India will be an important driver of growth in the next 10 years: Hein Schumacher, Unilever

On the sidelines of Barclays Fireside Conference, Hein Schumacher, chief executive officer, Unilever, said the multinational company should not be complacent about its market share as that could weaken its historical position. Take a look at the key highlights from Schumacher about the FMCG juggernaut’s global and India market growth and intervention plans.

On Unilever's GAP - Growth Action Plan

We have talked about doing fewer things better with greater impact. So, we're making real choices when it comes to the areas we want to focus on for top line growth. What's really different is that the new organisation - we should stop calling it ‘new’, but we're putting our finishing touches to it. It's a really major change for the company and I'm very keen to push that one through all the way to the max also.

We have put a new leadership in place. We changed around 60 percent to 70 percent of the team. There's still some more change on that one to come. I think there are quite a number of things that are very different. I'm just a bit careful to call it out as a strategy.

This is an action plan internally by the way. We label it as the Gap - Growth Action Plan. But, it's also very well meant to close the gap. We're trading at a discount, absolutely determined to close that discount. We have many reasons that we can do. The perceived change within the company is actually very high.

We saw an inflection point in the beginning of 2023 when it came to gross margin. There's a way to go and we're going to build on that. But, it's not that you know things are not moving. Secondly, if you look at our business groups - the five of them. Three of them have now moved to positive volume growth.

The new leadership is to be installed on January 1. But we're off to a flying start when it comes to concepts like filling the pipeline on breakthrough innovations to develop the markets again. There are many things that were sort of hidden somewhere in the company and I'm extremely keen to dial it up.

The same goes for the superiority, thinking it was well executed in our Home Care Division in the last year. They piloted it and I'm very keen to make it all Unilever. So I guess, what I want to say is, ‘Look, it's an action plan meant to close the gap of many things already at play and I do see some momentum in business.’

On Unilever's global leadership team and having the right internal and external leaders to unlock value

We've gone through all the roles. We've gone through a very thorough process and when it comes to the CFO, I'm super happy. I'm very happy with the choice. I've gone very carefully about these appointments because I knew they were going to be very important. But I wanted to make sure that a) All of these people would have a proven track record certainly within the company and they have really performed over the last few years.

They are squarely behind the plan. That's super important to me as well. For example, we still have an open position in nutrition. There will be some changes down the road that ultimately we have a great mix which is internal, external, male, female. It's a super global team with people from Latin America.

So you know when it comes to diversity and understanding and getting different perspectives, I'm sure we'll get there but I'm very happy with the choices that we've made.

On speed of growth and performance culture - turning talent into performance

People are very hungry actually for change. This company has outstanding people and we are the most preferred employer in the CPG (consumer packaged goods) industry in 16 out of our 20 markets where these are very large markets. India, Brazil, outstanding talent bases. It's our job to turn talent into performance.

But wherever I go, and when I speak to people, they are hungry. When you talk about performance culture, we should be careful here. It's a whole series of actions that you take. First of all, do we allow people to be really empowered?

If you think of our new organisation, we have five global verticals and we did some analysis in June or July when I came in. I said, “Hey! If you want to launch a new deodorant in Southeast Asia under a new brand, how many centres of decision making are there for people to make that call? And, there were simply too many.

I think the structure will allow me and the company to drive speed, empower people and hold them accountable simply because of much simpler decision making and this is something I will be on day in day out.

We are changing remuneration to the hard stuff and we're making sure that the things we talk about build though on the strong fundamentals that we have because we should never lose some of the good things. We have a human culture and values are important to us. They will remain so - that was one of the reasons why I joined this company in the first place. But it doesn't mean that it should get in the way of doing things faster, better and with greater impact.

On India and the market's potential and growth

India is a super important part of the portfolio. We look at market share through business winning. We look at it not only turnover weighted but also market weighted. In the last particularly six to nine months on a market weighted basis, the company is actually showing positive numbers and India is an important part of that.

That is the primary lens through which I look at India. For the next 10 years, this will be an important driver of growth and will be well positioned to do that. But, we should not be complacent about it. We have great positions but with some slowdown in China, I do see international competitors flocking into India and putting a greater amount of resources behind it. And we're seeing increasingly strong local competition.

So, market shares and the enormous business winning percentages that we had above 80 percent might not be there forever. But, with the undercurrent of you know us being very well positioned, the Indian economy doing well, I think the prospects in India particularly behind digitization are phenomenal. It will be a continued country of focus for all five of the business groups.

On nature

“On the subject of nature, it's not just about regenerative agriculture but also deforestation free sourcing. That one for me is paramount. We have to be 100 percent on that, so no compromises. It's about inequality in the communities in which we operate. That's already a very big agenda and I believe with everything that we've built up over the years, we can play a leading role.”