Polman bows out of Unilever with a rich legacy, but a tarnished reputation

When Paul Polman announced his plan to quit as boss of Unilever last autumn, he had plenty of reasons to think he would be leaving the consumer goods giant on a high: he had fought off a £115bn takeover attempt from Kraft Heinz earlier in the year and forged a reputation as a champion of responsible capitalism. But lying in wait was a shareholder row that would tarnish his hard-won standing and leave a black mark on his otherwise-impressive record.

Polman injected a dynamism and a sense of urgency into Unilever over his decade at the company, which was previously regarded as steady but relatively unexciting in its growth ambitions. He tapped into emerging markets and recognised growing consumer appetite for ethical products: an ambition that might now feel obvious, but was often lacking in other FTSE bosses at the time.

As for returns, Polman’s success was unquestionable: shares provided a total return (including dividend reinvestment) of some 260 per cent over his decade-long reign, standing far higher than the 70 per cent provided by the FTSE 100 over the same time frame.

But just as analysts universally recognise the chief executive’s track record of growth, so too do they share the verdict that he will be leaving the blue-chip firm on 1 January – the date announced today – with a reputation blemished by the botched attempt to consolidate the firm’s headquarters in Rotterdam.

Thwarted by an investor rebellion, the failed effort to simplify Unilever’s Anglo-Dutch corporate structure still leaves a sour taste in the mouth of shareholders. “A whiff of distrust” continues to linger between managers and investors, according to one analyst, with many in the City left reeling from the company’s standoffish manner during the fiasco.

There was also a perception that Polman was more focused on attending climate change summits and social activism events – a fixation on the environmental agenda proved vital in helping to push Unilever’s brand to the forefront of ethical capitalism – than addressing shareholder fears over a planned de-listing.

Continuity, not change, is forecast under the rule of his replacement, Alan Jope. The Scottish insider is seen as a safe pair of hands who will oversee a smooth transition of power.

It is clear too that Polman has left him a rich legacy to build upon. But the departure of the present boss is also a salutary reminder of lesson number one for chief executives: never forget the shareholders.