Unilever

Unilever N.V.
Unilever plc
Dual-listed (Naamloze vennootschap/
Public limited company)
Traded as Euronext: UNA
LSE: ULVR
NYSE: UN, UL
Industry Consumer goods
Predecessor
Founded 1930 (1930) (by merger)[1]
Founders
Headquarters Unilever N.V. Rotterdam, Netherlands
Unilever House, London
Area served
 Worldwide
Key people
Products Foods, beverages, cleaning agents and personal care products
Revenue €53.272 billion (2015)[2]
€7.515 billion (2015)[2]
€4.909 billion (2015)[2]
Number of employees
 172,000 (2015)[3]
Subsidiaries
Website www.unilever.com

Unilever is a British-Dutch multinational consumer goods company co-headquartered in Rotterdam, Netherlands, and London, United Kingdom. Its products include food, beverages, cleaning agents and personal care products. It is the world's third-largest consumer goods company measured by 2012 revenue, after Procter & Gamble and Nestlé.[4] Unilever is the world's largest producer of food spreads, such as margarine.[5] One of the oldest multinational companies, its products are available in around 190 countries.[6]

Unilever owns over 400 brands, but focuses on 13 brands with sales of over 1 billion[7] euros: Axe/Lynx, Dove, Omo, Becel/Flora, Heartbrand ice creams, Hellmann's, Knorr, Lipton, Lux, Magnum, Rama, Rexona, Sunsilk and Surf.[6] It is a dual-listed company consisting of Unilever N.V., based in Rotterdam, and Unilever plc, based in London. The two companies operate as a single business, with a common board of directors. Unilever is organised into four main divisions - Foods, Refreshment (beverages and ice cream), Home Care, and Personal Care. It has research and development facilities in the United Kingdom (2), the Netherlands, China, India and the United States.[8]

Head office Unilever N.V. Rotterdam, Netherlands

Unilever was founded in 1930 by the merger of the Dutch margarine producer Margarine Unie and the British soapmaker Lever Brothers. During the second half of the 20th century the company increasingly diversified from being a maker of products made of oils and fats, and expanded its operations worldwide. It has made numerous corporate acquisitions, including Lipton (1971), Brooke Bond (1984), Chesebrough-Ponds (1987), Best Foods (2000), Ben & Jerry's (2000), Alberto-Culver (2010), and Dollar Shave Club (2016). Unilever divested its speciality chemicals businesses to ICI in 1997. In 2015, under leadership of Paul Polman, the company gradually shifted its focus towards health and beauty brands and away from food brands showing slow growth.[5]

Unilever N.V. has a primary listing on Euronext Amsterdam and is a constituent of the AEX index. Unilever plc has a primary listing on the London Stock Exchange and is a constituent of the FTSE 100 Index. The company is also a lux of the Euro Stoxx 50 stock market index.[9]

History

1870s–1910s

In 1872, Antoon Jurgens, founded the first margarine factory in the world in Oss, Netherlands. Then, in 1888, Samuel van den Bergh, also from Oss, opened his margarine factory in Kleve. These two companies, merged in 1927 to form Margarine Unie.

1910s–1920s

Lever House in Port Sunlight, United Kingdom, the former headquarters of Lever Brothers

The initial harvesting of palm oil was from British West Africa, from where news reports seen back in England showed the workers abroad in favourable conditions.[10] In 1911, the company received a concession for 750,000 hectares of forest in Belgian Congo, mostly south of Bandundu, where a system of forced labour operated.[11]

1920s–1930s

In 1922 Lever Brothers acquired Mac Fisheries, owner of T. Wall & Sons.[12]

In September 1929, Unilever was formed by a merger of the operations of Dutch Margarine Unie and British soapmaker Lever Brothers, with the name of the resulting company a portmanteau of the name of both companies.[13] The merger made sound commercial sense, as palm oil was a major raw material for both margarines and soaps, and could be imported more efficiently in larger quantities.

