A year after he left Unilever, Terry Slavin interviews the former CEO about this month's disappointing COP25, and what he has done in the year since he was set free of the ‘shackles’ of steering one of the world's biggest consumer goods companies
At a press conference at COP25 last week, former Unilever CEO Paul Polman sat on a panel announcing that 177 companies have now signed up to the UN Global Compact’s Business Ambition for 1.5C campaign, a huge increase on the 68 signatories at the campaign’s launched at the UN General Assembly in September.
But the sparse attendance in the room for what Polman described as “one of the major announcements of the COP” was a sharp contrast to the media buzz that surrounded him at COP21 in Paris in 2015, when I first encountered him, sharing the main stage with Al Gore, Leonardo DiCaprio, and the Prince of Wales.
It’s been barely a year since Polman walked away from his job heading one of the world’s biggest consumer goods company. But if the 62-year-old Dutchman misses the attention and power that office conferred, he didn’t sound it in an interview with Ethical Corporation in October at the Responsible Business Awards.
Indeed, he seems to be relishing freedom from what he describes as “the shackles” of running the Anglo-Dutch multinational, enabling him to his full energies to what motivates him most. He may no longer be front of stage in the climate battle, but behind the scenes Polman seems to be a veritable puppet master, using his leadership on a formidable list of global bodies to pull the strings to bring the critical constituencies of government, business, finance, and civil society into alignment.
Polman said he stayed 10 years as CEO of Unilever, an unusually long tenure, because he was able to use the company’s size to drive forward transformative change. “So that was very motivating for me. It also positions Unilever well in the global landscape and the company got amply rewarded for that ... But there are inherent limitations if you're a CEO,” he said, notably in terms of working with competitors. At the same time, having been a former boss of Unilever means fellow CEOs in other sectors give him a hearing.
The latter card is one he has been playing in Imagine, the benefit corporation and foundation he co-founded last year with two former leading executives at Unilever, Jeff Seabright and Kees Kruythoff, and Valerie Keller, formerly of the EY Beacon Institute.
Imagine, which has offices in London, Amsterdam, New York and Los Angeles, works to support forward-thinking CEOs, building up a critical mass of companies in sectoral value chains and connecting them with allies in government, think tanks, finance and civil society to help them reach scale at speed.
If you look at the trends and the strong impacts of the fashion industry it is tremendously exposed
Polman says Imagine targets CEOs, who generally only stay in post two or three years, “because there is a sense of urgency about what needs to happen.”
Imagine’s first big gig came when France’s president Emmanuel Macron asked it to mobilise the private sector behind a new climate commitment to announce at the G7 meeting in Biarritz in August.
Led by Kering’s CEO, the French billionaire François-Henri Pinault, the team brought together 32 CEOs, committing to a Fashion Pact to fight the climate crisis and protect biodiversity in the oceans.
According to the UN, the fashion industry contributes to around 10% of global greenhouse gas emissions, consuming more energy than the aviation and shipping industry combined.
It also has huge impacts on biodiversity, Polman says, pointing out that micro-fibres released by synthetic clothing while they are washed account for a whopping 35% of the plastics found in the ocean. “So you look at the trends and you look at the strong impact made by this industry, and it is tremendously exposed,” he said.
But the industry had not woken up to this threat, which is where Imagine came in, Polman said. The first step was to build up awareness among a critical mass of CEOs, representing at least 20%-of the value chain. The second was to come up with a common commitment for action. This long shopping list includes committing to 1.5C science-based targets, helping develop SBTs on biodiversity, adopting regenerative agriculture practices, eliminating micro-fibre pollution and ending the use of single-use plastics.
Smart NGOs want to work with you, to move the agenda in the right direction
Once 30% of the value chain is covered by the commitment, he said, tipping points start to happen. Other industries get drawn in, and “NGOs are not attacking you anymore... The smart NGOs want to be part of it, to move the agenda in the right direction. And actually, then we start to see is governments then say, ‘hey, look, so much of the industry is behind this. Our rules, laws and regulations must not get in the way’. So you start to de-risk the governmental processes to put the right frameworks in place.”
What Polman brings to the table is his internationalist vision and contacts book of corporate and government A-listers compiled over a decade of striding the stage at World Economic Forum meetings in Davos and the annual UNFCC COP jamboree. “Individual companies don't have access to Christiana Figueres or Al Gore, [but] if you have an aggregate, as we try to do at Imagine, it allows them be part of that.”
When we spoke in early October 44 companies had signed up to the Fashion Pact, including H&M, Gap, Adidas, Inditex Hermes, Chanel, Kering, Tommy Hilfiger and Ralph Lauren.
