Sustainability: A vital consideration from a commercial view

Paul Polman, a long-serving practitioner in the fast-moving consumption goods market, says sustainability is not just a government or a social consideration.

Unilever CEO Paul Polman

"Sustainability is a commercial issue," he insists, adding it can mean serious money.

Environment issues and enterprise development are interwoven, the Unilever CEO insists.

Whenever there is catastrophe such as a typhoon or drastic climate change, the people and places that suffer the most are the low-income groups and less-developed areas, he points out.

Thinking big and caring big in FMCG market

Unilever buys into China's Qinyuan

For FMCG suppliers, natural disasters also have huge consequences because farmers and agricultural sectors, which provide significant resources and materials for companies, may suffer from a reduced harvest, which pushes up prices and costs for FMCG suppliers.

From this perspective, environmental issues are precisely commercial issues.

Unilever's acquisition of Ningbo-based Qinyuan Group, a water purification business, is an example of how Unilever may leverage China's local power to keep its sustainability commitment and to meet its growth target at the same time.

Qinyuan generated sales of 1.2billion yuan ($196 million) for the 12-month period ending Dec 31, 2013. The deal may more than doubles the size of Unilever's water purification business and will bring together complementary technologies from Pureit, Unilever's own water purification brand, and Qinyuan, according to Unilever.

Why do Polman and Unilever place so much significance on water? For the FMCG supplier, water is a big deal because it is an important material for many of Unilever's products, ranging from food to shower gels.

Unilever launched Pureit in China in July 2013. It is currently in markets in 13 countries. In India, Pureit has the largest market share.

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