Annual Report 2011 The Cosmetic Toiletry & Perfumery Association Annual Report for the year ended 2011 Photograph courtesy of John Frieda® - Kao Corporation Contents 01 page 1 CTPA Board of Directors 08 page 23 Cosmetic Industry in Figures 02 page 3 Chairman’s Report 09 page 29 CTPA Members 03 page 4 Executive Summary 10 page 31 CTPA Committees 04 page 5 Review of the Year 11 page 33 CTPA and Members’ Representatives to Cosmetics Europe (formerly Colipa) 05 page 13 CTPA Events 12 page 35 Directors’ Report & Financial Statements 06 page 17 CTPA Working with the Media, Educators and Consumers 13 page 43 CTPA Who’s Who 07 page 19 Science, Innovation and the Cosmetics Industry 14 page 44 CTPA Membership - What can we do for you? CTPA Board of Directors At the end of the year under review, the CTPA Board of Directors comprised: Lady Jay (Sylvia) CBE Chairman, CTPA – Chairman, L’Oréal (UK) Anke Menkhorst President, Kao (UK) Dr Gerald (Ged) O’Shea Vice-chairman, CTPA – Head of Beauty Brands Development, Alliance Boots Ann Murray Managing Director (UK), PZ Cussons (UK) – Beauty Division Anand Rangaswamy Vice-chairman, CTPA – Managing Director, Keyline Brands Per Neuman Managing Director, Estée Lauder Companies Massimiliano (Max) Costantini Chief Executive Officer, Mibelle Iain Potter Vice President Marketing HPC UK & Ireland, Unilever UK & Ireland Kathryn Davies Associate Director, Procter & Gamble UK Brian Riddick General Manager, Coty Beauty Susan Egstrand Category, Insight & Marketing Director Oral Care, GlaxoSmithKline Consumer Healthcare Scott Sherwood Vice President & General Manager (UK/Ireland), Colgate-Palmolive (UK) Lisa Garley-Evans Vice President & Counsel EMEA Regional Legal & Regulatory Affairs, Avon Cosmetics Brian Walmsley Marketing Director – Skincare, Johnson & Johnson Martin Hamilton Legal Director/Company Secretary, Chanel Barratt West General Manager UK & Ireland, Elizabeth Arden (UK) Ian Mackinnon Chief Executive Officer, Swallowfield plc John Harold Honorary Treasurer Joyce Traylen Secretary, CTPA 1. Mark Wood Senior Vice-President & Managing Director, EMEA, Revlon International Corporation Appointments to the Board since 1 January 2012 Resignations from the Board during 2011 Resignations from the Board since 1 January 2012 Chris Good Managing Director, Estée Lauder Companies Elaine Birchall Managing Director, PZ Cussons (UK) Ann Murray Managing Director (UK), PZ Cussons (UK) – Beauty Division Blake Hughes General Manager UK & Ireland, Elizabeth Arden New York John R E Harold Treasurer, CTPA - Managing Director, Combe International Per Neuman Managing Director, Estée Lauder Companies Eric Brockhus Vice-President, General Manager, Kao Brands Europe Brian Walmsley Marketing Director – Skincare, Johnson & Johnson Matthew (Matt) Close Vice-chairman, CTPA Vice President Marketing HPC, Unilever UK Barratt West General Manager UK & Ireland, Elizabeth Arden (UK) Andrew McCarthy General Counsel UK & Ireland, Procter & Gamble UK Fergal McGarry Managing Director, Johnson & Johnson Carol-Ann Stewart Marketing Director Oral Care, GlaxoSmithKline Consumer Healthcare Solicitors Norton Rose LLP Auditors Crowe Clark Whitehill LLP Bankers Barclays Bank Plc 2. Chairman’s Report Lady Jay (Sylvia) CBE on 2011 During 2011 we expected the European Commission to bring forward a legislative proposal on the marketing ban relating to animal testing, due to come into force in 2013. As you will see elsewhere in this report, CTPA has been fully involved with Cosmetics Europe’s discussions about the options with the European Commission and other stakeholders, including animal welfare groups. One task fell specifically to CTPA: a series of one-to-one meetings with UK members of the European Parliament, to ensure they had full background briefing on the issue, including a clear presentation of industry concerns and wishes and an offer to provide future help as the negotiations continue. Andrew McCarthy retired as Chairman of the CTPA in June and I must begin by thanking him for his strategic thinking and guidance as the Association negotiated the uncertain terrain underpinning the advertising of our products and their benefits. His knowledge and contacts assisted the Secretariat greatly and helped the Association show our industry to be responsible advertisers, in the face of widespread criticism of advertising generally and especially concerning the use of body images. That issue continues to be controversial and, as can be seen from the separate section on body image, has been taken up at European level by our umbrella organisation Cosmetics Europe, through its Strategic Project Team on Responsible Self-Regulation, of which our Director-General,Dr Chris Flower, is Vice-chairman. It is in such areas that CTPA makes a great difference for members, covering issues on behalf of the industry as a whole that would be difficult or inappropriate for individual members, or small groups of members, to tackle. Throughout the year, CTPA held a series of meetings with the UK competent authority for cosmetics legislation, the Department for Business, Innovation and Skills (BIS), to ensure officials knew our industry’s positions prior to meetings of member states with the European Commission. Similar meetings were held with other government departments on issues where cosmetics might become involved, usually as an unintended consequence. These meetings were invariably