Unilever shareholders to vote on climate transition action plan
14 Dec 2020 --- Unilever is planning to put its climate transition action plan before shareholders and seek a non-binding advisory vote on its emissions reduction targets and the strategies to achieve them.
This is understood to be the first time a major global company has voluntarily committed to putting its climate transition plans before a shareholder vote.
It closely follows Unilever setting a global sales target to net €1 billion (US$1.2 billion) from plant-based meat and dairy alternatives within the next five to seven years.
Plant-based offerings for climate neutrality
Unilever’s plan sets out the multinationals’ climate strategy to reduce emissions within its operations, through its value chain. It further aims to outline how the the risks are managed, how it meets consumer needs connected with climate change and the societal responses to it.
The aim is to roll out The Vegetarian Butcher brand and ramp up vegan alternatives from brands including Hellmann’s, Magnum and Wall’s.
The target is part of Unilever’s Future Foods ambition, which has two key objectives: to help people transition toward healthier diets and help reduce the global food chain’s environmental impact.
Could other companies follow suit?
Unilever believes that the economy-wide shift to net-zero emissions will require a more significant and more profound engagement level between companies and their investors about their climate transition plans.
Unilever recently set a global sales target to net €1 billion (US$1.2 billion) from plant-based meat and dairy alternatives within the next five to seven years.It is unusual to ask board members to vote on such an issue as climate change, and Unilever’s plan could inspire other businesses to do the same in a bid to boost transparency.
“In setting out our plan, we hope this increased level of transparency and accountability will strengthen the dialogue with our shareholders and encourage other companies to follow suit,” says the company.
Unilever’s science-based targets include zero emissions from its operations by 2030 and a 50 percent reduction in its products’ average footprint by 2030.
In June, Unilever announced a new net-zero target of net-zero emissions from sourcing to the point of sale by 2039.
How will targets be achieved?
Achieving these targets will require a range of measures. These include decarbonizing the raw materials Unilever sources, completing the transition of its operations to 100 percent renewable energy, and advocating for the global energy grid’s accelerated decarbonization.
It will also need to eliminate deforestation from its supply chain.
In addition, to achieve its net-zero by 2039 target, Unilever will require high-quality carbon removal credits to balance any residual emissions from sourcing to the point of sale.
Increasing transparency
“Climate change is the most pressing issue of our time, and we are determined to play a leadership role in accelerating the transition to a zero-carbon economy,” says Alan Jope, Unilever CEO.
“We have a wide-ranging and ambitious set of climate commitments – but we know they are only as good as our delivery against them. That’s why we will be sharing more detail with our shareholders who are increasingly wanting to understand more about our strategy and plans.”
“We welcome this increased transparency, and in the plan we present, we will be clear both about the areas in our direct control where we have a high degree of certainty of our route to net-zero, as well as more challenging areas across our value chain where systemic solutions will be required to achieve our targets.”
“Transparency Triumphs” was recently crowned Innova Market Insights’ Top Trend for 2021, highlighting industry’s push toward more visible reporting on environmental sustainability initiatives and benchmarks.
What’s next?
Unilever will share its climate transition action plan in the first quarter of 2021, ahead of its Annual General Meeting on May 5.
The plan will be updated on a rolling basis, and Unilever will seek an advisory vote every three years on any material changes made or proposed to the plan.
The first year the company will report on its annual progress against the plan will be 2022.
Edited by Gaynor Selby
