Brazilian cosmetics maker Natura Cosméticos considers three categories of impact when looking at the value of a product: economic, environmental, and social. This is a natural fit with MIT Sloan’s sustainability focus. The company’s work with MIT Sloan has led to a plan for procuring palm oil sustainably.
Palm oil is an industry worth well over $40 billion a year and a key ingredient in foods and cosmetics. But much of the world's palm oil is produced using unsustainable farming practices and industry growth can threaten natural forests. Further, many palm oil growers have a hard time making a living because most of the profits go to middlemen. These problems presented Brazilian cosmetics maker Natura Cosméticos S.A. with a challenge: obtaining a palm oil supply that does right by the environment and farmers.
Natura is the leading cosmetics company in Brazil. As its name suggests, the company has a strong association with nature. Natura sources most of its ingredients domestically, and it supports small suppliers in rain forest communities using a fair trade model. "We give them royalties," said Romulo Zamberlan, Natura's Innovation Manager. "We use that term because of the cultural knowledge that they're providing us."
Natura looks at the value of a product from three aspects: economic, environmental, and social, said Zamberlan. This holistic approach to sustainability dovetails with the sustainability focus at MIT Sloan, and the company has been closely engaged with the school in recent years. Natura became a member of MIT's Industrial Liaison Program in 2010.
MIT Sloan's Action Learning has been valuable to Natura, said Zamberlan. The company has participated in Sustainable Business Lab (S-Lab) and Leading Sustainable Systems Lab (L-Lab) courses. When Zamberlan presented the palm oil challenge to an L-Lab class, half the students volunteered to help develop a business plan.
When the four students chosen to work on the plan met the company's supplier communities in the Amazon, “they were just blown away by what they saw," said Zamberlan. The students' agroforestry plan combined micro scale palm oil plantations with other fruit crops for additional revenue. The plan also called for the growing communities to produce the oil, cutting out the middleman.
Natura will continue to participate in S-Lab and L-Lab, said Zamberlan. "We have a very good understanding of the timing and the scope of the challenge for the students," he said. "Now that we have that, we can get more value out of [S-Lab and L-Lab], both for the company and the students."