Profit’s not always the point

You might not expect the chief operating officer of a major global corporation to look too far beyond either the balance sheet or the bottom line. But Harish Manwani, COO of Unilever, makes a passionate argument that doing so to include value, purpose and sustainability in top-level decision-making is not just savvy, it's the only way to run a 21st century business responsibly.

The entire model of capitalism

and the economic model that you and I

did business in,

and, in fact, continue to do business in,

was built around what probably Milton Friedman

put more succinctly.

And Adam Smith, of course,
the father of modern economics

actually said many, many years ago,

the invisible hand,

which is, "If you continue to operate

in your own self-interest

you will do the best good for society."

Now, capitalism has done a lot of good things

and I've talked about a lot of good
things that have happened,

but equally, it has not been able to meet up

with some of the challenges that we've seen

in society.

The model that at least I was brought up in

and a lot of us doing
business were brought up in

was one which talked about

what I call the three G's of growth:

growth that is consistent,

quarter on quarter;

growth that is competitive,

better than the other person;

and growth that is profitable,

so you continue to make

more and more shareholder value.

And I'm afraid this is not going to be good enough

and we have to move from this 3G model

to a model of what I call

the fourth G:

the G of growth that is responsible.

And it is this that has to become

a very important part

of creating value.

Of not just creating economic value

but creating social value.

And companies that will thrive are those

that will actually embrace the fourth G.

And the model of 4G is quite simple:

Companies cannot afford
to be just innocent bystanders

in what's happening around in society.

They have to begin to play their role

in terms of serving the communities

which actually sustain them.

And we have to move to a model

of an and/and model which is

how do we make money and do good?

How do we make sure

that we have a great business

but we also have a great environment around us?

And that model

is all about doing well and doing good.

But the question is easier said than done.

But how do we actually get that done?

And I do believe

that the answer to that is going to be leadership.

It is going to be to redefine

the new business models

which understand

that the only license to operate

is to combine these things.

And for that you need businesses

that can actually define their role

in society

in terms of a much larger purpose

than the products and brands that they sell.

And companies that actually define a true north,

things that are nonnegotiable

whether times are good, bad, ugly --

doesn't matter.

There are things that you stand for.

Values and purpose are going to be the two

drivers of software

that are going to create

the companies of tomorrow.

And I'm going to now shift

to talking a little bit about my own experiences.

I joined Unilever in 1976

as a management trainee in India.

And on my first day of work

I walked in and my boss tells me,

"Do you know why you're here?"

I said, "I'm here to sell a lot of soap."

And he said,
"No, you're here to change lives."

You're here to change lives.

You know, I thought it was rather facetious.

We are a company that sells soap and soup.

What are we doing about changing lives?

And it's then I realized

that simple acts

like selling a bar of soap

can save more lives

than pharmaceutical companies.

I don't know how many of you know

that five million children don't reach the age of five

because of simple infections that can be prevented

by an act of washing their hands with soap.

We run the largest

hand-washing program

in the world.

We are running a program on hygiene and health

that now touches half a billion people.

It's not about selling soap,

there is a larger purpose out there.

And brands indeed can be

at the forefront of social change.

And the reason for that is,

when two billion people use your brands

that's the amplifier.

Small actions can make a big difference.

Take another example,

I was walking around in
one of our villages in India.

Now those of you who have done this

will realize that this is no walk in the park.

And we had this lady

who was one of our small distributors --

beautiful, very, very modest, her home --

and she was out there,

dressed nicely,

her husband in the back, her mother-in-law behind

and her sister-in-law behind her.

The social order was changing

because this lady

is part of our Project Shakti

that is actually teaching women

how to do small business

and how to carry the message

of nutrition and hygiene.

We have 60,000 such women

now in India.

It's not about selling soap,

it's about making sure

that in the process of doing so

you can change people's lives.

Small actions, big difference.

Our R&D folks

are not only working to give us
some fantastic detergents,

but they're working to make sure we use less water.

A product that we've just launched recently,

One Rinse product that allows you to save water

every time you wash your clothes.

And if we can convert all our users to using this,

that's 500 billion liters of water.

By the way, that's equivalent to one month of water

for a whole huge continent.

So just think about it.

There are small actions that
can make a big difference.

And I can go on and on.

Our food chain, our brilliant products --

and I'm sorry I'm giving you
a word from the sponsors --

Knorr, Hellman's and all those wonderful products.

We are committed to making sure that

all our agricultural raw materials

are sourced from sustainable sources,

100-percent sustainable sources.

We were the first

to say we are going to buy all of our palm oil

from sustainable sources.

I don't know how many of you know that palm oil,

and not buying it from sustainable sources,

can create deforestation that is responsible

for 20 percent of the greenhouse gasses in the world.

We were the first to embrace that,

and it's all because we market soap and soup.

And the point I'm making here

is that companies like yours, companies like mine

have to define a purpose

which embraces responsibility

and understands that we have to play our part

in the communities in which we operate.

We introduced something called

The Unilever Sustainable Living Plan, which said,

"Our purpose is to make
sustainable living commonplace,

and we are gong to change the lives

of one billion people over 2020."

Now the question here is,

where do we go from here?

And the answer to that is very simple:

We're not going to change the world alone.

There are plenty of you and plenty of us

who understand this.

The question is,

we need partnerships, we need coalitions

and importantly, we need that leadership

that will allow us to take this from here

and to be the change

that we want to see around us.

Thank you very much.

(Applause)