After Unilever bought Ben & Jerry’s, many in the conscientious business community were sort of wondering whether Unilever could keep Ben & Jerry’s “weird.” People loved how weird it was, and its whole marketing identity was weird. It could be the most important thing about the company.
Unilever is this huge multinational company; it’s selling a lot of soap and other products, and people were skeptical. The acquisition and the passage after the acquisition were a little rocky.
Then the top people at Unilever did the most amazing thing. There was a danger that Ben & Jerry’s was going to get unweirded, and that was not going to be OK for Ben & Jerry’s. Then the top people in Unilever amazingly looked inside their own company and found, according to B the Change Media CEO Bryan Welch, the weirdest CEO ever to emerge from a corporate multinational — Jostein Solheim.
Below is a presentation made by Solheim at B the Change Media’s 2016 Best for the World Gathering. At our online Best for the World hub, you can listen to his presentation and learn more about all the Best for the World honorees.
How the Business Model at Ben & Jerry’s Really Works
Jostein Solheim: Obviously this is about leadership, and my presentation is a little different. I’m going to give you like a speed tutorial on Ben & Jerry’s strategy, and what we do, and then I’ll weave in some of those leadership moments and conclusions at the end. …
I was really inspired by the Leading Toward Growth panel. My thing is also about scale. When Adam [Lowry of Method and Ripple Foods] says there’s 96 percent of the market still to play for — that’s exciting. When you think about what’s happening now with digital, we’re actually able to put all the relevant information right in the consumer’s hand, and we’re able to create a one-on-one relationship and communication. That will allow us to scale. It’s exponential, and it’s really exciting.
That’s what’s happening at Ben & Jerry’s.
The thing that I always like to say before I start is, this business model at Ben & Jerry’s really works. I speak to a lot of business people, and they’re sort of thinking like, “Yeah, that’s on fire.” We’re the fastest-growing, we’re the most profitable, we have the best cash flow, and we have the best operational indexes across our business, in our industry. You’ll see lots of mission, you’ll see lots of other stuff, but just keep in mind, it actually really works.
I am not Ben, and I’m not Jerry, but they are still involved. Jerry and Ben [the founders] have the absolutely best job in the world. Their job is to be Jerry and Ben, and we actually pay them for that. They are engaged but they have no executive responsibility and no, as Jerry likes to say, power. They have this ability to be part of our journey, to guide us, to engage but not overly interfere, and that’s a very strong point.
Ben & Jerry’s was created in 1978 — so it’s taken us a little longer than some of these companies you just heard from — in 1978 in a scoop shop, and in about 1988 they said, “We’ve got to summarize this into a mission statement.”
What they came up with — you got to remember, this is the ’80s … shoulder pads, power, money — they came up with a mission statement that basically said, “We’re going to give equal priority to three parts of our mission. The product mission, which is to make the best possible product, in the most natural way, with the least environmental impact.” We could say that’s more than one, but that’s the product mission.
The economic mission was, of course, to deliver a sustainable return to our shareholders, and then the social mission was essentially to change the world, to be a force for good, and for human rights in the world. The business model was a model called “linked prosperity,” and I’ll come back to that.
It was a pretty rocky company. These guys were trying to do a lot of things that weren’t being done, and there were a lot of people who didn’t think they should do it. At one point they actually moved the board meeting out of Vermont because they were too embarrassed about all the fights, that they didn’t want anybody to walk by and hear them arguing, so they said, “We’ll move it across to New York State.” It was an intense time.
In 2000, Ben & Jerry’s was acquired by Unilever. It was a listed company, so it was acquired off the stock market, and not directly from the founders.
You buy a company and it says Ben & Jerry’s on the front of the package. If Ben and Jerry are not happy about this, it’s really undermining your brand. What they agreed, in 2000, was to set up a board-governance structure, which is totally independent of Unilever. This board has the responsibility for the integrity of the Ben & Jerry’s brand and a whole host of other quite operational aspects and can stop any action of the CEO that they feel goes against the integrity of the brand. Unilever is the only shareholder and has full operational responsibility.
