NEW YORK — Aveda, Wharton Business School’s Net Impact Club and indigenous leaders gathered at the United Nations last Wednesday to discuss future models for business partnerships. The goal of the summit was to spark dialogue on how to best create business models that protect the planet and its myriad indigenous communities, not threaten them.
The summit was tied into the U.N.’s Permanent Forum on Indigenous Issues, which began May 16 and runs through Friday.
The day before, another meeting took place across town, showcasing the years of effort by Brazilian beauty power O Boticario to promote environmental preservation and protection in its native country. The Fundacao O Boticario de Protecao a Natureza (O Boticario Foundation for Nature Protection) held a dinner at the Helmsley Park Lane Hotel in conjunction with the Brazilian Embassy, The Heinz Center and Mitsubishi International Corp. Also lending support were some top beauty executives, the heads of International Flavors & Fragrances, Firmenich, and Mane USA.
At the U.N. meeting on Wednesday, Aveda, which is owned by the Estée Lauder Cos., was trying to break ground. As part of its own business model, the company has formed partnerships with key indigenous leaders to obtain raw materials for use in its beauty products.
Aveda president Dominique Conseil called on companies to change the way the world does business, and to act as responsible citizens in the communities in which they operate. Conseil said that such “creative rethinking” could bolster the bottom line. He noted that over the past eight years Aveda has cut its energy needs in half at its Blaine, Minn., manufacturing plant by implementing energy conversation programs, such as utilization of natural light. He added that since 1996, manufacturing and sales have increased 13.2 percent and 20.1 percent, respectively, while the company’s carbon monoxide emissions output has been kept in check, with only a 1.2 percent increase.
Lauder shared several practical examples of how Aveda has aligned itself with farmers and harvesters to cultivate the plants used in its products.
Sandalwood — an ingredient used in Aveda products such as Love Essence and Pure-Fume Brilliant Shampoo — is widely available in India and Australia. Given human rights concerns in India, Aveda has spent the past seven years working with the Aboriginal people of Western Australia to foster a strong business relationship, one that stipulates they receive fair payment for their sandalwood harvest. Aveda has also partnered with Mount Romance, the Australia-based producers of sandalwood oil, to extract sandalwood oil by steam instead of using chemical solvents.
This story first appeared in the May 25, 2005 issue of WWD. Subscribe Today.
“We can start to make a difference through purchasing discussions,” said David Hircock, adviser to Conseil on environmental sustainability, social responsibility and herbology. He added that the company is cautious not to create markets that would amount to a dependency on Aveda. Therefore, the company does not sign exclusivity agreements with its suppliers. Several attendees — from Kenya and Guana — took the opportunity to pitch their raw ingredients to Aveda, hoping to find ways to build a market for their countries’ natural resources.
Conseil, who stressed his belief in capitalism, said such efforts are not about philanthropy.
At a cocktail reception held in the lobby of the United Nations following the discussion, Conseil commented, “You can’t give people a fish, you can just give them tips on where to fish.” He said he felt encouraged that something tangible came out of the event, the first of its kind for Aveda. Next year, Aveda will host a two-day summit intended to share “turn-key solutions” to doing business in an environmentally conscious way, said Conseil, adding that it could include other companies as well.
At the dinner the evening before, Miquel Gellert Krigsner, founder and president of O Boticario, hosted a parade of distinguished speakers talking about the environment. The company was founded 28 years ago, and 13 years later Krigsner decided to launch the environmental foundation, financed by an annual contribution of 1 percent of O Boticario’s net revenues.
The director of the foundation, Miquel Serediuk Milano, said the trip to the U.S, which included stops in Washington and San Francisco, was aimed at enlisting allies. As a result, Milano said, partnerships are forming and doors are opening.