• Sales of natural cosmetics are expected to top $10bn before 2010
• There is no legally agreed definition of what is a natural cosmetic
• Debate centres on which chemicals and reaction chemistries may be included
• Sustainability of supply is crucial, especially for ingredients sourced from the wild
Worldwide sales of natural and organic cosmetics are soaring and last year expected to reap a bumper $7bn, according to market researcher Organic Monitor. The fastest growing sector of the cosmetics market, revenues for natural cosmetics are projected to top $10bn before 2010, with countries such as Germany and the US expected to see their market shares grow to nearly 10%.
Despite consumers’ enthusiasm, however, as yet there is no legally agreed definition of a natural cosmetic. German industries association BDIH started developing its standards in 1996, and to date, 100 firms, both German and non-German, have applied for BDIH certification for more than 3000 products. The organisation’s list of restricted ingredients has come in for criticism from some quarters, however, and is a barrier deterring many firms from signing up, argues Paul Crawford, head of regulatory services at the UK’s Cosmetic, Toiletry & Perfumery Association.
To be eligible to carry the BDI label, products may contain certain inorganic salts and other ingredients derived from hydrogenation and esterification reactions, for example, but must not include ethoxylated ingredients, silicones, paraffin or other petroleum products. ‘The BDIH standards are focused on sustainability and minimising the number of chemical transformations,’ Crawford argues. ‘But most cosmetics need some chemical reactions to get to something useful; all standards allow some chemical processing. We’d be happier if they concentrated more on sustainability and ethical trading than banning chemical processes which can create ingredients with improved performance characteristics.’
Is it sustainable?
Roughly 80% of the natural raw materials used for cosmetics and pharmaceuticals, meanwhile, come from plants that are collected from the wild, says Franziska Staubli, project manager of Swiss Import Promotion Programme. An estimated 50 000 to 70 000 medicinal and aromatic plants (MAP) are known, about 5000 of them used in traditional and modern cosmetics, including 600 plants traded for cosmetics in the EU. Indeed, the business of international plant collection reaps an annual trade volume of 450 000t/year, with a trade value of over E1bn, Staubli points out. However, ‘the source of the plant is often not known and not traceable and their collection is mostly considered as unsustainable’.
Habitat loss, unsustainable harvesting practices and increased competition among commercial users are all putting added pressure on resources, leading to ‘price rises, specifically during the past five years, for many of the wild collected plant species’, such as Red Sanders, White Sandalwood, Saussurea costus (herb) and Aquilaria spp (southeast Asian tree species), Staubli points out.
According to Organic Monitor, the biggest challenge the industry faces is lack of regulation, with what it says are ‘many pseudo-natural products competing with legitimate natural and organic cosmetic products’. It warns that ‘differences in natural ingredient compositions and the variation in private standards could dampen consumer confidence in natural and organic products’. In Europe, Organic Monitor reports that there are more than 400 companies involved in the sales of natural and organic cosmetics, most of them small to medium size businesses that often do not comply with any of the recognised certification schemes, such as those operated by BDIH, Ecocert or The Soil Association. One of the leading European producers is Weleda, whose Weleda Naturals arm headquartered in Germany produces a range of complementary medicines, nutritional supplements and personal care products, mostly derived from plants grown in its own extensive gardens, and certified by either the BDIH or under The Soil Association’s ‘organic’ system.
Wild collection standards
Although many of the bigger suppliers, such as Proctor & Gamble, Unilever and L’Oreal, operate their own sustainability agendas, the smaller firms often do not have the resources to put such programmes in place. Nor do they have the finances to develop their own cultivation processes, sometimes viewed as the more sustainable option for harvesting certain plant species. ‘We estimate it takes five to 15 years and costs €1–2m to cultivate a new crop species, depending on the difficulty of domesticating the plant,’ according to Staubli. Making the chemicals synthetically, even if they are identical to those in the wild, is not an option as they can no longer be considered natural.
My gut feeling is that a relevant percentage of cosmetic products that contain natural ingredients may be from unsustainable sources,’ acknowledges Britta Paetzold, representing the ISSC-MAP secretariat, based at WWF Germany and wildlife trade monitoring network Traffic. ‘If you look at the low prices for some of these products, then it is hard to imagine they are produced in any sustainable way, economically or socially.’
Two new standards may go some way to improving the situation. First of these is ISSC-MAP, an initiative developed by a consortium including WWF-Germany, the IUCN/SSC medicinal plant specialist group, Traffic and the German Federal Agency for Nature Conservation.
