Navigating the Green Transition: Shaping the future of cosmetics

The European Green Deal[1] underpinned the last political mandate of the European Commission and proposed a new wave of policy initiatives affecting the cosmetics industry and its supply chain. The interplay between the zero-pollution ambition, a clean and circular economy, and how consumers are empowered for the green and digital transitions, are at the heart of these changes poised to shape the industry, their supply chains, and consumers from the mid-2020s onwards. However, despite European competitiveness set to play a deeper role in the forthcoming political mandate until 2029, it does not mean that the Green Deal is over.

Supply Chains, Sourcing and Sustainable Growth

Consumers are increasingly interested in the ethics and values of a company, as well as in the environmental impact and social transparency of a product and the raw materials it sources. To this end, new regulations have emerged that target company responsibility and supply chain practices, such as the European Deforestation Regulation (EUDR)[2], Corporate Due Diligence Directive (CSDDD)[3], and Corporate Sustainability Reporting Directive (CSRD)[4]. Whilst their scope may only affect certain raw materials (e.g., palm oil) or larger companies (e.g., over 1000 employees and a net global turnover of €450 million), it is undeniable that these actions represent a turning point for mandating company responsibility for the potential impact of their operations and supply chains on the environment and human rights. Indeed, the CSRD, which affects more than 50,000 companies, expands the scope of non-financial report obligations, embeds the concepts of double materiality, and requires third-party auditing of the sustainability statement. Nevertheless, due to the significant global calls, the Commission has proposed a 12-month extension to implementation of the EUDR, and recently launched infringement procedures against 17 European Member States for failing to fully transpose the CSRD into national law.

Circular Economy, Eco-Design and Waste
Improvements toward more sustainable packaging remains a complex and non-trivial topic. However, since environmental impact is increasingly visual to consumers, there is an inevitable drive towards change. To this end, circularity remains focal point of any future economy. It remains essential to improve product design, lower environmental impact and treat waste products. Two keystone initiatives in the last mandate were the Eco-design for Sustainable Product Regulation[5] (ESPR), which has already entered into force, and the Packaging and Packaging Waste Regulation (PPWR), which has been provisionally agreed[6] by the Parliament and Council.

Certain elements of the ESPR and the PPWR overlap, such as setting requirements for substances of concern, or general aspects such as waste reduction, reuse and recycling. For cosmetics, the most immediate impact of the ESPR centres around waste reduction by preventing the destruction of unsold consumer products, although it remains to be seen if further sector-specific measures could be introduced in future delegated acts. To support transparency and traceability, the ESPR establishes a digital product passport (DPP) for products, components, and materials, to support a product’s sustainability, promote its circularity and strengthen legal compliance. On another hand, the PPWR introduces sustainability and information requirements, including measures on packaging waste prevention and extended producer responsibility, as well as harmonised labelling (e.g., consumer sorting), measures for environmental claims, and targets for recyclability grade and minimum use of post-consumer recycled content starting in 2030.

Chemicals and Cosmetic
Green chemistry production using biotechnology or upcycling of industrial waste stream and by-products has increasingly become part of the cosmetics lexicon. This trend represents a shift from relying on finite, petrochemical substances to prioritising renewable, sustainable alternatives.

As part of EU’s zero-pollution ambition, the 2020 Chemical Strategy for Sustainability[7] (CSS) had the two-fold objective to:

1. better protect citizens and the environment, and
2. boost innovation for safe and sustainable chemicals by design.

In turn, this led to subsequent actions in 2021 to align CSS objectives with existing regulations, including REACH, CLP, and the Cosmetics Regulation (CPR). To-date, however, only the revision of CLP[8] has been completed, with entry into force expected by the end of 2024.

Although a proposed revision of REACH has yet to be published, certain key CSS concepts may persist and influence future policy. For example, the integration of the Essential Use Concept[9] and application of the One Substance, One Assessment approach, which already received three proposed Directives[10] from the EU Commission in 2023. These integral concepts from the CSS were reflected in initial work on the targeted revision of the CPR[11]. Even though the proposed CPR revision did not materialise by 2024, a planned evaluation of the CPR[12] is scheduled for Q2 2025, which will assess whether the current regulation is working as intended.

