Unilever is officially no longer a Dutch company. Starting Sunday, the multinational is registered as a fully British company with its headquarters in London. For 91 years, the company structure was divided between the Netherlands and Great Britain, with two head offices in London and Rotterdam. The company also had two boards and two types of shares. To simplify its structure, the company decided in 2018 to opt for one main office. Initially, the choice fell on Rotterdam, possibly partly due to the government’s announcement to abolish the dividend tax. However, after opposition from influential shareholders, London became the final choice. In the end, the abolition of the dividend tax in the Netherlands was not passed. The restructuring means that important strategic decisions will subsequently be made in London. This brings an end to the long Dutch history of the company, but in practice – at least in short term – there won’t be much change. The 2,500 Dutch employees can continue their work as usual. Most of them are located in Rotterdam and Wageningen. Although there is no longer a corporate head office in Rotterdam, the food and beverage division’s head office will remain located there. It remains uncertain if and how long that branch will stay part of Unilever. The company has already promised that if the food and beverage branch secedes, it will remain in the Netherlands.
Turbulent times
The road to ‘unification,’ as the process was called, has not been an easy one. Just two years ago, Unilever wanted to close the UK headquarters and continue fully as a Dutch company. Fast forward two years, the company is now entirely British. The main reason for this shift was because an entirely Dutch Unilever could not be listed on the London Stock Exchange. That would mean that many British investors would have to sell their shares, which was met with a lot of resistance. The Dutch Unilever NV shares have been converted into British shares. All of this is regulated under one jurisdiction, namely the British one. British shares are still listed on the Amsterdam Stock Exchange. In the end, the changes are mainly on paper, and for the most part, don’t have any immediate practical implications.
“Too bad, but understandable”
“I think it’s a shame, but understandable,” says Jeroen van der Veer, the former CEO of another British-Dutch multinational, Shell. They also had two head offices split between the UK and the Netherlands until 2005. “A dual head office has disadvantages,” says van der Veer. “You have a doubling of functions, and in the top layer of the company, it becomes more difficult to organize good cooperation.”
In the long run?
Unilever has promised that the step will not be at the expense of employment in the Netherlands. “But in the really long term, you see that the country in which the head office is located is also the place where a company carries out most of its research and development,” says Van der Veer. “The good news is that Unilever has just opened a new innovation center in Wageningen. I hope that will be a sustainable collaboration with the university there,” he says. Yet, according to Van der Veer, the Netherlands must do a number of things to remain attractive to multinationals. “Access to knowledge must be good, and you must be able to attract a sufficient number of highly educated people from abroad. The government must also continue to stimulate innovative research by entrepreneurs from a fiscal point of view.”