constructive because of the strong working relationships established between CTPA and the officials concerned. In one area, however, a noticeable gap has arisen. The dissolution of LACORS, the Local Authorities’ Co-ordinators of Regulatory Services, left us with no single point of contact when trying to ensure consistent interpretation and enforcement across Trading Standards. Fortunately, during the year, CTPA identified a specific Trading Standards Officer (TSO) who may well become the lead for all of Trading Standards on cosmetics and may even provide an opening into the Trading Standards Institute, which provides training for TSOs. 3. These are just a few examples of how CTPA works in the UK and at European level to improve the environment in which members compete and to protect members’ licence to operate. 2011 has been a busy year but the Association has coped admirably and in a highly cost effective way. It has shown itself fully conscious of the need to provide value for money in the current difficult economic climate and, as well as ensuring efficient management of costs, has agreed with the Board ways of increasing income, whilst remaining true to its mission. For the first time in over twenty years, therefore, the fees’ structure has been revised to reduce the impact of amalgamations and take-overs on total subscriptions. In addition, Associate Membership has been opened to retailers who market various brands. These two measures should broaden and deepen our membership base and also ensure that the Association remains on a sound financial footing. I shall end by expressing my sincere thanks to all members of the Board for their support during my first year as Chairman, and especially to the Vice-chairmen and to our long-standing Treasurer, John Harold. Particular thanks also go to the Secretariat for their great work on behalf of our industry, covering the breadth and depth of the many issues confronting us, to an admirably high standard. Executive Summary View from Dr Chris Flower, CTPA Director-General 2011 saw several key issues remain with us as work continued on developing specific guidance for members on the new EC Cosmetics Regulation. This involved in particular the database developed by the European Commission that will form the central notification portal for all cosmetic products marketed in Europe and where right of access and confidentiality of information were important issues. Other aspects covered the revised format for the cosmetic product safety report and the need for notification of nanomaterials. However, a major issue throughout the year was managing the implementation of the testing and marketing bans due to come into effect in 2013. The European Commission, under the Cosmetics Directive, had to assess the scientific progress towards the development of alternatives to animal testing and, if insufficient to enable animal testing to be replaced, to make a legislative proposal during 2011. The proposal required an assessment of the impact of the ban on costs to industry. Providing industry’s input was a priority during 2011; it demonstrated the potential for significant adverse effects on the innovative capacity of the European cosmetics industry and its competitive advantage in a global market. Owing to the complexity of this issue, the European Commission was unable to come forward with a legislative proposal during 2011. Animal testing is but one area where CTPA has worked hard to ensure clear information is readily available to ensure misunderstandings are corrected. It is important to know unequivocally that the testing on animals of cosmetic products has long been prohibited under European law. The remaining discussions are largely around the technicalities, such as managing apparent conflicts with other legislation where animal-testing of chemicals may still be necessary. Communications planning has also been actively invoked in correcting the continued misinformation regarding so-called dangerous ingredients. Here we have seen fewer concerns of late and greater appreciation of the facts. But we must not rest on our laurels, because there are always people seeking ever more remote risks with which to challenge us. In issues such as the use of animals in safety testing, the innovative use of nanomaterials and the question of risk to health from various chemicals we use as ingredients or which might be found as traces in products, the cosmetics industry may not have been the major player but was certainly at the forefront of explaining its position clearly and pro-actively throughout the year. 2011 saw the emergence of a new question where again the cosmetics industry may find itself needing to be very clear in its position as a responsible player – that of body confidence. The problem of low self-esteem is a complex social one where many factors interact: the simplistic view that seeing glamorous images leads to eating disorders is almost certainly incorrect. However, as a responsible industry, we must become involved in the debate, to dissect its many factors and ensure we are not, however inadvertently, contributing to an avoidable problem. But this is a long-term objective and it must not be highjacked to provide an illusionary quick win that ultimately betrays the very people in need of help. Once again, I would like to thank the members for their continued support throughout 2011 and particularly