Fund boss accuses Unilever of ‘virtue signalling’

FUND manager Terry Smith has accused Unilever of “virtue signalling” rather than focusing on financial performance in a fresh salvo against the ice cream-to-deodorant maker.

The stock picker, whose £22bn Fundsmith vehicle is the 15th largest shareholder in Unilever, accused the company of failing to listen to the concerns of investors and criticised the consumer goods giant’s marketing.

Mr Smith singled out Unilever’s Hellmann’s mayonnaise, claiming it relies on “virtue signalling ‘purpose’” in its advertisements rather than selling the taste. One of the brand’s most recent television advertising campaigns encourages buyers to use the sauce to cut down on food waste by using mayonnaise to brighten up leftovers.

It is the second time Mr Smith has criticised Hellmann’s. The investor previously claimed that the company had “clearly lost the plot” by trying to “define the purpose of Hellmann’s mayonnaise” in an annual letter to shareholders, which he dubbed “mayonnaisegate”.

Mr Smith has been a persistent thorn in the side of Unilever chief Alan Jope, who is set to stand down at the end of this year. The Fundsmith chief described Unilever’s £50bn bid for GSK’S consumer division as a “near death experience” for the company. The abortive bid was spearheaded by Mr Jope, who sold it as a way to revitalise Unilever’s flagging growth.

In his latest letter, Mr Smith complained that Unilever tended to “ignore” longterm shareholders but favour short-term investors.

Unilever did not respond to a request for comment.