An initial version of the ISSC-MAP standard was published in February 2007 and implementation projects are now under way in India, Nepal, Cambodia, Brazil and South Africa, Paetzold elaborates. ‘The focus is on resource assessment and estimating harvest yields: how much is in a collection area and how much can be harvested sustainably, without threat to the population. Also, what are the best harvesting methods and frequency of harvesting, to avoid over-collection.’
The second FairWild standard is complementary, but focuses more on the social aspects, Staubli explains. Worldwide, many more people are involved in wild collection than agriculture, including, for example, an estimated 100 000 families in Bosnia-Herzegovnia, she continues. The Balkan region is one of the major suppliers to Europe, although poor wages, often combined with a lack of training in the appropriate collection techniques, are increasingly putting pressure on resources, ‘especially in the Balkans, Bulgaria and Rumania. Now they’ve joined the EU, people can earn more by working in factories, etc, hence there is a big problem for supply,’ Staubli contends.
Introduced two years ago, the aim of the FairWild initiative is not only to pay collectors a fair price for their labours, but also to ensure that the plants are collected sustainably, in a way that protects the livelihoods for future generations. ‘The benefit should be an increase of price for the collectors of around 20–30%. Apart from the better price there is a premium of 10%, which should be used for community projects,’ Staubli says.
The first products carrying the FairWild label, organic essential oils derived from lavender, thyme, juniper berries and cypress, have started to appear this year, marketed by Farfalla of Switzerland. A specialist in organic essential oils and cosmetics, Farfalla sources up to 25% of its plants from the wild, says Jean-Claude Richard, one of the firm’s owners. ‘Wild grown organic is the very best quality for us. If you made a pyramid, then wild grown would be on top because plants are like human beings and choose to locate themselves near the best ingredients, where the conditions are better for them to grow.’
While price rises have been evident for many plants, this has had little impact at Farfalla as the firm has always paid its collectors more, Richard says. Most of the company’s products are premium brands for which customers are prepared to pay a little extra, he acknowledges. However, competition from other cosmetics companies has led the firm to look at another method for sourcing one of its plants, Immortelle or Everlasting. Used among other products in a major-selling anti-ageing cream by French firm L’Occitane, the price of the plant has increased tenfold in recent years, according to Staubli.
At Farfalla, the tack has been to turn over a whole village in France to cultivation of the plant, where the firm also operates its own distilleries — a new one is in the process of being built — to extract the oil. Knowing the exact provenance of the oil is key, Richard explains. While there are also other varieties of Immortelle growing in France and the Mediterranean, these do not have the required ingredients.
Consumer awareness of some of the issues surrounding natural cosmetics is growing, industry experts say. But there is still much more to be done. A recent Organic Monitor survey, for example, found that various health factors and ethical considerations were ‘the primary motive’ for 71% of UK buyers of natural care products included in the survey. ‘Avoiding synthetic chemicals’ – particularly parabens, sodium laureth sulphate and sodium lauryl sulphate – was also cited as ‘important or very important’ by 89% of buyers.
CTPA’s Crawford, however, is not impressed and cautions that care is needed over which audiences are sampled for their views. ‘The concerns about sodium laureth sulphate, sodium lauryl sulphate and parabens are an urban myth as far as I am concerned and show how certain consumers have been misled over the years,’ he says. ‘Parabens are probably the safest preservative in common use, used in foods, pharmaceuticals and cosmetic products.’ Even well-recognised suppliers such as The Body Shop, meanwhile, do not claim to use 100% natural ingredients in their preparations, according to a company spokesperson. ‘Unlike the women in the Amazon region, most people would not expect to moisturise with pure cocoa butter or olive oil and providing these ingredients in a fresh form and ensuring consistent reliable quality is not a practical retail option.’
Sustainable palm oil
Palm oil is the world’s second most used vegetable oil, with an annual production of 400m t, according to The Body Shop values report 2007. Among its many uses, including in margarine and foods, the oil is a common ingredient of soaps and other cosmetics. However, 90% of the world’s palm oil is exported from plantations in Malaysia and Indonesia, previously lowland forests that are the last remaining home of orang-utans. ‘The palm oil industry is now considered to be the biggest threat to orang-utans, and could lead to their extinction within 12 years,’ The Body Shop report acknowledges.
The Body Shop claims to be one of the first cosmetic companies to join the Roundtable on Sustainable Palm Oil (RSPO), working with NGOs such as Oxfam and WWF to develop a new standard for the production of palm oil. The roundtable now includes 20 retailers, with more than 40% of palm oil production now included in the initiative, according to The Body Shop website.
Fully certified palm oil, grown in managed plantations as promoted by the RSPO, is already available in limited quantities and more is expected this year. Ahead of certification, The Body Shop claims to have switched its entire soap range to be manufactured from one of the leading sustainable plantations at Daabon in Columbia.