those individuals who contribute through participation in the many committees, working groups and task forces both here and in Brussels. Without that support, CTPA and the Secretariat could not continue to be the authoritative public voice of a vibrant and responsible UK industry, trusted to act for the consumer. Executive Comment The CTPA has worked with members through the year on issues that are key to understanding the way consumers engage with their brands. Trust in the science behind cosmetics and understanding the industry’s communications is not a given and a responsible industry must ensure that it responds to the needs of its consumers and the view of the regulators. With products that range from daily essentials to those that impart a sense of well-being, it is incumbent on our industry to deliver only safe, effective and sustainable products. Dr Ged O’Shea Anand Rangaswamy John Harold 4. Review of the Year Self-esteem and Responsible Advertising In addition to its regulatory and technical roles, including representing our industry’s views to government and opinion formers, the CTPA has an active communications programme. Starting from the position that there was no accepted central source of information about the cosmetics industry for the general public and media, the CTPA Board set us the ambition to be “the authoritative public voice of a vibrant and responsible industry”. The Board had recognised that, in order to address the collective challenges facing us, such a public voice was essential. After running a structured programme over several years, we are in a position where we have constructive relations with journalists, the wider media, other representative industry organisations and health and charitable bodies, and have a public website full of useful information about our industry and its products. We have built a reputation for giving honest and accurate comment on current issues and are not afraid to get involved in matters that affect our industry’s reputation. Recognising the success to date, the CTPA Board added the additional challenge of being ‘trusted’, applying to both CTPA and the industry itself. In 2010 we had identified the relatively high volume of debate about the impact that the industry’s advertising and marketing techniques were having on people’s self-esteem and body confidence. To address this in 2011, a dedicated strand of activity sought to improve understanding of how the cosmetics industry is perceived within the Body Confidence debate and to promote the positive contribution of its products to self-esteem. 5. One of CTPA’s media panels, Does Beauty Matter?, was used to better understand the media’s (and therefore consumers’) perceptions of the broader body confidence debate and the cosmetic industry’s role within it. Lucy Beresford, a writer, UKCP registered psychotherapist and media commentator who writes about human psychology and mental health and Dr Alex Clarke, the head of the psychology department within the Royal Free Hospital Department of Plastic and Reconstructive Surgery, provided an interesting and credible catalyst to debate. Zoe Williams, the third speaker, provided a moving personal perspective on the importance of body confidence on self-esteem, having experienced the benefits of the Look Good, Feel Better programme while undergoing cancer treatment several years previously. The insights from the event informed the tone and content of the CTPA’s communications approach for the future. In May, CTPA Chairman Andrew McCarthy and CTPA Director-General Chris Flower met Lynne Featherstone, Government Minister for Equality, to discuss the impact of the industry on self-esteem. The meeting was resoundingly positive and the CTPA is now represented at the Minister’s Roundtable on the issue. This is providing a useful insight into the panel’s current thinking and the cosmetics industry’s participation is being viewed positively by the panel. June saw the publication of The Bailey Report into the Commercialisation and Sexualisation of Childhood. The Advertising Standards Authority (ASA) responded with guidance to tighten up the use of sexually-suggestive images in outdoor advertising close to churches and schools. Although our industry does need to be careful about some of its imagery and where it is used, this is not really a problem for our sector. In December, the advertising industry’s research arm, Credos, issued its report into the extent of any problems with the body image/confidence of young women, the part played by advertising and potential solutions. Again, this did not see the cosmetics industry as a major part of the problem. Rather, our industry is viewed widely as not underestimating the level of concern about these matters but is actively engaged with those expressing concern. The cosmetics industry wants to be a partner in understanding this very complex social problem, doing what is appropriate to help provide solutions based on facts and data. Earlier in the year, CTPA had been developing guidance on the ‘Use of production techniques in cosmetic advertising’ with the support of the ASA and its Committees on Advertising Practice (CAP & BCAP). The use of air-brushing has caused a problem in cosmetics advertising, with some confusion about what was allowed and what would be considered misleading. The guidance sought to address this without stifling innovation in cosmetics