Innovation and The Sustainable Organisation

This report discusses the concept of innovation and sustainability in organizations, focusing on the case study of Unilever and their sustainable living plan. It covers topics such as business approach to making profit from sustainability, overview of the company, literature review, sustainability stakeholders, sustainability benchmark, and recommendations for managers.

Innovation and The
Sustainable
Organisation
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
PART A...........................................................................................................................................3
Business approach to making profit from sustainability.............................................................3
Overview of the company............................................................................................................4
Literature Review........................................................................................................................5
Sustainability Stakeholders..........................................................................................................6
Sustainability Benchmark............................................................................................................7
Recommendation for managers...................................................................................................9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10
1

INTRODUCTION
Innovation and sustainability represents the concept behind the next phase of economic
growth. It integrates the preservation of natural environments by the ecosystem with the notion
of business creativity (Baker and Mehmood, 2015).It providing vital products and services that
meet public health, equality and environmental protection these are the social goals and an
organization need to fulfil it. This report based on Unilever case study for sustainability which
further helps in innovating new products and services in the market for environmental benefits.
Unilever is UK based transnational consumer goods company which founded in 2nd September
1929 and founded by William Lever. This report covers the various topics such as sustainability
which organization offer, relevant literature review, sustainability stakeholders, benchmarking
and some recommendation for managers to improve overall performance.
MAIN BODY
PART A
Business approach to making profit from sustainability
Living in a unpredictable and unstable environment. Temperatures are growing, heat waves
are more common, food resources are increasingly rare, inequality gap is increasing, and millions
of people still have no access to basic sanitation and hygiene (Helsen, 2018). Such problems are
further exacerbated as the global population continues to expand. Opportunity comes with
transformation although co-founded of Unilever, Business & Sustainable Development
Commission, estimated that implementation of the Sustainable Development Goals (SDGs). It
aims to solve 17 of the most pressing issues in the world would generate new markets of at least
$12 trillion a year (Unilever sustainable plan, 2020).
In 2010, company launch Unilever Sustainable Living Plan (USLP) for sustainable
growth. It helps us to push our brands for sustainable development, save costs, reduce risk and
create trust among our stakeholders (de Vargas Mores And et.al., 2018). USLP is comprised of
three goals and based on nine-pillar that cover social, environmental and economic success
across the supply chain. This includes goals for expansion, like how customers use our goods
and how we provide finished products.Three major goals of Unilever Sustainability Living plan
is to improve health care facilities for around more than 1 Billion people by 2020, reduce
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environmental impact by 2030 and enhance livelihood of millions of people by 2020 (Unilever
Sustainable Living Plan, 2020).
Above mention picture shows the 17 sustainability development goals of Unilever
Company which helps the organization to maintain sustainability as well as generate profit
(Unilever sustainable plan, 2020). The opportunities provided by this change would be massive–
business opportunities up to US$ 12 trillion per year and up to 380 million jobs by 2030.
The union of the Dutch Margarine Unies and the British soap manufacturer Lever
Brothers in September 1929 led Unilever to create a neologism of the names of both firms. The
company's name is a portmanteau.
In the 1930s, industries expanded and in Africa and Latin America new enterprises were
introduced. During the Second World War the Nazi invasion of Europe stopped Unilever from
reinvestirting its capital into Europe, then it established new companies in the United Kingdom
and the United States.
Overview of the company
Unilever is UK based consumer goods manufacturing company which deals in huge range
of products such as food, energy drinks, ice cream and soft drinks, cleaning products, cosmetics,
and personal care. Unilever is among the oldest multinationals and they served in almost 190
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countries. It is a double-listed company composed of Rotterdam based Unilever N.V. and New
York based Unilever plc. The 2 businesses have a shared board of directors and function as a
single firm. Unilever is organized into four major sectors-food, beverage (drinks and ice cream),
home care, and beauty & personal care. It has facilities for product development in China, India,
the Netherlands, UK and the US.
Literature Review
According to Leleux and van der Kaaij (2019), Business approach of Unilever for
sustainability not only supported coordination with stakeholders but also promotes the accurate
and efficient reporting of sustainability results. The small collection of relevant key performance
indicator closely linked to the core product of the organization adds to the focus of sustainability
activities and makes contact clearer.