1930s–1940s

In the 1930s business grew and new ventures were launched in Africa and Latin America. The Nazi occupation of Europe during the Second World War meant that Unilever was unable to reinvest its capital into Europe, so it instead acquired new businesses in the UK and the US.[14] In 1943 it acquired T. J. Lipton, a majority stake in Frosted Foods (owner of the Birds Eye brand) and Batchelors Peas, one of the largest vegetables canners in the UK.[12][15] In 1944, Pepsodent was acquired.[15]

After 1945 Unilever's once successful US businesses (Lever Brothers and T.J. Lipton) began to decline.[1] As a result, Unilever began to operate a "hands off" policy towards the subsidiaries, and left American management to its own devices.[1]

1950s–1960s

Sunsilk was first launched in the UK in 1954.[16] Dove was first launched in the US in 1957.[16] Unilever took full ownership of Frosted Foods in 1957, which it renamed Birds Eye.[17] The US-based Good Humor ice cream business was acquired in 1961.[18]

By the mid-1960s laundry soap and edible fats still contributed around half of Unilever's corporate profits.[12] However a stagnant market for yellow fats and increasing competition in detergents and soaps from Procter & Gamble forced Unilever to diversify.[12] In 1971, Unilever acquired the British-based Lipton Ltd from Allied Suppliers.[12] In 1978, National Starch was acquired for $487 million, marking the largest ever foreign-acquisition of a US company at that point.[19]

1970s–1980s

By the end of the 1970s, through acquisitions, Unilever had gained 30 per cent of the Western European ice cream market.[12] In 1982 Unilever management decided to reposition itself from an unwieldy conglomerate to a more concentrated FMCG company.[20]

In 1984 Unilever acquired Brooke Bond (maker of PG Tips tea) for £390 million in the company's first successful hostile takeover.[12] In 1986 Unilever strengthened its position in the world skin care market by acquiring Chesebrough-Ponds (merged from Chesebrough Manufacturing and Pond's Creams), the maker of Ragú, Pond's, Aqua-Net, Cutex, and Vaseline in another hostile takeover.[20] In 1989, Unilever bought Calvin Klein Cosmetics, Fabergé, and Elizabeth Arden, but the latter was later sold (in 2000) to FFI Fragrances.[21]

1990s

The US division carried the Lever Brothers name until the 1990s, when it adopted that of the parent company. The American unit has headquarters in New Jersey, and no longer maintains a presence at Lever House, a skyscraper on Park Avenue in New York City.

In 1993 Unilever acquired Breyers from Kraft, which made the company the largest ice cream manufacturer in the United States.[22]

In 1996 Unilever merged Elida Gibbs and Lever Brothers in its UK operations.[23] It also purchased Helene Curtis, significantly expanding its presence in the United States shampoo and deodorant market.[21] The purchase brought Unilever the Suave and Finesse hair-care product brands and Degree deodorant brand.[21]

In 1997 Unilever sold its speciality chemicals division, including National Starch & Chemical, Quest, Unichema and Crosfield to Akzo for £4.9 billion.[24]

Unilever established a sustainable agriculture programme in 1998.[25]

2000s

Global employment at Unilever 2000–08
Black represents employment numbers in Europe, light grey represents the Americas and dark grey represents Asia and Africa.
Between 2000 and 2008 Unilever reduced global workforce numbers by 41%, from 295,000 to 174,000.
Notes: Europe figures for 2000–2003 are all Europe; from 2004 figures in black are Western Europe. For 2004–2008 figures for Asia and Africa include Eastern and Central Europe.
Source: Unilever Annual Reports 2004, 2008

In April 2000 Unilever bought both Ben & Jerry's and Slim Fast for £1.63 billion.[24] Later that year, the company acquired Best Foods for £13.4 billion.[24] The Bestfoods acquisition increased Unilever's scale in foods in America, and added brands such as Knorr and Hellmann's to its portfolio.[24] The transaction was the second largest cash acquisition in world business history.[24] In exchange for European regulatory approval of the deal, Unilever divested itself of such well-known brands as Oxo, Royco and Batchelors.[24] The same year the company bought worldwide mustard and products firm Maille. Maille had three boutiques in Europe, all of which sell mustard from the pump in the traditional Maille fashion. Paris, Dijon, France and London, UK. The merge between Best Foods and Unilever was approved by the Israeli Anti trust agency.[26] The acquisition of Best Foods merged Rushdi (רושדי) food industry and Rushdi Textile industries into Unilever (adding the Telma brand to Unilever).

