Speaker 1: Well, he is the former CEO of a massive consumer
Speaker 1: products company, well known brands in the personal care space,
Speaker 1: food space. I mean we're talking dub We're talking Hellman's
Speaker 1: lipped in Ben and Jerry's Seventh Generation, Save so many more.
Speaker 1: Harvard Business Review recently wrote that he first save UNI
Speaker 1: Leaver and now he wants to save capitalism. You had
Speaker 1: me at Ben and Jerry's, don't We had everybody at
Speaker 1: Ben and Jerry's. So nice to have with us. Former
Speaker 1: Uni Leaver CEO Paul Pullman. He's got a new book
Speaker 1: out net Positive, how courageous companies thrive by giving more
Speaker 1: than they take. He joins us on the phone in
Speaker 1: the UK. Paul, So nice to have you here on Bloomberg.
Speaker 1: How are you? Thanks for having me. It's a great opportunity. Well,
Speaker 1: it's great to have you here. You know, first I
Speaker 1: want to ask you, I mean, you were CEO coming
Speaker 1: out of the financial crisis. You know, what do you
Speaker 1: remember that time and where you're kind of glad not
Speaker 1: to have to deal with this crisis as CEO of
Speaker 1: a major global company. Well, there's so many change is
Speaker 1: happening right now. We see the speak of change and
Speaker 1: of the technological volution and the scale of the Industrial revolution.
Speaker 1: And I don't think it's easy to be a CEO
Speaker 1: any time in history. But the financial time crisis what
Speaker 1: was particularly tough because we really saw a big contraction
Speaker 1: in emerging markets and big interventions from governments that were needed.
Speaker 1: But it was clear to me already then that the
Speaker 1: economic system needed to evolve to something that was more
Speaker 1: inclusive and frankly, more sustainable. That's what we set out
Speaker 1: in Unilever to do already back in two thousand eight,
Speaker 1: and over the ten years of my tenure, that has
Speaker 1: helped us show that business can be done differently, but
Speaker 1: that it ultimately is also good for the shareholds. Have
Speaker 1: you been concerned that the current crisis that we're facing
Speaker 1: as as a as a globe, as a global community,
Speaker 1: the coronavirus pandemic is going to further set back those
Speaker 1: those goals of being a more equal society, being more
Speaker 1: just society. Well, if I may be honest, even if
Speaker 1: the financial crisis we missed an opportunity and people felt
Speaker 1: that banks were too big to fail and people were
Speaker 1: too small to matter, and the governments did not really
Speaker 1: use that opportunity to channel the funds into creating a greener,
Speaker 1: more sustainable, more equitable society. COVID again is a stark
Speaker 1: reminder and that we can't have healthy people on an
Speaker 1: unhealthy planet. And I think it has brought to light
Speaker 1: complexities of our system, the biodiversity destruction, climate change, inequality,
Speaker 1: the racial dimensions as you've seen, especially in the US,
Speaker 1: and that has uh put many of these things higher
Speaker 1: on the agenda of the business community. And the reason
Speaker 1: for the net positive is I think most people understand
Speaker 1: what is happening now around climate change or inequality and
Speaker 1: trying to move in the right direction, but collectively we're
Speaker 1: clearly not moving at the speed and scale and recognizing
Speaker 1: the difficulties that we see in many countries and developed
Speaker 1: around governance or or global multilateralism if you want to.
Speaker 1: The book would argue that it is in businesses interests
Speaker 1: to step up and fill that point and healthy risk
Speaker 1: that political process. How do we get here, Paul and
Speaker 1: I asked, because look at the macro problems we have
Speaker 1: right now. You know, inequities, incredible wealth gaps, We're talking
Speaker 1: about the energy crisis, We're talking about climate and the
Speaker 1: impact that we've had, and maybe it's just getting too late, uh,
Speaker 1: the inability and maybe food feed everyone. Did companies become
Speaker 1: too greedy? Well, it is clear that the current economic
Speaker 1: system that we've had with infinite growth on the finite
Speaker 1: planet is really not sustainable and anything you can do
Speaker 1: uh continuously is by definition not not possible. So we
Speaker 1: need to change our economic system and be sure that
Speaker 1: we are pivoted in a way that we take care
Speaker 1: of planet Earth and also a fellow citizens. And the
Speaker 1: most existential threat we now have, without any doubt is
Speaker 1: climate change. But we and the other side of the
Speaker 1: coin that we've seen is that when we kept these
Speaker 1: issues nowaday after day, nearly on television or any other media,
Speaker 1: it's again the poor that suffered the most. COVID has
Speaker 1: put us back on the sustainable development goals probably fifteen
Speaker 1: twenty years. So there is no doubt that we need
Speaker 1: to work harder. The option of not doing anything and
Speaker 1: and going to a crisis like COVID again at the
Speaker 1: accelebrated phase and more often is simply not an option.
