Unilever has bowed to shareholder pressure with a commitment to publish more transparent information on the levels of fat, sugar and salt (HFSS) in its portfolio of food products.
The new benchmark for public reporting about the healthiness of its food follows months of engagement with a coalition of institutional investors co-ordinated by ShareAction, which promotes responsible investment.
ShareAction filed a shareholder proposal in January urging the company to disclose against government-endorsed health models and adopt ambitious targets to increase the share of healthy foods in its sales.
Unilever will now measure the sales of its products against major government-endorsed nutrient profile models, as well as its own internal metric.
The first of these annual assessments on the healthiness of its products will be published in October.
Unilever also agreed to set new stretching targets for growing the proportion of its healthier products by October in advance of its 2023 AGM, and to submit these targets for shareholder scrutiny.
The Marmite and Hellmann’s maker uses its own measurements to claim its portfolio is healthy, last year reporting 61% of its food and drink sales were derived from products with “high nutritional standards”.
ShareAction disputed the figure and said an independent review estimated it to be just 17%.
The backtrack by Unilever is the latest development in the trend of shareholders pushing retailers to move faster on tackling obesity with the use of “shaming” tactics.
In May, ShareAction withdrew a resolution criticising Tesco for its lack of action on obesity after the supermarket announced a raft of new measures across stores in the UK and Europe.
The group has also been involved in a dispute with Morrisons over its alleged lack of public reporting, although Morrisons has strongly denied the claims.
The move comes with a raft of supermarkets last week agreeing a joint statement with health and environmental campaigners Sustain, calling for “bold action” from the government to tackle obesity in its response to Henry Dimbleby’s National Food Satretgy (NFS).
Retailers are backing Dimbleby’s call for transparent reporting against metrics such as sales of healthy products and food waste, although have stopped short of backing his call for new taxes on sugar and salt.
However, Unilever’s agreement to begin publishing its figures set against nutrient profiling models is seen as a potentially significant move, especially ahead of sweeping moves by the government to ban HFSS promotions, which come into force in October.
“The enhanced disclosures form a new precedent for transparency in reporting for food manufacturing companies,” ShareAction said this morning.
Louisa Hughes, engagement manager at ShareAction, added: “We welcome Unilever’s willingness to engage with the shareholder group and we are pleased to see their commitment to set stretching targets to increase their sales of healthier products in response to our proposal.
“The next seven months are crucial for ensuring that this commitment is translated into ambitious long-term goals, with concrete policies to deliver these. We encourage investors to make their expectations known to the company. Whilst our resolution has been withdrawn, we may consider further action next year if we are unsatisfied with the company’s progress.”
Gerald Cooney at Greater Manchester Pension Fund, which backed the campaign, said: “As one of the largest food manufacturers, Unilever has a real opportunity to tackle rising obesity levels around the world.
“In the UK, poor diets are one of the biggest drivers of ill health and widening inequalities across the country. In this context, we welcome the announcement made by Unilever today and we encourage the company to be ambitious as it fleshes out these commitments later this year.”
Hanneke Faber, Unilever president of foods & refreshment, said: “We welcome the constructive dialogue we have had with ShareAction and the Healthy Markets Initiative.
“We share a common belief in the importance of having an ambitious long-term strategy for nutrition and health, and that companies should publish ambitious targets to deliver against.
“I am confident that with these new initiatives, we will set a new benchmark for nutrition transparency in our industry and accelerate our positive impact on public health.”