There is increasing awareness of environmental and sustainability issues in the beauty market. Consumers are ever more knowledgeable about the composition of their products, the origins of ingredients, potential health impacts, packaging waste and the need to reduce water and energy usage.

Personal-care companies are having to take note of customers’ concerns that are often re-inforced by regulatory controls and pressure from investors. But by adapting their product portfolios and operations, they can set the agenda for a greener beauty market.

Sustainability is still trumped by price for most beauty product purchasers and it is unlikely to be a mass-market trend in the near-term, but HSBC’s surveys of affluent consumers in markets from China to the US show it is increasingly important.

Many customers do actively seek out products from ethical companies and are prepared to pay premium prices for sustainable products. Millennials appear among the most willing to pay more for such items, suggesting companies have an opportunity to tailor products to younger, environmentally and socially-conscious consumers.

All of the large beauty and personal-care companies have made efforts to burnish their sustainability credentials. Besides any desire to ‘do the right thing’, it is increasingly important to be seen to be taking the issues seriously.

But the large companies have recently lost market share to smaller competitors that may be better able to respond to the trend.

Cosmetics encompass a range of environmental risks. For instance, silicones, the synthetic ingredients used in shampoo to toothpaste, do not break down easily in the environment and have faced criticism from consumers about their effects. Regulation now prevents some silicones being used in products that are washed off into waterways after use.

Animal-testing on personal-care products is now banned in many countries.

Some consumers are demonstrating a clear preference for natural products, including switching to organic or vegan items, and prefer synthetic biology to petroleum-based products. To some extent, this change in attitudes may reflect consumer concerns over health, waste, climate-change and the environment.

Even when unaware of the nuances between different chemicals, many people recognise the use of synthetic materials compared with organic or natural components.

Sometimes manufacturers act to allay even misplaced fears. Although there is no authoritative evidence that aluminium salts - used for antiperspirants, whitening in toothpastes and for lipstick colour - are linked with breast cancer or Alzheimer’s disease, some companies are offering deodorants without aluminium salts to address consumer concerns.

Other issues include the use of microplastics, now banned in some countries, and palm oil. The large amounts of scarce water used in making personal-care goods is leading to products such as ‘fast-rinse’ shampoos that use less water.

Consumers are also demanding action on plastic packaging, which can take hundreds of years to break down. Companies are responding with new designs or materials, but also selling refills for existing containers or concentrated products for the consumer to add water, while liquid soaps or shampoos could be replaced by solid bars requiring less packaging.

 

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