November 12, 2010 by Rhiannon Smith

David Taylor and I have been working on the development of so-called “Substance Avoidance lists” which can assist businesses in planning their inventory of product ingredients into the future.

All products result in the end user, and all the actors in the associated product supply chain, being exposed to the components (ingredients) of the product to some degree. Adverse effects on human health and the environment are avoided or minimised by manufacturers and downstream users managing the risks associated with the various ingredients.

As our knowledge has increased during the last century it has become apparent that some ingredients, previously considered to produce a low risk of harm to the user, have unanticipated properties that increase the risk, sometimes beyond the tolerable level. As a consequence some materials have had their use restricted either voluntarily or via regulation.

Since knowledge will carry on increasing, manufacturers have a continuing need to be able to identify and take appropriate steps to manage emerging risks. A broad range of such management strategies can be identified ranging from “wait until it’s regulated before taking action” to “take avoidance action as soon as anyone suggests a potential risk”. The actual strategy chosen by a business will depend upon an assessment of the five main drivers for avoidance:

  • Identification by the manufacturer: In this case the business itself identifies a significant adverse change in the risk profile of one of its products. Under these circumstances the business is likely to move rapidly to deal with the risk in order to protect its workforce, its customers and their environment. This action, if handled sensitively, will enhance the reputation of the business and its products. However, mistakes can be very damaging to reputation, as happened to Coca-Cola over their Dasani product.
  • Legal Requirements: These have to be complied with, within a specified period, and in some cases this may be short in relation to the time needed to modify formulations and change supply strategies. Early warning of impending action can, in these situations, be very valuable, especially if significant development time is needed to implement any changes.
  • Concerns expressed by the regulator: The first indications are usually expressed several years in advance of any overt regulation and they can be useful in providing an early indication of the type and degree of control that may occur. Although subsequent regulation is not inevitable, the presence of a material on a regulatory “List of Concern” remains a powerful avoidance driver.
  • Concerns expressed by customers: In many cases concerns arising from customers are closely linked to information derived from the media and NGO campaigns. The consumer may be the final end user or could be the wholesale or retail intermediary. Although lacking the force of law, consumer demand is a very powerful stimulus.
  • Concerns expressed by NGOs: In recent years some environmental NGOs have suggested that the Precautionary Principle should be applied more and more widely to any chemical that is persistent, bioaccumulative and toxic. They have produced a number of lists of candidates that they think should be severely controlled or eliminated. These lists have no legal standing, but nevertheless they can be a source of substances for regulatory action and are frequently used by customers to drive avoidance behaviour by business.

Avoidance Strategies can add significant value to a business in a number of ways; they can help to ensure compliance with regulation, they can enhance corporate reputation and brand image and, as a result of foresight, can save significant cost by enabling the business to meet regulatory and customer requirements in a timely manner. Added value arises in three areas:

  • The development and active maintenance of the strategy provides early warning of potential changes in both customer demands and regulation. This then permits any necessary product reformulation to be undertaken at a speed governed by the business rather than within a potentially short regulatory phase-in period. In the case of NGO-driven issues, the same foresight enables the business to plan its approach to the issue rather than having to react suddenly to a media-driven campaign. However, optimising added value requires a careful balance to be drawn between substitution of substances that will be regulated and those that have been identified as candidates but which are unlikely to be regulated.
  • In principle the use of an avoidance strategy could be beneficial to corporate reputation and, in theory, should lead to increased product sales and market share. However, such benefits will only be realised if the existence of an avoidance strategy is public knowledge. This needs careful management, since demonstrating that there is a plan to deal with potentially highly hazardous substances might be seen as an admission that the product contains such substances. The reputational benefit might also attract socially responsible shareholders.
  • The use of an internal avoidance strategy helps to ensure business compliance with both regulation and with customer requirements. However, to gain the benefit the strategy needs to be applied universally with appropriate monitoring and assurance.

wca has built on work previously undertaken in reviewing ingredient avoidance guidelines to produce an ‘avoidance list’ which we will update at regular intervals. The avoidance list is a table of substances which have been considered to be “of concern” under a range of international and national legislation and non-governmental reviews. A review of ingredient avoidance guidelines with respect to this combined avoidance list allows companies to answer the following questions:

  • Have all the ingredients we should be addressing been addressed?
  • Are there any ingredients that present potential liabilities that we are missing?
  • Are there any that we really should not be concerned with?
  • In short, is our program complete, appropriate and worth the resources and sacrifices (from a product formulation point of view) put into it?

A large number of chemical priority lists or lists of chemicals of concern have appeared over the last 40 years. These have been derived by a wide range of organisations, for a variety of purposes, using differing methodologies. We have selected lists covering a range of types and organisations and broadly related to Europe and the USA. The combined list is updated periodically and has been compiled from the data contained in the following governmental and NGO lists:

  • The amending regulation of persistent organic pollutants;
  • California proposition 65;
  • ChemSec Substitute It Now list;
  • Danish list of undesirable substances;
  • ECHA list of substances of very high concern;
  • EU endocrine disruptors list;
  • EU REACH regulation Annex XV candidate list;
  • EU REACH regulation Annex XVII list;
  • EU water framework directive candidate and priority substances lists;
  • International Fragrance Association (IFRA) Code of Practice;
  • OSPAR lists of chemicals of concern and chemicals for priority action;
  • Report on carcinogens candidate list;
  • Stockholm convention on persistent organic pollutants list;
  • Toxicology reporting index Persistent Bioaccumulative and Toxic list;
  • US endoctrine disruptor SP tier 1 screening list;
  • US EPA contaminant candidate list CCL3;
  • US EPA hazardous waste priority list;
  • US EPA priority PBT list;
  • US VCCEP pilot programme list.

wca is also able to benchmark the guidelines against customer requirements and competitor policies and thereby provide an opinion on how the current program affects the competitive situation. A further review of ingredients lists can also be undertaken, highlighting the inclusion of ingredients which may require further consideration. In doing this, we are able to:

  1. Provide a strategic overview of current ingredient avoidance guidelines, making recommendations for additions and deletions.
  2. Benchmark the current ingredient avoidance guidelines against the requirements of the most important customers or published guidelines from, for example, Trade Associations.
  3. Compare current ingredients with the current chemicals lists produced by Non-Governmental Organisations (NGOs) and regulators and providing a broad overview of any major deficiencies this highlights.
  4. Review the approach taken in this area by major competitors and provide an opinion, based on this review, of how the current program affects the competitive situation.

The information used to compile the “avoidance” lists has been taken from within the public domain, from the respective government or NGO websites. The customers’ and competitors’ websites, and sustainability and corporate responsibility documents contained therein, are the main sources of benchmarking information.

[1] e.g. Danish List of Undesirable Substances (2004) or Californian Proposition 65 List

[2] The Substitute It Now (SIN) List