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Unilever Sets 1 Billion Euro Climate Fund

Samantha Conti

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LONDON – In the wake of a landmark decision to consolidate the business under one London-based umbrella, Unilever is swiveling its gaze back to climate change, pledging 1 billion euros to a new Climate and Nature Fund, and promising to be carbon neutral by 2039, more than a decade ahead of the 2050 Paris Agreement.

The consumer giant will on Monday set out a new range of measures and commitments which it hopes will improve the health of the planet, and protect and regenerate nature.

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Unilever said it will achieve “net zero emissions” from all of its products by 2039 and eventually communicate to end-consumers the carbon footprint of every item it sells.

To achieve its carbon-neutral goals, Unilever said it will work with a new generation of farmers and smallholders, driving programs to protect and restore forests, soil and biodiversity. It also plans to work with governments and other organizations to improve access to water for communities in water-stressed areas.

The Climate and Nature Fund’s projects over the next decade are likely to include  landscape restoration, reforestation, carbon sequestration, wildlife protection and water preservation.

Unilever said the new initiatives will build on work that is already underway at its various brands, such as the Ben & Jerry’s initiative to reduce greenhouse gas emissions from dairy farms; Seventh Generation’s advocacy work around clean energy; and Knorr supporting farmers to grow food more sustainably.

“While the world is dealing with the devastating effects of the COVID-19 pandemic and grappling with serious issues of inequality, we can’t let ourselves forget that the climate crisis is still a threat to all of us. The planet is in crisis, and we must take decisive action to stop the damage, and to restore its health,” said Alan Jope, chief executive officer of Unilever.

“Climate change, nature degradation, biodiversity decline, water scarcity – all these issues are interconnected, and we must address them all simultaneously. In doing so, we must also recognize that the climate crisis is not only an environmental emergency; it also has a terrible impact on lives and livelihoods. We, therefore, have a responsibility to help tackle the crisis: as a business, and through direct action by our brands.”

Jope also pointed to Unliever’s plan, announced last year, to tackle plastic packaging, with targets that include halving its use of virgin plastic, and collecting and processing more plastic packaging than it sells. It recently committed to ensuring that 100 percent of its plastic packaging is fully reusable, recyclable or compostable by 2025.

Unilever has been at the forefront of sustainability moves in the consumer goods sphere: Ten years ago, it set its Sustainable Living Plan in motion to help more than a billion people improve their health and well-being; halve its environmental footprint and enhance the livelihoods of millions.

Unliever characterized its latest goals as its most ambitious yet. Until now, its target has been to have no carbon emissions from its own operations, and to halve the GHG footprint of its products across the value chain, by 2030.

In response to the “scale and urgency of the climate crisis,” the company said it was additionally committing to net zero emissions from all of its products by 2039, ranging from the sourcing of the materials it uses, through to the point of sale.

It said that to achieve this goal, it will work jointly with its partners across the value chain, to collectively drive lower levels of greenhouse gas emissions.

“We will, therefore, prioritize building partnerships with our suppliers who have set and committed to their own science-based targets,” the company said.

“We believe that transparency about carbon footprint will be an accelerator in the global race to zero emissions, and it is our ambition to communicate the carbon footprint of every product we sell. To do this, we will set up a system for our suppliers to declare, on each invoice, the carbon footprint of the goods and services provided; and we will create partnerships with other businesses and organizations to standardize data collection, sharing and communication.”

This is similar to the work that Kering does with some of its brands, creating a environmental profit and loss account, which records the environmental damage of sourcing, production and distribution as a loss, and sustainable moves as a profit. Stella McCartney was the first brand to audit itself this way when it belonged to Kering.

Unilever said it was also calling on all governments to set ambitious net-zero targets, as well as short-term emissions reduction targets, supported with “enabling policy frameworks,” such as carbon pricing.

The company said that 89 percent of its own forest-related commodities are certified as sustainably sourced in line with globally-recognized standards, but that was not good enough to end deforestation.

Going forward, it said it wants to have visibility on exact sourcing locations, and no longer wants to rely on old systems of measuring carbon offsets.

Unilever said it will achieve a deforestation-free supply chain by 2023 by increasing traceability and transparency via emerging digital technologies such as satellite monitoring, geolocation tracking and blockchain. It also plans to accelerate smallholder inclusion and change its approach to derivates sourcing.

The company said it wants to work with the industry, NGOs and governments to look beyond forests, peatlands and tropical rainforests. It wants to protect other important areas of “high conservation value and high carbon stock,” which are under threat of conversion to arable land “with potentially devastating impact on the natural habitats.”

It also plans to work with farmers and smallholders on issues including land rights, access to finance and financial inclusion, and restorative practices. It plans to introduce a Regenerative Agriculture Code for all of its suppliers.

The new code will build on Unilever’s existing code, and it will include details on farming practices that help to rebuild critical resources.

Marc Engel, Unilever’s chief supply chain officer, said that in most parts of the world, the economic and social inclusion of farmers and smallholders in sustainable agricultural production “is the single most important driver of change for halting deforestation, restoring forests and helping regenerate nature. In the end, they are the stewards of the land.”

Water preservation is also on the agenda, with Unilever planning to set up water stewardship programs for local communities in 100 locations by 2030. The international consumer giant said it would take lessons from its Prabhat program in India, which tackles water quality and supply challenges related to factories.

To further protect its water resources, Unilever said it wants to make its product formulations biodegradable by 2030, to minimize their impact on water and the aquatic ecosystems.

“Although some of the ingredients that we currently use have no viable biodegradable alternatives, we will work with partners to drive innovation and find solutions to help us reach our ambition,” the company said.

Unilever’s latest commitments come just days after the company announced that it was unifying its group legal structure under a single parent company, Unilever plc, that will be based in London. Unilever will maintain its multiple public listings on the Amsterdam, London and New York stock exchanges and will keep open its substantial operations and offices in the Netherlands.