A winning formula: 4 secrets to sustainable chemistry success
<p>Here's how Method, Seventh Generation and SJ Johnson have become leaders in the push for greener chemicals in consumer products.</p>
With personal care and home products increasingly in the spotlight, expectations have grown for more sustainable chemicals and formulations. Target, Walmart and states such as Minnesota, California and Washington are demanding that companies take a new approach to managing chemicals in these products. To help guide companies managing this added pressure, Pure Strategies evaluated leaders in the formulated products marketplace to uncover how they've constructed their goals, strategies, tools and partnerships. So what is at the core of these programs — and what makes them successful?
We found four essential parts to the enhancement of sustainable chemistry programs: strategy and alignment; competencies; measurement and tracking; and external engagement.
1. Strategy and alignment
A strategy with leadership support is the core of any company's efforts to move toward sustainable chemistry. That's why the first questions to answer concern basic strategy: What issues are we trying to solve? What approach do we want to take? Issues range from meeting market demands to bringing new innovations in product design to customers. Strategies include engaging with the U.S. Environmental Protection Agency's Design for the Environment program. Other approaches involve determining what chemicals of concern are in products and prioritizing these chemicals for replacement.
Our review of industry front-runners identified strategies that address specific ingredient objectives as part of their sustainability programs, with a protective approach to health and environmental considerations across the product life cycle. This moves from restricting chemicals of concern to improving overall ingredient profiles for intentionally added ingredients, known by-products and known contaminants by:
• Understanding and assessing chemicals and their hazard profiles.
• Prioritizing chemicals and avoiding chemicals of concern.
• Improving the chemical hazard profile in products.
• Disclosing chemical composition.
Beyond ensuring safety, a key piece of the strategy is to provide appropriate organizational alignment. The leading companies interact and share information across functions to empower more groups across the organization to engage on key objectives. Often, R&D, procurement and regulatory groups work together to advance on the targets — especially when working to improve the profile of product ingredients.
SC Johnson, for example, has embraced a philosophy focused on better ingredients and more transparency. The company's goal is to increase the proportion of ingredients in its products that have a lower impact on the environment and human health. It is also committed to disclosing product ingredients. SC Johnson scientists creating a new product or a reformulation are armed with chemical profile information when making ingredient selections to ensure that environmental and health ratings are equal to or higher than the original formula. By including R&D in raw material evaluation, in addition to having a safety team, the company provides greater alignment across the organization. In this way, it goes beyond regulatory requirements to continually improve products.
To meet strategic objectives in sustainable chemical management, companies need several critical competencies. These include expertise in evaluating ingredient hazards; proficiency in developing improved formulations; and the ability to assess the performance, cost, compatibility and safety of alternatives. To support these internal competencies, leaders have tools in place that:
• Provide clear guidance to R&D teams to assist in the selection of preferable ingredients.
• Include a substance database with environmental and health hazard information.
• Integrate these two elements in a development tool that shows the environmental and health impact of possible formulations.
Effective use of external resources is important here, as well. Strong supplier relationships are needed to assess, communicate and assure the composition of raw materials. Suppliers must increasingly understand and be willing to share details on trace ingredients, impurities and contaminants. For example, are preservatives or stabilizers included with ingredients? Are extractions, distillation or other activities conducted in PVC piping that may lead to phthalate contamination? These partnerships also help to solve issues and innovate solutions.
As an example, Seventh Generation has developed product and ingredient guidelines to ensure that products are not acutely toxic and are free of chronic toxicants. The company also has a scorecard system to evaluate performance. Additionally, it has strong supplier relationships to provide the highest level of transparency and assurance of ingredient composition. The company co-develops solutions and new ingredients to enable its top-of-the-class program. For example, the company worked for two years with its suppliers to eliminate 1,4-dioxane from its products and introduced liquid dish and liquid laundry detergents with no detectable levels of 1,4-dioxane in 2010.
3. Measurement and tracking
Performance measurement and tracking provide structure and accountability for organizations leading in chemicals management. This includes a system to evaluate conformance to the company's stated policy and progress against its objectives. Performance tracking encompasses internal product evaluation, testing and scorecards. Leaders also engage with independent reviewers and analysis to assure their standards are being met.
For instance, all of the ingredients in Method's products undergo a comprehensive evaluation by an independent environmental research institute, EPEA. This material research process assures the company that its products are healthy and environmentally safe. Method also leverages the third-party certification program Cradle to Cradle to provide an additional, rigorous assessment of all ingredients, packaging materials and design, and processes.
4. External engagement
Communication and collaboration with external stakeholders are the final elements of an effective chemical management program. Consumer education about ingredient sustainability and safety that empowers the public and encourages responsible product use has become a standard practice. Some form of ingredient disclosure, typically online, is becoming commonplace. The differentiator in communication is that leaders disclose ingredients on the packaging and provide consumers with more details, such as the composition of fragrance mixtures.
External engagement also includes other stakeholders. Companies in the forefront contribute to industry initiatives and support external centers of excellence. We found that involvement in thought leadership organizations such as the Green Chemistry in Commerce Council (GC3) or work with advocacy groups was limited to leading companies such as Seventh Generation and Method.
In the case of Sevent Generation, it discloses all ingredients both on the packaging and on its website, so consumers can access the information right in the store aisle. While fragrance information is often hidden in the personal care and household cleaning industries, the company discloses all fragrances.
Seventh Generation additionally holds a strong leadership role within the industry and chairs the American Cleaning Institute's (ACI) Sustainability Committee. The company helped develop ACI's successful Ingredient Communication Initiative, leading the way for many ACI members (including most major players in the cleaning products market) to disclose the ingredients in their products voluntarily beginning in 2010.
Leaders also engage with their customers, working to set standards for the industry, as well as government policy makers to help them establish better policies and regulation to protect consumers and the environment.
An apple a day
Firms with successful sustainable chemistry programs not only protect workers, consumers and the environment — they protect their reputations. Successful companies have mastered the capabilities outlined in this article. The core of their approach is a solid strategy with alignment across the company. The meat of a leading program combines critical expertise, clear guidance, and tools with a solid measurement and tracking strategy. Finally, ingredient disclosure and consumer empowerment, as well as engagement with important external stakeholders, puts the final polish on leading programs. Just as an apple a day keeps the doctor away, adopting best practices for sustainable chemical management keeps programs healthy and strong.