Unilever believes Brexit will make Britain 'stronger and more united'
There's never a good time to lose a top 10 FTSE company to an EU rival but to do so in the middle of emotionally charged Brexit negotiations is potentially awkward for the British government.
In the run up to the referendum Unilever energetically campaigned for Britain to remain in the EU.
On Thursday morning the company announced its intention to shift its corporate headquarters to Rotterdam in a move that many interpret as a direct consequence of our vote to Leave.
"Brexit was not a factor," insists the CEO of Unilever, Paul Polman. "This was about making our legal structure simpler and more agile for long-term shareholder value."
Eighteen months ago Polman was warning of the "negative impact" of Brexit, he now sings a different tune.
Not only is Brexit a "short-term issue" but, he told ITV News, the Unilever board believes it can be a success.
"Common sense, ultimately, will prevail. We have high confidence that the UK will come out of this as a stronger more united country," he said.
As proof of that confidence Unilever has decided to locate two of its three newly restructured divisions in Britain and has re-stated its intention to continue spending £1 billion a year here.
It’s worth remembering that Unilever, while widely referred to as “Anglo-Dutch”, operates in 190 countries and does most of its business outside the European Union. While many chief executives of large companies say Brexit is their number one concern, Polman is understandably more relaxed.
He also plays down the significance of the decision to shift Unilever’s corporate base. “Isn't is all about investment and job creation?” he argues, “the old notion of headquarters is probably a little bit obsolete."
Polman is polite and pragmatic but the decision to move headquarters will greatly disappoint the British government not least because it fought so hard to keep it here.
Unilever has had a headquarters in both Britain and the Netherlands ever since Lever Brothers merged with Margarine Unie in 1929.
Last April Unilever decided such a structure was messy and unhelpful and announced plans to choose between London and Rotterdam. London has lost and that matters.
Unilever will maintain a listing of its shares on the London Stock Exchange but is likely to slip out of the FTSE 100 unless a special exemption can be made.
Symbolically and politically Unilever's decision is damaging although far from disastrous. It has economic implications too.
The upfront cost is small but measurable, around 50 jobs will move from Britain to the Netherlands. Over the longer-term it's hard to see how having a major company run entirely from the Netherlands advantages Unilever's British operation and the 7,500 staff who work in it.
The disquiet around Unilever moving its headquarters will quickly die down; as long as no other multi-national follows suit.