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21
Unilever Annual Report and Accounts 2012 Report of the Directors About Unilever
ABOUT UNILEVER GOVERNANCE FINANCIAL STATEMENTS SHAREHOLDER INFORMATION
TAKIN PALM OIL IN HAND
In 2012, three years ahead of schedule, we succeeded
in sourcing 100% of our palm oil sustainably. We’re
one of the largest buyers in the world, purchasing
some 3% of the total volume produced.
Importantly, this is just the beginning. We also want
to know exactly where it comes from, so we’re now
aiming to purchase entirely from traceable certified
sources by 2020, which means we’ll be able to track
every tonne back to the certified plantation where it
was grown. We’ll be helped in this by our €69 million
investment in a new palm kernel oil processing plant
in Indonesia, which will bring us closer to the source.
We are also actively considering similar joint venture
investments in processing crude palm oil derivatives
in South East Asia, India and West Africa.
TIME FOR TEA
As part of our plan to
source tea sustainably,
for the last six years we’ve
worked with the Kenya Tea
Development Agency to
educate its smallholder
farmers about sustainable
cultivation and Rainforest
Alliance certification.
And it’s working – many
certified tea farmers are
now achieving higher yields.
Globally our programmes
have contributed to
training 450,000
smallholder farmers.
SUPPLIER OF
THE YEAR
In the UK, our supply
chain dramatically
improved customer
service through closer
customer collaboration,
a new planning process
and a more responsive
sourcing network.
We were named the top
multi-category supplier
in the Advantage Group
Survey and supplier of
the year by the major
retailers including Asda,
Sainsbury’s and Boots.
OUR SUPPLIERS TO FIND OUT HOW WE PARTNER WITH SUPPLIERS TO MEET CONSUMERS’
AND CUSTOMERS’ NEEDS GO TO WWW.UNILEVER.COM/ABOUTUS/SUPPLIER.
Our contnuous mprovement programme
ams to delver sustanable, proftable
growth by seekng to add value at every
step n the value chan by enhancng
product qualty and customer servce,
and rollng out nnovatons faster Ths
approach, combned wth our global scale,
generates sgnfcant savngs that we
nvest back nto our brands and factores
to fuel growth and fulfl our ambton
to reach more consumers It’s also
helpng us create new ways to source,
manufacture and delver our products
more sustanably
Leveragng entre value chan
Leveragng entre value chan
By working across the entire value
chain – from sourcing, manufacturing
and logistics through to innovation,
advertising and promotions, and pricing
– we can use our global scale to add
value, reach new markets and meet
our sustainability targets.
Workng wth global scale and local aglty
Our procurement organisation now buys
the majority of all materials and services
centrally – some €35 billion in 2012.
This scale improves our buying efficiency
and has made a considerable contribution
towards our €1.4 billion supply chain
savings, double what we saved in 2007.
When it comes to production, our
philosophy of ‘design once, deploy
everywhere’, enables us to maximise
our global scale. This ensures our
world-class manufacturing network of
over 250 factories delivers higher quality
products and faster global innovation
roll-outs. In 2012, we also increased
cross-border sourcing by investing in
large regional or global manufacturing
bases, making better use of our capital.
Our global logistics network transports
our finished goods over 1.5 billion
kilometres each year. This scale enables
us to have global and regional distribution
hubs, improving operational efficiency
significantly and reducing vehicle
kilometres by 175 million over the next
three years in Europe alone – cutting costs
and emissions while improving service.
Drvng return on marketng and
captal nvestment
Completing the value chain picture,
we focused on getting the best return
on marketing investment for every brand
in every category, spending €6.8 billion
on advertising and promotion in 2012.
We reviewed our approach to marketing
through our ‘Crafting Brands for Life’
programme, placing an emphasis on
learning through continuous improvement.
By focusing on creating fewer but better
advertisements, and using them in more
places, we drove down advertising
production and fees globally, reducing
our overall spend by over €41 million. Our
return on marketing investment delivered
over €175 million in savings in 2012, vital
to fund our marketing programmes.
Unlever Annual Report and Accounts 2012
 14 bllon
in supply chain savings in 2012
39%
of all tea sourced comes from farms
certified by the Rainforest Alliance