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Meet the Change Makers: Avon Calls for a Green Makeover

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Q&A with director of corporate responsibility Susan Arnot Heaney

The first "Avon Lady" started knocking on doors in New Hampshire back in 1886, selling beauty products directly to her friends and neighbors. The door-to-door approach may seem familiar -- even quaint -- today, but it was groundbreaking at a time when women had few job options outside the farm or factory and rarely owned or ran their own businesses. By offering credit, products, and sales support, Avon created the possibility for them to do so. By the turn of the century, the ranks of Avon Ladies surpassed 5,000.

Today, more than 6.5 million independent sales representatives sell Avon products in over 100 countries to more than 300 million customers. Echoing its original appeal in the United States, the brand continues to find fast success opening up opportunities to women in emerging markets such as Kazakhstan and Saudi Arabia. With a product line that now spans makeup, perfume, and jewelry, as well as gifts, clothes, jewelry, and housewares, Avon's sales totaled $11.3 billion through September.

Ongoing Series: Meet the Change Makers

These big numbers inspire Susan Arnot Heaney, but they also make her job more difficult. As Avon's director of corporate responsibility since 2006, Heaney focuses on developing, tracking, and reporting efforts to reduce the impact of Avon's activities on the planet. Each year, the New York-based company has to balance expanding its business while also managing and reducing the use of resources, including trees to make hundreds of millions of catalogs, tons of palm oil for its cosmetics, more energy, water and other materials.

In recent years, Avon has mapped out in increasing detail how, when, and by how much it wants to alter its impact. Earlier this month, the company published its third corporate responsibility report detailing efforts and goals set out in 2009-2010. By 2020, for instance, Avon aims to cut its consumption of water per unit produced by 40 percent, compared with a 2005 baseline, while also aiming for 20 percent absolute reductions in energy use and greenhouse gas emissions. In the same period, Avon aims for its operations to produce zero waste by fully recycling or reusing any leftovers from its factories and distribution centers.

Susan Arnot HeaneyOnEarth contributor Adam Aston recently caught up with Heaney at the unveiling of the company's new LEED Gold-certified Manhattan headquarters to learn more about the beauty brand's sustainability agenda and how it aims to harness the power of millions of "affiliates" -- better known as Avon ladies -- to help further it.

The "Avon Lady" is practically a cultural icon, yet on Main Street, Avon storefronts are conspicuously absent. How do you get by with no brick-and-mortar stores?

It goes back to 1886, when David H. McConnell founded the company. At the time, women had relatively limited job options: teaching, factory work, and farming jobs dominated. Very few owned their own businesses.

Starting with the first Avon Lady, in New Hampshire, McConnell devised a model that let women build a business of their own, by selling cosmetics face-to-face.

The approach also meant that Avon has never built shops or showrooms. Today, our store is a brochure, and our website. Our representatives use these to show products to millions of customers in more than 100 countries. Orders are delivered by via mail, online or through mobile technology.

In terms of our sustainability efforts, this means that, unlike other big retail chains, we have never had to build -- or heat, cool, and fit out -- storefronts. That said, we still have millions of square feet of real estate worldwide -- offices, factories and distribution centers -- and our Green Building Promise ensures all new or major renovations around the world are certified "green," such as our U.S. headquarters in New York City.

But this model means you print a lot of paper?

Yes. We're one of the largest printers in the country. Our product brochures -- we call them "brochures" because that's what they were dubbed in 1886, even though you would call them catalogs -- are printed around the world.

They're smaller than a regular magazine: our current holiday brochure is about 5.5 inches wide by 8 inches high and has 227 pages. And we produce one campaign like this every two weeks, all year long, printing here in the U.S. somewhere between 13 and 17 million copies for each. Then there are our even larger international sales. Brazil, for example, is a bigger market for us than the U.S.

Keep in mind, these product brochures are never mailed. We do not do anything direct-to-consumer. Instead, we ship them to our sales representatives, who order the quantity they need and then distribute them to their customers.

Isn't the greener path to move towards paperless catalogs and ordering?

Yes. We're paper-intensive, but we're reducing that. Customers can go online and page through a virtual brochure. But that approach doesn't yet address the needs of our face-to-face sales process. We're very careful about altering that process, but we also have a robust online business and we are experimenting with lower-paper workflows.

In addition to the web, we have mobile apps for consumers and our sales representatives to place their orders. In Eastern Europe, where a smaller volume of business lets us experiment more easily, we're testing a paperless sales model.

