How AI Makes Estée Lauder's Supply Chains More Sustainable
The Estée Lauder Companies (ELC) is advancing a transformation of its supply chain.
The push to overhaul ELC’s value chain comes at a time when many corporations are retreating from their earlier sustainability goals.
But, amid political pressure and an emerging backlash against ESG initiatives, ELC is taking a different path.
Despite the shifting rhetoric in boardrooms, the company is doubling down on its commitment to responsible practices.
Rebuilding the supply chain for speed and sustainability
Roberto Canevari, Executive Vice President and Chief Value Chain Officer at ELC, has made clear that his strategy is built around three principles: “safety, sustainability and respect for people.”
Speaking to L’Economia, he explains how the beauty giant is becoming faster, more responsive and more digitally driven – with a vision anchored in Europe but applied globally.
In the interview, he outlined ELC’s shift towards a more agile supply chain that allows the business to respond more rapidly to consumer needs.
“We’re moving toward a much more agile model. More product launches, less inventory,” he says.
ELC aims for 30% products to be launched within 12 months.
Streamlined operations span across its nine global production facilities, particularly in Belgium, the UK and Switzerland.
In Belgium, a major upgrade to the Oevel campus strengthens this vision.
The site is a key part of the company’s manufacturing and fulfilment network, with 60% of global product volume passing through the facility.
“Oevel exemplifies how we’re committed to advancing sustainability for the long term,” adds Nancy Mahon, Chief Sustainability Officer at ELC.
The European supply chain not only bears operational importance but is also entwined with ELC's historical roots.
For instance, ELC's Italian operations, established in the 1960s, benefit from partnerships with local firms like Intercos, a veteran provider of makeup powders.
These partnerships facilitate shorter supply chains, curtailing environmental footprints while sustaining production integrity.
AI as a supply chain catalyst
AI is at the heart of ELC’s transformation as collaborations with Microsoft and Zero100 are driving innovation across the entire value chain.
The collaboration birthed the AI Innovation Lab, a continuation of their partnership dating back to 2017.
It has introduced innovations like the Voice-Enabled Makeup Assistant for real-time cosmetic application advice.
AI is aiding ELC in transitioning from reactive to predictive supply chain management.
Machine learning tools are being utilised to foresee consumer demand, refine inventory and heighten operational efficiency.
Olly Sloboda, Co-Founder and Chief Executive of Zero100, praised the partnership in a LinkedIn post: “Love what we’re building with Zero100 and The Estée Lauder Companies Inc. And cool to be mentioned as a strategic partner alongside Microsoft."
Zero100’s research confirms that AI is becoming critical to supply chain performance.
Its AI ROI Report shows that 90% of large firms are now experimenting with AI in their operations.
Companies like ELC are enhancing workforce skills, with some deploying incentives like financial perks, gamification or swift promotions for employees adopting AI proficiencies.
Staying the course on ESG in a changing climate
While a trend known as green-hushing sees some firms dialing down their ESG communications, Estée Lauder ventures forth with transparency on their sustainability aspirations.
This stance stands out in a context where more than $8bn has been withdrawn from global ESG funds in the first quarter of 2025 alone, much of it from US investors.
With executive caution heightening, certain companies are backtracking on public commitments regarding diversity, equity, inclusion (DEI) and environmental initiatives.
New research from AlphaSense shows DEI references in US corporate filings have dropped nearly 70%, while climate mentions are down 30%.
Despite this, ELC maintains clear ESG metrics and invests in long-term progress.
The business sees AI not only as a technological tool but as a way to reinforce sustainable and inclusive practices.
