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Estée Lauder releases 2016 Future Beautiful report

By Deanna Utroske

05-Dec-2016
Last updated on 05-Dec-2016 at 22:08 GMT2016-12-05T22:08:48Z

Estée Lauder releases 2016 Future Beautiful report

The report highlights the beauty makers’ corporate responsibility goals and initiatives: “We believe that citizenship and sustainability are essential to our success as a business and our responsibilities as a global company.”

That, according to Fabrizio Freda, president and CEO of Estée Lauder Companies. Commenting in a press release about this year’s Future Beautiful report, Freda adds, “our long-term success rests on our ability to embed sustainable practices along our value chain.”

An overall view

The report opens with a joint letter from Freda and the company’s executive chairman William P. Lauder, and goes on to give some big picture data on the Estée Lauder business.

In fiscal year 2016, the Estée Lauder Companies reported $11.3bn in net sales, $1bn of which was in online sales. While, operating income amounted to $10.6bn. The company comprises over 25 prestige brands, operates over 1,200 standalone retail stores, and does business in 150 countries and territories, according to the Future Beautiful report.

Among the featured sustainability and citizenship data opening the report, Estée Lauder boasts an “88.5% recycling rate at manufacturing sites and distribution centers,” notes that 42% of is US workforce is made up of minorities, and that 85% of the company workforce worldwide is women.

The company also points out that over 51,000 volunteer hours have been clocked at nonprofits, that $6.5m has been raised to support the Breast Cancer Research Foundation, and $41 was raised by MAC to support people living with HIV and AIDS.

With sections dedicated to products and packaging, employee well-being, sustainable sourcing, efficient operations, and finally citizenship, the report recaps the company’s CSR efforts.

Products and packaging

This year Estée Lauder “launched a carbon-footprint analysis for all packaging types across our brands—some 68 packaging types in all,” according to the report. Goals and action plans for better packaging will come later. But for now the company is quite proud of one of its cross-brand innovations: though Back to MAC consumers return plastic packing that they can’t recycle at the community level; and the company has since turned those makeup containers in to makeup pencil sharpeners for its Aveda brand.

Beyond that, the company works with suppliers and partners to establish environmentally sustainable business practices, and scores ingredients on ecotoxicity.

Data reported in the products and packaging section of the Estée Lauder report shows that between 2015 and 2016, 72% of the company’s packaging suppliers completed a sustainability survey.

Sustainable sourcing

The company’s sustainable sourcing efforts are guided by larger industry forces: “We recognize that some ingredients are of particular concern to stakeholders around the world, and that through partnership and continuous improvement we can solve these issues,” as the report states.

Future Beauty 2016, speaks most directly to the company’s sourcing of palm oil. In fiscal year 2016, 5% of the palm-based ingredients and palm kernel oil that the Estée Lauder Companies used was mass balance, or rather “a mix of RSPO-certified and conventional palm oil.”

Now, curiously, “since the start of fiscal 2017, we’ve increased our procurement of mass balance palm-based ingredients to 20 percent.”

By contrast, 100% of the palm oil-based ingredients source by the company’s Aveda brand are reportedly certified Identity Preserved by RSPO as well as certified organic.

Citizenship and sustainability are a moving target at Estée Lauder. Though, executive chairman Lauder, believes that “sustainability and citizenship is about how we do business. How we create long-term value and continually deliver a sustainable business model,” he says in the press release announcing the 2016 report. 

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