advertising. CAP & BCAP formally adopted and published this guidance in April 2011. Media Smart is an initiative that aims to encourage an informed approach to understanding advertising images from a young age. It does this by providing materials and lesson plans for teachers in primary schools. CTPA co-funded Media Smart’s new module on Body Confidence and provided expert advice on content. Launched in October, CTPA is monitoring feedback. In relation to her campaign on air-brushing, the CTPA also invited Jo Swinson MP to contribute an article to a special edition of the CTPA members’ newsletter on the topic of body confidence. We secured additional contributions from ASA, Credos, the Institute for Public Policy Research, Lucy Beresford, a key speaker at our media panel and Lynne Featherstone. Following publication, feedback from the contributors has been overwhelmingly positive, with many describing it as a real step-change in CTPA’s communications. To ensure that there was senior level co-ordination amongst members and the CTPA with regards to strategy on responsible advertising practices, we set up our own Responsible Advertising Working Group. Its first meeting was held in September. 6. 04. Review of the Year Sustainability Matters International Regulation CTPA’s own public and media-facing website, www.thefactsabout.co.uk, has lots of content written in plain language that is relevant to the body confidence debate. As part of the updated look and style of the website, the opportunity was taken to create three new sections on Beauty Matters, Safety Matters and Sustainability Matters. Additional content relevant to the current debates on body confidence has been taken from the CTPA’s educational programme Catie www.catie.org.uk and included in Beauty Matters, which deals with perception of beauty and the positive impact of appearance on self-esteem and self-worth. CTPA remains actively involved in cosmetics industry working groups looking at new regulations being developed for cosmetic products in India, Israel and Korea. The aim is to ensure that new legislation complements the new European Cosmetics Regulation as far as practicable. The European Union Chamber of Commerce (EUCCK) organised a seminar on 30 November in Seoul on the impact on the cosmetics industry of the new Free Trade Agreement (FTA) between EU and Korea. Most EU cosmetics exported to Korea currently face a duty of 8% (the EU has 0% duty on cosmetic imports). The FTA should entirely eliminate these duties over a maximum time of 5 years. During the Seminar, presentations were made by various stakeholders including the EU delegation, the French cosmetics association (FEBEA), the Korean Food & Drug Administration (KFDA), the EUCCK and Korean cosmetic companies. Olivia Santoni from CTPA presented the UK cosmetics market and explained how the Cosmetics Directive is implemented here. It was a very successful event, well attended by Korean companies and European stakeholders. A totally new section on Sustainability Matters has been written for two reasons: CTPA member companies have active programmes on sustainability and government, investors and the general public want to know that our industry takes sustainability seriously; and secondly, many journalists writing about the beauty industry had intimated that they do not understand what sustainability means and they needed a ready-reference to explain the issues in a straightforward way. The traffic to the CTPA's consumer website continues to grow strongly, underlining the success of this part of our communications strategy. Regulatory Issues In spite of all the good intentions about ‘better regulation’ from the UK Government and the European Commission, the cosmetics industry continues to be affected by a host of regulatory initiatives or extensions to existing regulation. Olivia Santoni, CTPA, speaking in Seoul International Information Day On Tuesday 6 December CTPA held an International Information Day attended by 83 delegates including members, guests and speakers. Attendees had the opportunity of hearing about the different legislative requirements in a number of regions including the US and Canada, Asia, the Middle East and South America from speakers with expert knowledge and experience of those areas. Read more about the event in CTPA Events (Section 5). 7. 2011sawachangeforourInformation Officers.Inrecognitionofthewaysthat ourInformationOfficershaveadvanced theirrolesandmanageissuesso effectively,aswellasdevelopingand runningthehugelysuccessfullyCosmetics Basicsseminars,itwasappropriatetohave acollectivechangeinjobtitlestobetter reflecttheirresponsibilities. ThereforeAmandaIsom,LindsayHolden andOliviaSantoniarenowour TechnicalAffairsManager,Scientific AffairsManagerandRegulatoryAffairs Managerrespectively. 8. 