Food & Beauty Sectors Trending Green, Report Finds

A worker delivers Coca Cola products in Nashville, Tenn., on June 23, 2016. A report published Monday by the nongovernmental group CDP found consumer goods giants are working to lower their carbon emissions, prepare for the effects of global warming and respond to growing environmental consciousness among customers. (AP Photo/Mark Humphrey, File)

(CN) — From Nestle to Unilever, foreign companies are leading the pack among the globe’s top 16 consumer-goods retailers when it comes to efforts to reduce their carbon footprint, a survey out Monday shows.

Breaking the companies up into two groups — food and beverage and household and personal care — London-based CDP found that foreign companies placed first and second in both sectors when it comes to how threatened they are by the effects of climate change and how well they are preparing for it.

On the food and beverage side, the French company Danone and Nestle, of Switzerland, topped the chart, with U.S.-based PepsiCo at a distant fourth behind AB InBev of Belgium.

Three American companies — Coca-Cola, Mondelez and Kraft Heinz — rounded out the back of the pack, behind the U.K.-based Diageo and Heineken of the Netherlands.

On the beauty side, Unilever earned top marks for its efforts to market a laundry detergent formula that works with washing machines on a lower “eco” temperature setting.

While Unilever is based in the U.K. and Netherlands, second-place L’Oreal has headquarters in Paris, France.

U.S.-based Colgate-Palmolive did break into the top three for this sector, but fellow American companies P&G and Estee Lauder ranked last, behind the German company Henkel and the U.K.’s RB.

Tighter regulations in Europe could account for the ranking disparity, but increasing pressure from climate change activism has been seeping into investment board rooms across the globe.

In the last five years, however, 60 percent of the top 10 revenue-generating brands have failed to deliver low-carbon innovations. Monday’s report does find that almost all of the companies are trying out vegan and biodegradable options in both categories.

“While consumers face limited direct regulation related to climate change, there is an emerging trend amongst millennials to adopt more environmentally conscious practices,” an executive summary of the report states. “This is evidenced in shifting preference for vegan diets, smaller eco-friendly brands and reduced packaging.”

The study also points out that the purchasing of smaller companies by larger companies, such as PepsiCo buying Health Warrior, helps to boost the going-green initiative. PepsiCo is not alone, with 75 percent of companies having a similar strategy. 

“Leading companies are responding to these trends through the acquisition of small brands but more transformative innovation and shifts in business models may be needed to align with targets set by the Paris Agreement,” the report states.

Packaging has been a popular area for companies to focus their climate-change efforts, CDP found, reporting that 63 percent of companies are investing to advance depolymerization and recycling infrastructure.

The report was written by Christie Clarke, Carole Ferguson, Tom Crocker and Kane Marcell.

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