In 2001 Unilever split into two divisions: one for Foods and one for Home and Personal Care.[24] In the UK it merged its Lever Brothers and Elida Faberge businesses as Lever Faberge in January 2001.[27]

In September 2002, the company sold its specialty oils and fats division, Loders Croklaan, for RM814 million (€218.5 million) to IOI Corporation, a Kuala Lumpur, Malaysia-based oil palm company. As part of the deal, the Loders Croklaan brand will be maintained.

Also in 2002 Unilever sold the Mazola, Argo & Kingsfords, Karo, Golden Griddle, and Henri's brands, along with several Canadian brands, to ACH Food Companies, an American subsidiary of Associated British Foods.[28][29]

In 2004 Unilever sold its share in Rushdi food industry to the Bashir family which started to used the Baracke brand name.[30] As of 2014 Roshadi food industries was one of the three largest tahini producers in Israel and one of the largest producers of Tahini worldwide.[31]

In May 2007 Unilever became the first large-scale company to commit to sourcing all its tea in a sustainable manner,[32] employing the Rainforest Alliance, an international environmental NGO, to certify its tea estates in East Africa, as well as third-party suppliers in Africa and other parts of the world.[33] It declared its aim to have all Lipton Yellow Label and PG Tips tea bags sold in Western Europe certified by 2010, followed by all Lipton tea bags globally by 2015.[34]

In September 2009 Unilever agreed to acquire the personal care business of Sara Lee Corporation, including brands such as Radox, Badedas and Duschdas, strengthening its category leadership in skin cleansing and deodorants.[35] The Sara Lee acquisition was completed on 6 December 2010.[36]

2010–2014

On 9 August 2010 Unilever signed an asset purchase agreement with the Norwegian dairy group TINE, to acquire the activities of Diplom-Is in Denmark.[37] On 24 September 2010 Unilever announced that it had entered into a definitive agreement to sell its consumer tomato products business in Brazil to Cargill.[38] On 27 September 2010 Unilever purchased Alberto-Culver, a maker of personal care and household products including Simple, VO5, Nexxus, TRESemmé, and Mrs. Dash, for US$3.7 billion.[39] On 28 September 2010 Unilever and EVGA announced that they had signed an agreement under which Unilever would acquire EVGA's ice cream brands (amongst others, Scandal, Variete and Karabola) and distribution network in Greece, for an undisclosed amount.[40] In February 2011 Unilever announced that it will switch to 100% cage-free eggs for all products it produces worldwide.[41]

In March 2011 it was announced that Unilever had entered into a binding agreement to sell the Sanex brand to Colgate-Palmolive for €672 million, and that Unilever would acquire Colgate-Palmolive's laundry detergent brands in Colombia (Fab, Lavomatic and Vel) for US$215 million.[42] In April 2011 Unilever was fined €104 million by the European Commission for establishing a price-fixing cartel in Europe along with P&G, who was fined €211.2 million, and Henkel (not fined). Though the fine was set higher at first, it was discounted by 10% after Unilever and P&G admitted running the cartel. As the provider of the tip-off leading to investigations, Henkel was not fined.[43] On 24 August 2011 it was announced that Unilever had agreed to sell the Alberto VO5 brand in the United States and Puerto Rico, and the Rave brand globally, to Brynwood Partners VI L.P.[44] On 14 October 2011 it was announced that Unilever had agreed to acquire 82% of the Russia-based beauty company Kalina.[45]

On 27 December 2012 it was announced the Unilever is phasing out the use of microplastics in their personal care products by 2015.[46]

In January 2013, Unilever agreed to sell the Skippy peanut butter brand, together with related manufacturing facilities in Little Rock, Arkansas, United States and Weifang, Shandong, China, to Hormel Foods for approximately $700 million (£433 million, or approximately €540 million) in cash.[47][48] In July 2013 Unilever increased its stake in its Indian unit, Hindustan Unilever, to 67% for around €2.45 billion.[49] On 12 August 2013 Unilever announced that it had signed an agreement for the sale of its Wish-Bone and Western dressings brands to Pinnacle Foods Inc. for a total cash consideration of approximately US$580 million, subject to regulatory approval.[50] On 6 September 2013 Unilever entered into a definitive agreement to acquire the premium Australian tea brand T2.[51]

