Transparency is taking on new meaning, thanks to scrupulous consumer audiences and the technology that helps them on their hunt for the truth that lies between the lines of marketing copy. It’s an evolution resulting from clean beauty, which has been subjected to an especially discerning eye as of late. With recent articles by the Washington Post highlighting the lack of regulation around the term, the New York Times reporting on the allergen potential of essential oils in natural skincare, as well an extensive clarification of certifications and controversial ingredients by the likes of Cosmopolitan, it’s evident that customers are peeking behind the curtain. 52% of millennials delve into background information around a product before buying, and only 20% trust sustainability claims.
“Media whistleblowers have always been calling out brands, but as opposed to before [the pandemic], everyone is starting to care collectively about the bad practices of these companies and public figures. It’s imbued us with a sense of justice,” explains Pooj Morjaria, founder of independent watchdog site Did They Help?. Over 60% of consumers attach brand value to transparency, and the industry is following suit as more brands utilize digital tools and meticulous approval processes to prove their virtue. “Transparency is a central part of our company culture so it’s pretty deeply ingrained in who we are. In that sense, it is a quality we try to build not only with our partners, but also within ourselves,” states Solésence Director of Product and Component Development Yoana Dvorzsak.
Whereas a Leaping Bunny may have been the logo du jour in 2020, B Corporation certification is becoming the new gold standard, whereby a company’s environmental, social, and legal impact is taken into consideration, requiring more stringent transparency than other stamps of approval. “Our brand partners are making more requests around transparency, and often these are centered around sustainability, safety, or efficacy. In many ways, a brand’s own ability to be transparent is enabled by its supply chain partners, so we take our role in that seriously and, honestly, with much pride,” Dvorzsak comments.
Bliss became the first mass and drugstore-level beauty brand to become B certified. According to Bliss CEO Meri Baregamian, transparency is a tenet of Bliss’s mission to connect with a younger audience. “The consumer today expects authentic brands, and you can’t be authentic without being transparent,” she comments.
Transparency is the new MO for industry and consumer alike, with 58% of America’s S&P 500 Index companies publishing sustainability reports in 2020. “Common questions now asked include those concerning the treatment of the workers who make a product, the gender diversity of the team providing a service or a list of the third parties that a business uses. While there is not always an obligation to answer, if they don’t, brands can be perceived as trying to cover up a problem,” states Annabel Rake, CMO for Deloitte in northwest Europe.
HR standards and employee diversity are being increasingly disclosed in company reports and being called out on social media if they fail to meet standards, but the production side requires a more extensive approach. Software-as-a-service (SaaS) solutions such as Provenance, which has already provided its blockchain-fueled supply-chain software for the likes of Cult Beauty to verify product claims, will continue to gain traction. It’s not only product brands getting in on the action, but retailers as well. Klarna partnered with carbon footprint-calculating enterprise Doconomy to show the environmental impact of every purchase to its 90 million-strong customer base. “With fat, sugar and salt levels labelled on food we buy, why shouldn’t our CO2 emissions be just as visible? This type of information shouldn’t be a premium or luxury that consumers pay for, but rather an essential part of every shopping journey,” comments Klarna CEO Sebastian Siemiatkowski.
Cross-industry inspiration presents further opportunities for beauty brands looking to bare all the facts. Mastercard released a carbon calculator that measures the environmental impact of every purchase. Allbirds collaborated with Adidas on a pair of sneakers that bore their environmental impact stamped on the sole. Sheep Inc. uses a biobased Near Field Communication (NFC) tag that carries a unique ID that discloses the journey of its knitwear from farm to retail shelf. PANGAIA champions scannable, digital IDs printed on care labels which divulge real-time data on the product’s materials and facility of origin. “In an industry where the relationship between brands and customers has ended at point of sale, with connected products it is now only the beginning,” comments EON CEO and founder Natasha Franck. It also means that transparency will morph from add-on or researchable data to a front-and-center focus on products. However, ensuring true efficacy means a precise overhaul from beginning to end of these complex supply chains, as the blockchain can only be as strong as the data it is being fed. “We have been responding to the increased need for transparency by doing what we have always done—offering as much information forward as we can,” Dvorzsak adds.
Google and Stella McCartney teamed up to reveal the environmental impact of cotton and viscose, combining the fashion brand’s supply-chain data with the tech giant’s algorithmic powers, aiming to demystify the murky waters of the industry’s supply chain all the way back to the source. If successful, this approach could be directly transferred to beauty. The hope is that with increasingly accessible, up-to-date numerical data comes an upsurge in practical solutions.
Wider-spanning regulations could further increase pressure to overhaul practices. The UK became the first country to mandate businesses to report on how climate change impacts their sales by 2025. The Safe Cosmetics and Personal Care Products Act of 2019, which could take effect by 2022, would ban over a dozen chemicals, demand supply-chain transparency, and require full disclosure of any fragrance ingredients. The Competition and Markets Authority (CMA) drafted guidelines for environmental/sustainability claims, which require evidential substantiation of such declarations, as well as take the entire life cycle of the product into consideration. Increasing access to easily digestible information in order to combat consumer and industry inaccuracy remains a crucial piece of the puzzle.
For example, while PCR materials have become increasingly popular, they still bear an environmental footprint given the resources and materials needed for processing. Compostable products such as those by LOLI Beauty leave no residual trace on the environment but do require more upfront capital and research investment. As far as other raw materials go, biotechnology may be another tool in lessening the environmental load by helping shift from animal- to plant-based sources, as well as lessening the resource strain. Biossance has been utilizing sugarcane-sourced squalane, which is usually derived from shark liver, since 2016. The ingredient can also be obtained from other plant-based ingredients such as olives, amaranth seed, rice bran, and wheat germ. Bioeffect uses barley-engineered EGF (Epidermal Growth Factor) as a key ingredient—previously, the product was either grown in bacteria, a potential endotoxic risk, or human/animal cells. "Biotechnology uses bacteria and yeast as nano factories to produce active ingredients, minimizing the impact on the environment. By using only tiny amounts of botanicals, biotechnology is a highly sustainable process,” comments dermatologist Dr. Hadley King. It also ensures for a more stable product outcome, as ingredients are under more testing scrutiny than when grown au naturel. With an average budget of $1.2 million required to develop a new biotech product, it’s not financially viable for every company, but given its safety and sustainability merits, it does hold much promise for prospective product development.
Whether it is going through the extensive process of B certification or completely overhauling the production process, being a truly socially and environmentally minded company in 2021 undoubtedly requires increased resources, be they time, money, technological advancement, or additional employees. However, as the world awakens to the environmental impact of our everyday purchases, these steps won’t be an optional route, but rather become a key to survival in the future.
