Unilever finds short-term sustainability costs lead to long-term savings

Read the full story at Supply Chain Dive.

Unilever has cut costs by $1.5 billion through sustainable sourcing since 2008, according to the company’s February earnings call presentation. Unilever executives said they see a pattern — up front sustainability investments very often result in long-term discounts, CEO Alan Jope said.

Unilever’s goals for using renewable electricity in its operations were achieved a year early, and the savings from the resulting procurement contracts for “green electricity” have been “tremendous,” Jope said. Increased crop yields from sustainable agriculture practices are producing similar cost advantages.

The company expects the cost of recycled plastics to eventually drop below the price of virgin plastics, as recycling systems are implemented across the globe. Jope said Unilever’s transition to recycled plastics will result in cost benefits over time, putting current premiums for recycled plastic between 1% and 10%.

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