On 21 February 2014 Unilever signed a definitive agreement for the sale of its meat snacks business, including Peperami (UK/Ireland) and BIFI (continental Europe) to Jack Link's, for an undisclosed amount.[52] In March 2014 Unilever agreed to acquire a majority stake in the China-based water purification company Qinyuan, which makes water purifiers, drinking water equipment and water treatment membranes, for an undisclosed price.[53][54] On 22 May 2014 the company announced it had sold its North America pasta sauces business including the Ragú and Bertolli brands to Japanese company Mizkan in a deal worth $2.15 billion.[55] On 10 July 2014 Unilever announced that it has sold its Slim-Fast brand to Kainos Capital. Unilever will retain a minority stake in the business.[56] On 2 December 2014: Unilever announced that it has acquired Talenti Gelato & Sorbetto. Minneapolis-based Talenti, which was founded in 2003, has grown into the best-selling packaged gelato in the United States. On 22 December 2014: Unilever announced the purchase of the Camay brand globally and the Zest brand outside of North America and the Caribbean from The Procter & Gamble Company. The brands had a turnover of $225 million in the last fiscal year.

Hampton Creek lawsuit

In November 2014, Unilever was the subject of a media backlash[57] due to its lawsuit against rival Hampton Creek. In its suit,[58] Unilever revealed that Hampton Creek is "seizing market share" and the losses are causing Unilever "irreparable harm." Unilever used standard of identity regulations in claiming that Hampton Creek's "Just Mayo" products are falsely advertised because they don't contain eggs.[59]

The Washington Post[60] headline on the suit read, "Big Food's Weird War Over The Meaning of Mayonnaise." The Los Angeles Times[61] began its story with "Big Tobacco, Big Oil, now Big Mayo?" A Wall Street Journal writer described that with "Giant corporation generates huge quantities of free advertising and brand equity for tiny rival by suing it."[62]

Eat Drink Politics headlined the controversy with "Unilever's Bullying Backfires, Boosts Hampton Creek. Negative media coverage of Big Mayo lawsuit goes viral in case study of PR blunder".[57]

2015–present

In March 2015, Unilever confirmed it had reached an agreement to acquire REN Skincare, a British niche skincare brand.[63] This was followed in May 2015 by the acquisition of prestige skincare brand Kate Somerville Skincare LLC.[64]

In July 2015, the company separated its spreads business,[65] including its Flora and I Can't Believe It's Not Butter! brands, into a standalone entity named Unilever Baking, Cooking and Spreading.[66] The separation was first announced in December 2014 and was made in response to declining worldwide sales in that product category.[67]

In October 2015, Unilever agreed to acquire the Italian premium ice cream maker GROM for an undisclosed fee.[68]

In July 2016, Unilever bought the US start-up Dollar Shave Club for a reported $1bn (£764m) in cash to compete in the male grooming market.[69]

Operations

Unilever is multinational with operating companies and factories on every continent except Antarctica and research laboratories in: Colworth and Port Sunlight, England; Vlaardingen, Netherlands; Connecticut and New Jersey, United States; Bangalore, India; and Shanghai, China. It has subsidiaries in almost 100 countries. Notable Unilever subsidiaries include Hindustan Unilever, in which Unilever holds a 67% controlling share.

Unilever is organised into four main divisions: Personal Care (production and sale of skin care and hair care products, deodorants and oral care products); Foods (production and sale of soups, bouillons, sauces, snacks, mayonnaise, salad dressings, margarines and spreads); Refreshment (production and sale of ice cream, tea-based beverages, weight-management products and nutritionally enhanced staples sold in developing markets); and Home Care (production and sale of home care products including powders, liquids and capsules, soap bars and other cleaning products).[70] In the financial year ended 31 December 2013, Unilever had a total turnover of €49.797 billion of which 36% was from Personal Care, 27% from Foods, 19% from Refreshment and 18% from Home Care.[70] Unilever invested a total of €1.04 billion in research and development in 2013.[70]

Unilever is one of the largest media buyers in the world, and invested around €6 billion (US$8 billion) in advertising and promotion in 2010.[71][72]

Unilever's largest international competitors are Nestlé, Rockline Industries, and Procter & Gamble.[73] It also faces competition in local markets or specific product ranges from numerous companies, including Beiersdorf, ConAgra, Danone, Henkel, Mars, PepsiCo, Reckitt Benckiser and S. C. Johnson & Son. Unilever was fined by Autorité de la concurrence in France in 2016 for price-fixing on personal hygiene products.[74]

Products

For a full list of Unilever brands, see List of Unilever brands.

