Cosmetics and Pharmaceutical 

The demand on natural medicines and cosmetics constantly increases and became mainstream, which is why many brands emphasize their "natural” products. An environmentally oriented procurement can strengthen the substantial availability and quality of raw materials and therefore ensure a good reputation of the brand. That makes it possible to raise the costumers’ awareness of biodiversity in combination with brand promotion and product advertising.

The pharmaceutical and cosmetic industries rely on the genetic diversity and biodiversity. Since most of their row materials derive from nature, the increasing loss of biodiversity impacts their resources. 72,000 (17 %) of all global plant species are used for medical purposes, 15,000 (21 %) of them being endangered species.

Risks

Research & Development

  • 25 to 50 % of the pharmaceutical market is derived from active ingredients from nature (TEEB 2010)
  • 118 out of the 150 most prescribed medications in the USA are developed from natural resources
  • 74 % of these medications are generated of plants, 18 % derive from fungi, 5 % from bacteria, and 1 % from a specific snake species
  • The development of most medications is based on the research on flora and fauna, especially from tropic forests or marine organisms (cancer drugs in particular)
  • The estimated value of marine biodiversity which is used to generate new cancer drugs comes up to 0.56 – 5.69 Billion US$

Production & Manufacturing

The pharmaceutical and cosmetic sectors depend on the natures’ provision of plants producing special ingredients, and therefore they rely directly on biodiversity and ecosystem services. Because not all of these plants can be cultivated, there is a lot of wild collection. The underlying agricultural production (espacially of Palm Oil) leads to land-use changes and degradation. Most cosmetic contents, like saponins, flavonoids, amino acids, antioxidants, and vitamins derive from natural resources. In addition, the sector relies on natural materials like fish oils, soya, and palm oil to manufacture drugs.

For this sector, the declining biodiversity impacts operational, reputational, regulatory, and market risks as well as new opportunities linked to new drug discovery. Furthermore, species which could be of a great value for the cosmic and pharmaceutical production could cease. The main environmental impacts are the (indirect) land usage for resource production, the destruction of natural habitats and ecosystems, pollution through the use of pesticides and fertilizer and erosion promoting cultivation methods.

Similar to the land use of the raw material production, companies should assess the geographic location of its own production sites as well as those of its suppliers and undertake a risk assessment. Especially suppliers operating in biodiversity-rich regions should have a functioning and certified environmental management system (ISO 14001, EMAS III). The Fact Sheet gives detailed information on cosmetics and biodiversity and provides several guidelines for companies.  

Medications

Even at the end of the cosmetic value chains there exist risks of negative impacts on biodiversity. For example, many of the active ingredients of cosmetics end up in the sewage water and cannot be filtered in conventional sewage treatment plants. Such "Xenobiotic” (bio-incompatible) materials end up in streams and rivers and are likely to accumulate in aquatic organisms and for instance compromise their reproductive capabilities. 

Access and Benefit Sharing (ABS)

One of the objectives of the UN Convention on Biological Diversity (CBD) is the fair and equitable sharing of the benefits arising out of the utilization of genetic resources – a fundamental challenge for companies. Further, the CBD sets out that a person or institution seeking access to genetic resources in a foreign country should seek the prior informed consent of that country, as well as negotiate mutually agreed terms with respect to the use of this resource and related benefit-sharing. 

In addition, the Nagoya Protocol on Access and Benefit-sharing, adopted in October 2010, enhances ABS related obligations at the international level by creating predictable conditions for accessing genetic resources and traditional knowledge associated with them, as well as promoting adequate benefit-sharing and supporting mechanisms to monitor and ensure stakeholders’ compliance with mutually agreed terms and national ABS regulatory frameworks. As a consequence, cosmetic companies using genetic resources, i.e. conducting research and development on the genetic and /or biochemical composition of genetic resources, must therefore ensure that those resources have been obtained with the proper permit and on the basis of mutually agreed terms.

Chances & Benefits

  • The rising consumer demand for natural ingredients and sustainable cosmetic products mean that biodiversity is increasingly becoming a strategic issue for the cosmetics industry. Sustainable companies that are engaged in the protection of biodiversity could therefore capitalize on market potential and get a competitive advantage.
  • The consumer demand for natural medicine and cosmetics and for products with natural ingredients, as well as a responsible procurement potentially raises even more (Ethical Sourcing).
  • According to the Union for Ethical Bio Trade the world’s 20 top-selling cosmetic companies communicate the most about biodiversity