Unilever chief executive Hein Schumacher said board member Nelson Peltz is “fully behind” a recently devised strategy to re-invigorate the company.
The announcement shows that Schumacher still has the backing of the activist investor who endorsed his appointment last year.
Schumacher told Reuters he wants the Dove soap and Ben & Jerry’s maker to chart a “systematic” marketing strategy for its top brands.
He also said he will not shy away from streamlining Unilever’s 127,000 workforce.
Criticism
Schumacher’s predecessor Alan Jope was criticised for allowing the group’s branded portfolio to grow to around 400, leaving management with too little time to focus on the best performers.
Some investors also said that Unilever was too slow to revive margins following the pandemic, and they faced criticism for placing emphasis on sustainability at the expense of performance.
Reports emerged in January 2022 that Peltz had been building a stake in Unilever through his Trian Partners investment fund.
He eventually accepted a seat on Unilever’s board in July of that year. By September, Jope’s departure was announced and Schumacher eventually became CEO.
As of March 2023, the Trian Partners fund has a 1.45% stake in the company.
“Nelson [Peltz] came on board [because] there was dissatisfaction with the performance,” Schumacher said. “He saw an opportunity to buy at the share price where he thought there was potential.”
Strategy
Schumacher said Peltz’s views are “very much in line” with Unilever’s growth strategy.
The strategy involves investing more in its top 30 brands that represent over 70% of sales, supporting its innovation pipeline for the next few years and working towards a better operating discipline.
Some investors told Reuters in October that they were disappointed when Schumacher initially outlined his strategic plans.
They said they would have preferred a more in-depth restructuring.
“I’m now in the mode of ‘okay, I heard you and this is what we’re doing about it,’” Schumacher said in response.
“History will judge whether I will be a good or bad CEO.”
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