Interview: How Chanel Leads Cosmetics Traceability Charge

Supply chains in the cosmetics industry are long and complex.

So says Julien Garry, International Director of Purchasing and Packaging Innovation Development at Chanel Parfums Beauté.

“We hypothetically estimate a ratio of 1 to 100 between the number of tier 1 and last tier suppliers,” Garry tells Sustainability Magazine. “This is due, in particular, to the diversity of materials and technologies required to manufacture cosmetic products and their packaging.”

Which is why Chanel Parfums Beauté has initiated a collective approach to the challenge – joining forces with five other industry leaders to form a consortium.

As a founding member of 'TRaceability Alliance for Sustainable Cosmetics' (TRASCE), the French beauty brand will work alongside 14 other alliance members including cosmetic giants L’Oreal, Shiseido, Dior and The Estee Lauder Companies to enhance traceability in key ingredient and packaging supply chains across the industry.

“Our priority is to map our supply chains to get a clear picture of the suppliers involved,” Garry explains. 

“The greater the number of suppliers and the more data collected, the more the consortium members will understand and be better able to assess risks in their supply chains.”

Gaining deeper knowledge of the sector’s supply chains has become essential in better understanding and mitigating risks, enhancing resilience, and improving environmental and social sustainability.

“The tangible reinforcement of public, local and international regulations, such as the European Directive on Duty of Vigilance or the European Regulation against Deforestation and Forest Degradation have highlighted the responsibility of the prime contractor in our production methods”, says Garry.

According to Garry, TRASCE aims to respond to three fundament challenges for the industry:

• To gain a better understanding of its supply chains
• To assess the related social and environmental risks
• To determine the actions required to support supply chains in their social and environmental transition

Founding members have committed to working collectively to map their supply chains across the entire value chain on a common digital platform – Transparency-One, a complete platform helping global businesses meet consumer demand for safe, sustainable, and responsibly sourced products

While various individual traceability initiatives have emerged in recent years, the TRASCE consortium has been formed to address traceability at scale.

For Chanel Parfums Beauté, the essential and demanding work of mapping its own supply chains carried out in recent years has revealed the main limitations of such an exercise.

“It is sometimes difficult for a single client to convince distant tier suppliers to commit to this process, when we do not exchange directly with them or when they do not meet the same regulatory requirements,” explains Garry.

“Based on this observation, we proposed that the actors of the sector join forces to trace our supply chains and as quickly as possible.”

Leveraging Technology to Address Traceability at Scale

Garry says that by pooling individual efforts to map the industry's supply chains, TRASCE will be able to determine the actions to be implemented to support the social and environmental transition of the sectors.

“This collective effort is both a factor of simplification – with a single entry of information by suppliers – and a tool for accelerating the transition. This joint dynamic is undoubtedly more powerful than an accumulation of individual initiatives.”

As a single traceability tool, to implement a common methodology, the Transparency-One platform guarantees each supplier the ownership, security and confidentiality of the data they share – ingredients or components used, origins, supplier activities and places of transformation, names of suppliers.

“The information is collected in a declarative way,” says Garry. “Each supplier enters their own information regarding their production and invites its suppliers to join the platform. By a cascading principle, each of the suppliers will be invited to share their information and so in order to cover the entire supply chain.”

The use of Transparency-One reduces the burden of information requests on suppliers, by aligning and bringing together buying company requests to suppliers.

“This pooling considerably reduces the burden on suppliers: they will no longer have to multiply the sharing of different information for each of their customers but will be able to carry out a single entry of information on the same tool, while choosing the level of visibility granted to each customer.

Already proving itself as a tool to reduce the burden of information requests on suppliers in other sectors, from food to automotive, Maison Chanel and The Estee lauder Companies have both experimented with tool and delivered positive assessments.

“The platform has made it possible to map up to supplier-tier 6 in certain supply chains,” Garry shares.

TRASCE members include: Albéa, CHANEL, Clarins, Cosfibel powered by GPA Global, Dior, The Estée Lauder Companies, L’Occitane en Provence, L’Oréal Groupe, Merck, Neyret, Nuxe, Pochet Group, Sensient, Shiseido and Sisley.

The FEBEA (Fédération des Entreprises de la Beauté) also supports the project as an official sponsor.