Case Study : Hindustan Unilever

HINDUSTAN UNILEVER LIMITED

‘THE BEST CORPORATE COMMUNICATOR’

Introduction

Hindustan Unilever Limited (HUL) is India's largest fast moving consumer goods company, with
leadership in Home & Personal Care Products and Foods & Beverages. HUL's brands, spread
across 20 distinct consumer categories, touch the lives of two out of three Indians. They endow
the company with a scale of combined volumes of about 4 million tonnes and sales of Rs.10,000
crores. The mission that inspires HUL's over 15,000 employees is to "add vitality to life". With
35 Power Brands, HUL meets everyday needs for nutrition, hygiene, and personal care with
brands that help people feel good, look good and get more out of life. It is a mission HUL shares
with its parent company, Unilever, which holds 51.55% of the equity. A Fortune 500
transnational, Unilever sells Foods and Home and Personal Care brands in about 100 countries
worldwide.

Unilever's mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene, and
personal care with brands that help people feel good, look good and get more out of life.
Unilever's mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene and
personal care with brands that help people feel good, look good and get more out of life

Our deep roots in local cultures and markets around the world give us our strong relationship
with consumers and are the foundation for our future growth. We will bring our wealth of
knowledge and international expertise to the service of local consumers - a truly multi-local
multinational.

Our long-term success requires a total commitment to exceptional standards of performance and
productivity, to working together effectively, and to a willingness to embrace new ideas and
learn continuously.
To succeed also requires, we believe, the highest standards of corporate behaviour towards
everyone we work with, the communities we touch, and the environment on which we have an
impact.
This is our road to sustainable, profitable growth, creating long-term value for our shareholders,
our people, and our business partners.

Over 100 years' link with India

In the summer of 1888, visitors to the Kolkata harbour noticed crates full of Sunlight soap bars,
embossed with the words "Made in England by Lever Brothers". With it, began an era of
marketing branded Fast Moving Consumer Goods (FMCG).Soon after followed Lifebuoy in
1895 and other famous brands like Pears, Lux and Vim. Vanaspati was launched in 1918 and the
famous Dalda brand came to the market in 1937.
In 1931, Unilever set up its first Indian subsidiary, Hindustan Vanaspati Manufacturing
Company, followed by Lever Brothers India Limited (1933) and United Traders Limited (1935).
These three companies merged to form HUL in November 1956; HUL offered 10% of its equity
to the Indian public, being the first among the foreign subsidiaries to do so. Unilever now holds
51.55% equity in the company. The rest of the shareholding is distributed among about 380,000
individual shareholders and financial institutions.

The erstwhile Brooke Bond's presence in India dates back to 1900. By 1903, the company had
launched Red Label tea in the country. In 1912, Brooke Bond & Co. India Limited was formed.
Brooke Bond joined the Unilever fold in 1984 through an international acquisition. The erstwhile
Lipton's links with India were forged in 1898. Unilever acquired Lipton in 1972, and in 1977
Lipton Tea (India) Limited was incorporated.Pond's (India) Limited had been present in India
since 1947. It joined the Unilever fold through an international acquisition of Chesebrough
Pond's USA in 1986.Since the very early years, HUL has vigorously responded to the stimulus of
economic growth. The growth process has been accompanied by judicious diversification,
always in line with Indian opinions and aspirations.The liberalisation of the Indian economy,
started in 1991, clearly marked an inflexion in HUL's and the Group's growth curve. Removal of
the regulatory framework allowed the company to explore every single product and opportunity
segment, without any constraints on production capacity.

Simultaneously, deregulation permitted alliances, acquisitions and mergers. In one of the most
visible and talked about events of India's corporate history, the erstwhile Tata Oil Mills
Company (TOMCO) merged with HUL, effective from April 1, 1993. In 1995, HUL and yet
another Tata company, Lakme Limited, formed a 50:50 joint venture, Lakme Lever Limited, to
market Lakme's market-leading cosmetics and other appropriate products of both the companies.
Subsequently in 1998, Lakme Limited sold its brands to HUL and divested its 50% stake in the
joint venture to the company.HUL formed a 50:50 joint venture with the US-based Kimberly
Clark Corporation in 1994, Kimberly-Clark Lever Ltd, which markets Huggies Diapers and
Kotex Sanitary Pads. HUL has also set up a subsidiary in Nepal, Nepal Lever Limited (NLL),
and its factory represents the largest manufacturing investment in the Himalayan kingdom. The
NLL factory manufactures HUL's products like Soaps, Detergents and Personal Products both
for the domestic market and exports to India.