Unilever's products include foods, beverages, cleaning agents and personal care products. The company owns more than 400 brands, which are organised into four main categories - Foods, Refreshments, Home Care, and Personal Care.

Unilever's current largest-selling brands include: Axe/Lynx; Ben & Jerry's; Dove; Flora/Becel; Heartbrand; Hellmann's/Best Foods; Knorr; Lipton; Lux/Radox; Omo/Surf; Rexona/Sure; Sunsilk; TRESemmé; Magnum; Vaseline and VO5.

Unilever's Standard Industrial Classification codes are 10890: Manufacture of other food products n.e.c., 10410: Manufacture of oils and fats, 10420: Manufacture of margarine and similar edible fats.[75]

Corporate affairs

Legal structure

100 Victoria Embankment, Unilever House in London, United Kingdom

Unilever has two holding companies: Unilever N.V., which has its registered and head office in Rotterdam, Netherlands and Unilever plc, which has its registered office at Port Sunlight in Merseyside, United Kingdom and its head office at Unilever House in London, United Kingdom.[76] Unilever plc and Unilever N.V. and their subsidiary companies operate as nearly as practicable as a single economic entity, whilst remaining separate legal entities with different shareholders and separate stock exchange listings.[76]

There are a series of legal agreements between the parent companies, together with special provisions in their respective Articles of Association, which are known as the Foundation Agreements.[76] A key requirement of the agreements is that the same people be on the Boards of the two parent companies. An Equalisation Agreement regulates the mutual rights of shareholders in Unilever plc and Unilever N.V. with the objective of ensuring that, in principle, it does not make any financial difference to hold shares in Unilever plc rather than Unilever N.V. (and vice versa).[76]

Senior management

Unilever's highest executive body is the Unilever Leadership Executive, which is led by the Chief Executive (currently Paul Polman).

Members of the current Unilever Leadership Executive include:

  • Paul Polman (Chief Executive Officer)[5]
  • David Blanchard (Chief R&D Officer)
  • Marc Engel (Chief Supply Chain Officer)
  • Kevin Havelock (President, Refreshment)
  • Alan Jope (President, Personal Care)
  • Kees Kruythoff (President, North America)
  • Harish Manwani (Chief Operating Officer)[5]
  • Leena Nair(Chief HR Officer)
  • Nitin Paranjpe (President, Homecare)
  • Graeme Pitkethly (Chief Financial Officer)
  • Pier Luigi Sigismondi (President, Southeast Asia and Australasia)
  • Amanda Sourry (President, Foods)
  • Ritva Sotamaa (Chief Legal Officer)
  • Keith Weed (Chief Marketing and Communication Officer)
  • Jan Zijderveld (President, Europe)

Unilever's current non-executive directors are:

Logo

In 1930, the logo of Unilever is used for Helvetica font in all caps with former U logo, but in 1969, the logo text was changed with other font with same logo.

The current Unilever corporate logo was introduced in 2004 and was designed by the brand consultancy Wolff Olins. It is composed of 25 icons woven together to create a U shape, with each icon representing one of the company's sub-brands or its corporate values.[77] The brand identity was developed around the idea of "adding vitality to life."[78]

Advertising

Unilever owns both of the toiletries companies Dove and Lynx. Soon after the release of Dove's Real Beauty campaign in 2004 it was compared to Lynx's style of advertising which gained Unilever scrutiny over its hypocritical and opposing ideas to advertising.

