Unilever has ‘lost the plot,’ according to fund manager

Unilever has ‘lost the plot’ by trying too hard to display its sustainability credentials instead of focussing on running the business, leading fund manager Terry Smith has said.

Smith is the founder of Fundsmith, which is one of Unilever’s top-10 shareholders and who’s long-tern record has helped him gain a large retail following.

Smith hit out at the global consumer goods group in his annual letter by writing: “Unilever seems to be labouring under the weight of a management which is obsessed with publicly displaying sustainability credentials at the expense of focusing on the fundamentals of the business.”

Unilever, which is the maker of Hellmann’s mayonnaise, Magnum ice cream and Dove soap has laid out speculative climate and social goals and is attempting to prove that a sustainable business drives superior financial performance.

READ MORE: Co-op partners with Unilever to launch reusable packaging

“The most obvious manifestation of this is the public spat it has become embroiled in over the refusal to supply Ben & Jerry’s ice cream in the West Bank . . . there are far more ludicrous examples which illustrate the problem,” Smith continued.

“A company which feels it has to define the purpose of Hellmann’s mayonnaise has in our view clearly lost the plot.

“The Hellmann’s brand has existed since 1913 so we would guess that by now consumers have figured out its purpose (spoiler alert — salads and sandwiches).”

The group’s shares were down around 9% over the past 12 months and was one of the Fundsmith Equity Fund’s worst-five performers last year next to PayPal.

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