Then you could say, “Well that’s easy, because you just put all your friends on the board and then you’re good,” but these are all of Ben & Jerry’s friends. Jeff [Furman, chairman of the board] is my boss; he was the first employee of Ben & Jerry’s. He did the business plan with Ben & Jerry’s. You will see people from Berkeley here, Annie Leonard, who heads up Greenpeace. You might have heard of them, not a real pushover organization to have on the board, I tell you.
The board is a strong activist board, deeply rooted in social justice, and they really stand up, and they really leverage that right. When I came to Ben & Jerry’s in 2010 … they said to me, “Finally we’ve found the perfect job for you Jostein.” … I actually said no, because the brief was, “Go and re-radicalize Ben & Jerry’s,” and I said, “You don’t really want me to do that.” Then I read their acquisition agreement and I realized that, actually, we had the right to do this, and we could do it independently and following our own purpose and our own beliefs. It really changed my life.
I talked about “linked prosperity.” … What we try to do is connect the three principal communities that we do business with, and we try to connect them not just technically but emotionally. We try to create empathy between the farming community and our ingredient suppliers that make the stuff that we buy, that’s the biggest investment we do, is buy ingredients for our product. We connect up with our community where we make our products, with our management, with our manufacturing, and then try to connect them with the people we sell our product to, the communities in which we sell. I think the unique thing about ours is that to make that wheel go around we need corporate activists.
… We like to connect deeply on a personal level with everybody that we can. Then we really care about the community in which we sell our product. That’s when we move from marketing to activism, and we pick up the issues that we care about and that the community cares about, and we use digital and other means to drive that through. The more times we go around this wheel, the more prosperity we can create in these communities, the more issues we can tackle. That’s the basic model.
We’ve got two big platforms for corporate activism. My bosses at Unilever have told me, “Jostein, you haven’t left anything out,” because once you cover climate justice, and then you cover social and economic equity, what issue is it that you’re not covering? We like these two solid platforms; we’ve been at work on those for 10 years. … We have a tax, an internal price on carbon that we redeploy to intercept the carbon in our supply chain. We have a program to create an equitable and inclusive value chain. We’ve got a program, of course, around the area of our dairy company; dairy is not environmentally sound, so we need to really tackle that. We have a fair trade enterprise model.
… How do we actually do this? Adam said if you want to change the world, and you want to bring the 96 percent in, you’ve got to talk their language. Our philosophy is, and I said it nicely, if I can’t dance, I don’t want to be part of the revolution. We like to have fun with it. It’s really important. That’s our way of inviting people in. Our marketing mix for our activism and our engagement is anchored around three things:
(1) An amazing product. We are ice cream nerds; we live and die and eat ice cream, all the time. That’s what we do; we love it. That’s sounds terrible, but it’s true. (2) We’re a mission-led company. We’re a B Corp, we do fair trade, we do non-GMO, etc. (3) Then we have our unique take on popular culture. It’s not a sense of humor that’s always shared; I mean, we launched Schweddy Balls. That was delisted by every major retailer in America. We thought it was funny; our fans thought it was funny. There was no mission in it, but it was fun. Every newscaster in America got to look into the camera and say, “They launched a product called Schweddy Balls.”
We have this triangle, and I think that’s what allowed us to break away from just the people who deeply care about our social mission into just having fun with the product.
Point is, I’ve got an awesome team. They’re in charge. They know our values. They know our boundaries, and they are free to execute on it.
I would recommend you go on our website and look at the video with Cornell Brooks talking about democracy. Last year, if you remember, there was COP21 [the 2015 United Nations Climate Change Conference]. Last year was all about climate justice. … That was our single-minded focus last year.