The 1990s also witnessed a string of crucial mergers, acquisitions and alliances on the Foods and
Beverages front. In 1992, the erstwhile Brooke Bond acquired Kothari General Foods, with
significant interests in Instant Coffee. In 1993, it acquired the Kissan business from the UB
Group and the Dollops Icecream business from Cadbury India.As a measure of backward
integration, Tea Estates and Doom Dooma, two plantation companies of Unilever, were merged
with Brooke Bond. Then in July 1993, Brooke Bond India and Lipton India merged to form
Brooke Bond Lipton India Limited (BBLIL), enabling greater focus and ensuring synergy in the
traditional Beverages business. 1994 witnessed BBLIL launching the Wall's range of Frozen
Desserts. By the end of the year, the company entered into a strategic alliance with the Kwality
Icecream Group families and in 1995 the Milkfood 100% Icecream marketing and distribution
rights too were acquired.
Finally, BBLIL merged with HUL, with effect from January 1, 1996. The internal restructuring
culminated in the merger of Pond's (India) Limited (PIL) with HUL in 1998. The two companies
had significant overlaps in Personal Products, Speciality Chemicals and Exports businesses,
besides a common distribution system since 1993 for Personal Products. The two also had a
common management pool and a technology base. The amalgamation was done to ensure for the
Group, benefits from scale economies both in domestic and export markets and enable it to fund
investments required for aggressively building new categories.

In January 2000, in a historic step, the government decided to award 74 per cent equity in
Modern Foods to HUL, thereby beginning the divestment of government equity in public sector
undertakings (PSU) to private sector partners. HUL's entry into Bread is a strategic extension of
the company's wheat business. In 2002, HUL acquired the government's remaining stake in
Modern Foods.
In 2003, HUL acquired the Cooked Shrimp and Pasteurised Crabmeat business of the Amalgam
Group of Companies, a leader in value added Marine Products exports.

YEAR
MILESTONES
1888
Sunlight soap introduced in India.
1895
Lifebuoy soap launched; Lever Brothers appoints agents in Mumbai, Chennai, Kolkata, and
Karachi.
1902
Pears soap introduced in India.
1903
Brooke Bond Red Label tea launched.
1905
Lux flakes introduced.
1913
Vim scouring powder introduced.
1914
Vinolia soap launched in India.
1918
Vanaspati introduced by Dutch margarine manufacturers like Van den Berghs, Jurgens,
Verschure Creameries, and Hartogs.
1922
Rinso soap powder introduced.
1924
Gibbs dental preparations launched.
1925
Lever Brothers gets full control of North West Soap Company.
1926
Hartogs registers Dalda Trademark.
1930
Unilever is formed on January 1 through merger of Lever Brothers and Margarine Unie.
1931
Hindustan Vanaspati Manufacturing Company registered on November 27; Sewri factory site
bought.
1932
Vanaspati manufacture starts at Sewri.
1933
Application made for setting up soap factory next to the Vanaspati factory at Sewri; Lever
Brothers India Limited incorporated on October 17.
1934
Soap manufacture begins at Sewri factory in October; North West Soap Company's Garden
Reach Factory, Kolkata rented and expanded to produce Lever brands.
1935
United Traders incorporated on May 11 to market Personal Products.
1937
Mr. Prakash Tandon, one of the first Indian covenanted managers, joins HVM.
1939
Garden Reach Factory purchased outright; concentration on building up Dalda Vanaspati as a
brand.
1941
Agencies in Mumbai, Chennai, Kolkata and Karachi taken over; company acquires own sales
force.
1942
Unilever takes firm decision to "train Indians to take over junior and senior management
positions instead of Europeans".
1943
Personal Products manufacture begins in India at Garden Reach Factory.
1944
Reorganisation of the three companies with common management but separate marketing
operations.
1947
Pond's Cold Cream launched.
1951
Mr. Prakash Tandon becomes first Indian Director. Shamnagar, Tiruchy, and Ghaziabad
Vanaspati factories bought.
1955
65% of managers are Indians.
1956
Three companies merge to form Hindustan Lever Limited, with 10% Indian equity participation.
1957
Unilever Special Committee approves research activity by Hindustan Lever.
1958
Research Unit starts functioning at Mumbai Factory.
1959
Surf launched.
1961
Mr. Prakash Tandon takes over as the first Indian Chairman; 191 of the 205 managers are
Indians.
1962
Formal Exports Department starts.
1963
Head Office building at Backbay Reclamation, Mumbai, opened.
1964
Etah dairy set up, Anik ghee launched; Animal feeds plant at Ghaziabad; Sunsilk shampoo
launched.
1965
Signal toothpaste launched; Indian shareholding increases to 14%.
1966
Lever's baby food, more new foods introduced; Nickel catalyst production begins; Indian
shareholding increases to 15%. Statutory price control on Vanaspati; Taj Mahal tea launched.
1967
Hindustan Lever Research Centre, opens in Mumbai.
1968
Mr. V. G. Rajadhyaksha takes over as Chairman from Mr. Prakash Tandon; Fine Chemicals Unit
commissioned at Andheri; informal price control on soap begins.
1969
Rin bar launched; Fine Chemicals Unit starts production; Bru coffee launched
1971
Mr. V. G. Rajadhyaksha presents plan for diversification into chemicals to Unilever Special
Committee - plan approved; Clinic shampoo launched.
1973
Mr. T. Thomas takes over as Chairman from Mr. V. G. Rajadhyaksha.
1974
Pilot plant for industrial chemicals at Taloja; informal price control on soaps withdrawn; Liril
marketed.
1975
Ten-year modernisation plan for soaps and detergent plants; Jammu project work begins;
statutory price control on Vanaspati and baby foods withdrawn; Close-up toothpaste launched.
1976
Construction work of Haldia chemicals complex begins; Taloja chemicals unit begins
functioning.
1977
Jammu synthetic Detergents plant inaugurated; Indian shareholding increases to 18.57%.
1978
Indian shareholding increases to 34%; Fair & Lovely skin cream launched.
1979
Sodium Tripolyphospate plant at Haldia commissioned.
1980
Dr. A. S. Ganguly takes over as Chairman from Mr. T. Thomas; Unilever shareholding in the
company comes down to 51%.
1982
Government allows 51% Unilever shareholding.
1984
Foods, Animal Feeds businesses transferred to Lipton.
1986
Agri-products unit at Hyderabad starts functioning - first range of hybrid seeds comes out;
Khamgaon Soaps unit and Yavatmal Personal Products unit start production.
1988
Launch of Lipton Taaza tea.
1990
Mr. S. M. Datta takes over as Chairman from Dr. A. S. Ganguly.
1991
Surf Ultra detergent launched.
1992
HLL recognised by Government of India as Star Trading House in Exports.
1993
HLL's largest competitor, Tata Oil Mills Company (TOMCO), merges with the company with
effect from April 1, 1993, the biggest such in Indian industry till that time. Merger ultimately
accomplished in December 1994; Launch of Vim bar; Kissan acquired from the UB Group.
1994
HLL forms Nepal Lever Limited, HLL and US-based Kimberley-Clark Corporation form 50:50
joint venture - Kimberley-Clark Lever Ltd. - to market Huggies diapers and Kotex feminine care
products. Factory set up at Pune in 1995; HLL acquires Kwality and Milkfood 100%
brandnames and distribution assets. HLL introduces Wall's.
1995
HLL and Indian cosmetics major, Lakme Ltd., form 50:50 joint venture - Lakme Lever Ltd.;
HLL enters branded staples business with salt; HLL recognised as Super Star Trading House.
1996
Mr. K. B. Dadiseth takes over as Chairman from Mr. S. M. Datta; Merger of Group company,
Brooke Bond Lipton India Limited, with HLL, with effect from January 1; HLL introduces
branded atta; Surf Excel launched.
1997
Unilever sets up International Research Laboratory in Bangalore; new Regional Innovation
Centres also come up.
1998
Group company, Pond's India Ltd., merges with HLL with effect from January 1, 1998. HLL
acquires Lakme brand, factories and Lakme Ltd.'s 50% equity in Lakme Lever Ltd.
2000
Mr. M. S. Banga takes over as Chairman from Mr. K. B. Dadiseth, who joins the Unilever
Board; HLL acquires 74% stake in Modern Food Industries Ltd., the first public sector company
to be disinvested by the Government of India.
2002
HLL enters Ayurvedic health & beauty centre category with the Ayush range and Ayush
Therapy Centres.
2003
Launch of Hindustan Lever Network; acquisition of the Amalgam Group
2005
Launch of "Pureit" water purifiers

Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods company,
touching the lives of two out of three Indians with over 20 distinct categories in Home &
Personal Care Products and Foods & Beverages. They endow the company with a scale of
combined volumes of about 4 million tonnes and sales of Rs.10,000 crores. HUL is also one of
the country's largest exporters; it has been recognised as a Golden Super Star Trading House by
the Government of India. The mission that inspires HUL's over 15,000 employees, including
over 1,300 managers, is to "add vitality to life." HUL meets everyday needs for nutrition,
hygiene, and personal care with brands that help people feel good, look good and get more out of
life. It is a mission HUL shares with its parent company, Unilever, which holds 51.55% of the
equity. The rest of the shareholding is distributed among 380,000 individual shareholders and
financial institutions.

HUL's brands - like Lifebuoy, Lux, Surf Excel, Rin, Wheel, Fair & Lovely, Pond's, Sunsilk,
Clinic, Pepsodent, Close-up, Lakme, Brooke Bond, Kissan, Knorr-Annapurna, Kwality Wall's –
are household names across the country and span many categories - soaps, detergents, personal
products, tea, coffee, branded staples, ice cream and culinary products. They are manufactured
over 40 factories across India. The operations involve over 2,000 suppliers and associates. HUL's
distribution network, comprising about 4,000 redistribution stockists, covering 6.3 million retail
outlets reaching the entire urban population, and about 250 million rural consumers. HUL has
traditionally been a company, which incorporates latest technology in all its operations. The
Hindustan Unilever Research Centre (HLRC) was set up in 1958, and now has facilities in
Mumbai and Bangalore. HLRC and the Global Technology Centres in India have over 200
highly qualified scientists and technologists, many with post-doctoral experience acquired in the
US and Europe.

HUL believes that an organisation's worth is also in the service it renders to the community.
HUL is focusing on health & hygiene education, women empowerment, and water management.
It is also involved in education and rehabilitation of special or underprivileged children, care for
the destitute and HIV-positive, and rural development. HUL has also responded in case of
national calamities / adversities and contributes through various welfare measures, most recent
being the village built by HUL in earthquake affected Gujarat, and relief & rehabilitation after
the Tsunami caused devastation in South India.

