Paul Polman, Unilever's advocate of kinder capitalism, steps down with tarnished legacy

After a decade at the top, the leader of the consumer goods group is handing over to insider Alan Jope

Unilever CEP Paul Polman

FTSE 100 CEOs continue to fall like skittles, with Unilever’s Paul Polman the latest to announce his departure after a ten year run.

The phrase ‘the end of an era’ is a cliche, but it’s probably true in this case. Most leaders of FTSE 100 companies manage barely half that time in the boss’s chair.

Polman had been an advocate of a better sort of capitalism, one willing to look beyond the short term interests of those shareholders seeking a quick buck to consider the interests of multiple stakeholders.

He preached it in the speeches he was fond of giving. The evidence of its operation in practice was more mixed.

It was challenged when Kraft Foods came a calling with a bid that would have deprived investors with a time horizon longer than the end of their noses of an interest in a company that might have provoked the occasional grumble, but was hardly in crisis.

It really was goodies v baddies. Kraft, which had gobbled up Cadbury in an earlier, and much criticised, deal was a buy up and burn merchant, a rapacious monster fuelled by M&A.

Polman fought a tenacious, and ultimately successful, battle to fend off the unwanted suitor, to the relief of (nearly) all concerned.

But he had to promise disposals and cost cuts and aggressive targets. This left unions, among others, wondering whether the victory was a pyrrhic one for kinder capitalism.

They spoke of a squeeze and fretted about the long term health of a business that had picked and crushed most of the low hanging fruit as regards costs.

Some of the shareholders in London who’d backed him were left wondering why they’d bothered in the wake of his greatest misstep: A plan to reform the company’s dual headed structure and consolidate the corporate HQ in Rotterdam.

This would have resulted in the exit of the maker of everything from Marmite to Dove Soap from the FTSE 100 and made forced sellers of a lot of London fund managers, to their considerable chagrin. The plan floundered on their opposition, leaving Polman and his allies shaking their fists at their own shareholders and with egg on their faces.

When you outperform the FTSE as he did as CEO, while keeping pace with the growth put in by global peers, it’s always possible to smooth ruffled feathers and the market initially reacted to the news of his departure by marking the shares down a little bit, before they recovered.

The announcement was handled too smoothly for anything other than a token gesture.

There will be a transition while Polman's replacement, insider Alan Jope, who has been running home & personal care, the biggest division, takes up the reins. Continuity and stability will be assisted courtesy of finance chief Graeme Pitkethly staying put.

Despite the aforementioned dramas, the message being sent out is that Unilever is a stable sort of place in a world that is anything but.

That world is going to impose significant challenges upon Mr Jope, however, including Brexit, the move to internet shopping, and questions over the sustainability of the targets set by Mr Polman.

Now isn’t a bad time to be handing over to someone else.