04. Review of the Year Ingredient Defence Without ingredients there would be no cosmetic products. As an industry we are able to respond to the growing needs of consumers for more innovative and high performance products due, in the main, to a wide potential palette of available cosmetic ingredients. However, this pool of ingredients is constantly being challenged. We also need to recognise that ingredients are generally defended by the efforts of the largest companies in our industry because of the cost, time, effort and technical expertise required. Owing to competition law, national trade associations can only be involved if the ingredients in question are used widely by Members. Small companies may not be able to afford to defend ingredients they might be using if they become subject to official review and often the ingredients that give them a point of difference can be lost, not because they are unsafe but because they are not defended. So it is more important than ever that specific ingredients are only put up for official review if there are solid scientific concerns about their safety. A number of ingredients received attention in 2011, some of which have been under the spotlight for many years. 9. Parabens Ingredients activity in France 2011 was an important year for the parabens, a family of preservatives that most in our industry believe to be safe and effective. The publication of the draft SCCS opinion in December 2010 has been followed by a year of discussion over how this opinion will be implemented into cosmetics legislation. Not only were a number of regulatory proposals discussed at the European Commission’s Working Group on Cosmetics meetings over the course of the year, the SCCS was also mandated to provide clarification regarding the use of parabens in products for children. This was, in part, to address actions by the Danish Authorities to ban propyl and butyl parabens in cosmetic products for children under three. Discussions will continue into 2012 although, based on the positive SCCS opinions that support the safety of these ingredients, we hope that a satisfactory resolution will be arrived at soon. The French Agency, Afssaps, has been very active in 2011 performing its own risk assessments for a number of cosmetic ingredients. As an outcome of this activity, we have seen reports released on benzophenone-3, aluminium and nano-form titanium dioxide and zinc oxide, as well as a decision to ban 3-benzylidene camphor in cosmetic products in France. We know that many other ingredients are also receiving attention. We understand that it is the intention of the French Agency to share its reports or assessments with the European Commission. It remains to be seen how these reports will be received and if any will prompt an SCCS evaluation. Industry continues to monitor the situation and act where appropriate. Nanomaterials D4/D5 The two cyclic siloxanes, D4 and D5, have received much attention in 2011, both from a human health and environmental perspective. For human health, since the publication of the SCCS opinion in July 2010 concluding the safety of D4 and D5 under current practices of use, discussions have been focussed on the regulation of these materials under cosmetics legislation. During the EC Working Group meeting in November, in light of concerns from industry, it was agreed that industry would provide updated usage information for D4. A further industry dossier would also be prepared for the SCCS evaluation of D5 in its own right. Both D4 and D5 are also receiving attention under REACH, the culmination of a seven-year-long review of these ingredients in the UK. It is up to the UK Competent Authority to propose environmental risk management measures for each of these substances. CTPA has been involved in representing the European industry position to the various UK Government Departments involved in the process (HSE, Defra, BIS). News of the nature of the UK proposal is expected in mid 2012. Following a prolonged period of consultation and discussion, October 2011 saw the adoption of the European Commission’s Recommendation on the Definition of Nanomaterials. The Recommendation provides a broad regulatory definition that affects all industry sectors within the EU. However, its recitals do allow for the narrowing of the scope under specific sector legislation. It is the industry position that both the Recommendation and the definition in the Cosmetics Regulation can co-exist. The Commission has also indicated that the criteria in the Regulation definition are useful in narrowing its scope to those materials that may be of concern. However, the possibility is foreseen that criteria based on a size or a weight distribution cut-off could eventually be introduced into the definition in the Cosmetics Regulation. The Commission has so far provided no interpretation of the Cosmetics Regulation definition criteria. Mindful of the 2013 deadlines for compliance with the Cosmetics Regulation’s requirements for nanomaterials (labelling and notification), our European association, Cosmetics Europe, has released the industry interpretation of the definition to its Members as guidance. Companies are now committing resources to meet the requirements of the regulation but based on our own industry’s interpretation of the official definition of a nanomaterial. Tooth whitening After more than 10 years of discussion, the European Council adopted a directive in September 2011 that allowed tooth whitening products with higher levels of hydrogen peroxide. Although this type of product has been available overseas for many years, and there have been a number of safety reviews, the Member States of the EU could never agree on the controls necessary to introduce these products to the EU market. Consequently, the normal legal process of European Commission and working groups, made up of officials from all EU countries, agreeing a regulatory proposal has been overridden in this case. Although this mechanism is rarely used, perhaps even more unusual is that, for the first time, the way a cosmetic product is sold has been regulated; these tooth-whitening toothpastes can only be made available to consumers after a consultation with a dentist. 