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Unilever to cut 1,500 jobs as investors increase pressure | Unilever

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Marmite maker Unilever has announced plans to cut 1,500 management positions globally as it comes under increasing pressure from an activist U.S. investor and other shareholders to improve its performance.

The FTSE 100 company, known for brands such as Dove soap, Hellmann mayonnaise and Ben & Jerry’s ice cream, said it would cut its senior management positions by 15% and more junior management positions by 5% because it removes some layers to simplify the business, including in the UK. He will consult with unions on the plans and stressed that workers at the plant would not be affected.

Unilever employs around 150,000 people worldwide, including 6,000 in the UK and Ireland.

Chief Executive Alan Jope has been under pressure for months to revive sales growth as the company failed to meet its profit margin targets. In recent days, it emerged that American activist investor Nelson Peltz had taken a stake in the company.

Jope had a liking for GSK’s consumer health business, but Unilever’s £50bn bid was rejected as too low by GSK and sparked shareholder fury, forcing the group to drop its bid. interest last week.

Outspoken fund manager Terry Smith, founder of Fundsmith and one of Unilever’s largest shareholders, described the failed bid as a “near-death experience” and said management should focus on improving its core business – or withdraw. He had previously said that Unilever had “lost the thread”, accusing management of pursuing sustainability at the expense of business performance.

As the furor mounted, Unilever released a strategy update on January 17 in which it promised to expand its health, beauty and hygiene businesses and sell off slower-growing businesses. Asked at the time if the plan included job cuts, Jope said: ‘It’s not cost-driven. We have seen huge progress in speed and agility from Unilever during the pandemic. »

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Unilever announced on Tuesday that the business would be organized around five areas: beauty and wellness, personal care, home care, nutrition and ice cream. Each business group will be fully responsible for its strategy, growth and profit realization globally.

“Our new organizational model has been developed over the past year and is designed to continue the acceleration we are seeing in our business performance,” Jope said. “Moving to five category-focused business groups will allow us to be more responsive to consumer and channel trends, with crystal-clear responsibility for delivery. Growth remains our top priority and these changes will support our pursuit of that goal. »

Unilever has announced new appointments to its management team. The changes include Nitin Paranjpe, the Chief Operating Officer, who takes on a new role as Chief Transformation Officer and Chief Human Resources Officer.

Unilever to cut 1,500 jobs as investors increase pressure | Unilever

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