Dove: Dove describes itself as a company dedicated to "help ... women develop a positive relationship with the way they look – helping them raise their self-esteem and realize their full potential". (Dove, "Our Vision")[79] Dove employs the use of advertising for their own products to display their messages of positive self-esteem. In September 2004 Dove created a Real Beauty campaign, focusing predominately on women of all shapes and colour. Later in 2007 this campaign furthered itself to include women of all ages. This campaign consisted mostly of advertisements, shown on television and popularised by the internet. Dove fell under scrutiny from the general public as they felt the Dove advertisements described the opinion that cellulite was still unsightly, and that women's ageing process was something to be ashamed of.[80]

Lynx/Axe: Axe, known as Lynx in the United Kingdom, the Republic of Ireland, Australia and New Zealand, is a toiletries brand marketed towards young men between the age of 16 and 24.[81] It is marketed using double entendre and tongue-in-cheek humour, which 'suggests the men using it instantly become more attractive, with beautiful women falling at their feet.' (Poulter, 2011).[82] Unlike Dove's long running beauty campaign Lynx advertising often creates mini series' of advertisements based around a singular product rather than communicating an overarching idea. This advertising campaign thrives on controversy. Using images which the company knows will receive complaints about garners the brand more free publicity and notoriety. A wide variety of these adverts have been banned in countries around the world. In 2012 Lynx's 'Clean Balls' advert was banned. This advert designed for television, shows an attractive young woman cleaning various sport balls. In 2011 in the UK Lynx's shower gel campaign was banned. The poster for Lynx shower gel showed a woman in a bikini under a shower at a beach, with the headline: "The cleaner you are the dirtier you get."[82] The same year Lynx's Full control advertising campaign was banned. It related nervous sweating to premature ejaculation. In 2014, Lynx was forced to drop its American Super Bowl ad for its 'Dry' Product.

Both advertising campaigns make stark comparisons between how women and their sexuality are portrayed in advertising and sales efficiency. Lynx commonly portrays the women in their visual advertisements as hyper sexual, flawless and stereotypically attractive who are aroused by the men, of all ages and stature, for their use of the Lynx product. Their target audience are men between the ages of 16-24 who are single.[81]

Environmental record

Unilever has declared the goal of decoupling its environmental impact from its growth, by: halving the environmental footprint of its products over the next 10 years; helping 1 billion people improve their health and well-being; and sourcing all of its agricultural raw materials sustainably.[83]

Palm oil

Unilever has been criticised by Greenpeace for causing deforestation,[84] Unilever was targeted in 2008 by Greenpeace UK,[85] which criticised the company for buying palm oil from suppliers that are damaging Indonesia's rainforests.[86] By 2008, Indonesia was losing 2% of its remaining rainforest each year, having the fastest deforestation rate of any country. The United Nations Environmental Programme stated that palm oil plantations are the leading cause of deforestation in Indonesia.[86]

Furthermore, Indonesia was the fourteenth[87] largest emitter of greenhouse gases largely due to the destruction of rainforests for the palm oil industry, which contributed to 4% of global green house gas emissions.[88] According to Greenpeace, palm oil expansion was taking place with little oversight from central or local government as procedures for environmental impact assessment, land-use planning and ensuring a proper process for development of concessions were neglected.[88] Plantations that were off-limits, by law, for palm oil plantations were being established as well as the illegal use of fire to clear forest areas was commonplace.[88]

Unilever, as a founding member of the Roundtable on Sustainable Palm Oil (RSPO), responded by publicising its plan to obtain all of its palm oil from sources that are certified as sustainable by 2015.[89] It claims to have met this goal in 2012 and is encouraging the rest of the industry to become 100% sustainable by 2020.[90]

In Côte d'Ivoire (Ivory Coast), one of Unilever's palm oil suppliers was accused of clearing forest for plantations, an activity that threatened a primate species, Miss Waldron's red colobus. Unilever intervened to halt the clearances pending the results of an environmental assessment.[91]

According to Amnesty International in 2016 Unilever palm oil provider Wilmar International profited from 8 to 14 year old child labor and forced labor. Some workers were extorted, threatened or not paid for work. Some workers suffered severe injuries from toxic banned chemical. In 2016 Singapore-based Wilmar International was world’s biggest palm oil grower.[92]

