HUL's Strategic Update on Board’s Skill Matrix!

Overhauling Leadership Skills at Hindustan Unilever Ltd.

Hindustan Unilever Ltd. (HUL), India’s largest consumer goods company, is revamping the skill sets of its top leadership, the Board, to stay current with the times and meet consumer demands.

The Board of HUL will now delve into cybersecurity, ESG (environmental, social, and governance), data governance, and other growth-related topics crucial for the company’s future growth and talent retention.

In its annual report for 2023-2024, the company noted significant changes in the external environment and regulatory framework, emphasizing the increasing importance of cybersecurity, artificial intelligence, ESG, and risk management. Consequently, the skills required of Directors have evolved.

The Board, based on the Nomination and Remuneration Committee's recommendation, approved and adopted a revised Board Skill Matrix on February 26, 2024.

HUL will be among the first major companies to formally adopt additional skill sets for its Board. While certain skill sets were previously deemed essential, this marks the first time HUL has quantified the extent of these skills among its directors.

Skill Set Insights

According to the report, 92 percent of the Board possess leadership experience, but only 33 percent are well-versed in cybersecurity, data governance, and information technology. However, all directors understand the importance of conducting business with purpose, and 75 percent have experience overseeing large and complex operations.

The company's board includes Nitin Paranjpe, Rohit Jawa, Leo Puri, Kalpana Morparia, Tarun Bajaj, Neelam Dhawan, among others. HUL owns over 50 brands across 16 FMCG categories, reporting a turnover of Rs 59,579 crore in FY24.

In April, HUL appointed B.P Biddappa to its management committee as executive director, human resources, and chief people, transformation, and sustainability officer for South Asia. Biddappa will lead the people's agenda and drive transformation initiatives from a business, organizational, and sustainability standpoint.

These changes coincide with India's growing importance in Unilever's global market and the emergence of Indian talent within the company. HUL is renowned for producing executives who hold leadership positions worldwide.

Moreover, search firms are actively seeking independent directors familiar with evolving business needs, as over 1,000 independent directors are set to retire by June 2024. This trend is prompting companies to seek managing directors and chief executive officers capable of taking the helm.