As consumers become increasingly concerned with the environmental footprint of their cosmetic products, the beauty industry is scrambling for ways to become more sustainable without sacrificing profits or reducing the scale and velocity at which brands launch new products.
This problem may seem like a Catch-22 at first glance. More products require increased production efforts, which comes at an exponential cost to our environment. If beauty brands aren’t budging in their production schedule and revenue goals, they’ll have to compensate elsewhere in the equation to make up for the increased emissions.
Climate Neutral, a nonprofit dedicated to combating climate change, is helping beauty brands measure and offset their carbon footprint, while also reducing emissions over time. The Climate Neutral certification indicates net-zero carbon emissions and a long-term commitment to positive climate action.
“As a basic starting point for all businesses, we’re trying to neutralize emissions, recognizing, of course, that we’ve got a whole lot more to do,” Austin Whitman, Climate Neutral's CEO, tells BeautyMatter. “We’re still so far from that baseline that [carbon neutrality] is a minimum standard, really.”
Global warming is proportional to cumulative carbon emissions. In the most simple terms, net-zero carbon emissions are needed by 2050 to limit the worst effects of climate change.
This is the baseline that Climate Neutral is hoping to achieve through its certification process, which starts with an intensive data collection period to measure total carbon emissions across company operations and supply chain. This includes everything from utility bills to travel and purchase records. All of this data adds up to a number that Climate Neutral estimates to be the brand’s final carbon footprint.
“Once they’ve done that process, we have them compensate for all those emissions with eligible, verified carbon credits from third-party sources and identify reduction actions that they’re going to begin implementing over the next year,” explains Whitman. “By the time they come and recertify a year later, they ideally have fewer emissions, or at least fewer emissions per dollar of revenue, than they had the first time around.”
Climate Neutral’s certification process
Since it was founded in early 2019, Climate Neutral has certified 295 brands across the wide consumer packaged goods sector, including 28 health and beauty brands. In total, the organization has helped offset 784,213 metric tons of carbon.
Health and beauty is one of the industries that Climate Neutral is most interested in improving through these offsetting and reduction efforts, alongside home goods and food and beverage. Whitman says this is driven by consumer interest, noting that beauty consumers are more aware of the impact that their purchases have on overall sustainability, including climate.
“People tend to think more about purchases they’re spending a lot of money on and products going on their body,” says Whitman.
Climate Neutral’s certification is a three-step process. First, brands measure and identify their carbon footprint. Next, they purchase carbon credits to offset their carbon emissions, which can come in the form of investing in a wind farm, protecting a forest, or installing electric vehicle charging stations.
“When you buy a carbon credit, you’re essentially putting money into that project,” says Whitman. “The benefits of that project are measured in terms of tons of carbon, so you can match the tons of carbon from that project against the tons of carbon from your emissions.”
The final step is carbon reduction efforts, which involves planning ahead to reduce your carbon footprint as the company grows. Brands are required to reapply for Climate Neutral’s certification annually by showing not only have they measured and offset the emissions they produced in the last year, but also how they plan to lower their carbon footprint over time. This is one way that Climate Neutral holds brands accountable for their climate-change pledges.
“Accountability is built into the certification process,” says Whitman. “You have to complete all those three steps. Currently, we don’t reject certifications for companies that haven’t met all of their prior year reduction actions, but we’re talking about when or whether we should make that a requirement.”
How Climate Neutral Certified beauty brands offset their carbon footprint
For beauty brands like Versed, the certification from Climate Neutral is an important part of their climate-first sustainability action plan. The brand was first certified in 2020 and invested $19,448 in carbon credits last year to offset their total carbon emissions, which Climate Neutral estimated to be 9,795 metric tons of carbon dioxide.
“66% of our community say that our Climate Neutral Certification is important to them—and they're spot on,” Versed President Melanie Bender tells BeautyMatter. “Measurement and disclosure of a business' greenhouse gas emissions through a credible partner like Climate Neutral enable consumers to reward those acting for our collective good.”
The consumer demand for sustainable goods incentivizes companies to make investments in initiatives like Climate Neutral’s certification. While individual action is important for slowing climate change, it pales in comparison to the impact that collective corporate action can achieve when it comes to reducing total emissions.
“To align our sustainability plan with the needs of humanity, we prioritize climate first,” says Bender. “Our Climate Neutral Certification helps us to better understand our priorities for footprint reduction, while also providing a framework for investing into global climate solutions.”
Everist, a waterless and sustainability-minded beauty brand based in Toronto, understands the complexities and confines of sustainability initiatives and strives to be net-neutral in all aspects of business. Last year, the brand reported 396 metric tons of carbon emissions, which was offset with a $5,346 investment in carbon credits in forests and renewables. The brand’s Climate Neutral certification holds them accountable in these efforts.
