new ways of reducing carbon footprint. In 2021-22, in India we will collect and process more plastic than we use in our packging”, he said.

To check natural disasters disrupt lives and economies, businesses will have to remain proactive. According to him, this crisis has shown the world has become fragile and unsustainable. “The existing crisis was predictable in many ways but the world was in denial. Years of unsustainable consumption has led to climate change and loss of biodiversity is at the root of this pandemic. New diseases are just the beginning. From coastal erosion to the decline of natural resources such as fisheries and forest, loss of nature carries a huge economic cost. While some may disagree it is imperative to save the natural world but there can be no disagreement on the economic imperative of doing so”.