10. 04. Review of the Year Chemicals Regulations Cosmetics Regulation There are many regulations that affect the manufacture and use of chemicals, including cosmetic ingredients. Implementation of the REACH regulation will continue for several more years. Large tonnage chemicals had to be registered by 1 December 2010 if they were to remain on the market; medium volume chemicals must be registered by mid-2013. As users of chemicals, we are primarily concerned with the loss of ingredients if manufacturers fail to register in time and how to deal with the mass of new information on how to manage and use ingredients following successful registration. Importers of finished cosmetic products also have registration obligations for ingredients used in those products. The implementation of the new EU Cosmetics Regulation is obviously of prime importance to our sector. Although the main premise to only place safe cosmetic products on the market remains, there are many changes that will impact companies and providing clear interpretation to members to ensure compliance with the July 2013 implementation date has been key to CTPA. As well as developing common interpretation for its members Cosmetics Europe is working with the European Commission to develop guidance to complement the new regulation in 4 major areas: notification, claims, the new Annex I and the reporting of Serious Undesirable Effects (SUEs). CTPA staff have been actively involved with the working groups at our European association. CTPA is represented on the committees discussing notification, claims, safety assessment, nanomaterials, Product Information File and the reporting of SUEs. This means CTPA has been able to feed industry views directly into the discussions and conversely the opinions of Member States and the Commission can be reported back to members. CTPA was also able to seek the advice of its relevant committees on critical questions – which has been invaluable in the whole process of developing clear, meaningful and workable guidelines on this major change in legislation. CTPA was also drawn into the development of the new EU regulation on biocides. Under the existing Biocidal Products Directive, cosmetic products are completely excluded fromits scope. Many cosmetic ingredients, such as preservatives or surfactants, do affect bacteria, moulds and fungi but their safety is fully assessed under the cosmetics legislation. Because of the intention of the new Biocidal Products Regulation to cover anything with a biocidal effect, we found our cosmetic products could be subject to both sets of regulations. However, the UK’s Department of Business, Innovation and Skills (BIS, responsible for cosmetics regulation) and the Health & Safety Executive (HSE, competent authority for biocides) were very supportive and helpful in negotiating a satisfactory outcome, with Cosmetics Europe also making the case to the relevant European Commission directorates. A review of the scope of the directive controlling the emissions of volatile organic compounds (VOCs) from products also looked at cosmetic products with the intention of reducing the use of solvents. Ethanol is the second most common solvent used in cosmetic products after water, for example. After our industry contributed information on costs that would be incurred and the financial impacts for reformulation and loss of specific product types, the European Commission eventually decided that the relatively small reduction in VOCs would come at too high a cost, especially when it is already successfully meeting its overall targets for VOC reductions. Guidance issued so far includes: • Roles and Responsibilities (of manufacturers, responsible persons, distributors) • Cosmetic Product Labelling • Product Information File • Notification System for all products placed on the EU market The documents are available to members in the members' intranet. Work continues on product claims, the new Cosmetic Products Safety Report, the reporting of SUEs and the new requirements for nanomaterials, including how to define nanomaterials used in cosmetic products. CTPA will be running its final seminar about the new regulation in the first quarter of 2012. It will also be important to roll this guidance out to the competent authorities responsible for enforcing the new Regulation. 11. Photograph courtesy of Paul Cox/Harper Collins News from Europe Dear Colleagues, It is with great pleasure that I meet CTPA’s request to share some ‘Brussels perspectives’ observations for the CTPA Annual Report. Our industry is faced with ever increasing challenges every day, requiring a pro-active strategy that focuses on our licence to operate and on enhancing and preserving trust and confidence from consumers and stakeholders. The value of our industry’s contributions to society is often underestimated. The values of well-being, self-esteem and self-confidence, the sheer joy and fulfilment that beauty gives, are important assets in every citizen’s life. Although the ‘European consumer’ does not exist, there is a general recognition across Europe that we have to do more to explain these values, to talk about our contributions. The personal care industry must