Managing People Across Borders: A Study of International

HRM Practices at Unilever

Submitted in partial fulfilment of the requirement for the award of degree of

POST GRADUATE DIPLOMA

IN MANAGEMENT
From
NARAYANA BUSINESS SCHOOL – AHMEDABAD

Submitted By

NAME: Nayan Choubisa

BATCH: PGDM 2023-25
ROLL NO: 226
SECTION: Gamma
DATE OF SUBMISSION: 13/04/2025
Under the Guidance Of
NAME: Dr. Pragya Sharma
DESIGNATION: Assistant Professor
DEPARTMENT: Human Resource
 Index
Company Overview .............................................................................................................................................. 3
Organizational Structure of the HR Department................................................................................................... 5
Recruitment and Selection Procedure ................................................................................................................... 7
Unilever’s International Compensation Approach ............................................................................................... 9
Conclusion .......................................................................................................................................................... 11
 Company Overview

Unilever is a globally renowned British-Dutch multinational corporation operating in the fast-

moving consumer goods (FMCG) sector. Established in 1930 through the merger of British
soapmaker Lever Brothers and Dutch margarine producer Margarine Unie, Unilever has grown into
one of the world’s largest and most diverse consumer goods companies. The organization is co-
headquartered in London, United Kingdom, and Rotterdam, Netherlands, although it now operates as
a single entity headquartered in London.

Unilever’s product portfolio spans across three main divisions: Beauty and Wellbeing, Personal
Care, and Nutrition and Ice Cream. It owns and manages more than 400 brands, many of which are
globally recognized household names such as Dove, Lux, Knorr, Magnum, Lifebuoy, Lipton,
Hellmann’s, and Surf Excel. These products reach approximately 3.4 billion people every day,
reflecting the company’s deep penetration into both emerging and developed markets.

With operations in over 190 countries and a workforce of around 127,000 employees, Unilever
functions through a decentralized yet highly integrated business model. This model empowers local
teams while aligning them with global corporate strategies. The company's presence in diverse
markets demands strong cross-cultural management and innovative HR practices to attract, retain,
and develop talent across geographies.

Unilever is globally recognized for its sustainability-focused approach to business. Through its
strategic framework, the Unilever Compass, and its former initiative, the Sustainable Living Plan,
the company integrates environmental, social, and governance (ESG) goals into its core operations.
It consistently ranks high on indices like the Dow Jones Sustainability Index, reinforcing its
reputation as a responsible multinational corporation.

By combining strong brand equity, a consumer-centric approach, and a robust global HR framework,
Unilever continues to lead in the international marketplace and serves as a benchmark for managing
people across borders.
 Organizational Structure of the HR Department

In early 2022, Unilever transitioned from its traditional matrix structure to a more streamlined,
category-focused organizational model. This shift aimed to enhance agility, accountability, and
responsiveness within the company's operations.

Key Components of the HR Organizational Structure:

1. Unilever Leadership Executive (ULE):

o The ULE comprises top executives responsible for overarching corporate functions,
including Human Resources.
o The Chief Human Resources Officer (CHRO) is a pivotal member of the ULE,
overseeing global HR strategies and policies.
2. Business Group HR Leaders:
o Unilever's operations are divided into five primary Business Groups: Beauty &
Wellbeing, Personal Care, Home Care, Nutrition, and Ice Cream.
o Each Business Group has dedicated HR leaders who align HR initiatives with specific
business objectives, ensuring that talent strategies support product innovation and
market growth.
3. Functional HR Teams:
o These teams specialize in core HR areas such as Talent Acquisition, Learning &
Development, Compensation & Benefits, and Employee Relations.
o They provide expertise and support across all Business Groups, ensuring consistency
in HR practices and policies.
4. Geographic HR Partners:
o While the new structure emphasizes global categories, regional HR partners remain
crucial.
o They address local labor laws, cultural nuances, and market-specific challenges,
ensuring that HR practices are both globally consistent and locally relevant.
5. HR Services & Operations:
o This segment handles the operational aspects of HR, including payroll processing,
HR information systems, and administrative support.
 o By centralizing these functions, Unilever ensures efficiency and standardization
across its global operations.

Implications of the New Structure:

• Enhanced Accountability: By aligning HR functions directly with Business Groups, there's

a clearer line of responsibility and quicker decision-making.
• Agility: The streamlined structure allows Unilever to respond more swiftly to market
changes and business needs.
• Global Consistency with Local Relevance: While global standards are maintained, regional
HR partners ensure that local requirements and cultural considerations are addressed.

This restructured HR organization supports Unilever's strategic goals, fostering a culture of

innovation, inclusivity, and performance excellence across its global operations.
 Recruitment and Selection Procedure

Unilever follows a structured, technology-enabled, and globally integrated recruitment and selection
process aimed at attracting diverse, high-potential talent across all its markets. The process is
consistent with the company’s global presence and commitment to innovation, diversity, and
inclusion.

Recruitment Process:

1. Online Application
Interested candidates begin their journey through Unilever’s global careers portal by
submitting an online application. The portal is designed to be user-friendly and allows
candidates to link their professional profiles for ease of access and screening.
2. Profile Assessment through Gamified Testing
Once the application is submitted, selected candidates are invited to participate in an
innovative online assessment. This stage involves gamified psychometric tests that measure
cognitive, social, and emotional traits. These assessments are powered by artificial
intelligence (AI) and are designed to reduce bias while identifying capabilities such as logical
reasoning, decision-making, and adaptability.
3. Digital Video Interview
Candidates who pass the assessment move to the digital interview stage. This includes
answering situational and behavioral questions in a pre-recorded video format. The digital
format allows standardized evaluation of communication skills, motivation, and alignment
with Unilever’s core values and culture.
4. Final Interview with Hiring Managers
Shortlisted candidates are then invited for a face-to-face or virtual final interview with HR
professionals and line managers. This stage may include a case study or scenario-based
questions and is aimed at evaluating the candidate’s technical knowledge, leadership
potential, and fit within the team.
5. Offer and Onboarding
Successful candidates receive a formal offer, after which the onboarding process begins.
 Unilever’s onboarding is structured, inclusive, and designed to integrate new hires smoothly
into the company culture and operations.

