In an era where top CEOs earn salaries that were formerly reserved for lottery winning amounts, Paul Polman comes as a breath of fresh air. The CEO of Unilever says that he is “somewhat ashamed” by his €10 million salary, maintaining that he probably has the simplest job in the company.
Polman is no ordinary CEO. He heads Unilever, a 300 brand behemoth that brings in $48 billion dollars of revenue a year. CEOs in such positions talk in terms of sales targets and YoY growth. Not Polman. He talks about the environment. Soon after taking over, he announced that he planned to reduce his company’s environmental footprint by half by 2020. That’s no mean feat, considering his company’s products are used by 2 billion people globally.
That wasn’t the only shocker. On his first day on the job, he announced that he was going to stop issuing earnings guidance and stop full quarterly reports. Shareholders were aghast – earnings guidance issued by companies signal a company’s performance to investors. Shareholders thought this secrecy was to hide some terrible news that was in the offing, and the stock tanked 8%. But Polman was unfazed.
“The issues we are trying to attack with our business model and that need to be solved in the world today—food security, sanitation, employment, climate change—cannot be solved just by quarterly reporting. They require longer-term solutions and not 90-day pressures.”, says Polman. “Interestingly, if you don’t give guidance, or quarterly reporting, then also you tend to attract the right shareholder base. You get into a better rhythm to develop the right long-term relationships and the right communication.”
Polman also has a reputation for being hands on. Even as CEO, he makes sure he conducts a few interviews every week, an unheard of practice for someone at his level. “I was just in the Netherlands at a university last week, and I interviewed people myself. It’s the same reason we often have these little focus groups or dinners or lunches with people in the company at all different levels. You have to be connected. We’re all working for the same course. It’s not that one job is more or less important.”
And he’s put his money where his mouth is. He froze his pay when he started at Unilever during the recession. “I’ve never earned so much. I never thought I ever would. When I came into the company, I never asked for a salary or negotiated my salary. I’ve never asked for a job in my career. I’ve always just worked hard and trusted that the system around me would do the right things.”
He believes that people at his level shouldn’t be motivated by a salary. “If you would pay me double, I’m not going to work twice as much, because I’m already probably maximizing my time available. And would it change the way I do things? Not really, because I try to do the right things for this company for the longer term.”, he says. “So, yes, I am fortunate, and I am sometimes ashamed about the amount of money I earn. It’s important that you then put it to good use. That’s the minimum you can do.”