Speaker 1: I've never really felt that to be reasonable, and unfortunately,
Speaker 1: we still have a lot of the opportunities to address
Speaker 1: it and to to figure out something better that would
Speaker 1: serve us in future generations. Paul, I'm curious about your
Speaker 1: path to becoming CEO, because I did read that you
Speaker 1: were considering becoming a priest, you were in line of
Speaker 1: to go join the priesthood or a doctor as well.
Speaker 1: I'm curious how that impacts you're thinking, impacted you're thinking
Speaker 1: as a CEO. Well, I was born in nineteen fifty six,
Speaker 1: and I always thought there was a long time after
Speaker 1: World War Two, but it actually was fairly short. And
Speaker 1: I grew up in a family where my parents were
Speaker 1: deprived education because of the war. So all they wanted
Speaker 1: is peace in Europe. The communities to work ensure that
Speaker 1: there's six children called education, and frankly had a better
Speaker 1: life than than they did. So I think at the
Speaker 1: end of the day, I was fortunate, um that I
Speaker 1: had these parents and who put the interest of others
Speaker 1: ahead of their own, and and they firmly believed that
Speaker 1: they would be better off by doing that as well.
Speaker 1: So that's how I grew up and and it brought
Speaker 1: me values of dignity, respect, equity, compassion that I've tried
Speaker 1: to live my life was I've always realized that having
Speaker 1: been born in the Mettlands. I've just been lucky. The
Speaker 1: government paid for my education, I had a toilet at home,
Speaker 1: I had some food, so I wasn't stunned that. Unfortunately
Speaker 1: that's only the case for five of the world population
Speaker 1: that that privileged position, and yet they didn't do anything
Speaker 1: for it. So I want the lottery ticket off verse,
Speaker 1: if you call it that. And I've always felt it's
Speaker 1: our obligation to put ourselves to the service of others,
Speaker 1: to ensure that that in consumption for everybody, So priesthoods
Speaker 1: or being a doctor or now being in business actually
Speaker 1: ultimately is the same purpose. How can you have the
Speaker 1: best impact who helped ensure the changes that are needed? Paul,
Speaker 1: I want to be honest with you, and Tim and
Speaker 1: I have been talking and people, you know, we get
Speaker 1: a lot of feedback this whole idea that companies that
Speaker 1: have got us into a predicament in some ways, have
Speaker 1: contributed to climate change, have helped create wealth gaps, have
Speaker 1: done a lot of things that have put us in
Speaker 1: not a great way today. How how can we really
Speaker 1: rely on them to be ethical, responsible and get us
Speaker 1: out of it. Yeah, I don't disagree with that statement,
Speaker 1: and we have that same skepticism. Obviously, a lot of
Speaker 1: these issues that we know deal with have craft up
Speaker 1: on us, and our incredible wealth creation and lifting so
Speaker 1: many people out of poverty over the last four or
Speaker 1: five decades has been incredible and we should be rejoicing
Speaker 1: in that. Unfortunately, though, we've done that in a linear
Speaker 1: production pattern that is giving us enormous pressures on the
Speaker 1: planetary boundaries. This year, World over shoot Day was July
Speaker 1: twenty nine, which is the day that we use up
Speaker 1: more resources then the world can be planets. In fact,
Speaker 1: after that day, we're stealing from future generations. Now, increasingly
Speaker 1: businesses are starting to understand that that is an unsustainable
Speaker 1: way of running businesses. The financial market seas that has
Speaker 1: an increasing risk. The employees that worked for the companies
Speaker 1: want to live in a better weld, The citizens are
Speaker 1: speaking up, So I think there's a ground swell of
Speaker 1: action happens to be. Fortunately still that in today's well
Speaker 1: the business community has held at a higher level of
Speaker 1: trust than governments. And whilst we in our book deliberately
Speaker 1: don't want to get into finger pointing, we say the
Speaker 1: first thing that businesses have to do is to own
Speaker 1: the problem. If you break it, you own it is
Speaker 1: what we call it, just like happens in the store
Speaker 1: when you break a couple uh that you wanted, that
Speaker 1: you didn't buy or whatever. So businesses need to go
Speaker 1: look at their total impact and take responsibility for that,
Speaker 1: and that takes leadership, That takes courage, and then they
Speaker 1: look at the negative consequences of some of their business
Speaker 1: models and try to work very hard, first alone, then
Speaker 1: in their value chain, then at industry level, or finally
Speaker 1: at societal level to drive the needed chances. And that
Speaker 1: is starting to happen. You look at climate. I think
Speaker 1: it's now undeniable that we have an issue of climate chance.