Helsen (2018), state that Unilever Company identifies sustainability issues by following
constructive approach that is required. They look at reasons for sustainability initiatives as well
as the big obstacles that multinational companies face. With the help of Unilever Sustainability
Living Plan (USLP), they highlight the contribution that global marketers can bring to executing
a sustainable strategy, and some of the obstacles they face.
Díaz-García, González-Moreno and Sáez-Martínez, (2015), discuss that, Unilever
Sustainable Living Plan aims to separate our development from our environmental impact while
growing our impact on society. Their strategy has three main targets to accomplish, underpinned
by nine commitments and objectives that extend our success across the value chain. Unilever
going to start partnering with others by concentrating on those sectors where they can make most
progress and help in UN Sustainable Development Goals (SDGs).
Fellnhofer (2017), Unilever recently announced its fourth consecutive year of growth for its'
sustainable living' products, which grew 46 per cent faster than the rest of the company,
generating 70 per cent of its increase in turnover. All Unilever's products are on a mission to
reduce their environmental footprint and maximize their positive effect on society.
Geissdoerfer, Savaget and Evans (2017),Consumer demand for sustainable brands is rising
strongly. Research indicates that 54 percent of customers would like to buy sustainable manner,
and even one-third of them do so. It is a huge opportunity and they have to make sure our
products are at the forefront of it.
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Gerlitz (2017), Unilever served 1.24 billion people by the end of 2018 by its hand washing,
clean drinking water, hygiene, oral health, body-esteem and skin healing services. Lack of
available drinking water and poor hygiene and sanitation every year cause millions of
unnecessary deaths–especially among children. Unilever will help more than one billion people
improve their quality of life and hygiene by 2020. This would help to reduce the occurrence of
lives-threatening diseases such as constipation, one of the main cardiovascular diseases in
children underage of 5.
According to Crane, Matten and Spence (2019), Corporate Social Responsibility (CSR) is a
regulating business strategy that allows a company to be publicly responsible to itself, its
investors and the community. Through practicing corporate responsibility, also known as
corporate governance, corporations may be mindful of the sort of effect they have on all facets of
society, namely economic, environmental and social.
As per Jamaliand Karam (2018), CSR is an emerging industry strategy incorporating
sustainable development into the business strategy of an organization. It affects social, cultural,
and environmental factors in a positive way.
Sustainability Stakeholders
Unilever follows a systemic plan to meet its social responsibilities at the firm. This
approach promotes the corporate citizenship values of the business, in particular as regards
meeting customer preferences and interests as stakeholders. Unilever's prioritization of CSR, for
example, puts customers at the top. Through the plan, company sustainability is preserved too.
Such a corporate responsibility plan serves the needs of the following groups of stakeholders are
as follows:
Consumers: Unilever's CSR policy gives customers top priority. The concerns of such
stakeholders concentrate on the quality and price of the products as well as the effects on the
environment of the goods. Such as general public who buy Unilever’s product and service.
Employees: In its corporate social responsibility policy, Unilever recognizes workers as
second priority. The significance of such stakeholders lies in their complete control of the
consumer products industry on organizational efficiency. For example, appropriate work-life
balance HR policies are helping to meet the needs of employees. Unilever's corporate
responsibility policy serves such priorities through high pay that competes favorably against
other labour market workers.
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Investors: Within Unilever's CSR plan are given the third priority to investors. The
success of consumer products sector is of concern to this community of stakeholders. Higher
sales and productivity, for example, improve the satisfaction and confidence of the shareholders
in the company.
Sustainability Benchmark
Business, governments and society are searching for mechanisms they can use to measure
the success of sustainability and to identify and encourage good practice. To evaluate, assess and
test this wide variety of sustainability strategies and results, various stakeholders are creating
assessment frameworks that are commonly referred to as' benchmarks.'
Above mention graph shows the stock value of companies from last five years that is
Unilever or P&G (Unilever Plc, 2020). Orange trend line represent the P&G Company and Blue
indicate Unilever. It is clearly observed that Unilever performance is better than their
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competitors.
Above graph indicate the gross profit of the organizations such as Unilever, Nestle and
P&G, these all are competitors of each other in the same sector (Unilever Plc, 2020). Unilever
perform better than remaining two companies but after 2018, Nestle get growth but P&G still
remain last.
Dow Jones Sustainability Index measures and ranks over 3,000 publicly traded
companies in economic, environmental and social results. Unilever has been a part of the
benchmark since it was introduced in 1999 and has been appointed 18 times sector leader over
that period.