Truth Squad

Checking industry claims with NRDC's sustainability experts

Few would think of Avon as a forestry expert. Yet palm plantations in tropical Asia provide plant oils for its cosmetics. And temperate North American forests are a source of paper for its catalogs. In both markets, harmful deforestation is an ongoing threat, one that Avon is countering using its buying power and influence. NRDC experts laud Avon's efforts in these areas but would like to see the company take even tougher steps to lower its impact and help accelerate wider change.

For palm oil, Avon has pledged to buy enough GreenPalm Certificates to cover all of its global demand. The certificate system works by offering farmers a premium price for palm grown in ways that are certified as environmentally and socially responsible, that do not destroy primary forest, and where farmers have committed to continually improve their operations. The premium paid for certificates to qualified farms acts as an incentive to lure others to improve their growing practices.

The rub? By design, certificate buyers such as Avon generally don't receive delivery of the actual sustainably-grown oil their certificates bought. Rather, because of the way palm oil is traded, the certified crop is comingled with conventional palm oil from other producers at each stage of distribution.

This approach is "a good first step," since it spurs farmers to change practices and boosts the total harvest of more sustainable oil, all while working within existing market mechanisms, says Debbie Hammel, an NRDC senior resource specialist based in San Francisco. Yet Avon and others can do better, she adds. "NRDC believes that companies should progressively work to clean up their supply chains," by requiring physical delivery of the certified palm oil, says Hammel. "This is more challenging that buying certificates, but it would ensure that none of the oil used is resulting from the harmful impacts of conventional production."

Likewise, in its paper purchases, Avon is doing good work now but could be doing better, says Darby Hoover, a senior resource specialist in NRDC's San Francisco office. She lauds Avon's commitment to buy paper certified by the Forest Stewardship Council (FSC) yet would to see Avon commit to buy a larger share of its paper from recycled sources. Recycled is better than FSC paper because to no trees are felled when making new paper from old. Moreover, less energy and chemicals are consumed to transform old paper into to recycled stock, compared with converting wood pulp into virgin paper, says Hoover.

"Avon should set a public target of 10 percent post-consumer recycled content and work towards 30 percent." Putting that goal in writing, says Hoover, will drive industry-wide change, giving paper makers a clear incentive to buy more waste paper to convert into more recycled paper. "I'm not discouraging the use of FSC-certified paper, but there's a hierarchy and recycled in better," she says. -- Adam Aston

Recycled is considered the greenest option, since it reduces the amount of trees that are felled. Yet supplies are limited. How do you meet your enormous appetite for paper?

Yes, so we're tackling the paper problem through a number of efforts. Last year, we launched our Hello Green Tomorrow initiative, which ties together our global environmental management work, including paper, forestry conservation, and palm oil. As part of that we announced the Avon Paper Promise, where we instituted very stringent internal guidelines for our paper buyers.

The policy was developed with input from several environmental NGOs, including the World Wildlife Fund (WWF). In October 2010 we were invited to join the Global Forest & Trade Network (GFTN), a WWF program to end illegal logging and improve some of the world's most threatened forests.

Our goal is that by 2020 -- and I'm certain we'll do it sooner -- 100 percent of our paper will be either Forest Stewardship Council (FSC)-certified or post-consumer recycled content. FSC is our preference among the "green" options for paper, when possible. But FSC is still evolving, and at any given moment, there may not be sufficient supplies available to match the size of our paper needs.

Currently, 74 percent of our product brochures, which account for the vast majority of our paper use, have already met the Paper Promise commitment. Of that, about 25 percent of our paper is already FSC-certified, and the remainder is recycled or carries other certification.

What about product packaging?

Our impact on paper is largely driven by our brochures. Because of our direct sales approach, we tend to have far less packaging per product than brands whose products sit on a shelf in a store. In those environments, the products need more packaging to prevent damage. They need more visible branding too, to fight for a buyer's attention. We actually don't use cartons for a lot of our products, so for instance, a tube of moisturizer won't be delivered in a box, packed into yet another container.

A challenge with programs such as Paper Promise is to induce change beyond your operations. How do you see Avon's efforts in this respect?

We've learned that the impacts beyond us depend on our size, but also on our image. With paper, for instance, we are such a huge buyer globally that we are in strong position to influence supply trends. When we press for more FSC paper, suppliers see that demand and will alter their growing and purchasing habits in turn.

Palm oil is an environmental hot spot because tropical forests are being razed to plant palm plantations. How does this differ from the challenge you face with paper?

