ESG in the Cosmetics Industry
May 12 2022
alva’s latest analysis reveals the impact of ESG issues on the cosmetics industry
Through the lens of 16 cosmetics companies, alva has examined 3 million+ press, media analysis and social media data points to reveal how ESG-related sentiment trends have shifted across this sector, and identified the emerging concerns, opportunities and shifts arising from ESG.
Key findings of the report include:
- Parent companies are leaking ESG negativity into their brands: Consumer concern around ESG issues is fuelling a broad focus on the companies that own cosmetics brands. The negative visibility of parent companies Unilever and P&G regarding issues such as governance, health and safety and the environment is being felt at an individual cosmetics brand level – even when concerns do not relate to their cosmetics products.
- Sustainable products hit the shelves to build differentiation: Innovation around sustainable products is emerging as a new way for brands to differentiate themselves and build their ESG credentials. Such developments include an investment by LVMH in a research and development centre dedicated to developing products with greater sustainability, and product launches by Coty and Natura that focus on clean formulation and vegan certification.
- Philanthropic initiatives provide most impressive positive impact: 11 out of the 16 cosmetics companies have promoted philanthropic initiatives, having the most positive impact on the sector’s ESG performance – with the best results being gained from donations to local charities, and support for causes focused on education and women.