“By removing the water from our products and making them 1/3 the size of traditional shower products, we are able to lighten our impact significantly,” Jessica Stevenson, co-founder and CEO of Everist, tells BeautyMatter. “The next step was offsetting the carbon impact that was left. We're proud to partner with Climate Neutral to be certified carbon neutral and continue to look for opportunities to reduce the carbon impact of our business and supply chain.”
Skincare brand OSEA Malibu has placed sustainability at the forefront of their business since the brand’s founding in 1996. The brand invested $16,128.76 in carbon offsets last year to balance out their 4,032 metric tons of carbon emissions.
"As a brand inspired by the ocean, we have a distinct duty to protect our deepest source,” says Melissa Palmer, CEO of OSEA Malibu. “By working with Climate Neutral, we're able to calculate our total carbon dioxide emissions, across all sectors of the business, and offset that footprint by funding sustainability projects.”
While many beauty brands focus on reducing packaging waste in their sustainability efforts, Whitman at Climate Neutral says it's the formula itself that produces a large share of the brand’s total emissions.
“[Brands] overestimate how much packing contributes to emissions,” he says. “Beauty products are interesting because they’re all, for the most part, chemical based, and chemicals have a high carbon footprint per weight. An ounce of lipstick is tied to far more carbon emissions than, say, an ounce of a cotton shirt. Beauty, in general, tends to have a higher carbon footprint because of this connection to chemicals—even if the products themselves are relatively small.”
The location of where you operate, manufacture, and ship is also important. Keeping your supply chain local has a significant bearing on total emissions.
“When you start to look at the trade-offs, like where you manufacture or how you ship, it affects the rest of the supply chain, which dictates timing in the journey of how something becomes a product from an idea,” says Whitman.
Climate Neutral’s brand selection process
Other Climate Neutral Certified beauty brands include By Rosie Jane, Everyday Humans, Vintner’s Daughter, and Saie. The nonprofit certifies between 30 and 50 brands each year, some of which are new brands receiving the certification for the first time and the rest of which are brands that are recertifying their commitments.
“Part of this whole puzzle is keeping brands with you, and that’s no small challenge as carbon credits get more expensive and companies get deeper into the journey,” says Whitman. “One of our challenges is getting people to stick with it year after year.”
Climate Neutral is approached by new brands every day seeking a certification, but the organization prioritizes large brands (above $5 million in annual revenue) due to the outsized impact they have the potential to make. The nonprofit has a waitlist for smaller brands that fall below that $5 million in revenue threshold.
Because the certification process is so intensive, Whitaker says they have to be selective in choosing which brands to work with.
“From a messaging and consumer labeling perspective, we look for companies that are brand-forward and are investing in a brand identity. That’s because they’ll tend to value the [Climate Neutral Certified] label more than a company that’s just trying to get a product on a shelf who is not as focused on the brand.”
Whitman also looks for organizations that have an organizational commitment or priority to sustainability and climate.
“In larger companies, it helps to have someone full time on the team thinking about sustainability. It’s always difficult for a marketing or operations person to take on something that involves new expertise and subject matter. We’re starting to see sustainability leads in conversation with their C-suite talking about the location of their next factory, as well as being connected to folks on the product development, strategy, and design team.”
Climate Neutral is focused on finding pragmatic, meaningful, near-term incentives for companies to think about how they become accountable for carbon emissions, and make it part of everything that they do. But Whitman is quick to point out that this is just the starting point.
“It can’t be said enough that we’re so far away from the path that we need to be on from an emissions perspective. We’ve drawn what we think is the bare minimum that we think companies should be doing, but even that bare minimum is so much more than most companies are actually doing.”
Climate Neutral is one certification among many others that help brands and consumers give back to the planet. In addition to Climate Neutral’s certification, other climate-focused sustainability initiatives include CodeRed4Climate, a collection of over 200 beauty and wellness brands committed to continued climate action. Versed founded the group and counts brands including OSEA Malibu, good light, and Youth To The People as members. 1% for the Planet is another organization advocating for positive climate action. Brands that join 1% for the Planet commit to giving 1% of gross sales each year to support environmental nonprofits. Everist is a proud member of 1% for the Planet, and from the start has donated 1% of profits towards creating a more sustainable future.
“Climate change is the grandmother of all environmental issues,” says Whitman. “Our goal is to cover the climate certification, but we recognize that every industry has other sustainability challenges. Every responsible company should be looking for multiple ways to have third parties weigh in on what they’re doing.”
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