In recent years, the prevalence of chemical and sustainability programs for formulated products within retail chains has increased significantly in number and in scope (https://saferchemicals.org/2021/03/30/new-study-finds-nearly-70-of-companies-surveyed-have-improved-toxic-chemical-safety-programs/). Driven by pressure from consumer groups, and NGOs like Mind the Store’s Retailer Report Card (https://retailerreportcard.com/grades/), these programs have started to have influence on regional chains as well. For suppliers, it’s important to have a clear understanding of retail chemical policy initiatives, because retailers are considering cooperative participation in these programs as a key component of their supplier relationships.
This article reviews:
1. Basic retailer chemical policy structure
2. More advanced programs
3. Actions suppliers should take
Basic retailer chemical policy structure
Retailers with chemical policy programs begin by identifying a set of ingredients that they would like to phase out of their assortment and whether the policy should capture only private label products or include national brands. These restricted substance lists (RSLs) generally include a core set of common chemicals of concern (e.g., phthalates, parabens) as well as additional retailer-specific chemical priorities and are focused on specific product categories (typically formulated products in Health & Beauty and Cleaning Products). The presence of an RSL chemical is likely to prompt a conversation with a retailer’s merchant. Depending on the retailer’s program stringency and a supplier’s product portfolio, the supplier may be required to remove the ingredient by a certain date in order to remain in the retailer’s assortment, or may be offered incentives to replace the ingredient with a safer alternative. Products that pass RSL screening may receive preferred on-shelf placement or additional retailer marketing support.
An increasing number of retailers are making public commitments regarding reformulating portions of their assortment, and even publicly disclosing the proportion of their product portfolio that passes or fails their RSL screen.
More advanced programs
Once a chemical policy is established, retailers are building upon that foundation by engaging their suppliers to make meaningful improvements in the sustainability of their commercial operations and to cultivate stronger relationships with their consumers.
1) Chemical footprinting – More and more retailers are joining the Chemical Footprint Project (CFP) (https://www.chemicalfootprint.org/), initially as signatories (meaning they encourage their suppliers to report chemical usage to CFP) and eventually as participants (meaning they calculate and report their own chemical usage, including chemicals in the products they sell). Previously, Walmart has been the only major US retailer tracking and reporting its aggregate chemical usage (https://www.walmartsustainabilityhub.com/sustainable-chemistry/walmart-sustainable-chemistry-commitment). This effort requires integration of sales volume data with WERCSmart formulation data at scale to be able to measure and track the mass of specific chemicals sold in a given year. Additional retailers like Target, Whole Foods and CVS are also beginning to calculate their chemical footprint. In the future, UL expects that setting chemical reduction goals, tracking chemical usage annually, and reporting on year-over-year trends will become an important component of most retailer corporate responsibility programs.
2) Consumer-facing chemical policy marketing – Driven by consumer demand, the marketing teams at a growing number of retailers are deploying in-store and on-line product tagging to help shoppers identify products that meet their chemical policy or transparency goals. Target’s Clean program (https://www.target.com/c/target-clean/-/N-p4n12) represents an integrated product curation and promotion program that utilizes both chemical screening results and transparency metrics to strengthen and reinforce their brand promise. To successfully participate in Target’s program, many suppliers are challenged to significantly improve both the business-to-business (i.e. all ingredients screenable) and business-to-consumer (i.e. all ingredients disclosed publicly) and transparency of their products.
3) Usage of third-party certifications – Product curation and tagging programs are incorporating third-party certifications into their evaluations and promotions. These certifications cover chemical policy issues (e.g., EPA Safer Choice) as well as a broad range of other material issues, such as animal testing, packaging recyclability and recycled content, etc. Amazon, for example, has recently launched its Climate Pledge Friendly tagging program, which recognizes products with certifications that validate a product’s energy or carbon efficiency.
4) Category-specific initiatives – Depending on retailer type, chemical policy programs may focus on chemicals of concern in formulated products or on articles. Retailers have learned that a single RSL may not be an efficient approach to conveying to suppliers which chemicals to avoid in the products they make. A chemical that poses a health risk in a product category where consumer exposure is significant may not be a problem at all in a different category. Targeted RSL lists are being developed by some retailers to ensure that potentially harmful chemicals in category-specific use-cases are flagged appropriately.