Essity’s Strategic Leadership Shift: Ulrika Kolsrud Steers Toward Sustainable Growth

The appointment of Ulrika Kolsrud as Essity’s new CEO marks a pivotal moment for the global hygiene and health leader. As the company navigates a complex landscape of demographic shifts, sustainability demands, and competitive pressures, Kolsrud’s deep operational expertise and proven track record position her to drive the next phase of growth.

A Leader Rooted in Essity’s DNA

Kolsrud’s 20-year career at Essity, including her nine-year tenure on the Executive Management Team and six years leading the Health & Medical division, underscores her familiarity with every facet of the business. Her promotion over external candidates signals the Board’s confidence in her ability to execute Essity’s strategy without disruption. A standout achievement: under her leadership, the Health & Medical division achieved 70% “product superiority” ratings—a metric reflecting customer preference for Essity’s offerings over competitors.

Strategic Priorities: Growth, Innovation, and Sustainability

Essity’s 2025 strategy hinges on three pillars:
1. Market Expansion: Prioritizing high-growth regions like East Asia, Latin America, and the U.S., while maintaining European dominance.
2. Innovation Leadership: Leveraging a 70-factory global network to deliver products that meet evolving consumer needs, such as eco-friendly materials and advanced medical solutions.
3. Sustainability Commitment: Aiming for net-zero emissions by 2050 and 100% material recovery of production waste by 2030, aligning with investor and consumer expectations.

Kolsrud’s emphasis on workplace safety and employee well-being, embodied by her “Essity I Care” initiative, also signals a focus on retaining top talent—a critical factor in sustaining operational excellence.

Market Context: Favorable Trends, Strategic Risks

The hygiene and health market is primed for growth, driven by:
- An aging global population boosting demand for medical products (e.g., TENA’s incontinence solutions).
- Rising consumer awareness of environmental issues, favoring Essity’s sustainable practices.
- Post-pandemic shifts toward preventive health measures.

However, challenges persist. Rising input costs and trade tariffs could pressure margins, though Essity’s localized production network—spanning 150 countries—buffers against geopolitical risks.

Data Note: Essity’s stock has outperformed the OMX Stockholm 30 Index by 12% over five years, with EBITA margins hovering around 14%, close to its >15% target.

Financial Resilience and Shareholder Value

Essity’s financial discipline is evident in its SEK 3bn share buyback program (launched April 2025) and stable dividend policy (SEK 8.25 per share proposed for 2024). Q1 2025 results show organic sales growth of 2.1%, driven by volume gains in Health & Medical and Consumer Goods, offsetting softness in Professional Hygiene.

The Board’s cash-based incentive program, tying executive pay to total shareholder return (TSR) and sustainability targets (e.g., reducing emissions by 7.5% by 2027), aligns leadership incentives with long-term value creation.

Conclusion: A Leader for a Sustainable Future

Ulrika Kolsrud’s appointment is a masterstroke. Her operational acumen, proven in scaling the Health & Medical division, and her alignment with Essity’s purpose—“breaking barriers to well-being”—position her to capitalize on growth opportunities while addressing sustainability and cost challenges.

With net sales of SEK 146bn in 2024, a market cap of SEK 191.8bn, and a strategy focused on high-margin categories and operational resilience, Essity is poised to strengthen its leadership. Investors can expect continued value creation through disciplined capital allocation, innovation, and a workforce empowered to deliver on Kolsrud’s vision.

In a sector defined by both human needs and planetary imperatives, Essity’s blend of technical expertise and purpose-driven leadership makes it a compelling investment in the years ahead.

Disclosure: This analysis is based on publicly available data and does not constitute financial advice.