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Sustainability needs to concern social and economic impact, says expert

By Simon Pitman , 18-Sep-2012
Last updated on 19-Sep-2012 at 11:34 GMT2012-09-19T11:34:58Z

Although Asian cosmetic and personal care companies have embraced the issue of sustainability, Organic Monitor director Amarjit Sahota believes that the social and economic impact are being overlooked.

Sahota made the observations ahead of his presentation on Sustainability in the Asian Cosmetic Market, which will be given at Organic Monitor’s Sustainable Cosmetics Summit, to be held in Hong Kong in November, targeting the growing market for natural and organic cosmetics in the Asia-Pacific region.

“We find that when most Asian companies look at sustainability, they mainly look at corporate CSR and this usually involves just the environmental aspects,” said Sahota.

“The social and economic impacts of sustainability are largely ignored by Asian companies. For instance, the sustainability programmes of most Asian companies look at reducing resource usage and reducing carbon footprint, however there is little emphasis on social aspects like supporting local communities, HR policies, fairtrade practices, etc.”

Asian companies slow to catch on to transparency

Sahota points out that there are a number of explanations for this, but that the primary reason that sustainability is more advanced in Europe and North America is the fact that there is far more importance placed on being transparent about sustainability by reporting about it.

“It has been largely driven by large companies like L'Oreal, P&G, BASF which have global operations; they are implementing the same sustainability initiatives in Asia that they have introduced in Europe / North America,” he said.

Likewise, sustainability initiatives to increase the transparency of suppliers to some of the world’s biggest retailers have also had a knock on effect in the Asian market.

 “Another reason is that international retailers like Wal-Mart are demanding more transparency from their suppliers; this is pushing Asian companies to adopt sustainability practices, for example, undertaking initiatives such as ethical sourcing or providing more transparency in their formulations,” Sahota said.

Challenges to undertake sustainability in the region

A holistic approach is what is needed to the issue of sustainability in the Asian cosmetics industry, Sahota believes, but instead many companies are looking at one particular aspect of the equation, at the expense of another equally important area.

“Many companies are reducing their environmental footprint by reducing energy usage, but they are not taking steps to reduce water / carbon footprints. Also, sustainable packaging has very low adoption rates in Asia. Apart from the initiatives of large cosmetic companies like P&G, few Asian companies are looking at sustainable packaging.”

Although research suggests that packaging plays an important part in the overall carbon footprint of a cosmetic and personal care product, Sahota points to the fact that it is only in markets such as Australia, New Zealand and Japan where any companies have done something considerable in this area.

Don't forget packaging!

“Apart from lower impact on the environment, sustainable packaging can give significant cost reductions to cosmetic companies, for example lightweighting, new design approaches,” said Sahota.

“This is a reason why we are focusing on sustainable packaging at the Asian summit; we want to highlight its importance and want to encourage more Asian companies to look at reducing their packaging footprint.”

As well as packaging, the other crucial aspect of cosmetics products, formulation, is also being overlooked, Sahota believes, with only a handful of natural and organic companies actually investing in green and raw materials.

Some are doing so because they have to adopt natural or organic cosmetic standards, others are doing so because they want to avoid synthetic or non-sustainably sourced raw materials,” said Sahota.

Amarjit Sahota will be giving a presentation called 'Sustainability in the Asian Cosmetic Market' at the Sustainable Cosmetics Summit, to be held in Hong Kong November 12 – 13.

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