Approach and Choice of HCN, PCN, and TCN

Unilever follows a flexible staffing strategy tailored to its multinational operations and global
workforce needs. The company applies different international staffing approaches depending on the
role, location, and strategic importance of the position.

• Home Country Nationals (HCNs):

These are employees hired from the local population of the host country. Unilever
predominantly employs HCNs for country-specific roles as they offer better understanding of
the local market, legal environment, and cultural context. This also fosters local community
engagement and regulatory compliance.
• Parent Country Nationals (PCNs):
PCNs are employees from the country where Unilever's headquarters is located. They are
typically placed in key management or strategic roles where it is crucial to align the
subsidiary with the parent company’s corporate philosophy and global strategy. PCNs are
often used when launching new operations in foreign markets or in executive leadership
roles.
• Third Country Nationals (TCNs):
These are employees who are citizens of countries other than the host or parent country.
Unilever uses TCNs to promote diversity and leverage cross-cultural expertise in leadership
development and regional coordination. Employing TCNs allows for increased flexibility,
talent mobility, and the promotion of a truly global workforce.
 Unilever’s International Compensation Approach

Unilever’s global compensation strategy is designed to support its diverse and geographically
distributed workforce while maintaining fairness, transparency, and competitiveness. As a
multinational corporation operating in over 190 countries, Unilever faces the challenge of balancing
local market conditions with global consistency. Its compensation philosophy is grounded in
principles of internal equity, external competitiveness, and alignment with business performance.

Key Elements of Unilever’s International Compensation Approach:

1. Balance Sheet Approach (for Expatriates)

Unilever uses the Balance Sheet Approach to compensate expatriates, ensuring they can maintain a
standard of living comparable to what they had in their home country. This method involves
calculating the total cost of living in the host country and then adjusting the expatriate's
compensation to cover differences in housing, taxes, goods, and services. This ensures that
employees are not financially disadvantaged when they accept international assignments. It is
particularly effective in motivating mobility without imposing financial stress.

2. Global Grading and Job Evaluation System

Unilever implements a global job evaluation framework known as the Unilever Job Level (UJL)
system. This framework classifies roles across the organization into specific levels based on factors
like scope of responsibility, complexity, and impact. By standardizing job levels globally, the
company ensures consistency in compensation practices across all regions. This system helps
benchmark roles across markets and facilitates equitable pay regardless of geographic location.

3. Performance-Based Incentives

Performance is a core element of Unilever’s reward philosophy. Employees are eligible for variable
pay components such as bonuses and incentive plans that are tied to both individual and
organizational performance. The company uses Key Performance Indicators (KPIs) at all levels to
evaluate success and reward contributions. For senior and global roles, performance-related pay may
also be tied to long-term incentive plans (LTIPs), such as share-based compensation.

4. Comprehensive Benefits for International Employees

Unilever provides an extensive benefits package tailored to the needs of international and expatriate
employees. These benefits are designed to support both the employee and their family, ensuring their
well-being and comfort during international assignments. Key benefits include:

• Relocation Assistance: Covering travel, moving expenses, and initial housing setup.
• Housing Allowance: Adjusted based on the cost of living in the host country.
• International Medical Insurance: Comprehensive coverage that includes medical, dental,
and emergency care for the employee and dependents.
• Educational Support: Tuition assistance for dependents enrolled in international schools.
• Repatriation Support: Guidance and financial support for returning to the home country
after the assignment.

5. Total Reward Strategy

Beyond fixed pay and traditional benefits, Unilever adopts a Total Reward Strategy that integrates
both monetary and non-monetary rewards. This holistic approach includes:

• Career Development Opportunities: Access to global mobility programs, leadership

training, and skill enhancement.
• Recognition Programs: Initiatives that reward innovation, collaboration, and performance.
• Work-Life Balance Support: Flexible working arrangements, wellness programs, mental
health support, and parental leave policies.

The Total Reward Strategy is designed to attract, motivate, and retain high-quality talent in a
competitive global market. It reflects Unilever’s broader commitment to employee engagement,
sustainability, and long-term value creation.
 Conclusion

In conclusion, Unilever exemplifies the effective management of human resources in a global

context. Through its structured and innovative HR practices, the company successfully balances
global integration with local responsiveness. The matrix-based HR organizational structure allows
for collaboration across regions while maintaining focus on core HR functions like talent acquisition,
learning and development, and employee engagement.

The company’s recruitment and selection process is modern, inclusive, and technology-driven,
emphasizing fairness and objectivity through AI-based assessments and structured interviews.
Unilever’s strategic use of HCNs, PCNs, and TCNs showcases its ability to align global business
goals with diverse talent pools, fostering cross-cultural collaboration and leadership development.

Moreover, its compensation philosophy is comprehensive and globally consistent. By combining

balance sheet methods for expatriates, a globally aligned job grading system, performance-based
rewards, and a holistic total reward approach, Unilever ensures competitiveness in the global talent
market while promoting employee satisfaction and retention.

Overall, Unilever’s international HRM practices reflect best-in-class standards for managing people
across borders. The company serves as a strong example of how multinational organizations can
build a cohesive global workforce by integrating strategic HR planning, local adaptability, and
employee-centric values.