Unilever
(Picture: PA Archive)Unilever is swinging the axe as part of a sweeping restructure, as under-fire CEO Alan Jope seeks to repair relations with the City and fend off attention from an activist investor.
The consumer goods giant today announced plans to cut 1,500 jobs around the world as it simplifies its corporate structure. A spokesperson declined to give details of where the job cuts may fall around the world.
15% of senior management roles will be axed and 5% of junior managers will be asked to leave. Unilever employs around 149,000 people around the world, including 6,000 in the UK and Ireland.
The job cuts are part of a sweeping overhaul meant to improve performance. The Dove soap and Marmite owner has been criticised by investors for weak growth and plodding decision making.
Today Unilever said it is abolishing its “matrix” management structure, which sees employees report to multiple bosses, and streamlining the company into five operating divisions: beauty and wellbeing; personal care; home care; nutrition; and ice cream.
Jope said: “Our new organisational model has been developed over the last year and is designed to continue the step-up we are seeing in the performance of our business.
“Moving to five category-focused Business Groups will enable us to be more responsive to consumer and channel trends, with crystal-clear accountability for delivery. Growth remains our top priority and these changes will underpin our pursuit of this.”
The “Unilever Business Operations” department will provide technology, systems, and processes support to each division and the “Corporate Centre” will continue to set strategy for the group. The changes will take effect from 1 April and will be funded through existing budgets.
Sunny Jain will leave the business as part of the revamp. Jain is a former Amazon executive who replaced Jope as head of the company’s beauty and personal care division when he was promoted to CEO in 2019. The branch had the slowest sales growth out of Unilever’s three main divisions in the first nine months of last year.
Unilever first publicly hinted at a possible restructure last February when it announced plans to make the business “future fit”. Jope said last week that the matrix structure was set to be axed as part of a looming overhaul.
While changes have been long in train, the timing of the announcement will attract attention. Jope is struggling to repair relations with the City after an aborted attempt to buy GlaxoSmithKline’s consumer healthcare business. Investors had concerns about the risks and cost of the potential deal.
In recent days it has emerged that New York activist investor Nelson Peltz has built a position in Unilever’s stock. While he has not made his intentions clear, analysts have speculated that he may push the company to spin off underperforming brands or even seek a full demerger of the company’s food and refreshments business, which will now fall under nutrition.
Peltz has not had any contact with Unilever as of yet, it is understood.
Unilever’s stock was down 9p, or 0.2%, to 3935p.
