Unilever’s chief executive, Paul Polman, is stepping down just months after a shareholder rebellion forced the company to scrap a planned move from London to Rotterdam.
The group, whose brands include Marmite, Dove soap and Magnum ice-cream, ditched its plan to simplify its dual Anglo-Dutch structure in October after an unprecedented protest from UK shareholders, many of whom would have been forced to sell up if the move had gone ahead.
The row was a significant blow to the credibility of its top executives, Polman and the chair, Marijn Dekkers.
Polman is a leading industry figure and has been at the helm of Unilever for almost a decade, during which the company’s share price has risen by about 150%, well ahead of the FTSE 100 average.
Polman last year fended off a £115bn bid from Kraft Heinz, the US consumer goods group behind Philadelphia cheese. The move to Rotterdam was partly seen as a way to shore up the company’s defences against such bids, as takeover laws are stricter in the Netherlands.
As part of efforts to rejuvenate the business, Polman also sold off Unilever’s spreads business, which included Flora and I Can’t Believe It’s Not Butter, to the private equity house KKR in a £6bn deal.
Polman will be succeeded on 1 January by Alan Jope, the president of Unilever’s biggest division, beauty and personal care.
The company said Polman would stay on to support the handover to Jope until early July. He told the board he wanted to leave at a board meeting in New York on Wednesday, and will not receive a payoff.
Unilever appointed headhunters to find a successor for Polman in the autumn of 2017 and said then the process would take 12-18 months. The announcement of a successor on Thursday came earlier than had been expected. The company is yet to find a successor for Jope at beauty and personal care, which accounts for almost half its operating profits.
Jope, 54, has led beauty and personal care since 2014. He previously ran Unilever’s north Asia business for four years, served as president of its Russia, Africa and the Middle East operations, and spent more than a decade in senior food, homecare and personal care roles in the US. Born in Scotland, he joined Unilever as a graduate marketing trainee in 1985.
He will be paid a salary of €1.45m (£1.29m) and an annual bonus of up to 225% of his salary, two-thirds of which will be in Unilever shares.
Dekkers said: “Paul is an exceptional business leader who has transformed Unilever ... His role in helping to define a new era of responsible capitalism, embodied in the Unilever sustainable living plan, marks him out as one of the most far-sighted business leaders of his generation.”
He denied Polman’s departure had been hastened by the controversy over Unilever’s scrapped move. “January 1st is an excellent start date, particularly in our industry that is so dynamic”, and would enable Jope to “own” 2019, Dekkers said.
Paul Polman - outgoing Unilever boss
Unilever’s ill-fated attempt to 'go Dutch' turned out to be the final chapter in Paul Polman’s 10-year tenure as chief executive – a period in which he won praise for tackling climate change and reducing plastic use, while rebuilding Unilever’s financial performance and fending off a £115bn hostile bid from Kraft. One analyst described it as a 'sorry way to finish an exceptional career at the company'.
The announcement of his retirement follows a year-long search for a successor, and a bruising recent row with shareholders over the plan to scrap Unilever’s dual Anglo-Dutch structure and move from London to Rotterdam, which would have pushed it out of the FTSE 100.
A leading figure in the consumer goods industry, the 62-year-old Dutchman (full name is Paulus Gerardus Josephus Maria Polman) has worked for three of the biggest firms in the sector in the last 40 years.
Born and raised in the Netherlands, he spent nearly three decades at US giant Procter & Gamble, which he joined in 1979 with two masters degrees from the University of Cincinatti. He left the maker of Pampers nappies and Gillette razors in 2006 to join Nestlé, the world’s biggest food group, where he became CFO.
After losing out on the top job at the Swiss firm, he went to Unilever in 2009, where he became the first 'outsider' to take the helm in the company’s 80-year history.
Faced with sluggish revenues, Polman stepped up the turnaround started by his predecessor, Patrick Cescau, and launched a sustainable living plan in 2010, with ambitious targets to halve the environmental footprint of its products and source 100% of its agricultural raw materials sustainably by 2020. The company has also pledged to eliminate coal from its energy usage within five years, and derive all of its energy solely from renewable sources by 2030.
'Growth at any cost is not viable,' Polman said. He has won numerous awards, including France’s Chevalier de la Légion d’Honneur for his efforts in galvanising business action on sustainability.
Polman is married with three children. He chairs the Perkins School for the Blind International Advisory Board and is head of the Kilimanjaro Blind Trust, a charity supporting schools for blind children in east Africa.
Julia Kollewe
Polman, who has been lauded for his environmental efforts at Unilever, said he was looking forward to engaging with many of the company’s partners “in a different capacity – to help address the many environmental and social challenges facing the world”.
Unilever shares were down slightly, 0.4%, shortly before the FTSE closed. The UBS analyst Pinar Ergun said: “The appointment of an internal candidate is likely to ensure continuity as Unilever makes progress towards its 2020 targets.”
Neil Wilson, the chief market analyst at Markets.com, said: “It’s no real surprise to see Paul Polman leave Unilever. The botched plan to move the company HQ to Rotterdam was a sorry way to finish an exceptional career at the company. Management was left badly bruised by the sole-listing affair and it was doubtful whether the leadership would remain the same for long.
“Plenty for the new man Alan Jope to get on with, not least a rather expensive acquisition of the Horlicks unit from GSK. A focus on emerging markets is clearly critical to delivering growth and shareholder value, but at such a price the execution has to be right.”