For Unilever, this is a significant achievement because it tells stakeholders that we are
meeting the highest standards (Helsen, 2018).Dow Jones Sustainability Index is used by
shareholders who understand that sustainable business practices are key to long-term shareholder
value creation and want to represent their sustainability values in their portfolios.Unilever rated
89 out of a total of 100, earning leading industry ratings in 11 out of 25 categories. This implies
we're already included in DJSI World, a global investment ranking that tracks top sustainability-
driven businesses.
Sustainable Business & Communications said: "DJSI is a critical point of reference for investors
and other investors who want to measure and benchmark our sustainability progress–so we are
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delighted that our efforts have been acknowledged. This result reflects our unequivocal
contribution to the Unilever Sustainable Living Program.
Recommendation for managers
It has been concluded that managers should overseeing overall sustainable performance of
the organization. Managers must formulate such strategies which help in performing operational
activities in well manner(Jaeger-Erben, Rückert-John and Schäfer, 2015). In addition, they need
to ensure that every individual follow their company’s ethics and social responsibility which
further helps in providing sustainable development and future growth. Along with this, manager
should value human resources because they are the most essential aspect of the Unilever
Company.
CONCLUSION
From the above discussion it has been concluded that innovation and sustainability for
the organization help economy to grow in the market. Every organization takes some necessary
steps for sustainable development and formulates strategies to implement it because stakeholders
are very much interested in this.While formulating any strategy in respect of company’s benefits
they need to focus on innovation and sustainable development.
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REFERENCES
Books & Journals
Baker, S. and Mehmood, A., 2015. Social innovation and the governance of sustainable
places. Local Environment. 20(3). pp.321-334.
Crane, A., Matten, D. and Spence, L. eds., 2019. Corporate social responsibility: Readings and
cases in a global context. Routledge.
de Vargas Mores, G. And et.al., 2018. Sustainability and innovation in the Brazilian supply chain
of green plastic. Journal of cleaner production. 177. pp.12-18.
Díaz-García, C., González-Moreno, Á. and Sáez-Martínez, F.J., 2015. Eco-innovation: insights
from a literature review. Innovation. 17(1). pp.6-23.
Fellnhofer, K., 2017. Drivers of innovation success in sustainable businesses. Journal of Cleaner
Production. 167. pp.1534-1545.
Geissdoerfer, M., Savaget, P. and Evans, S., 2017. The Cambridge business model innovation
process. Procedia Manufacturing. 8. pp.262-269.
Gerlitz, L., 2017. Design-driven innovation in SMEs: smart and sustainable organisation within
industrial transformation. International Journal of Environmental Policy and
Decision Making. 2(2). pp.98-124.
Helsen, K., 2018. Sustainable Marketing Strategies: Overview.
Jaeger-Erben, M., Rückert-John, J. and Schäfer, M., 2015. Sustainable consumption through
social innovation: a typology of innovations for sustainable consumption
practices. Journal of Cleaner Production. 108. pp.784-798.
Jamali, D. and Karam, C., 2018. Corporate social responsibility in developing countries as an
emerging field of study. International Journal of Management Reviews, 20(1), pp.32-61.
Leleux, B. and van der Kaaij, J., 2019. Embedding Sustainability into the Business Core.
In Winning Sustainability Strategies (pp. 263-284). Palgrave Macmillan, Cham.
Online
Sustainability Report of Unilever. 2020. [Online]. Available Through:
<http://panmore.com/unilever-corporate-social-responsibility-stakeholders>
Unilever Sustainable Living Plan. 2020. [Online].Available Through:
<https://www.unilever.com/sustainable-living/>
Unilever Plc, 2020. [Online]. Available Through:
<https://www.fool.com/investing/2018/09/14/better-buy-procter-gamble-company-vs-
unilever.aspx>
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APPENDIX
Case Study Short Notes
The Case of Energy Seminar According to current growth forecasts, the expenditure needed
for the water, farming, telecommunications, energy,
transportation, housing, industrial and forestry sectors is about
US$ 5 trillion per year up to 2020. Greening global economic
expansion seems to be the only way to fulfil the needs of the
population today and by 2050 up to 9 billion people. The Green
Growth Action Alliance is promoting green growth level-up
through the cooperation of more than 50 top financial
institutions, businesses, governments and NGOs. Through
putting together the expertise of many different stakeholders, the
Partnership seeks to collaborate with policymakers to help them
implement a systemic strategy that, through sound policies,
rewards creative green industries and boost their access to
finance. To do this, members of the Partnership plan
to collaborate to define and allocate public capital which can be
used to activate and leverage private sector investment; define
creative funding and de-risk mechanisms that enable pilot
projects.