demonstrate that it cares, and it has to strengthen its outreach to all stakeholders: consumers, citizens and decision-makers alike. That is why the European cosmetics association Colipa, in its 50th year of existence, has chosen to rejuvenate and clarify its identity. Our name has become unambiguous: Cosmetics Europe – the Personal Care Association. We have widened the ‘traditional agenda’ to new horizons, we strengthen our communication and public affairs, we deepen our involvement in sustainable development. In today’s world our industry’s licence to operate is not any longer exclusively defined by technical and regulatory issues: we are expected to show that we care for society in all its aspects. We build on our past, to serve for the future. This drives our strategies, our operations, our collaboration with members and stakeholders, in Europe and across the globe. And we do this – as always – in intense collaboration with CTPA, proud to be able to work with such enthusiastic, knowledgeable and committed colleagues! Bertil Heerink Director-General 12. CTPA Events Cosmetic Basics Workshops 2011 Owing to the success of the CTPA Cosmetic Basics Workshops in 2010, a further series of workshops was held throughout 2011 with more than 70 delegates attending the 5 sessions. Attendees were provided with a basic understanding of the Cosmetics Directive’s requirements and benefited from the latest CTPA advice and recommended best practice through a Q&A session with the three CTPA Affairs Managers (Regulatory, Scientific, Technical). Mainly dedicated to SMEs, new members and regulatory staff or personnel new to the cosmetics industry, the sessions were attended by a good mix of companies such as manufacturers, brand owners, contract manufacturers and retailers. “Excellent update on cosmetic legislation – very professional slides and presentations. A very worthwhile course” These events are also seen as an opportunity for attendees to have direct contact with CTPA, to meet their counterparts and exchange views on regulatory issues. “As a newcomer to the cosmetic industry I found this event very informative and it clarified many areas” CTPA Affairs Managers Dr Lindsay Holden Scientific Olivia Santoni Regulatory “Really excellent, very helpful, packed with useful information. The take-away pack is really good quality. I am very glad to have had the opportunity to come and recommend it highly” 13. Amanda Isom Technical Supporting Cosmetic Science BSc (Hons) Cosmetic Science Course The CTPA has continued to support the Cosmetic Science Degree Course at the London College of Fashion, University of the Arts London, since its inception over 10 years ago. Providing financial course support for materials and external activities as well as competitive bursaries for the students in years 1 and 2 of the course, the CTPA also recognises excellence amongst the third year students with CTPA awards for the best project and best presentation of their industry placement. In 2011, three students shared these prizes and went on to deliver their presentations to an evening lecture organised by the Society of Cosmetic Scientists. Philippa Harmann, Kristin Katakami and Susan Shehab Eldine The placements are seen as an essential part of this 4-year sandwich course, giving the students a real understanding of the exciting careers they can take up on graduation. Additionally, a 2011 graduate from the BSc (Hons) Cosmetic Science, Sophie Ludwig, won the third prize at the international competition organised by SEPAWA (Soap, Perfume and Detergent Experts Association based in Germany). She won the prize with her final project, entitled: “An ex vivo comparative study of the tensile strengthening efficacy of protein-derived actives in the management of heavily chemically bleached hair”, in the category 'Outstanding Graduate from a University of Applied Science'. Sophie received a prize of 500 Euros and travel and accommodation costs to attend the awards ceremony in October in Germany. As a past recipient of a CTPA bursary on the Cosmetic Science Course, we are delighted Sophie was recognised in this way. Sophie Ludwig A New Future – MSc Cosmetic Science An integrated MSc Cosmetic Science course has now been introduced replacing the BSc Cosmetic Science. This unique applied science course focuses on the needs of the cosmetics industry and its consumers. Situated in the School of Management and Science it is an integrated MSc, with a BSc exit point, and an optional placement year in industry in the third year of the course. The post-graduate part of the MSc also presents a unique opportunity for students on the Society of Cosmetic Scientists (SCS) Distance Learning Course. Those students finishing the SCS Diploma with merit or distinction will be eligible to join the MSc course in January of its penultimate year. Students will study a range of sciences, both pure and applied, formulation development and industry operations, designed to give a broad range of career opportunities. Students completing a placement year between the second and third year of the course will gain an additional qualification, the Diploma in Professional Studies, with the opportunity to make contacts and build relationships within the industry before the end of their studies. Graduates from the BSc course are already employed throughout the industry, both in the UK and internationally, in a wide range of roles. These include research and development, product manufacturing, marketing, technical sales, product testing, quality assurance, logistics, regulation and legislation departments. Some multinational companies also recruit directly from the course. CTPA has provided support for the development of the MSc from the successful BSc, in response to industry demand for graduates with a high level of scientific and technical knowledge coupled with business awareness. The course offers immediate relevance to the industry, with graduates who will already have an understanding of the way the industry operates and the challenges it faces. CTPA will continue to provide awards for the best students in each year of study. www.fashion.arts.ac.uk/courses/integrated-masters 14. 