Ex-Unilever CEO namechecks Tesla, says firms should focus on long
The ex-CEO of British consumer goods giant Unilever has shared his view on how businesses should operate in the years ahead, namechecking Elon Musk’s Tesla, Danish energy firm Orsted and Beyond Meat in the process.
In comments made during a discussion moderated by CNBC’s Karen Tso at Mobile World Congress in Barcelona, Paul Polman suggested that a company’s performance can be boosted by factors relating to environmental, social and governance (ESG).
“You have to be sure that, whatever you do when you run a company, that you get the results as well,” said Polman at the panel on Tuesday.
“But increasingly, I think we have the evidence that operating under a more inclusive, multi-stakeholder, longer-term model gives you a better chance to get the shareholder return over time.”
Polman said that although short-term shareholders — who he called speculators — will always be around, a significant shift was underway.
Polman added that “hard data” was showing that “more gender diverse companies perform better, companies that internalize climate challenges and reduce those perform better.” This also applied to firms addressing “human rights issues” in their value chain.
‘Higher market value’
Expanding on his point, the executive — who is the co-founder and co-chair of the social venture Imagine — said that from airlines to food and mobility to shipping, “the companies that more actively try to mitigate these negative externalities actually have a higher market value.”
“Although the accounting standard systems have not caught up yet, the financial market is already able to value these, what some people call, ‘immaterial’ issues,” he said. “They are material and they’re incredibly important for the future of a company.”
He cited energy firms Vattenfall and Orsted as examples of companies moving in this direction.
“Or you have the Teslas, or you have the Beyond Meats that go to alternatives for food. They are significantly higher valued than the incumbents, who have a harder time to change.”
Tesla specializes in the production of electric cars, a technology many regard as crucial when it comes to reducing urban air pollution.
While Tesla is focused on something that could have a key role to play in the planet’s shift to more sustainable forms of transport, it is not immune from criticism.
In February, a California civil rights agency sued the company, alleging racist harassment of and discrimination against Black workers that has persisted for years at the company’s car assembly plant and other facilities in the state. Tesla has called the lawsuit “misguided.”
Sustainability debate
With concerns about sustainability, the environment and climate change mounting, the discussion and debate surrounding ESG has become increasingly high profile. Polman’s comments reflect a growing trend toward ESG, which has its fair share of proponents and detractors.
Last summer, the CEO of Credit Suisse told CNBC that the coronavirus…
Read More: Ex-Unilever CEO namechecks Tesla, says firms should focus on long