Paper use

For years, Unilever purchased paper for its packaging from Asia Pulp & Paper, the third largest paper producer in the world, which was labelled as a "forest criminal" for destroying "precious habitat" in Indonesia's rainforest.[93] In 2011, when Unilever cancelled its contract with Asia Pulp & Paper, Greenpeace Executive Director Phil Radford commended the company for efforts made towards forest protection, for "taking rainforest conservation seriously."[94]

Rainforest Alliance

Unilever certifies its tea products by the Rainforest Alliance scheme. The company has stated that at least 50% of the tea in its products originates from certified farms, compared to the Alliance's 30% minimum entry point. Unilever decided on the scheme over Fairtrade, because according to the company's analysis, Fairtrade might "lack the scale and the organizational flexibility to certify industrial tea estates".[95]

Criticism

The Rainforest Alliance certification scheme has been criticised for not offering producers minimum or guaranteed price,[96] therefore leaving them vulnerable to market price variations. The alternative certificate, Fairtrade, has however received similar criticism as well. The Rainforest Alliance certification has furthermore been criticised for allowing the use of the seal on products that contain only a minimum of 30% of certified content, which according to some endangers the integrity of the certification.[97]

July - September 2016 Salmonella affair

Salmonella affair in cereals in Israel

In July 2016, rumours about salmonella contamination in cereals spread among Israeli consumers. The source for the speculation was the shortage in stores.[98] Initially Unilever did not provide public information about the subject and queries on the matter were initially rebuffed by the company as a non-story and nonsense. On the night of 26 July 2016, Unilever had stopped transferring cornflakes to retailer chains.[99] On 28 July, Yediot Ahronot reported tens of thousands of boxes of breakfast cereal had been destroyed.[100] By 28 July, despite the company's assurances that nothing contaminated was released for consumption, many customers stopped buying Unilever products and started to throw away all cornflakes made by Unilever.[101] The company withheld the information about what were the affected production dates.[102]

On 2 August 2016, Globes reported that the company has published more information about Telma cereals handled on the packaging line in which the contamination was discovered and that a Telma announcement had been made: "We again stress that all Telma products in the stores and in your homes are safe to eat. According to our company's strict procedures, every production batch is checked and put on hold. These products are not marketed until test results for this production series are returned, confirming that all is well. If any flaw is discovered, the batch is not marketed to stores, as was the case."[103] In the following days the Health Minister, Yakov Litzman, threatened to pull Unilever's licence in Israel. He accused Unilever of lying to his ministry regarding salmonella-infected breakfast cereals.[104]

On 7 August, Globes reported that contamination may be sourced in pigeon faeces, the Health ministry said that there might be other sources for the contamination and pigeon faeces are not the only possible source. Globes also said that the production line is automatic ("without human hands") and the possibility that the source is human is a very slim chance.[105] On 8 August 2016, the Israeli Health minister suspended a manufacturing licence until Unilever carry out a number of corrections; the action came after an inspection of the Arad plant, stating "This was a series of negligent mistakes, and not an incident with malicious intent by the firm's management and quality control procedures."[106] An investigation led by Prof. Itamr Grutto and Eli Gordon concluded that the event was caused by negligence.[107]

On 23 September it was reported that the cereals produced between the 18th and 20th at the Arad plant had traces of salmonella.[108]

Class actions

A filed class action must first be approved by an Israeli court, after an approval the case will be held.

Salmonella affair in Tehnia

On 31 August, Unilever stated that the Tehnia products produced by RJM had been contaminated by Salmonella.[111]

Kodaikanal

In 2015, Indian rapper Sofia Ashraf released the music video "Kodaikanal Won't," set to the beat of Nicki Minaj's "Anaconda," to criticise Unilever for dumping mercury into waste ground at the Indian town of Kodaikanal.[112][113] Unilever acknowledges it took on a thermometer factory there through the acquisition of Chesebrough-Ponds. According to Unilever's statement, the factory had sold mercury-contaminated scrap glass to a local dealer, prompting Hindustan Unilever to immediately close the factory, plan the clean-up of the affected sites and monitor the health of its workers. Unilever's website states that it has been waiting since 2010 for the local government Tamil Nadu Pollution Control Board to give it permission for the clean-up.[114]

See also

References

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