It came after the company has committed to set a new benchmark for public reporting about the healthiness of the food it sells. Going forward, it will measure the sales of its products against major government-endorsed Nutrient Profile Models as well as its own internal metric.
The shareholder resolution had been co-filed by ShareAction, an investor coalition managing $215bn in combined assets and investors in Unilever. The resolution was urging the company to adopt ambitious targets to increase the share of healthy foods in its sales.
In response to their demands, Unilever agreed to publish annual assessments of the health characteristics of its products on a global basis as well as for 16 key strategic markets, in line with government-endorsed nutritional criteria. The first report will be published in October 2022. It also agreed to set stretching new targets for growing the proportion of its healthier products by October in advance of its 2023 AGM and to submit these targets to shareholder scrutiny.
Unilever has always maintained that its products are healthy, using its own definitions of that term. Last year it said that 61% of its food and drink sales were derived from products with “High Nutritional Standards”. But an independent review estimated the figure to be just 17%.
Unilever’s new commitment to use independent benchmarks will therefore provide ‘far greater clarity to shareholders and consumers on its impact on public health’, ShareAction said, adding the enhanced disclosures form ‘a new precedent for transparency in reporting for food manufacturing companies’.
The investor group said it was further hopeful that Unilever’s example will stimulate progress in the quality of health reporting across the sector, leading to greater action from global food manufacturers to tackle systemic malnutrition through the provision of healthier products.
Louisa Hughes, Engagement Manager at ShareAction said: “We welcome Unilever’s willingness to engage with the shareholder group and we are pleased to see their commitment to set stretching targets to increase their sales of healthier products in response to our proposal. The next seven months are crucial for ensuring that this commitment is translated into ambitious long-term goals, with concrete policies to deliver these. We encourage investors to make their expectations known to the company. Whilst our resolution has been withdrawn, we may consider further action next year if we are unsatisfied with the company’s progress”
Unilever announced that it will be the first global Foods company to publicly report the performance of its product portfolio against at least six different government-endorsed Nutrient Profile Models (NPM) as well as its own Highest Nutritional Standards (HNS).
It will publish the assessment on an annual basis both globally and for 16 key strategic markets and will report its performance both by volume of product and by sales revenue. Its first report will be published by October 2022.
Unilever will also continue to set stretching nutrition targets for its portfolio, as part of its Future Foods commitments, which were published at the end of 2020. This includes timebound targets for plant-based sales, reduction of salt, sugar and calories, and increasing the sales of healthier ‘positive nutrition’ products.
Unilever added it will ‘update and strengthen’ its specific targets that expire at the end of 2022 and will consider both HNS and at least six different NPMs to determine which is the most stretching target benchmark to increase sales of healthier products in a way that maximises positive impact for global consumer health.
Hanneke Faber, Unilever’s President of Foods & Refreshment, said: “We welcome the constructive dialogue we have had with ShareAction and the Healthy Markets Initiative. We share a common belief in the importance of having an ambitious long-term strategy for nutrition and health, and that companies should publish ambitious targets to deliver against. I am confident that with these new initiatives, we will set a new benchmark for nutrition transparency in our industry and accelerate our positive impact on public health.”
Unilever will continue to engage with ShareAction and investors from the Healthy Markets Initiative as these commitments are developed and implemented in the run up to the 2024 AGM.
Cllr Gerald Cooney at Greater Manchester Pension Fund said: “As one of the largest food manufacturers, Unilever has a real opportunity to tackle rising obesity levels around the world. In the UK, poor diets are one of the biggest drivers of ill health and widening inequalities across the country. In this context, we welcome the announcement made by Unilever today and we encourage the company to be ambitious as it fleshes out these commitments later this year.”