'Green' is a growth engine

Emerging markets account for more than 60 per cent of Unilever’s business with a turnover (global revenue) of 48.44 billion euro as of 2014, which represents a growth of around 30 per cent when compared to 2009.
Unilever announced in 2010 its “2020 sustainability plan” to buy 100 per cent of its agricultural raw materials from sustainable sources, to reduce the environmental impact of everything it sells by one-half while doubling its revenues. Polman has revealed that, as of a year ago, 100 per cent of its agricultural raw materials are now from sustainable sources.
“Even if the emerging markets are slowing down a little, aggregated growth is still 4 per cent and Europe or the US would die for that. So, when people are talking about EMs slowing down, you have to put it into perspective,” he said in an exclusive interview with the Nation Multimedia Group last week.
“Our main focus is to help develop these markets… and we have a big business here in Thailand. If our global businesses is a little bit north of 50 billion euro, the Thai market is 1 billion euro, which is quite sizeable,” he added.
He explained that 3.5 billion people currently live in cities, which accounts for around 50 per cent of the world population. The global population is expected to reach 10 billion and 70 per cent will be living in cities, which means that the population of cities is predicted to increase from 3.5 billion to 7 billion over the next 30-40 years.
“This means that we have to build a new New York every two or two and a half months. The ways we build this and decide to build this is going to box us in or decide how we are going to live,” he said.
“This investment that goes into urbanisation, in the next 15 years alone, would equal around US$90 trillion and that is a tremendous business opportunity. But then we have to think carefully how we designed these cities in terms of density, public transport, building efficiency and these are big carbon emitters,” he added.
Meanwhile, besides combating air pollution, climate change and deforestation, the transition toward sustainable development and going green can actually lead companies of all sizes towards new technologies, financing, help save costs and allow them to generate economic growth.
Polman revealed that even for SMEs, the topic of carbon emissions and moving toward a greener economy could lead towards new technologies and financing from making the transition at a low cost where the decarbonisation in the manufacturing side of the top 500 companies have saved them US$1.1 billion with climate mitigation measures that actually permeate through to the smaller companies.
Nevertheless, he explained that some small and medium-sized companies, such as in the palm oil industry or in the forestry sector, have to be supported by large companies and government in terms of training and financing to make the greener transformation because, depending on the crops, the move towards sustainable farming might mean that they need 2-4 years of reduced income from replanting in a sustainable way.
The Brazilian government has managed to reduce the level of deforestation by 80 per cent over the last 15 years through an enforcement mechanism that allows the industry to move rapidly towards more sustainable and efficient farming and that allows them to be more competitive, hence become one of the driving forces of their economy.
“By taking these actions [going green] it does not mean that we gave up something. It is actually an engine for economic growth and job creation by doing so,” he added.