Natural health and beauty isn’t easy. Just ask Jessica Alba.
This week, The Honest Company, the Los Angeles-based sustainable consumer products retailer co-founded by Alba and recently valued at $1.7 billion, debuts a new line of cosmetics and facial care products. According to WWD, Honest Beauty’s eponymous web site will go live on Sept. 9 and will include 17 skin products and 66 makeup products, ranging from foundation to mascara to lipstick. Alba told the publication that the line fulfills a vision she’s had for years: to create cosmetics that feel and look great while using more natural ingredients and fewer harsh chemicals.
The company’s expansion comes just as it faces allegations that it has been not-so-honest about its ingredients and product efficacy. Last week, People reported that the company has been slapped with a $5 million lawsuit. The suit, brought by consumer Jonathan D. Rubin, claims that some Honest products contain “unnatural” and “synthetic” ingredients and that the company’s sunscreen is “ineffective,” according to People. This comes just a month or so after some consumers took to social media to share photographs of sunburns that they claim occurred while using Honest’s sunscreen. The founders issued a statement on the company’s blog defending their product.
Honest’s rapid growth and heady valuation is indicative of an booming demand for products that use more plant-based and natural ingredients. A March 2015 report by market research firm Kline & Company estimates the “natural products” industry at $33 billion worldwide. A2015 report by Nielsen found that 53% of consumers surveyed said that an “all-natural” description was moderately or very important to them.
But there’s a big problem with using terms like “natural,” “organic,” and “eco-friendly” to describe personal care products: There’s no consensus on what those descriptors really mean.
Consumers often think that the government sets ingredient standards for “natural” products and requires tests to ensure that items meet those standards, but “none of that is true,” says Ken Cook, co-founder and president of Environmental Working Group (EWG), a Washington, DC nonprofit that specializes in research and advocacy regarding toxic chemicals, corporate accountability, and other environmental issues.
While the U.S. Food and Drug Administration (FDA) requires that products be properly labeled and that ingredients be “generally recognized as safe” when used as directed, it doesn’t approve cosmetics or other personal care products directly. Nor does the FDA define or regulate terms like “organic” or “natural.” The U.S. Department of Agriculture (USDA) regulates the term organic only when it relates to agricultural ingredient marketing.
Here and there, states have stepped in to fill the void. States such as California and Washington have enacted legislation to require disclosure of various chemical ingredients, while Minnesota bans formaldehyde in certain products marketed to children. However, such laws do nothing to create a nationwide standard.
“You can put [almost] anything in a personal care product, if you want. Same with cleaning products that are so-called ‘natural.’ It just doesn’t have meaning,” Cook says. He likens the sector to the “Wild West.”
Honest has taken the transparency route, describing its views on using safe ingredients and sustainable practices on its web site, with the disclaimer that the company is not perfect and working on getting better as science improves. The company’s Honestly Free Guarantee states, “You can rest easy knowing The Honest Company DOES NOT USE health-compromising chemicals or compounds.” The company also publishes a list of chemicals it won’t allow in its products.
Disclosure is a start, but claims like “made with organic ingredients” or “made with natural ingredients” can be deceptive and leave plenty of room for synthetic ingredients which may be harmful, says Janet Nudelman, director of the Campaign for Safe Cosmetics (CSC), a project of the Breast Cancer Fund, a San Francisco nonprofit that works to reduce exposure to chemicals and radiation linked to breast cancer. The CSC grew out of concerns about cosmetics containing phthalates, a set of chemicals linked to birth defects and reproductive harm, and has since evolved to include many other chemicals of concern found in personal care products, says Nudelman.
It’s not uncommon for natural compounds to be created synthetically, says Mark Blumenthal, founder and executive director of the American Botanical Council, an Austin nonprofit research and education organization specializing in herbs and medicinal plants. For example, he says caffeine made synthetically can be chemically identical to the naturally occurring caffeine found in coffee or tea.
“Then the question is: If you do make it synthetically and you’re not drawing it out of a plant, is it still natural? That’s a debate that goes back and forth among various people depending on their level of commitment to the natural-is-better philosophy,” Blumenthal says.
Other concerns about natural ingredients include the potential for chemical contamination along the supply chain or through processes like solvent use that may be found in the final product.
Consumers are beginning to call for stricter standards in terminology as well as overall product safety, Cook says.
One trade group—the National Products Association (NPA) based in Washington, DC—has taken a move toward self-regulation. It established a certification program requiring products labeled “natural” be made up of “only, or at least almost only, natural ingredients.”
Daniel Fabricant, executive director of the NPA, says that no company that has been NPA-certified has been challenged in court. Fabricant is also the former director of the Division of Dietary Supplement Programs at the FDA. “I’m not going to say that anything’s perfect, but I’d rather be 95% right than 100% wrong,” Fabricant says.
In addition to concerns about natural products, Nudelman says the U.S. lags behind other countries in regulating overall cosmetic safety, allowing chemicals that are banned in Canada, Japan and Europe to be used in products sold in America. Just 11 ingredients used in cosmetics are banned or restricted for use in the U.S., yet more than 1,300 chemicals have been prohibited or restricted in cosmetics sold in Europe, according to CSC data.
CSC’s Think Dirty app and Red List flag ingredients the organization has deemed unsafe. Similarly, EWG’s Skin Deep Cosmetics Database and app list chemical ingredients that may be unsafe. Staff scientists compare personal care product labels and web sites to information in roughly 60 toxicity and regulatory databases and give more than 69,000 products an overall score as well as scores for each ingredient.
In a broader move to better regulate personal care product ingredients, Senators Dianne Feinstein (D-CA) and Susan Collins (R-ME), introduced the Personal Care Products Safety Act in April 2015. Stating that federal regulations regarding personal care products haven’t been updated in 75 years, the bill seeks to strengthen the FDA’s authority to regulate ingredients in many everyday products and would require the agency to review five chemicals each year for safety. It would also grant the FDA the authority to recall products it deems harmful—a power it does not currently have.
The outcome of the case against Honest won’t be clear for some time. However, as consumers grow more frustrated trying to sort out the murky definitions of words like “natural” and “safe,” pressure on consumer products companies will continue to increase. Those who respond in meaningful ways will be the ones to win customer trust.
More from Entrepreneur
Brittney's a Certified Financial Planner who can help you manage your business and personal finances and navigate the ups and downs of starting a business.
Starting, buying, or growing your small business shouldn’t be hard. Guidant Financial works to make financing easy for current and aspiring small business owners by providing custom funding solutions, financing education, and more.