Last week at the UN Global Compact press conference he said membership had mushroomed to 60. He had hoped to be able to announce that their numbers could be added to the 177 companies in the Business Ambition for 1.5C coalition, but the fashion firms’ 1.5C targets have yet to be approved by the Science Based Targets initiative. “Without doubt we will double that number or more by COP26 [in Glasgow] next year,” he promised.
It might sound like a lot but putting myself as chair of all these organisations keeps them aligned on the same agenda
But Imagine is only one tine in Polman’s multi-pronged climate mission. He is chair of the Food and Land Use Coalition, the B Team, vice-chair of the UN Global Compact, and past chair of the World Business Council for Sustainable Development. Since June 2018 he has also been chair of the International Chamber of Commerce, an organisation that represents more than 45 million businesses.
“It might sound like a lot, but putting myself as chair [of all these organisations] keeps them aligned on the same agenda,” he said. “And we get the private sector to spin in the same direction so that we get this viable movement. And then with organisations like the World Business Council or the B Team we create some heroic companies that move faster and become the locomotive to the train.”
Polman’s influence on the ICC was on show at COP25, where the ICC for the first time joined WBCSD and the UN Global Compact as a third major force for business climate action, hosting the official COP25 business and industry day.
A Chambers Climate Coalition, committed to corporate action to keep global warming well below 2C, has attracted the support of 2,100 chambers and affiliate organisations since it was launched in June. In an open letter to finance ministerson the eve of the talks, the ICC set out a 10 point plan to better align the governance of the financial system with the objectives of the 2015 Paris Agreement and the Sustainable Development Goals.
Getting the finance world on board for a 1.5C world is one of the biggest strings being pulled by Polman, who co-chairs, with eminent climate economist Nick Stern, the Global Commission on the Economy and Climate, formed in 2013 the run-up to Paris. The commission comprises former heads of government and finance ministers as well as economics and business leaders, and created the New Climate Economy initiative to provide independent evidence that taking action on climate change does not mean sacrificing economic growth.
“We change the narrative to saying, ‘if you don't tackle climate change, you don't have economic growth’,” Polman said of the New Climate Economy work. “And then we target some countries - Colombia, Ethiopia, China, and Indonesia - where we make them hopefully more courageous, and help them with their NDCs [nationally determined contributions] so that there are examples [of clean growth] in all parts of the world.”
From the investment side, Polman is a member of the board of responsible investment organisation PRI, which this year released a report forecasting the new policies governments are likely to implement up to 2050 as the realities of climate change become increasingly apparent, and the impact on financial markets.
PRI is also co-convener, with the UNEP’s Finance Initiative, of the Net Zero Asset Owners Alliance, an international group of institutional investors, representing $4trn in assets under management, that announced at the UN General Assembly in September that they have committed to transition their investment portfolios to net-zero GHG emissions by 2050, in alignment with a 1.5C climate scenario.
A lot of the discontent is because we're not handling the transitions properly for the people who are suffering
As Polman said at last week’s press conference, “Even under the current climate legislation companies that are high emitters can expect 30% of their market value to disappear by 2030, while more progressive companies will see their market value increase by 33%. There’s a bifurcation of winners and losers that is starting to happen. It’s not about [climate] risk any more; it’s about still being there in the future, and leading in your sector.”
In his interview with Ethical Corporation, Polman emphasised the importance of ensuring that the transition is a just one, an agenda that former Irish president Mary Robinson is leading internationally as a member of the B-team and other organisations. “A lot of the discontent that is out there is because we're not handling the transitions properly for the people who are suffering, so that's a big part of what we are advocating,” he says.
This was why it was significant that the United for the Paris Agreement statement from 80 CEOs in the lead up to COP25 urging President Trump to stay in the Paris agreement bore the signature of the AFL/CIO, union leaders who represent 12.5 million US workers.
So what did he make of the acrimonious end to COP25, with exhausted leaders leaving it to COP26 in Glasgow to decide on critical rules for implementing the Paris Agreement, such as integrating carbon pricing into the Paris Agreement?
Responding by email, Polman condemned the fact that “a handful of big emitter nations are blocking urgent, global action”. He said this put them at odds with civil society and the 80 countries that have signed up to the Climate Ambition Alliance, launched at Climate Week New York in September, committing signatories to enhanced ambition in line with limiting global temperatures to 1.5C. The alliance also includes 780 businesses, 400 cities, and institutional investors with $4tr in funds under asset management.
“These are unprecedented climate coalitions, supported by civil society,” Polman said. “So-called ‘leading’ governments are going to be left behind.”
It is a message to the countries that blocked progress at COP25 - China, the US, Brazil and Australia - but it applies equally to the companies that are standing in the way of transformative change, too. They have been warned.UNEP FI Fashion Pact UN Global Compact WBCSD ICC We Mean Business PRI Climate Ambition Alliance