In 2001, the company embarked on an ambitious programme, Shakti. Through Shakti, HUL is
creating micro-enterprise opportunities for rural women, thereby improving their livelihood and
the standard of living in rural communities. Shakti also includes health and hygiene education
through the Shakti Vani Programme, and creating access to relevant information through the
iShakti community portal. The program now covers 15 states in India and has over 31,000
women entrepreneurs in its fold, reaching out to 100,000 villages and directly reaching to 150
million rural consumers. By the end of 2010, Shakti aims to have 100,000 Shakti entrepreneurs
covering 500,000 villages, touching the lives of over 600 million people.

HUL is also running a rural health programme – Lifebuoy Swasthya Chetana. The programme
endeavours to induce adoption of hygienic practices among rural Indians and aims to bring down
the incidence of diarrhoea. It has already touched 70 million people in approximately 15000
villages of 8 states. The vision is to make a billion Indians feel safe and secure.
If Hindustan Unilever straddles the Indian corporate world, it is because of being single-minded
in identifying itself with Indian aspirations and needs in every walk of life.

Hindustan Unilever Limited is India's largest Fast Moving Consumer Goods (FMCG) company.
It is present in Home & Personal Care and Foods & Beverages categories. HUL and Group
companies have about 16,000 employees, including 1200 managers.

The fundamental principle determining the organisation structure is to infuse speed and
flexibility in decision-making and implementation, with empowered managers across the
company's nationwide operations. For this, HUL is organised into two self-sufficient divisions -
Home & Personal Care & Foods - supported by certain central functions and resources to
leverage economies of scale wherever relevant.

Board At the apex is the Board, headed by the Chairman, and comprising 5 whole time Directors
and 5 independent non-executive Directors. The day to day operations are supervised by the
National Management comprising the Vice Chairman, Managing Director (HPC), Managing
Director (Foods) and the Finance Director.

Divisions Each division is self-sufficient with dedicated resources and assets in sales, marketing,
commercial, and manufacturing. The two divisions are further reorganised into categories.
Typically, each category and each function - Sales, Commercial, Manufacturing - is headed by a
Vice President. They with their respective Managing Director, comprise that Division's
Management Committee.

For managing sales operations, HUL divides the country into four regions, with regional
branches in Delhi, Kolkata, Chennai and Mumbai. Headed by a Regional Manager, they
comprise Regional Sales Managers and Area Sales Managers, assisted by dedicated field forces,
comprising Sales Officers and Territory Sales Incharges.

In Marketing, each category has a Marketing Manager who heads a team of Brand Managers
dedicated to each or a group of brands.
The commercial team of a Division is responsible for its supply chain management. There are
teams dedicated to sourcing, planning and logistics.
Each Division has a nationwide manufacturing base, with each factory peopled by teams of
Production, Engineering, Quality Assurance, Commercial and Personnel Managers.
Central functions

HUL's Central Functions are Finance, Human Resources, Technology, Research,

Information Technology, Legal & Secretarial, and Corporate Affairs. Their services are shared
across the company. But, wherever necessary, managerial resources are dedicated exclusively to
a business. For example, each Division now has dedicated HR managers. HUL believes that
while it leverages the scale of a large corporate, it must also retain the soul of a small company.
Its organisation structure, which has and will continue to evolve with time, is aimed at achieving
this knitting.

BusinessesHome & Personal Care• Personal Wash• Fabric Wash• Home Care• Oral Care• Skin
Care• Hair Care• Deodorants & Talcs• Colour Cosmetics Foods• Tea• Coffee • Branded Staples•
Culinary Products• Ice Creams• Modern Foods rangesNew Ventures• Hindustan Unilever
Network• Ayush ayurvedic products & services• Sangam• Pureit water purifiersExports• HPC•
Beverages• Marine Products• Rice• Castor

Mr.Harish ManwaniChairman
A distinguished alumnus in statistics & economics and MBA from Mumbai University, Mr.
Manwani joined HUL in 1976. Following several Sales and Marketing assignments, he became
Divisional Vice President - Marketing. Mr. Manwani joined the Board of HUL in 1995,
responsible for the Personal Products business. In addition, he held regional responsibility as the
Category Leader for Personal Products for the then Central Asia and Middle East (CAME)
Business Group.

Mr. Manwani then moved to the UK as Senior Vice President for the Global Hair Care and Oral
Care Categories and in early 2001 was appointed President of the Home & Personal Care (HPC)
- Latin America Business Group

In 2004, he was appointed President and Chief Executive Officer of the HPC - North America
Business Group. In April 2005, he was elevated to the Unilever Executive as President – Asia &
Africa.

Mr. Manwani has attended the Advanced Management Programme (AMP) at Harvard Business
School.

