Kao’s ESG strategy spotlights biodiversity, refillable packs and eco-friendly palm oil production

30 Jun 2022 --- Japan-based Kao corporation is releasing its progress reports on its Environmental, Social and Governance (ESG) strategy – the Kirei Lifestyle Plan.

In order to encourage decarbonization, Kao reports its internal rise in the carbon price to 18,500 yen (US$136) per metric ton of carbon dioxide. As part of strengthening Kao’s ESG governance structure, it also describes changes made to the company’s biodiversity policy and the creation of new ESG steering committees.

“The expectation of our stakeholders for companies like Kao to help build a more sustainable society is intensifying year by year,” says Dave Muenz, director and managing executive officer at Kao’s ESG Division.

“Kao took steps in 2021 that will help us continue setting ambitious decarbonization goals of aiming for carbon zero by 2040 and carbon negative by 2050. This year, our ESG governance structure has been reinforced by setting up four ESG steering committees that will address decarbonization, plastic packaging, human rights and chemical stewardship.”

This setup is to implement ESG initiatives reliably and promptly, according to Kao.

“As a company dependent on natural capital such as palm oil, we have published a new policy around procurement which will help us work across our supply chain to ensure traceability and identify risks by arranging third-party audits of our suppliers. Kao will continue to work through collaborations and partnerships to create a Kirei Life,” Muenz continues.

Biodiversity policy
Kao operates by utilizing various biological resources, including pulp, paper and palm oil. Kao established the “Basic Policies on Conservation of Biodiversity” in 2011 and has since been working to create innovative technologies that aid the sustainable sourcing of raw materials and the preservation of biodiversity.

The modern world strives to lessen harmful effects on biodiversity and nature, boost beneficial actions and stop the trend of biodiversity loss.

The current policy has been changed in light of the revision of the global biodiversity goals at the 26th session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP26) in 2021 and the “Basic Policy on Biodiversity” was developed in April 2022.

Kao is also a member of RE100, which is a global initiative bringing together businesses committed to 100% renewable electricity.

Palm oil production
Kao has been working to ensure the environmentally sustainable material sourcing of palm oil, one of its primary raw resources.

Kao purchased certified (RSPO5 certified) sustainable palm oil and helped Indonesian smallholders who grow oil palms.

Kao’s ESG governance structure is being built to address decarbonization, plastic packaging, human rights and chemical stewardship.By 2025, Kao aims to use only palm oil that has been RSPO approved for both consumption and industrial uses. Usage was at a rate of 27% in 2021.

In conjunction with Asian Agri, a plantation and palm oil company and Apical Group, a global palm oil processor and exporter, the Smallholder Inclusion for improved Livelihood and Empowerment program was launched in 2020.

Refill packs and waste
Kao’s innovation in reduction includes encouraging the use of replacement and refill packs.

Kao Corporation had 380 refill and replacement items as of December 2021, with an 83% conversion rate.

Additionally, compared to the scenario if all items were produced utilizing their original product container, the amount of plastic eliminated with refill and replacement products is 77,000 metric tons. Around 139,800 metric tons of plastic were reduced when the impact of concentrated items was added, yielding a reduction rate of 78.4%.

“We seek to contribute to the development of a zero-waste society by ensuring that used items and product packaging are employed to the greatest extent feasible, if required by modifying their purpose. Our efforts are motivated by a philosophy of avoiding unnecessary waste,” adds Kao.

Kao has been working to ensure the environmentally sustainable material sourcing of palm oil, one of its primary raw resources.Presently, 106,000 metric tons of plastic – of which 104,000 metric tons are made from fossil fuels – are used by Kao for its packing containers.

By 2030, Kao will have utilized all of the plastic made from fossil fuels that it has ever used in packaging containers.“In 2040, we want to have zero waste and in 2050, negative waste,” states Kao.

By 2030, Kao wants to utilize 200,000 metric tons less plastic packing containers for its products and for society as a whole.

Kao’s eco-friendly endeavors and NPD
In environmental sustainability moves, Kao partnered with Kosé to achieve horizontal bottle-to-bottle recycling, in which used cosmetic plastic bottles are collected and converted into new cosmetic bottles.

The company was also a member of the EcoBeautyScore Consortium, which aimed to provide consumers with an environmental impact assessment and scoring system that will allow them to make sustainable decisions.

In other developments, Kao recently introduced the Bioré Guard Mos Block Serum mosquito repellent in Thailand. The company previously unveiled 3D shampoo sheets and laundry detergent for astronaut hygiene.

By Nicole Kerr