Market Overview

Could A Ban On Microbeads Overhaul The Cosmetics Industry?

Related UN
Wall Street's M&A Chatter From November 27: Time, Barracuda, Unilever, Jumei
Wall Street's M&A Chatter From Nov. 21: PepsiCo, Kraft-Heinz Foods, H&E Equipment Centers, AT&T
Road To Financial Independence: My December 88-Stock Portfolio Review (Seeking Alpha)
Related PG
The 'Bomb Cyclone' Portfolio: Winners And Losers
Consumer Staples ETFs Leave Investors Hungry In 2017
Procter & Gamble shakes off Goldman bear call (Seeking Alpha)

Cosmetics companies could see US legislation overhaul their product lines over the next few years as consumers begin to pay more attention to their effect on the environment.

Though many companies have begun to introduce “green” cosmetics lines, a push to outlaw microbeads could result in major changes to the beauty industry.

Microbeads, small plastic cylinders found in exfoliating scrubs, are set to be banned in Illinois beginning in 2015 due to their negative impact on the state's aquatic ecosystems. The beads can be harmful to marine life as they are small enough to pass through water treatment systems and later ingested by fish and birds.

Illinois is the first state to make the sale of such products illegal, but many see the ban widening to other states in the coming months. New York, California and Ohio have already begun to draw up legislation supporting a state-wide ban.

Companies like L'Oreal SA and Unilever N.V. (NYSE: UN) have already promised to completely remove the plastic beads from their product lines by 2015 in an effort to satisfy consumers' demand for social responsibility.

International campaigns like "Beat the Microbead," for example, have been encouraging consumers to stop purchasing products that contain the beads, causing many big-name companies to take note.

Procter & Gamble (NYSE: PG) has also vowed to become microbead free, though not until 2017.

If other states start banning the beads in the coming year, though, most expect to see big cosmetics chains picking up the pace on phasing out products that include the tiny plastic balls.

Posted-In: L'Oreal SAShort Ideas Trading Ideas


Related Articles (PG + UN)

View Comments and Join the Discussion!