Unilever 2010 Annual Report Download - page 9

6 Unilever Annual Report and Accounts 2010
Chief Executive Officer’sreview
2010 was a very positive year for Unilever, both in terms ofresults
and also in our continuing transformation to a business that delivers
consistent top and bottom linegrowth.
Report of the Directors About Unilever
321
Slow economic growth in 2010, food
price volatility and geopolitical instability
remind us that we live in challenging
times. We expect economic recovery
tobe protracted and uneven. All except
emerging markets remain sluggish and
consumer spending continues to be held
back by high levels of personal debt and
fear of continuing unemployment.
Despite this backdrop, we achieved
volume growth of 5.8% in 2010,
significantly higher than growth in the
previous yearand Unilever’s best volume
growth performance for more than 30
years. Growth was both competitive –
wegained market share in many of our
leading categories – and profitable, with
asteady improvement in underlying
operating margin. The emerging markets
– now 53% of our total business –
continue to be our growth engine. We
are also encouraged that our Western
European business returned to volume
growth in 2010.
In this environment, as well as
improvingefficiencies, we continue to
take a long-term view of our business
byinvesting in our people and our
brands,strengthening our portfolio
andbuilding innovation and
R&Dcapabilities.
We expanded our underlying operating
margins again, by 20bps, and generated
strong free cash flow at €3.4 billion.
Wedelivered savings of €1.4billion and
maintained negative working capital at
closeto best-in-class levels. These were
significant achievements.
During the year we also launched an
audacious plan to meet our energising
vision of doubling the size of the company
while reducing the overall impact on the
environment. In an increasingly resource-
constrained world, this decoupling of
growth from the impact onthe planet is
thegrowth model thatconsumers will
ultimately demand.
In addition to halving our overall
environmental impact, the Unilever
Sustainable Living Plan (the Plan) commits
us tohelping more than a billion people to
improve their health and well-being and to
sourcing 100% of our agriculturally-based
materials sustainably. We will achieve this
across the whole value chain, with specific,
time-bound commitments and with the
active participation of many partners.
These are not acts of charity or a tick inthe
box for corporate responsibility. ThePlan
makes sound business sense. Asan integral
part of our business model, it will enable us
to accelerate innovation, ensure security of
resources, reduce overall costs and build
sustainability intoour brand propositions,
ultimately winning consumerpreference
and loyaltywell intothe future.
Meeting our growth ambition also
requires usto stick to our strategy. This is
set out in ‘the Compass’, which is based
on winning in four key areas.
Winning with brands and innovation
Brands and innovation are the lifeblood of
our business, which is why strengthening
brand equities and building a pipeline
ofbigger and better innovations, rolled
Unilever Executive (UEx)
Paul Polman – Chief Executive Officer (pictured above)
1. Doug Baillie – Chief Human Resources Officer
2. Professor Geneviève Berger – Chief Research
&Development Officer
3. Jean-Marc Huët – Chief Financial Officer
4. Dave Lewis – President Americas
5. Harish Manwani – President Asia Africa CEE
6. Michael Polk – President Global Foods,
Home&Personal Care
7. Pier Luigi Sigismondi – Chief Supply Chain Officer
8. Keith Weed – Chief Marketing and
CommunicationOfficer
9. Jan Zijderveld – President Western Europe
For UEx biographies please go to page 40