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PROGRESS REPORT 2012 UNILEVER SUSTAINABLE LIVING PLAN STRATEGY In November 2010 we set out the Unilever Sustainable Living Plan (USLP), our blueprint for achieving our vision to double the size of the business whilst reducing our environmental footprint and increasing our positive social impact. ABOUT OUR REPORTING The Unilever Sustainable Living Plan: Progress Report 2012, published in April 2013, is complemented by: Boundaries for reporting • The online Unilever Sustainable Living Report for 2012. Our website is our principal means of reporting. This Progress Report 2012 covers Unilever’s global It includes more background to our progress on the USLP and the scope of our assurance programme operations for the period 1 January-31 December as well as more detailed information on our approach to running a responsible business. It also contains 2012 unless otherwise stated. Data is provided for indices that cross reference our performance to the UN Global Compact Principles, the Millennium Unilever’s wholly owned companies, subsidiaries Development Goals and Global Reporting Initiative indicators. and key joint ventures and listed entities where www.unilever.com/sustainable-living we have a majority ownership. • Unilever’s Annual Report and Accounts 2012: Making Sustainable Living Commonplace, which outlines The Unilever Sustainable Living Plan is our business and financial performance including key financial and non-financial performance indicators. independently assured. Further information www.unilever.com/investorrelations on our approach to assurance can be found on page 52. STRATEGY OUR CHANGING WORLD THE CONTEXT OUR RESPONSE The Unilever Sustainable Living 9 billion Plan is our strategic response to People expected on the planet by 2050; population is growing by 200,000 a day the unprecedented challenges the world faces. It is at the heart of our Compass strategy which sets out 200 million our ambitious vision and purpose. Unemployed today; 600 million jobs need to be created over the next decade 2 million Children die every year from diarrhoea OUR PURPOSE and pneumonia TO MAKE SUSTAINABLE Climate change LIVING COMMONPLACE Is accelerating towards a temperature rise greater than 2 degrees We work to create a better future every day, with brands and services that help people feel good, look good and get more out of life. Two-thirds Our first priority is to our consumers – then Of the world could be living in customers, employees, suppliers and water-stressed conditions by 2025 communities. When we fulfil our responsibilities to them, we believe that our shareholders will be rewarded. 40% Of the world’s agricultural land is seriously degraded 40% rise In food prices expected 2010-20 1 in 10 Of the adult population is obese while almost 1 billion people go hungry Unilever Sustainable Living Plan: Progress Report 2012 Our Changing World 1 CHIEF EXECUTIVE OFFICER’S REVIEW VOLATILITY AND UNCERTAINTY As the thinking becomes embedded in – THE NEW NORMAL our business, there is increasing evidence 2012 proved to be another challenging that it is accelerating our growth in ways year for the global economy. Commodity that contribute to positive change in markets remained volatile and costs rose people’s lives. significantly in excess of expectations. The threat of the world’s largest economy STRONG BUSINESS PERFORMANCE going over a ‘fiscal cliff’ and the euro crisis Unilever performed well in 2012, despite added uncertainty and undermined fragile difficult economic conditions. consumer confidence. Turnover increased by 10.5%, taking Overall we continue to see sluggish growth Unilever through the €50 billion barrier, in most developed markets contrasted by a significant milestone to becoming an relatively healthy consumption and growth €80 billion company. Emerging markets in aspiring markets. These both have grew for the second consecutive year by consequences in terms of the world’s more than 11% and now account for 55% social and environmental equilibrium. of total business. Personal Care and Home Care showed double-digit growth, Inequality and rising levels of unemployment in line with our strategic priorities. – especially among young people – place added strains on social cohesion. But the UNILEVER SUSTAINABLE LIVING PLAN biggest challenge is the continuing threat to The Unilever Sustainable Living Plan ‘planetary boundaries’, resulting in extreme (USLP) inspires us to grow in line with our weather patterns and growing resource new purpose to make sustainable living constraints. These have an increasing commonplace. The lens of sustainable impact on people’s lives. living is helping us to drive brands that have Put simply, we cannot thrive as a business a strong purpose in people’s lives, to reduce in a world where too many people are costs and take waste out of the system and still excluded, marginalised or penalised to drive innovation that will make a positive through global economic activity; where difference to the environmental and social nearly 1 