Target's new chemicals policy hits a bullseye

Target's new chemicals policy hits a bullseye

Shutterstock Maksim Kabakou

A chemical reaction needs at least two elements and a catalyst to begin a swift and irreversible change. Target’s new chemicals strategy promises to cleanse its shelves, and the brands along its value chain, of toxic chemicals. If enacted properly, the chain reaction of the policy and its implementation can have lasting, positive repercussions across and beyond the retail industry.

Target’s Jan. 25 announcement is the first push from a U.S. retailer encompassing every product it sells — including its in-house and national brand consumer products — and its operations. The process calls for several ingredients: Strategic planning from the retailer; the commitment of its business partners; and best practices borrowed from NGOs.

The hoped-for result? A healthier consumer base with loyal purchasing power, meaning sustainable returns for the company.

"Our chemical strategy will be one of the most comprehensive in the U.S. retail industry, including all Target-owned and national brand products and operations, not just formulated products," wrote Jennifer Silberman, Target’s chief sustainability officer (CSO), in the press announcement. "Ultimately, we want to bring all stakeholders together to innovate and champion a consistent, industry-wide approach to greener chemistry."

A controlled experiment

Target's grand strategy is to strive for full visibility in chemicals contained in or used to make products it sells; to work with business partners to implement policies, practices and tools to manage chemicals throughout the supply chain and across operations; and to pursue and promote safer approaches to chemicals development.

By 2020, Target promises to achieve transparency of all ingredients, including generic fragrances, in beauty, baby care, personal care and household cleaning products. It aims to formulate these product categories to exclude high-concern chemicals: phthalates; propylparaben; butyl-paraben; formaldehyde; formaldehyde-donors; and NPEs. SaferChemicals.org has a comprehensive list of these ingredients, found in most household products, and their terrifying side effects.

By 2022, it will remove added Perfluorinated Chemicals (PFCs) from textile products, along with potentially carcinogenic added flame retardants. In order to spur innovation for safer alternatives where none currently exist, Target will invest up to $5 million in green chemistry innovation by 2022. Can it spur a chain reaction for the retail industry?

Educated consumers are empowered activists

For years, GreenBiz has been documenting the business case behind big retail's buildup towards a systemic overhaul of hazardous chemicals in consumer products. In 2009, columnist Richard Liroff, executive director of the Investor Environmental Health Network, predicted that reducing toxicity in products would be considered as important to corporate sustainability as decarbonizing supply chains.

"Product toxicity reduction should be a core element of business strategy because it can reduce reputational and litigation liabilities, help companies avoid 'toxic lockout' of their products from the marketplace, and drive innovation," he wrote. "It can drive sales in the marketplace … lower overhead costs when products subject to government hazardous waste laws are eliminated, and contribute to workplace safety."

Liroff added that companies that overpromise and underdeliver "open themselves to criticism if they establish a goal and then fail to meet it."

Target CSO Silberman echoed those business benefits when talking about the new policy. "Hyper-transparency is one of the biggest macro trends that retailers are dealing with," she said. "We see that information equals empowerment. People have more access than ever to information and choices; our job is to make those choices as easy as possible for our guests.

"Sixty-two percent of the general population believe that harmful chemicals in personal care products can impact their health, and 66 percent of U.S. consumers want better-for-you products, from a social and environmental standpoint."  

Products that are branded as healthier, such as Target’s Made to Matter offerings (which include Honest, Clif Bar, Method and Ripple brands), have been some of the fastest-growing in the brand’s portfolio.

Standards and safety goggles

Target has a long track record of proactive chemicals management. In 2013, it launched the Sustainable Product Index (SPI), which tasked vendors representing 7,500 products — including household cleaners, cosmetics and baby care — to assess the sustainability of ingredients as well as their health and environmental impacts. The assessment was meant to address the lack of a unifying consumer-industry chemicals standard, but lacked transparency about implementation, such as how Target would use the PSI to make purchasing decisions.

Target received a B grade (76.5 points out of 130) from Mind the Store, a report card on retailer actions to eliminate toxic chemicals. As a retailer, it "has the most robust criteria for evaluating suppliers’ disclosure practices," said the report. However, Target has not yet become a signatory to the Chemical Footprint Project (CFP), which provides a metric for benchmarking businesses (such as Target’s partner, CVS) as they phase out nasty chemicals and select safer alternatives.

"Target and other brands are active in industry-led groups including the Sustainability Consortium and Higg Index," Susan Baker, vice president of shareholder advocacy at Trillium Asset Managementtold me. "However, these are primarily B2B tools and do not offer comparative data concerning programs and practice. Investors do not have sufficient information to adequately assess chemical risk, which is why disclosing policies and practice to a third-party verifier like the CFP will allow companies, investors and other stakeholders to better track corporate progress away from hazardous chemicals."

Target’s CSO said the company will rely on internal tools and best practices gleaned from industry benchmarks to create an evolving chemicals management footprint process and report its benchmarks in the company’s corporate social responsibility (CSR) report.

Industrial effort

In order to operationalize its strategy, Target will have to engage multiple partners beyond consumers, including the CEOs of its retailed brands and vendor partners.

"We have great engagement and dialogue with our vendors," Silberman said. "We all have the same goals: Transparency; access; and better products. Our first set of goals were done in consultation with those partners. It’ll be an iterative process that we continue to work on with those brands."

Target has not shied away from engaging competitors to create a safer chemicals landscape. In 2015, Target, Walmart and nonprofit Forum for the Future collaborated to clarify priorities for makeup, hair and personal care products, and to formulate best practices to accelerate the availability of healthier alternatives.

And it’s not alone in its efforts: In early February, Unilever announced a new transparency initiative to provide fragrance ingredient information for its personal care products. Like Target’s initiative, it goes beyond regulatory requirements to disclose consumer-facing information.  

"Including fragrance in its transparency goal is huge," said Mike Schade, Mind the Store’s campaign director, in a statement about Target’s new chemicals policy. "Fragrances can contain harmful chemicals and consumers have no way to find out what they are. Any consumer who wants to know what they’re putting on their body or exposing their kids to will applaud this step."

Even a lax EPA environment under the Trump administration won’t turn Target’s tide against such chemicals of concern.

"While a more laissez-faire regulatory environment may impact the willingness of lagging firms to improve their toxics reduction programs, the market, state and regulatory drivers encouraging sectoral and value chain efforts to advance safer chemistry will continue," said Joel Tickner, founder of the Green Chemistry and Commerce Council, a network of 70 companies dedicated to promoting safer products. "In many ways, we have reached a tipping point where chemical transparency and investment in safer chemistry is the norm for forward-looking, sustainability-minded companies."

The journey will be long, but Silberman said that "any investment in good-for-you products is good for the future goals of the organization."