Unilever ‘has lost the plot’

FUND manager Terry Smith has blasted Unilever for being ‘obsessed’ with its sustainability credentials.

The stock-picker, who runs several popular funds through his firm Fundsmith, said Unilever has ‘lost the plot’.

On its website, Unilever says: ‘Hellmann’s purpose is to help people enjoy good, honest food, for the simple pleasure it is, without worry or waste.’

In his annual letter to investors in his Fundsmith Equity fund, Smith said: ‘A company which feels it has to define the purpose of Hellmann’s mayonnaise has… clearly lost the plot. The brand has existed since 1913 so we would guess that by now consumers have figured out its purpose (spoiler alert – salads and sandwiches).’

He blasted its refusal to supply Ben & Jerry’s ice cream in the West Bank, as sales ‘in the Occupied Palestinian Territory’ were ‘inconsistent with our values’.

Smith said: ‘Unilever seems to be labouring under the weight of a management obsessed with publicly displaying sustainability credentials at the expense of focusing on the fundamentals of the business.’

Unilever was one of the worstperforming holdings in Smith’s £22.7bn fund, as was payments company Paypal. The latter has been looking to branch out of its payments sphere. Smith said it should ‘stick to its knitting’.

He conceded that buying shares in Amazon had ‘attracted a lot of attention’ as he had previously steered clear of the internet giant.

But he said it was a case of ‘better late than never – or at least it will be if our purchase delivers the performance we expect’.

Fundsmith returned 22.1pc for investors in 2021, missing its benchmark, the MSCI World Index, which returned 22.9pc.

Last year, Smith bagged a payday of up to £150m.