Mr.Douglas BaillieCEO and Managing Director

Douglas Baillie (50) Born and educated in Zimbabwe, Mr. Baillie graduated from the University
of Natal with majors in business finance, marketing and business administration and joined
Unilever SA in 1978. His career over the years has spanned various sales and marketing
positions, culminating in a secondment to Lever Rexona in Australia in 1987.
On his return to South Africa in late 1988, he took up the position of Sales Director, which was
followed by a spell as Marketing Director. Mr. Baillie moved to London in 1994 to Personal
Products Co-ordination where he became the Regional Liaison Member for Africa, Middle East,
Central and Eastern Europe and Turkey before moving to Vice President, Home and Personal
Care for the Africa Business Group. Mr. Baillie was appointed Managing Director Lever Pond’s
South Africa in 1997 and National Manager, Unilever South Africa, in May 2000. Whilst in this
position Mr. Baillie served on several external Boards including the Advertising Standards
Authority, the Consumer Goods Council of South Africa and was a member of Presidential Big
Business working group

Prior to assuming responsibilities as the Chief Executive Officer (CEO) of Hindustan Unilever
Limited, Mr. Baillie was Group Vice President and Head of Unilever AMET (Africa, Middle
East and Turkey). Mr. Baillie is also the Group Vice President responsible for Unilever’s
business in South Asia, which includes Sri Lanka, Pakistan and Bangladesh.

D. Sundaram
Finance & IT Director
Mr. D. Sundaram is post-graduate from Madras University and a Fellow of the Institute of Cost
and Works Accountants of India (FICWA). He joined Hindustan Unilever in 1975 as a
Management Trainee. He has worked in various capacities as Corporate Accountant,
Commercial Manager and Treasurer.He was seconded to Unilever, London,as Commercial
Officer for Africa and Middle East
Group between 1990 and 1993 and on return was the Financial Member of the TOMCO
Integration team from 1993 to 1994. He became the Finance Director of the erstwhile Brooke
Bond Lipton India Limited in March 1994. He was again seconded to Unilever in August 1996
as Senior Vice President–Finance, Central Asia and Middle East Group with responsibility for
Finance, IT and business strategies for Unilever companies in the Indian sub-continent, North
Africa and the Middle East countries. He returned to India in May 1999 as Finance & IT Director
of HUL.

Mr. Nitin Paranjpe

Exectuive Director
Mr. Nitin Paranjpe after obtaining a degree in BE (Mech) and MBA in Marketing (JBIMS) from
Mumbai joined the Company as a Management Trainee in 1987. In his early years in the
Company, Mr. Paranjpe worked as Area Sales Manager – Detergents and then Product Manager
– Detergents.
In April 1996, he became the Branch Manager, Chennai and in February 1999 was appointed a
member of the Project Millennium team. In 2000, he moved to Unilever, London and was
involved in a review of the Organisation Structure. During 2001, he was Assistant to the
Unilever Chairman & Executive Committee in London. On his return to India in 2002, he
became the Category Head – Fabric Wash & Regional Brand Director (Asia) for some Laundry
and Household Cleaning (HHC) Brands. In 2004, he became Vice President – Home Care
(Laundry & HHC) India responsible for the top and bottom-line of the Homecare business.
Effective March 2006 Mr. Paranjpe is the Executive Director for the Home & Personal Care
business.

Mr. Sanjiv Kakkar

Director
Mr. Sanjiv Kakkar is BA (Economics) and PGDM from IIM Ahmedabad with 23 years work
experience. Mr. Kakkar joined the Company in June 1984 and has worked in various Sales and
Marketing assignments. His marketing experience spans across categories including Beverages,
Personal Products and Oral & Hair Care
He has also had key stints as Category Head of Oral and General Manager – Sales & Customer
Management of Personal Products. He was appointed Vice President – Oral & Hair Care in May
2004. In March 2006, Mr. Kakkar was appointed as Executive Director - Foods and joined the
Management Committee on 1st January 2007. Sanjiv was appointed as the Executive Director -
Sales and Customer Development in May 2007.
A.Narayan
Director
Mr. A. Narayan is the Managing Director and CEO of ICI India Limited. He is also the
Chairman of ICI India Research & Technology Centre. Mr. Narayan joined the Board as
Independent Non-Executive Director in 2001.
V. Narayanan
Director
Mr. V. Narayanan is a post-graduate from Madras University. He was Chairman and Managing
Director of the erstwhile Pond's (India) Ltd. He is now Chairman of the Academy of
Management Excellence. He joined the Board as Independent Non-Executive Director in 1987.
D. S. Parekh
Director
Mr. D. S. Parekh holds a FCA degree from England & Wales. Mr. Parekh has held senior
positions in Grindlays and Chase Manhattan. He is the Executive Chairman of Housing
Development Finance Corporation. Mr. Parekh joined the Board as Independent Non-Executive
Director in 1997.
C. K. Prahalad

Code of Business Principles

Unilever has earned a reputation for conducting its business with integrity and with respect for
the interests of those our activities can affect. This reputation is an asset, just as real as our
people and brands.
Our first priority is to be a successful business and that means investing for growth and balancing
short-term and long-term interests. It also means caring about our consumers, employees and
shareholders, our business partners and the world in which we live.
To succeed requires the highest standards of behaviour from all of us. The general principles
contained in this Code set out those standards. More detailed guidance tailored to the needs of
different countries and companies will build on these principles as appropriate, but will not
include any standards less rigorous than those contained in this Code.
We want this Code to be more than a collection of high-sounding statements. It must have
practical value in our day-to-day business and each one of us must follow these principles in the
spirit as well as the letter.

