12 January 2026: Transparent sourcing of raw materials, mitigating chemical footprints, and focusing on refill and reuse are just some of the vital steps for cosmetics companies to take to address sustainability, future-proof their businesses and build a loyal and responsive customer base, new research from BSI shows.
BSI’s new whitepaper authored in partnership with Amy Nguyen, sustainability expert and contributor, Setting the foundations for a sustainable beauty and cosmetics industry: Aligning product quality with environmental and social goals, sets out ten key areas of best practice for beauty brands to focus on across development, manufacture and sales chain, highlighting the environmental and market share benefits that can be achieved as a result.
Areas covered include fair purchasing practices and investment in safe working conditions, as well as an exploration of how AI is embedding itself across the value chain, from supporting sustainable ingredient substitution to delivering personalised consumer experiences.
Past BSI research has shown that nearly two-thirds of people globally (63%) consider a company’s social and environmental purpose when making purchasing decisions. In light of this, the report explores what ambitious action looks like for the global beauty industry – estimated to have generated US$441 billion in sales in 2024 - spotlighting examples of companies redefining the industry standard.
This includes sourcing raw materials and the need for brands to go beyond compliance to ensure ingredients from mica to palm oil and vanilla are ethically and transparently procured. The report urges brands to act decisively to improve traceability, work with local communities, or invest in alternative materials in order to reduce harm, strengthen supply resilience, and build consumer trust.
In manufacturing, the focus falls on managing and mitigating chemical footprints, following intense scrutiny of the industry’s use of substances such as PFAS and parabens, with regulators in Europe, the US and Asia moving swiftly to tighten restrictions. BSI’s report highlights the opportunity of green chemistry and safer alternatives to protect both consumers and ecosystems, while also addressing wider environmental footprints by tackling carbon, water and biodiversity impacts through renewable energy adoption, regenerative agriculture partnerships and nature-positive sourcing.
As the report notes, embedding circular economy principles is becoming essential for beauty brands, with refill systems, upcycled ingredients and reuse schemes redefining product lifecycles and BSI’s research further demonstrates this trend with 68% of consumers saying they are motivated to reuse, repair and recycle. This evolution is being accelerated by innovations in biotechnology and green chemistry, where companies are trialling renewable feedstocks, solvent-free formulations and bio-fermented actives.
The whitepaper highlights the regulatory drive towards recyclable, biodegradable and reusable solutions, alongside innovations ranging from carbon-captured plastics to mycelium and algae-based alternatives. With consumers increasingly demanding action on plastic waste, packaging has become both a reputational risk and a platform for innovation.
The report underscores that social considerations must sit alongside environmental goals, and makes clear that responsible communication and marketing is vital. With regulators clamping down on greenwashing, transparency, evidence-based claims, and inclusivity in advertising are essential. BSI research backs this up, showing that three-quarters of consumers are more likely to trust a business’s environmental claims if they are verified, certified, or backed by credible evidence.
Todd Redwood, Global Managing Director – Consumer, Retail and Food, BSI said: “The beauty and cosmetics sector stands at a defining moment as sustainability is no longer a peripheral issue but a core driver of resilience, competitiveness and trust. Above all, consumer expectations are rising and shoppers want products that are efficacious, ethically sourced and with a demonstrably reduced impact on people and the planet.
“For brands, the challenge is significant, but so too is the opportunity. By harnessing innovation, embedding responsibility across the value chain, and leading the sector towards a future where performance and sustainability go hand in hand, brands can ensure they have a positive societal impact, aligning to future regulation and building consumer trust for the long term.”
The report acknowledges that significant hurdles remain. Smaller brands face cost and capacity constraints in financing audits, technology and material innovation. Evolving regulation, from the EU Green Claims Directive to California’s Toxic Free Cosmetics Act, is reshaping the competitive landscape.
There is clear consumer appetite for change. The global natural cosmetics market was valued at US$642 million in 2022 and is projected to surpass US$1 billion by 2030, reflecting growing desire for products that combine efficacy with environmental and social responsibility.
For more information and to access the full whitepaper, click here: Setting The Foundations For a Sustainable Beauty and Cosmetics Industry
Notes to editors:
Setting the foundations for a sustainable beauty and cosmetics industry: Aligning product quality with environmental and social goals, sets out ten key areas of best practice for beauty brands to focus on across development, manufacture and sales chain, highlighting the environmental and market share benefits that can be achieved as a result. These cover:
1. Sourcing of raw materials
2. Manufacturing - Managing and mitigating chemical footprints
3. Managing and mitigating environmental footprints
4. engaging in initiatives that are rooted in conservation and restoration as well as supporting communities
5. Considering packaging
6. Integrating principles of the circular economy by eliminating waste and pollution
7. Investing in Innovative formulations
8. Embracing AI
9. Considering social considerations
10. Responsible communication and marketing