Consumers and Claims
Consumers rely on claims as points of orientation and informed decision-making, and environmental claims increasingly play an important role in choice. To provide a reliable, comparable, and verifiable basis to unlock the green and circular economy, the last Commission proposed two complementary ‘anti-greenwashing’ Directives; both supported by third-party certification.

To-date, the revision of the existing Unfair Commercial Practices (UCPD) and Consumer Rights Directives has resulted in the Empowering Consumers for the Green Transition (ECGT) Directive[13]. The ECGT sets general rules and acts as a safety net for sustainability claims, and introduces targeted amendments covering misleading actions and omissions, as well as new bans on generic environmental claims (e.g., biodegradable, biobased) in its Annex I “blacklist”, aimed at facilitating enforcement and levelling the playing field. Member States now have two years to transpose the text to national law with application of the ECGT from 27 September 2026. Since the ECGT’s scope is horizontal, all sectors are covered although application is business-to-consumer (B2C) only.

Meanwhile, the companion to the ECGT with the same scope and application is the proposed Green Claims Directive (GCD), which sets specific rules for explicit environmental claims and labels. Uniquely the GCD proposes an ex-ante verification of claims procedure, although the Council negotiating position introduces the concept of a simplified procedure to exempt certain types of explicit environmental claims for eligible operators. The legislative process is expected to enter the institutional trilogue phase with the Commission by Q1 2025. Ultimately, consistency between the two final texts is crucial to avoid any potential conflict that could derail their joint objective.

The Future of Sustainability
With the combined outcome of the European elections and publication of the Draghi Report[14], there is an increased sense to focus on the future competitiveness of Europe. Upcoming priorities for the new Commission relate to climate, industrial decarbonisation, and a clean industry. In this context, further work on the circular economy coupled with a chemicals package to focus on REACH appear likely from 2025.

Harmony with other legislative acts is critical, and, as with all the Green Deal initiatives, a clear balance must be struck between the expectations of the environmental and social sustainability objectives and speed allowed by the economic realities and market capacities. Therefore, a framework that promotes sustainable innovation while fostering consumer empowerment is essential.

As the transition gathers pace, cosmetic manufacturers will need to adapt to an increasingly intricate and complex web of regulatory compliance outside the CPR. Consequently, closer pre-competitive collaboration will be essential to capitalise on these opportunities through standardised best-practices and initiatives that lower entry barriers – particularly for SMEs.

Whilst regulatory adaptations represent a challenge, they equally offer an opportunity for ethical and sustainable sourcing, biodiversity protection and enhanced transparency throughout the chain of custody. Furthermore, the advantages of digital transition offer a basis to explain complex elements of the green transition to consumers and enhance transparency.

References:

[1] European Green Deal https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/european-green-deal_en

[2] Regulation (EU) 2023/1115 https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32023R1115

[3]  Directive (EU) 2024/1760 https://eur-lex.europa.eu/eli/dir/2024/1760/oj

[4] Directive (EU) 2022/2464 https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32022L2464

[5] Regulation (EU) 2024/1781 https://eur-lex.europa.eu/eli/reg/2024/1781/oj

[6] https://data.consilium.europa.eu/doc/document/ST-7859-2024-INIT/en/pdf

[7] https://environment.ec.europa.eu/strategy/chemicals-strategy_en

[8] https://www.europarl.europa.eu/doceo/document/TA-9-2024-0296_EN.html

[9] https://op.europa.eu/en/publication-detail/-/publication/90926c62-0365-11ef-a251-01aa75ed71a1/language-en

[10] https://ec.europa.eu/commission/presscorner/detail/en/ip_23_6413

[11] https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/13197-EU-chemicals-strategy-for-sustainability-Cosmetic-Products-Regulation-revision-_en

[12] https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/14433-Cosmetic-Products-Regulation-evaluation_en

[13] Directive (EU) 2024/825 https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:L_202400825

[14] https://commission.europa.eu/topics/strengthening-european-competitiveness/eu-competitiveness-looking-ahead_en

Article written by  Dr Mark Smith, NATRUE”s Director General, and originally published on Kosmetika and Tecniche Nuove (available here in Italian)