Code of Business Principles

Standard of Conduct

We conduct our operations with honesty, integrity and openness, and with respect for the human
rights and interests of our employees.
We shall similarly respect the legitimate interests of those with whom we have
relationships.Obeying the Law
Unilever companies and employees are required to comply with the laws and regulations of the
countries in which we operate.
EmployeesUnilever is committed to diversity in a working environment where there is mutual
trust and respect and where everyone feels responsible for the performance and reputation of our
company.
We will recruit, employ and promote employees on the sole basis of the qualifications and
abilities needed for the work to be performed.
We are committed to safe and healthy working conditions for all employees. We will not use any
form of forced, compulsory or child labour.
We are committed to working with employees to develop and enhance each individual's skills
and capabilities.
We respect the dignity of the individual and the right of employees to freedom of association.We
will maintain good communications with employees through company based information and
consultation procedures.
ConsumersUnilever is committed to providing branded products and services which consistently
offer value in terms of price and quality, and which are safe for their intended use. Products and
services will be accurately and properly labelled, advertised and
communicated.ShareholdersUnilever will conduct its operations in accordance with
internationally accepted principles of good corporate governance. We will provide timely,
regular and reliable information on our activities, structure, financial situation and performance
to all shareholders.Business Partners
Unilever is committed to establishing mutually beneficial relations with our suppliers, customers
and business partners.
In our business dealings we expect our partners to adhere to business principles consistent with
our own.

Community Involvement

Unilever strives to be a trusted corporate citizen and, as an integral part of society, to fulfill our
responsibilities to the societies and communities in which we operate.Public Activities
Unilever companies are encouraged to promote and defend their legitimate business
interests.Unilever will co-operate with governments and other organisations, both directly and
through bodies such as trade associations, in the development of proposed legislation and other
regulations which may affect legitimate business interests.Unilever neither supports political
parties nor contributes to the funds of groups whose activities are calculated to promote party
interests.The Environment
Unilever is committed to making continuous improvements in the management of our
environmental impact and to the longer-term goal of developing a sustainable business.Unilever
will work in partnership with others to promote environmental care, increase understanding of
environmental issues and disseminate good practice.InnovationIn our scientific innovation to
meet consumer needs we will respect the concerns of our consumers and of society. We will
work on the basis of sound science, applying rigorous standards of product safety.
CompetitionUnilever believes in vigorous yet fair competition and supports the development of
appropriate competition laws. Unilever companies and employees will conduct their operations
in accordance with the principles of fair competition and all applicable regulations.Business
Integrity

Unilever does not give or receive, whether directly or indirectly, bribes or other improper
advantages for business or financial gain. No employee may offer, give or receive any gift or
payment which is, or may be construed as being, a bribe. Any demand for, or offer of, a bribe
must be rejected immediately and reported to management.Unilever accounting records and
supporting documents must accurately describe and reflect the nature of the underlying
transactions. No undisclosed or unrecorded account, fund or asset will be established or
maintained.
Conflicts of Interests

All Unilever employees are expected to avoid personal activities and financial interests which
could conflict with their responsibilities to the company.Unilever employees must not seek gain
for themselves or others through misuse of their positions.

Compliance – Monitoring – Reporting

Compliance with these principles is an essential element in our business success. The Unilever
Board is responsible for ensuring these principles are communicated to, and understood and
observed by, all employees.

Day-to-day responsibility is delegated to the senior management of the regions and operating
companies. They are responsible for implementing these principles, if necessary through more
detailed guidance tailored to local needs.Assurance of compliance is given and monitored each
year. Compliance with the Code is subject to review by the Board supported by the Audit
Committee of the Board and the Corporate Risk Committee.
Any breaches of the Code must be reported in accordance with the procedures specified by the
Joint Secretaries. The Board of Unilever will not criticise management for any loss of business
resulting from adherence to these principles and other mandatory policies and instructions.
The Board of Unilever expects employees to bring to their attention, or to that of senior
management, any breach or suspected breach of these principles.Provision has been made for
employees to be able to report in confidence and no employee will suffer as a consequence of
doing so.

In this Code the expressions 'Unilever' and 'Unilever companies' are used for convenience and
mean the Unilever Group of companies comprising Unilever N.V., Unilever PLC and their
respective subsidiary companies. The Board of Unilever means the Directors of Unilever N.V.
and Unilever PLC.