Speaker 1: But it's also clear that the costs that society are
Speaker 1: incurring five point nine trillion all of us, according to
Speaker 1: the I m F significantly hired. And actually what it
Speaker 1: would cost us two attack it partners would be the
Speaker 1: photom to realize that, Paul, are the incentives aligned though,
Speaker 1: Because here we are, we're in the fourth quarter of
Speaker 1: the year, We're about to start getting earnings from companies,
Speaker 1: and the numbers that move the company's stock are revenue
Speaker 1: and UH bottom line forecasts and how the companies did
Speaker 1: in the previous quarter. There's nothing in there about environmental impact,
Speaker 1: and that's what investors are focused on. Well, yes, I
Speaker 1: know what we now see in the shareholder proxy season
Speaker 1: that you just close that most of the questions are
Speaker 1: around E s G. You ask. You see shareholders asking
Speaker 1: uh x on to change board members. You see shape
Speaker 1: from being attacked. You see ninety tillion dollars of money
Speaker 1: on the management now in the financial markets asking for
Speaker 1: disclosure on carbon you see Larry Pink writing is letters
Speaker 1: friend guard. I think we're past that point. We also
Speaker 1: see that if companies make announcements, significant announcements to do
Speaker 1: something about it, that that actually their share price gets
Speaker 1: positively affected. We've looked by industry sector, just comparing within
Speaker 1: a sector companies and companies that more aggressively attack these
Speaker 1: externalities actually seem to get a higher market value now
Speaker 1: as well. So we would argue just the opposite that
Speaker 1: if you want a longer term shareholder return, short term
Speaker 1: you can always speculate, but if you want a longer
Speaker 1: term shareholder return, it is now better to do that
Speaker 1: in a way that also deals with the environmental and
Speaker 1: social issues. That will say some unfortunately, more and more
Speaker 1: CEOs are understanding that. It is just that I think
Speaker 1: we don't have to spend too much time anymore on
Speaker 1: the why, which is really your question, but more on
Speaker 1: the how. And this is where they struggle. Well, when
Speaker 1: it comes to how. You write in the book about
Speaker 1: a net positive world right, and you talk about redefining
Speaker 1: the corporation, that the corporate world is zeroing in on
Speaker 1: better metrics with a sup of new initiatives and acronyms
Speaker 1: are popping up. And you know, in this section you
Speaker 1: talk about, you know, what would it mean if companies
Speaker 1: had to pay for the natural capital and resources that
Speaker 1: they used for free? None of the biggest industries would
Speaker 1: be profitable. And then you also ask what what would
Speaker 1: a company look like if citizens, not shareholders were the focus.
Speaker 1: Do we need new metrics, whether it's from the SEC
Speaker 1: or European regulators or Asian regulators in terms of what
Speaker 1: really is a successful company? And I do wonder how
Speaker 1: the capital markets, the financial markets that Tim and I
Speaker 1: report on minute by minute every day, makes it complicated
Speaker 1: and maybe impossible for new metrics to be created. Well,
Speaker 1: there is a lot of effort going on around the
Speaker 1: globe actually to create these methods, measures because people increasingly
Speaker 1: see that these environmental issues like climate chains, or these
Speaker 1: social issues like resilience in your value chain or employee
Speaker 1: engatesment eutchet uh are actually of material importance, and increasingly
Speaker 1: the financial community is asking for it. Unfortunately, until now
Speaker 1: we have not had governments that were in some countries
Speaker 1: conclusive to put in that direction, and as a result
Speaker 1: we have a little bit of an alphabet soup. Assion
Speaker 1: mentioned was about six hundred different efforts to put standards
Speaker 1: out there. Fortunately someone has thought about it, and on
Speaker 1: climate were increasingly rolling out the standards of financial Disclosure
Speaker 1: for Climate related risks, which are called TCFD. We now
Speaker 1: have over two thousand, three hundred companies supporting that. We
Speaker 1: have about forty five companies countries implementing that, and that
Speaker 1: is from basically zero a year ago. We have the
Speaker 1: SEC getting increasingly interested in looking at some of these
Speaker 1: measures for matt reality reasons. Europe has the European Taxonomy,
Speaker 1: and last but not least, the i f r S
Speaker 1: is working quite aggressively on creating the sustainable standard boards.
Speaker 1: So there are things happening on that front, and rather
Speaker 1: sooner than later. Hey, forgive me thirty seconds quickly. Is
Speaker 1: there a company other than you know Leaver that you
Speaker 1: think is getting it right with this and just quickly
Speaker 1: if you could, Oh, No, there are many companies that
Speaker 1: get it right. We see now companies like Google wanting
Speaker 1: to put their system to the use of consumers and
Speaker 1: helping consumers make better choices in purchasing or investing in companies.
Speaker 1: We see companies like Belta Order Airlines now making commitments
Speaker 1: to be net zero by twenty fifty. We see companies
Speaker 1: now trying to go to the net positive direction. Walmart
Speaker 1: restoring forests, protecting oceans, Salesforce replanting forest, Microsoft trying to
Speaker 1: capture govern or Juice since their inception Noah, the trainers
Speaker 1: left the station. We just need to get more companies
Speaker 1: and then as these companies work together with governments to
Speaker 1: change some of the frameworks that are out there. Well, Paul,
Speaker 1: nice to get some time with You really appreciate pop
Speaker 1: Home and former you know Leaver ceo his book Net Positive,
Speaker 1: how courageous companies thrive by giving more than they take.
Speaker 1: A lot of problems to solve, a lot of problems
Speaker 1: to solve um WA's optimistic phil Yeah, I'm gonna be
Speaker 1: optimistic to have a great evening. Everyone