This year, some of you might have noticed, there is an election. Our platform of social equity really starts with creating a democracy that works for all of us. … This year, what we’re doing is, we’re doing a campaign together with the NAACP and a whole host of other organizations, where we basically have three pillars. Pillar one is to get the money out of politics. We’ve been working on that for a long time. What we discovered when we started working on this was that that was actually quite a white sort of a campaign, and that all the people of color, they’re over here “doing,” get the people in. How do we get the people in? We joined these two pillars and we said, “OK, we’re going to get the money out and get the people in.” That’s the campaign, merging these two.
The third pillar is race. If you can’t tackle structural racism, you can’t deal with these two, inside your own company and in society. You think climate is hard? I can tell you this is harder, but this is … doable and it’s the right fight to fight. It is the right issue to tackle. We’re putting this together, and that’s our campaign for this year. …
We did a bit of civil disobedience and then we did a big launch event for empowerment, where the royalties go to the NAACP in North Carolina. Those two, the combination of those two events, got about 500 million impressions. We reached a lot of people. …
Honestly, people worry about corporate activism, and I would worry about corporate activism too if it was a CEO thing. It’s got to be a company thing. Nobody really cares what values you have as a company; what they care about is how you act on it. That’s the biggest take: It really works. We’re growing, we’re profitable, the people who believe what we believe are extremely loyal to our business and buy a lot of ice cream, so it works.
I think also, the other part is, this thing about perfection. Perfection is a real enemy. Yes, you have to walk the talk. You have to walk the talk as a leader, you have to walk the talk as a company, but don’t use perfection, this pursuit of perfection for an excuse for not taking action. If you know the solution is in that direction, start walking. You’re not going to figure it all out. You’ll figure it out when you get a bit further down. It’s the biggest lesson for me. You can get paralysis by trying to analyze things too much. Yes, you need a low carbon economy; yes, you need to have inclusion and equity at the heart of your business; and yes, you can’t do it alone. You’ve got to play your role in a movement. You’ve got to join others. Doing your whole own thing doesn’t work. Join the big movements. They’re out there, they’re great, they’re good at doing this stuff on traction. …
First of all, be purpose-led, personally and as an organization. A big part of our success is our product is a real pain in the ass to make. You’ve got chunks, swirls, you’re trying to put all this stuff in there. It’s not easy, but because the people that work at our company really believe in what we believe in, they really pay extra attention. A lot of people have tried to make something similar to Ben & Jerry’s; it’s actually really hard to make. Being purpose-led also drives connection and allows me to empower these teams, to really get on with their jobs rather than doing the command-and-control thing, which died about 10 years ago and nobody’s told the rest of the business world. That’s purpose-led.
The second part … is you’ve got to think emotional. Actually, if you look at the research that just came out yesterday, facts don’t convince people. They actually polarize people. You got to think emotional, you got to think about how you make people feel and how you get them to take action, not about the facts. Celebration of failure is a core value at Ben & Jerry’s. We have a flavor graveyard where we write poems about the flops, and we bury them in the ground. … The fact is, if you haven’t got a big flaw, what the heck have you been doing? You’re not trying hard enough. For us it’s really important that failure is taken out of the equation and that we’re heading in the right direction. We’re trying to do the right thing; we should celebrate failure when it happens.
Transparency has always been something that people worry about. “We shouldn’t tell people; they might get angry.” Well the thing is, in a digital age, everybody knows everything anyway. And if you put it all out there, people can actually help you. … Outrageous transparency, I think, is a key driver. …
My personal purpose is actually to help people thrive in ambiguity and paradox when it really matters for the world. I love this stuff. Here you’ve got social change, business technical disruption, there’s so much ambiguity, there’s so much paradox out there. I’m having a great time, but I think everybody at Ben & Jerry’s feels they can lead with courage. That’s one of my philosophies: What could possibly go wrong? I mean, we are trying to do the right thing, and yeah, we’ll screw some things up, but if you’re trying to do it, you’re putting your heart and soul into doing the right thing, what could possibly go wrong? That’s my last point. This is really a bottom-up revolution. We’re not going to run this top-down; we’re going to run it bottom-up.