STAYING AHEAD OF THE GAME THROUGH INNOVATION; OPEN INNOVATION DR JONATHAN HAGUE VICE PRESIDENT OPEN INNOVATION UNILEVER GLOBAL R&D

STAYING AHEAD OF THE GAME THROUGH INNOVATION; OPEN INNOVATION DR JONATHAN HAGUE VICE PRESIDENT OPEN INNOVATION UNILEVER GLOBAL R&D

OUR COMPANY

UNILEVER REACH EUROPE THE AMERICAS 17.3 BILLION TURNOVER 0.4% UNDERLYING VOLUME GROWTH 32% OF GROUP TURNOVER 13.6 BILLION TURNOVER 2.6% UNDERLYING VOLUME GROWTH 26% OF GROUP TURNOVER ASIA/AMET/RUB 22.4 BILLION TURNOVER 3.0% UNDERLYING VOLUME GROWTH 42% OF GROUP TURNOVER 2015 TURNOVER = 53.3 BN

FAMOUS FOR MANY OF THE WORLD S FAVOURITE BRANDS

MAKE SUSTAINABLE LIVING COMMONPLACE

POSITIVE SOCIAL IMPACT OUR VISION DOUBLE THE BUSINESS REDUCE ENVIRONMENTAL FOOTPRINT TO DOUBLE THE SIZE OF OUR BUSINESS, WHILST REDUCING OUR ENVIRONMENTAL FOOTPRINT AND INCREASING OUR POSITIVE SOCIAL IMPACT

3 BIG GOALS BY 2020 HELP MORE THAN 1 BILLION PEOPLE IMPROVE THEIR HEALTH & WELL-BEING HALVE ENVIRONMENTAL FOOTPRINT OF OUR PRODUCTS ENHANCE THE LIVELIHOODS OF MILLIONS OF PEOPLE

SUSTAINABLE LIVING BRANDS HELP GROW OUR BUSINESS 50% OF UNILEVER S GROWTH 2x THE RATE OF GROWTH BRANDS WITH A POWERFUL PURPOSE ENJOY SUSTAINABL E GROWTH SUSTAINABLE LIVING BRANDS SUSTAINABLE LIVING PURPOSE = + SUSTAINABLE LIVING PRODUCT S MOR E

238,000 WOMEN WITH ACCESS TO TRAINING & 55% SUSTAINABLY SOURCED 800,000 SMALLHOLDERS HELPED & TRAINED MAKING PROGRESS 2010-2014 397 MILLION HELP TO IMPROVE HEALTH & HYGIENE -2% WATER -12% WASTE +4% GHG +21% UNDERLYING SALES GROWTH

INNOVATION IN OUR COMPANY

INNOVATION IS IN THE HEART OF THE STRATEGY

INNOVATION GROWING THE CORE BUSINESS Iron-fortified Knorr Cubes Lifebuoy with Activ Naturol Shield Dry Spray Aerosol Deodorants Cooking ingredients up >50% in 5 yrs in emerging markets 15% growth in 2014 Launch in US in 2015

INNOVATION DELIVERING RESULTS Stronger Pipeline Incremental Turnover In the funnel Bigger innovations Average project size More Benefits % Projects using New Technologies +20% +30% 45% Now 35% 2013 2013 Now 2013 Now 75% of Innovations are Margin Accretive

OPEN INNOVATION

OUR CHALLENGE POSITIVE SOCIAL IMPACT 2.8 Unilever R&D Spend % Turnover 1650 Global Gross R&D ($Bn) DOUBLE THE BUSINESS 2.3 1600 1550 1500 1.8 1450 2004 2006 2008 2010 2012 2014 2016 FOOTPRINT 2012 2013 2014 REDUCE ENVIRONMENTAL Ambition remains High R&D Spend falling In Real Terms Global R&D Spend up - Biotech - Advanced materials - ICT *Source Battelle Global R&D forecast 2014

MAGNIFYING THE IMPACT OF R&D Digital R&D High Throughput Modelling and Simulation Fit to win Organization Sharper Category Innovation Choices Partnership and Open Innovation

OUR OPEN INNOVATION MANDATE Program Owners Open Innovation Team Drives capabilities Categories HC, PC, Foods, Refreshments Scouting / Technology Intelligence Deal Architecture Strategic Science Group Cross Unilever Strategic Partnerships IP Agreements Processes and IT Training New Capabilities

OPEN INNOVATION IMPACT % Deliverables OI Enabled 90 70 50 30 2008 2010 2012 2014 2016 Pipeline Incremental Turnover Reliant on Open Innovation Not Reliant 46% 0% OI Reliant 54% We have saturated our program Open Innovation (as we define it) is fully embedded Focus Now ; Simpler, Faster, More Networked, More Digital, More Leverage, More Value

WHAT S WORKED FOR R&D Partner to Win Science Grid Innovation Ports Site Ecosystems

PARTNER TO WIN - THE CO CREATION MODEL Targeted Encapsulation Unilever IP on fabric molecular surface recognition Partner IP on Fragrance Capsules Fragrance Design Winning high performing fragrance encapsulates

SCIENCE GRID - THE MULTIPLIER EFFECT Translational R&D World Leading > 200 M Million Investment in High Performance Computing Data Analytics X M Real world applications Of In Silico First - Billions In potential value creation Unilever s spend accesses a capability that is multiple times our investment Commercial impact In Unilever and to UK PLC Is CRITICAL to Hartree Computer Aided Formulation Optimiser Engines Virtual Engineering Processing Virtual Engineering Packaging Factory Line Optimization

SITE ECOSYSTEMS CO - INVESTMENT FOR SCALE Centre for Materials Discovery Micro Biorefinery High Throughput Formulation Centre Materials Innovation Factory Advanced Manufacturing Centre Operational 2016 Over 130 Million invested in Next Gen Capabilities by Unilever and its Partners Open Facilities UK Government has contributed > 20 Million

WHAT S NOT WORKED FOR R&D Submissions Portal for unsolicited product ideas > 2,000 since launch Nothing of substance An Independent New Business Unit Aimed at Radical / Disruptive technology Innovation Incubation Investment horizon too long + uncertain

THE FOUNDRY

COLLABORATING WITH INNOVATORS TO MAKE SUSTAINABLE LIVING COMMONPLACE OUR PLATFORM FOR COLLABORATING OUR FRAMEWORK FOR EXPERIMENTATION foundry.unilever.com @UnileverFoundry ENABLING OUR BRANDS & FUNCTIONS TO PIONEER

A framework for experimentation Pitch Pilot - Partner The Brief The Pitch The Partnership The Pilot

Still at the beginning of the journey 4500 350+ mentors registered 25+ brands involved + applications $20m+ received invested into pilots 100+ startups piloted 48+ start-ups being scaled-up

THE LAST WORD. Foundry Overview film: https://youtu.be/mpzgn3vu7wu

THANK YOU THERE S NEVER BEEN A BETTER TIME TO CREATE A BRIGHTER FUTURE