The Case of Waste and
Limits to Growth
Development that addresses present needs, without sacrificing
future generations ' capacity to meet their own needs. Impacts
from living conditions cause people to cut down forests for
energy and create space for crops to grow. Dependency on
biomass as a source of energy in the household not only causes
harm to forests and their habitats but also affects the education
and health of individuals. Dr. Fatih Birol, Chief Economist of
the International Energy Agency (IEA), pointed out that 2.5
billion people can't read or research after darkness without
electricity, lack air conditioning to maintain food and
medications and spend long hours collecting fuel that creates
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toxic fumes if used in poorly built biomass furnaces. Research
show that poverty contributes to increased forest harvest to meet
demand not just for energy but also for medicinal herbs and
natural medicinal remedies. While there are logging protocols
and management guidelines for timber production, they are
missing for a wide variety of regional problems-from herbal
medicine to new settlements in the farming community. The
well-informed media can help create a deeper understanding of
local issues and can influence policy-makers ' decisions and
public behaviour.
GreenEgg Big Green Egg, the world's number one company of Kamado
grills works with the Product Essentials squad. The two partners
have introduced a marketing campaign to motivate the Major
Green Egg Customers experience. Every business wishes to turn
its customers into loyal fans. The Big Green Egg consumer
group are real brand ambassadors with an effective marketing
plan. Such ambassadors are the secret to producing more clients,
bigger fans or more skilled employees. Clients are becoming
fans for the brand with a face. However, many businesses are
persuaded the more environmentally friendly they are, the more
their profits will be undermined by the effort. They think it
would add to expenses and not have short term financial
benefits. Big Green Egg converted its customers into
ambassadors for the brand.
Hydrogen cell pilots Generally, hydrogen is created by one of two methods from
liquid through electrolysis, where energy separates H2O into its
constituent parts of hydrogen and oxygen and from coal and oil,
such as methanol or natural gas, where H2 is separated from the
silicate minerals. Hydrogen to become a viable energy provider
it is important to collect and disseminate experience and
operating data through experimental projects. There are growing
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numbers of integrated hydrogen energy demonstrations taking
place around the world. The IEA Hydrogen Program has
assumed the task of collaborating with the members of the
demonstration project to create a detailed series of reports on
these different demonstrations and to make this knowledge
accessible to the hydrogen community. Each methane-based
energy system was critically evaluated and compared, with the
main focus being on measuring system efficiency.
Car2Go Premium automakers participate in mobility services, but some
realize, like Auto drive’s Armitage that it's hard to follow a solo
route.BMW and Daimler have now formed a joint agreement to
merge their mobility activities. It will see the integration of
Daimler's Car2go and Moovel to BMW's Drive Now car sharing
and on-demand mobility combination ReachNow. The contract
would also include bundled riding-hailing, parking, and electric
car charging facilities.Brand Head Tony Douglas BMW Group
Mobility Services, says the deal would allow the two
organizations to upgrade their mobility operations. Early
indications are that UK corporations are considering adopting
similar travel models, particularly those with offices in large
urban conurbations, while many others are holding a brief look
at autonomous, distributed and connected technologies. But, for
now, conventional options remain dominant over the fleet
approaches of most businesses.
The rise of bioplastics Feasible product design, also known as Design for
Sustainability (D4S), it including the more specific Ecodesign
term which is one of the most commonly accepted ways in
which companies seek to increase energy efficiency, product
quality and business opportunities (local and export) while at the
same time enhancing the environmental efficiency. Throughout
many advanced economies D4S initiatives are related to wider
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principles such as brand-service blends, device creativity and
other life- cycle -based activities due to a high degree of
understanding about the capacity of productivity and
environmental issues. More extensive technical support is
required in developed economies to implement Design for
Sustainability definition. Several organizations also built
strategies and solutions to help companies (and those
collaborating with corporations) consider how to design and
manufacture goods that increase profitability and productivity
while reducing environmental impacts.
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