In some ways, paper is an easier problem to solve. In part, because we have more weight given how much we buy. But also because forests can be maintained sustainably, over decades, so that trees that are cut down can be replaced. And recycled paper offers another option. With palm, the conversion from forest to plantation cannot as easily be reversed.

The other difference is the degree of our influence. In palm oil, it's almost the reverse: we have little buying power but enormous visibility. Food accounts for a far larger share of palm oil consumption -- more than 80 percent -- than cosmetics, so changes in that industry are the real driver of change. In truth, even if we stopped using palm oil tomorrow, there wouldn't have a major impact on global palm markets. But lending our name to the issue raises it in the minds of many who wouldn't otherwise know.

What we've done through the Avon Palm Oil Promise is to commit to buy only certified sustainable palm oil through the purchase of Green Palm certificates. This year we became the first major beauty company to hit the 100-percent goal.

So given Avon's relatively small size as a palm oil user, how do the company's actions influence other buyers?

We work with the Roundtable on Sustainable Palm Oil (RSPO) to help influence industry practices. There are those NGOs who criticize the Roundtable's efforts precisely because it engages with companies, who feel that commercial buyers are the source of the problem. I see it differently: that you have to bring everybody -- the planters, buyers, and environmentalists -- to the table. RSPO is the one body right now that is trying to pull everyone together. We're doing this through Green Palm certificates, where we buy "book and claim" certificates to support plantations that commit to grow palm in a sustainable, verifiable way.

Our goal is not just to do our purchasing sustainably, but also to help drive demand for sustainable palm oil and influence other bigger buyers. We can help by raising the awareness of sustainable palm oil, increasing the supply of it, and then, through that, reducing the pressure on forests and on the endangered species that live in these endangered forests.

Palm oil aside, critics have charged that the industry has a poor track record in terms of making ingredients transparent. In fact, the U.S. Congress is considering labeling rules to require fuller disclosure. How does Avon approach this issue?

The cosmetic and personal care industry has one of the longest safety records of any, and Avon is especially proud of our 125-year commitment to safety. As one example, in a recent report on breast cancer and environmental exposures by the Institute of Medicine, the findings did not support the risk of cosmetic ingredients as a cause of concern.

Avon adheres to all labeling requirements in the more than 100 countries in which we do business. Complete ingredient disclosure is found on product labels and avon.com according to the strict guidelines established by governing bodies, allowing consumers to make personal choices on products they select.

For many companies, health and environment are lightning-rod issues, attracting lots of outside attention. But studies show consumers, in aggregate, put such concerns further down their list. How do you reconcile this?

For better or worse, most customers of any brand don't care too terribly much what's coming out of the back end a factory in Guangzhou. We hope more will care, since we work to keep those waste flows in accord with the best global practices. But we know from marketing studies that most of what motivates the customers are the brochures, the samples, what they see in their hands. However, numerous studies show that customers -- including Avon customers -- increasingly consider environmental issues as a factor in brand choice, with some studies showing an 80 or even 90 percentile level of interest.

As a result, it may be hard to say clearly that sustainability policy X drove Y sales. But we also know that sustainability is a decision with very little downside --internally with our employees or externally with suppliers and customers. And there's tremendous upside in terms of cost reduction, risk management, and employee engagement. And it is, quite simply, the right thing to do.

What's an example of the cost reductions that you've found from these efforts?

We find that there's real passion around these issues, and that leads to real change, and genuine improvements in operations. Take Brazil, our biggest market. As you can imagine, when you've got hundreds of thousands of sales representatives, delivering their orders can mean criss-crossing trucks.

As part of a program requesting green improvements from our employees, the team in Brazil mapped out all these routes to find and eliminate the overlap. It was a massive project, but the savings has been amazing--in man-hours, in fuel, in speed of delivery and, ultimately, the environmental impact. And this came from someone just saying, "You know what? We have to do this better."

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Adam Aston is a freelance journalist and editor who focuses on green issues. Previously, Adam was energy and environment editor at BusinessWeek, where he covered corporate sustainability, renewable energy, and green finance while producing a regular ... READ MORE >
Reduce, reuse, recycle. Remember the first is the most important. Woman don't "need" makeup. They look much better without it. It's degrading to say a woman doesn't look good naturally and "needs" to be painted to fit in to society. Girls are being brainwashed at younger and younger ages, and pretending to be green only makes it easier for everyone to say it's ok to make them feel bad about themselves and have to cover up to go out in public. Break the cycle, REDUCE!