Environment Policy

Hindustan Unilever Limited (HUL) supplies high quality goods and services to meet the daily
needs of consumers and industry. In doing so, the Company is committed to exhibit the highest
standards of corporate behaviour towards its consumers, employees, the societies and the world
in which we live.The company recognises its joint responsibility with the Government and the
Public to protect environment and is committed to regulate all its activities so as to follow best
practicable means for minimising adverse environmental impact arising out of its operations.The
company is committed to making its products environmentally acceptable, on a scientifically
established basis, while fulfilling consumers' requirements for excellent quality, performance and
safety.The aim of the Policy is to do all that is reasonably practicable to prevent or minimise,
encompassing all available knowledge and information, the risk of an adverse environmental
impact arising from processing of the product, its use or foreseeable misuse.This Policy
document reflects the continuing commitment of the Board for sound Environment Management
of its operations. The Policy applies to development of a process, product and services, from
research to full-scale operation. It is applicable to all company operations covering its
plantations, manufacturing, sales and distribution, research & innovation centres and offices.
This document defines the aims and scope of the Policy as well as responsibilities for the
achievement of the objectives laid down.The Vision Our vision is to continue to be an
environmentally responsible organisation making continuous improvements in the management
of the environmental impact of our operations.We will achieve this through an Integrated
Environment Management approach, which focuses on People, Technology and Facilities,
supported by Management Commitment as the prime driver.The Environment Policy Hindustan
Unilever Ltd. (HUL) is committed to meeting the needs of customers and consumers in an
environmentally sound manner, through continuous improvement in environmental performance
in all our activities. Management at all levels, jointly with employees, is responsible and will be
held accountable for company's environmental performance.Accordingly, HUL's aims are to:
· Ensure safety of its products and operations for the environment by using standards of
environmental safety, which are scientifically sustainable and commonly acceptable.
· Develop, introduce and maintain environmental management systems across the company to
meet the company standards as well as statutory requirements for environment. Verify
compliance with these standards through regular auditing.
· Assess environmental impact of all its activities and set annual improvement objectives and
targets and review these to ensure that these are being met at the individual unit and corporate
levels.
· Reduce Waste, conserve Energy and explore opportunities for reuse and recycle.
· Involve all employees in the implementation of this Policy and provide appropriate training.
Provide for dissemination of information to employees on environmental objectives and
performance through suitable communication networks.
· Encourage suppliers and co-packers to develop and employ environmentally superior processes
and ingredients and co-operate with other members of the supply chain to improve overall
environmental performance.
· Work in partnership with external bodies and Government agencies to promote environmental
care, increase understanding of environmental issues and disseminate good
practice.Responsibilities Corporate The Board and the Management Committee of HUL is
committed to conduct the company operations in an environmentally sound manner. The
Management Committee will:
· Set mandatory standards and establish environmental improvement objectives and targets for
HUL as a whole and for individual units, and ensure these are included in the annual operating
plans.
· Formally review environment performance of the company once every quarter.
· Review environment performance when visiting units and recognise exemplary performance.
· Nominate:- A senior line manager responsible for environmental performance at the individual
HUL site.- HUL environmental coordinator.The Management Committee, through the nominated
environmental coordinator will:
· Ensure implementation of HUL Policy on environment and compliance with Unilever and HUL
environmental standards and the standards stipulated under relevant national / local legislation.
When believed to be appropriate, apply more stringent criteria than those required by law.
· Assess environmental impact of HUL operations and establish strategies for sound environment
management and key implementation steps.
· Encourage development of inherently safer and cleaner manufacturing processes to further raise
the standards of environment performance.
· Establish appropriate management systems for environment management and ensure regular
auditing to verify compliance.
· Establish systems for appropriate training in implementation of Environment Management
Systems at work.
· Ensure that all employees are made aware of individual and collective responsibilities towards
environment.
· Arrange for expert advice on all aspects of environment management.
· Participate, wherever possible, with appropriate industry and Government bodies advising on
environmental legislation and interact with national and local authorities concerned with
protection of environment.Individual UnitsThe overall responsibility for environment
management at each unit will rest with the Unit Head, who will ensure implementation of HUL
Policy on environment at unit level. Concerned line managers / heads of departments are
responsible for environmental performance at department levels.In order to fulfill the
requirements of the Environment Policy at each site, the Unit Head will:
· Designate a unit environment coordinator who will be responsible for co-ordinating
environmental activities at unit, collating environmental statistics and providing / arranging for
expert advice.
· Agree with the Management Committee Member responsible for the unit, specific
environmental improvement objectives and targets for the unit and ensure that these are
incorporated in the annual objectives of the concerned managers and officers and are reviewed
periodically.
· Ensure that the unit complies with Unilever and HUL mandatory standards and the relevant
national and state regulations with respect to environment.
· Ensure formal environmental risk assessment to identify associated environmental aspects and
take appropriate steps to control risks at acceptable levels.
· Ensure that all new operations are subjected to a systematic and formal analysis to assess
environmental impact. Findings of such exercises should be implemented prior to
commencement of the activity.
· Manage change in People, Technology and Facilities through a planned approach based on
training, risk assessment, pre-commissioning audits and adherence to design codes.
· Regularly review environment performance of the unit against set objectives and targets and
strive for continual improvement.
· Sustain a high degree of environmental awareness through regular promotional campaigns and
employee participation through training, safety committees, emergency drills etc.
· Ensure dissemination of relevant information on environment within the unit and to outside
bodies, and regularly interact with Government authorities concerned for protection of
environment.
· Maintain appropriate emergency procedures consistent with available technologies to prevent /
control environmental incidents.
· Provide appropriate training to all employees.
· Ensure periodic audits to verify compliance with environment management systems and
personally carry out sample environment audits to check efficacy of the systems.
· Report environmental statistics to HUL Corporate Safety & Environment Group on a monthly
basis.Research and Innovation Centres
Since most new products and processes are developed in these Units, certain additional
responsibilities devolve on them to ensure implementation of the Environment Policy of the
company. In addition to the Unit Head's responsibilities outlined above, the heads of these units
will:
· Ensure that a formal and systematic risk assessment exercise is undertaken during the
process/product development stage with specific reference to environmental impact.
· Transfer technology to the pilot plant and main production through a properly documented
process specification which will clearly define environmental impact and risks associated with
processes, products, raw material and finished product handling, transport and storage.
· Ensure that treatment techniques are developed for any wastes generated as a result of the new
product/process and is incorporated into the process specifications

