The Men Who Run Unilever

Published in Company Comment on 8 November 2012

What you need to know about the consumer goods group's top executives.

Management can make all the difference to a company's success and thus its share price.

The best companies are those run by talented and experienced leaders with strong vested interests in the success of the business, held in check by a board with sound financial and business acumen. Some of the worst investments to hold are those run by executives collecting fat rewards as the underlying business goes to pot.

In this series, I'm assessing the boardrooms of companies within the FTSE 100 (UKX). I hope to separate the management teams that are worth following from those that are not. Today I am looking at the Anglo-Dutch consumer staples company Unilever (LSE: ULVR) (NYSE: UL.US).

Here are the key directors:

Michael Treschow(non-exec) Chairman
Paul PolmanChief executive
Jean-Marc HuëtFinance director

Unilever has a dual-company structure -- Dutch and US investors have shares in Unilever NV, while UK investors have shares in Unilever plc -- but both boards appoint identical directors and effectively operate as a single board.

A Swedish industrialist, Michael Treschow is a former chairman of telecommunications firm Ericsson and white-goods manufacturer Electrolux where he also served as CEO for five years from 1997. In that role he was credited with turning the company around, simultaneously cutting costs and building the brand. He had previously also been CEO at Swedish industrial conglomerate Atlas Copco.


His appointment as chairman of Unilever in 2007 was the first time the board had appointed a candidate from outside the company. Though it appears to have been Mr Treschow's first engagement with consumer business, his independence and turnaround experience were important for Unilever at a time when the business was struggling somewhat.

Paul Polman was appointed CEO in 2009. He too was the first outsider appointed to the post, and was a surprise appointment with four strong internal candidates overlooked. He worked at Procter & Gamble (NYSE: PG.US) for 27 years, rising to be group European president, and then spent three years at Nestlé as CFO and head of the Americas.

A former investment banker, Jean-Marc Huët was previously CFO of Royal Numico, the Dutch baby food company, and was voted Dutch CFO of the year in 2007. He also served as CFO of Bristol-Myers Squibb from 2008 to 2009. He joined Unilever as CFO in 2010.

Three women

Unilever's nine non-executives have backgrounds in business, science and politics, but look a little light on finance. Surprisingly, only three of the 12-strong board are women.

Unilever has come in for some criticism for generous pay, and for the golden hello paid to Jean-Marc Huët, but it has at least introduced claw-backs on its long-term incentive scheme.

I analyse management teams from five different angles to help work out a verdict. Here's my assessment:

1. Reputation. Management CVs and track record.

Very strong.


Score 4/5

2. Performance. Success at the company.



Score 3/5

3. Board Composition. Skills, experience, balance



Score 3/5

4. Remuneration. Fairness of pay, link to performance.



Score 3/5

5. Directors' Holdings, compared to their pay.



Score 4/5

Overall, Unilever scores 17 out of 25 -- a middle-order result. The company's executives look competent and have performed well, but the composition of the board has a quirky feel to it.

I've collated all my FTSE 100 boardroom verdicts on this summary page.

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> Tony owns shares in Unilever but no other companies mentioned in this article.

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