billion go to bed hungry every night, challenges facing us all. The Plan pushes 2.8 billion are short of water and increasing us to think ahead, reducing risk and numbers of people are excluded from the making the business more resilient for opportunity to work. the long term. In 2012 we continued to make good progress OUR VISION FOR GROWTH delivering the Plan’s commitments. We remain convinced that businesses that Our factories made great strides in cutting address both the direct concerns of citizens energy, water and waste. For example all and the needs of the environment will our US operations have moved to purchasing prosper over the long term. We need to their energy from certified, renewable build new business models that enable sources and more than half our sites responsible, equitable growth that is worldwide have achieved zero non- decoupled from environmental impact. hazardous waste to landfill. This thinking lies at the heart of the Unilever What makes our commitment unique Sustainable Living Plan and our Compass is that it is across the total value chain. vision of doubling the size of the business We are not only managing our own and whilst reducing our environmental footprint upstream operations, but we are also and increasing our positive social impact. determined to help people to live more To achieve our vision, we have set clear sustainably through the impact of our goals to halve the environmental footprint products in their lives. of our products, to help more than 1 billion We have maintained the momentum people take action to improve their health towards our target of sourcing all our and well-being, to source 100% of our agricultural raw materials sustainably, agricultural raw materials sustainably and reaching 36% by the end of 2012. All our to enhance the livelihoods of people across palm oil is now covered by GreenPalm our value chain. certificates. We have made a start in buying 2 Chief Executive Officer’s Review Unilever Sustainable Living Plan: Progress Report 2012 STRATEGY THE UNILEVER SUSTAINABLE LIVING PLAN Our Plan has three big goals to achieve by 2020: • Help more than 1 billion people improve • Source 100% of our agricultural raw their health and well-being. materials sustainably and enhance the livelihoods of people across our • Halve the environmental footprint of value chain. our products. traceable oil. Investment in a new palm oil Through working with Oxfam on a study This is why we are working with organisations processing factory in Indonesia, working of our business in Vietnam over 2011-12 we and initiatives such as the Consumer Goods with partners and other initiatives are all have gained important insights into human Forum, the World Business Council for helping us to make progress towards our and labour rights in our own and our Sustainable Development, the World new commitment to 100% certified suppliers’ operations. The study has Economic Forum, the Tropical Forest Alliance sustainable palm oil which is traceable implications for our global business. 2020, Refrigerants, Naturally!, the Global back to the plantations on which it is grown. We are identifying how we can promote Green Growth Forum and the UN’s Zero sustainable livelihoods for all our workers Hunger Challenge and Scaling Up Nutrition We are also helping to improve the and those in our value chains. initiatives. This is also why I agreed to join livelihoods of farmers while guaranteeing the UN Secretary General’s High Level Panel future supplies, and we will increasingly In areas where big breakthroughs are to review the Post-2015 Development Agenda. place a special focus on women, due to the needed, we must step up joint working with multiplier effect we know that women have others. Making more progress on healthy LOOKING AHEAD in developing societies. We are working with eating, for example, will require action Despite the scale of the task, I believe many partners, including with Rainforest across the industry whilst governments we are on track to become a sustainable Alliance on tea for Lipton, with Barry will need to take a bigger lead on action to growth company. But one thing is sure Callebaut on cocoa for Magnum and with combat climate change and decarbonise – this will not be possible without the vegetable farmers through Knorr’s energy supplies. dedication and hard work of our 173,000 Sustainability Partnership Fund. Overall it is clear that we will need creative colleagues and our many partners around Brands that are starting to put their as well as science-based solutions if we the world. They are demonstrating the sustainable living ambition at the heart of are to achieve our full ambition by the end power of purpose, making Unilever again their proposition not surprisingly enjoyed of the decade. ‘fit to win’. strong growth. Lifebuoy soap delivered I hope this report gives you a good sense another year of double-digit growth while WORKING WITH PARTNERS of the progress we are making, and our scaling up its handwashing campaigns.

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