News 2017 / April

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Toxic secrets stand in the way of effective chemicals management

CBI confidential business information for chemicals

It’s almost ironic how three simple characters can be so frustrating sometimes. CBI, or Confidential Business Information, is sometimes referred to when a chemical manufacturer does not want to disclose the ingredients in its formulas.

In theory it makes sense, since companies that have spent a lot of money on developing new chemicals, new materials and new products don’t want to give away the blueprint so competitors can just copy it without any effort of their own.

In practice, however, it is very often used to hide unwanted ingredients in products, which leaves clients and customers in the dark about the inherent risks of their products.

Toxic secrets are a major obstruction in the struggle to design better and safer products. Not only do they dilute the right to know principle – consumers can’t get answers on whether a cuddly toy has been treated with flame retardants even if they wanted to – but it also seriously slows down progressive companies who want to increase transparency and get out of the business of producing toxic products.

“Toxic secrets are a major obstruction in the struggle to design better and safer products.”

In my opinion no single company should be allowed to withhold ingredients when it comes to SVHCs (substances of very high concern). Fortunately there are strategies out there to understand the chemistry of products and at the same time protect intellectual properties.

A recent example is from the home and personal care product sector, where many companies are currently fighting for a better understanding of fragrance composition. So far the fragrance industry has been very protective and unwilling to disclose its formulas, and to further complicate things fragrances are quite complex.

A fragrance can be built up of 200 or more single chemicals, and only a portion of them might be of concern. Musks, for example, are well known for their hazardous properties, and phthalates are also regularly found in perfumes. These chemicals make the alcohol used in perfumes non-swallowable and therefore alcohol taxes and abuses are avoided.

But both Unilever and SC Johnson have worked out a way around the secret scents.

SC Johnson has screened the list of all the 3000 ingredients available for fragrances and come to the conclusion that it uses 1500 of them in its own products. And since 2015 SC Johnson has started to disclose fragrance ingredients in their products, with the aim of listing them for all their products down to 0.09% of the product formula. SC Johnson negotiated with their suppliers for the right to disclose most of the chemicals, “with just a bit held back for confidentiality”.

Unilever has also been working on product transparency and recently published its goals (which go even further than SC Johnson’s): Fragrance ingredients will be disclosed down to 0.01% of the product formulation, together with additional information about the function of the chemicals, or in plain language, why the chemical is needed. All fragrance ingredients should be disclosed for all products by 2018, according to Unilever.

The way these two companies go about this is that they withhold a small percentage of the fragrance content and they disclose only the chemical name, but not the weight or amount. In this way the proprietary information can be protected.

The driving force for the industry is the increasing desire from consumers for more transparency. Behind that desire could be growing knowledge about chemicals and an increasing need to avoid health effects, such as allergies. And this desire is not only found within well-informed consumer groups. In California, legislators are currently discussing the cleaning product right to know act SB-258, which will force companies to provide a full and complete list of chemicals in their cleaning products.

One sector that has overcome the challenge of secret ingredients without a legislative “stick” at its back is the automotive industry. The international materials data system IMDS was created back in June 2000 to help suppliers cope with different corporate restricted substance lists.

In 2004, the Global Automotive Declarable Substance List GADSL was established – a list of prohibited and declarable substances – in which all suppliers worldwide enter the ingredients of their components. To protect intellectual property suppliers are allowed to use a “joker”, which enables them to hide chemicals behind a general description. The joker can be used if the substance is not listed as prohibited and declarable and the total of all undeclared substances is at a maximum of 10%.

The driver behind this development was the need to comply with future, evolving legislation, which is maybe not known at the time of product design. The threat of product recalls or changing parts in running model programmes makes it logical for the industry to cooperate. Because there are only around 50 car manufacturers globally, the cooperation of a few, mainly European brands (Audi, BMW, Daimler, Ford, Opel, Porsche, VW and Volvo) quickly grew into a global cooperation with the power to dictate the requirements for disclosure to the suppliers.

It is certainly much easier to create transparency with the backing of market power, but there are companies who are able to do it on their own. Seagate, the producer of hard discs and other data storage solutions, requires a full material declaration from its suppliers, for example.

I admire them for their achievements. But transparency must spread further. We need to know which ingredients are used, in order to make better choices – and to get rid of hazardous substances in our daily products. I hope more companies are encouraged by some of the frontrunners I mentioned above and find ways together with their suppliers to disclose their ingredients – for safer products, for our health and for our environment.

 

Sonja Haider
Sonja Haider
Senior Business and Investors Advisor, ChemSec