Unilever 2007 Annual Report Download - page 65

Unilever Annual Report and Accounts 2007 63
Report of the Directors continued
Terms of reference
The Corporate Responsibility and Reputation Committee (CRRC)
comprises four independent Non-Executive Directors and one
Executive Director, the latter being the person who chairs
Unilever’s Corporate Responsibility Council.
In May 2007 three new independent members were appointed to
the Committee – Genevieve Berger, Narayana Murthy and Hixonia
Nyasulu. They replaced Antony Burgmans and Lynda Chalker who
retired. Wim Dik stood down from the Committee in September
2007. Leon Brittan replaced Lynda Chalker as Chairman of the
Committee and thanked departing members for their support and
the valuable insights they had contributed to the Group’s
thinking.
The Committee has responsibility for overseeing Unilever's
conduct as a responsible corporate citizen. It is also charged with
ensuring that Unilever’s reputation is protected and enhanced.
Inherent in this is the need to identify any external developments
which are likely to have an influence upon Unilever’s standing in
society and to bring these to the attention of the executive team.
One of the issues the Committee oversees is that of sustainable
development. In this capacity the Committee is building links with
the Unilever Sustainable Development Group (USDG) – a body of
five eminent people who advise on Unilever’s sustainability
strategy. To facilitate greater synergy between the two groups,
members of the CRRC share the briefings of the USDG and are
invited to join their meetings.
Full details of the Corporate Responsibility and Reputation
Committee’s terms of reference and details of the members of the
Unilever Sustainable Development Group are available at
www.unilever.com/investorcentre/corpgovernance
Meetings
Committee meetings are held quarterly. In 2007 the Committee
discussed a range of topics including Unilever’s Code of Business
Principles, human rights, its Business Partner Code and supplier
assurance, corporate responsibility strategy, reporting and
measurement. Further details of these discussions are set out
below.
Code of Business Principles
At its April meeting in Durban, the Committee discussed the
practices of Unilever South Africa in implementing and
communicating the Code of Business Principles. Committee
members commended Unilever on its thorough and rigorous
approach to procedures for upholding the principles and its
ongoing efforts to maintain awareness of the Code through
diverse communications channels.
Human rights
The Committee supported a review of Unilever’s approach to
human rights. The aim of the review was to ensure that Unilever
continues to live up to its ethical standards, as defined in the
Code of Business Principles, and that effective communications
and compliance mechanisms are in place. It concluded that
further training was needed and that clearer definition of the
various elements of human rights was required in order to
increase employee awareness and understanding.
Currently, compliance monitoring of Unilever’s human rights
obligations is delivered via the positive assurance process. The
review proposed that this should be complemented by a system
of continuous improvement (akin to the systems Unilever uses for
safety, health and environment), based primarily on self-
assessment at site level and supported by periodic external audits.
The self-assessment methodology is designed to be consistent
with that used to monitor suppliers’ compliance with our Business
Partner Code.
Business Partner Code
Unilever’s Business Partner Code is based on its Code of Business
Principles. It makes clear our expectations of suppliers in the areas
of health and safety at work, business integrity, labour standards,
consumer safety and the environment. Unilever’s supply
management is responsible for the roll-out of the Business Partner
Code and for gaining supplier assurance.
As these areas are of increasing concern to both manufacturers
and retailers, many companies are launching similar assurance
initiatives, leading to multiple demands on suppliers to provide
evidence of appropriate management policies and compliance
with recognised social, environmental and labour standards.
As both a customer and a supplier, Unilever has a clear interest in
avoiding this resource-intensive duplication of effort. To this end,
Unilever initiated a collaborative forum with peer fast-moving
consumer goods manufacturers to develop a common approach
to supplier evaluation through self-assessment and shared audit.
The Committee endorsed Unilever’s commitment to responsible
sourcing and offered suggestions to reinforce communication
around the Business Partner Code.
Corporate responsibility strategy
Committee members reviewed Unilever’s updated corporate
responsibility strategy, including its CO2reduction targets. The
importance of pursuing clear and realistic targets was
emphasised, along with the need to engage retail customers on
this agenda, which is becoming an increasingly important part of
their business activities. The Committee recommended that the
elements of the strategy be reflected clearly in Unilever’s next
sustainable development report. Members also studied the metrics
Unilever uses to measure progress in its corporate responsibility
initiatives and suggested ways in which these should be
reinforced.
As part of its watching brief on current issues of concern to
society, the Committee also received and commented on updates
on a range of issues, including Unilever’s approach to biofuels as a
source of renewable energy, carbon footprinting, marketing to
children, the use of ‘size zero’ models in advertising, sustainable
sourcing of tea, packaging, and feedback on Unilever’s
participation in the World Economic Forum at Davos.
Board assessment of the Committee
The Board evaluated the performance of the Committee and the
Committee carried out a self assessment of its performance.
More information about Unilever’s corporate responsibility
initiatives is available at www.unilever.com
Leon Brittan Chairman of the Corporate Responsibility and
Reputation Committee
Genevieve Berger
Narayana Murthy
Hixonia Nyasulu
Ralph Kugler Executive Director
Report of the Corporate Responsibility and Reputation Committee