Quality Policy

Hindustan Unilever Limited considers quality as one of the principal strategic objectives to
guarantee its growth and leadership in the markets in which it operates.The company is
committed to respond creatively and competitively to the changing needs and aspirations of our
consumers through relentless pursuit of technological excellence, innovation and quality
management across our businesses, and offer superior quality products and services that are
appropriate to the various price points in the market as well as to our commitment to building
shareholder value.The company recognises that its employees are the primary source of success
in its operations and is committed to training and providing them the necessary tools and
techniques as well as empowering them to ensure broad base compliance of this policy in the
organisation at all levels.The company is committed to fulfill its legal and statutory obligations
and international standards of product safety and hygiene and will not knowingly sell product
that is harmful to consumers or their belongings. It will institute systems and measures to
monitor compliance in order to meet its responsibilities to consumers.The company will maintain
an open communication channel with its consumers and customers and will carefully monitor the
feedback to continuously improve its products and services and set quality standards to fulfill
them.The company is committed to extend its quality standards to its contract manufacturers, key
suppliers and service providers and by entering into alliances with them, to jointly improve the
quality of its products and services. This policy is applicable to production from its own facilities
as well as to production that is outsourced.The company will periodically review this quality
policy for its effectiveness and consistency with business objectives.The company delegates
authority and responsibility for dissemination and implementation of this policy to each Business
and Unit Head.

Safety and Health Policy

Hindustan Unilever Limited (HUL) supplies high quality goods and services to meet the daily
needs of consumers and customers. In doing so, the Company is committed to exhibit the highest
standards of corporate behavior towards its consumers, employees, the societies and the
environment in which we operate. Towards this, the Company recognises its responsibility to
ensure safety and protection of health of its employees, contractors and visitors in all its
operating sites, which include manufacturing, sales and distribution, research laboratories and
offices during work and work related travel.This Policy document defines the vision, principles,
aim, required actions and scope of the policy application as well as the responsibility for
execution.Our Vision Our vision is to be an injury free organisation. Our MissionWe will bring
safety on top of mind for all employees and will integrate it with all business processes. We will
realise our Vision through an Integrated Safety Management approach, which focuses on People,
Processes, Systems, Technology and Facilities, supported by demonstrated leadership and
employee commitment at all levels as the prime drivers for ensuring a safe and healthy work
environment.Safety PrinciplesHUL's Occupational Safety and Health Policy is based on and
supported by the following eight Principles.These Principles have the same status as the
Company's Code of Business Principles:
· All injuries and occupational illnesses are preventable
· All operational exposures can be safeguarded
· Safety evaluation of all business processes is vital
· Working safely is a condition of employment
· Training all employees to work safely is essential
· Management audits are a must
· Employee involvement is essential
· All deficiencies must be reported and corrected promptly Note: In order to facilitate
operationalisation of the Safety Principles, a separate document has been prepared, which covers:
a) Safety Principles b) Success Criteria c) Illustrative KPIThis document will form the basis for
the concerned Line / Organisations in developing KPI's for their respective functions /
sites.Scope of Application This section defines the scope of application of this Policy (where,
when and to whom is this Policy applicable). Where does this policy apply?
· All own/leased sites – Manufacturing, Research/Innovation, Offices, Depots, Warehouses
· In-house purchased services i.e. canteen, travel desk, IT implementation etc.
· Sites of associates with HUL holding > 24% while carrying out operations of making, handling,
using, transporting, selling or disposing off of our products Who does the policy apply to?
· All employees at business anywhere
· Contractors and visitors while at our own sites When does it apply?
· At work (our employees, contractors and visitors)
· Travel between home and work of our employees
· Business related travel including stay out of headquarter
· All Company organised business events i.e. training programmes, conferences, business related
get-togethers, annual sports etc.Implementation Responsibility HUL Management at all levels is
responsible for Policy implementation. Every site shall prepare a responsibility matrix with
respect to this Policy. Such SHE responsibilities shall form an integral part of overall job
responsibilities of all employees.All Unilever and HUL Standards, Rules and Procedures on
Occupational Safety and Health, including those that may be specific to a site are integral to this
Policy and its implementation. All employees are required to ensure strict adherence.
Questions:

1) If Hindustan Unilever straddles the Indian corporate world, it is because of being single-
minded in identifying itself with Indian aspirations and needs in every walk of life, for being
single –minded in identifying itself it needs to have good communication system, taking into
account the parameters given in the case study you are required to explain the communication
environment within the Organization set up of Hindustan Unilever Ltd.

2) Based on the details given with reference to Hindustan Unilever Ltd, you are required to
prepare a speech for The Chairman of Hindustan Unilever Ltd on ‘every employee needs to be
an effective communicator’.

3) Prepare a diagrammatic representation of Organization structure and explain it with relevance

to Formal Communication network.

4) Explain the relevance of informal communication network and how to use for the benefit of a
multi product company like Hindustan Unilever Ltd