05. CTPA Events “A well organised and executed event, a lot of information to get in one day” “I found the seminar excellent it was a very informative day” CTPA International Information Day The CTPA International Information Day, held on 6 December 2011, was attended by 83 delegates including members, guests and speakers. The event was chaired by Dr Emma Meredith, CTPA, and attendees had the opportunity of hearing about the different legislative requirements in a variety of regions from speakers with expert knowledge and experience of those areas: • • • • • • • USA / Canada “Initiatives are being developed by different stakeholders which may have an impact on the cosmetics industry” China, Japan, ASEAN, Korea, India USA and Canada Israel and Dubai South America Australia South Africa UK Government Export Services The marketing of cosmetic products beyond Europe is becoming increasingly important for CTPA members. Knowing if these new markets require pre-registration or follow a European Directive style of legislation is the first step in a long and often difficult path to getting products onto the shelves in other economic areas. 15. Dr Emma Meredith CTPA Chair Yuri Endo Malamant Shiseido Japan Ana Ost L’Oréal ASEAN Debra Redbourn DR Cosreg South Africa & Dubai Tricia Francis UK Trade & Investment Export Services Emmanuel Capiomont L’Oréal ASEAN Sue Wemyss Estée Lauder Israel Tina Flaherty Kimberly Clark USA, Canada & South America Tiphaine Daubert-Macia Chanel China Olivia Santoni CTPA Australia, India & Korea South America “Mexico, Brazil, Argentina, Colombia, Chile and Venezuela are considered to be the most regulated markets of South America” “It was a great opportunity to share difficulties we are facing in some countries and realise that we were not the only one struggling!” China “The new Chinese regulatory regime for cosmetics is impacting the EU cosmetic industry and companies are facing a lot of difficulties to market products with ‘new ingredients’” Dubai “EU Compliant products (Formula and labelling) are generally acceptable as long as they have been registered with the Dubai Municipality” Japan “The Japanese regulatory system for cosmetics and quasi drugs is very specific” Israel “The Israeli Ministry of Health is willing to adopt the EU Cosmetics Regulation and published a draft bill on this issue in 2010” ASEAN “ASEAN adopted the Asean Cosmetic Directive (ACD) based on the EU Cosmetic Directive in 2009 but harmonisation is unfortunately going backwards in some cases, noticeably in Vietnam and Indonesia” Korea “The new Korean Cosmetic Act will be a big challenge for EU companies, in particular regarding the new GMP and Claims requirements” India “A new system of registration should be coming into force in April 2012” South Africa “Products should comply with the CTFA South Africa Cosmetic Compendium developed by the Industry, Government and SABS (South African Bureau of Standards) which includes Codes of Practice, Standards and Annexes of ingredients” Australia 83 “Members should be aware of the difference of process between cosmetics and therapeutic goods regulation” delegates including members, guests and speakers. The CTPA would like to thank all of the speakers for their first class contributions. 16. CTPA Working with the Media, Educators and Consumers In 2003 the CTPA set out a mission statement for the future: “To be the authoritative, public voice of a vibrant and responsible industry”. With the support of its members, the CTPA has cemented its role as the industry’s authoritative, public voice and its commentary is widely regarded as credible by government, stakeholders and the media alike. There was therefore an appetite to agree a new ambition for the next five years and to set out, as far as possible, the key themes that should underpin it. The agreed ambition is to secure the trust of stakeholders, partners and the public in the Association and, by proxy, in the industry as a whole. In short: “To be the authoritative, public voice of a vibrant and responsible UK industry trusted to act responsibly in meeting consumers’ needs”. Communicating the safety and efficacy of the industry’s diverse, and growing, range of products remains the foundation stone of the CTPA’s communications. However, in working towards building greater trust, the 2011 programme included many initiatives around the positive contribution made by the industry to innovation, self-esteem and sustainability. Working with stakeholders The CTPA has continued to strengthen its understanding of the communications environment in which it operates by carrying out a comprehensive audit of key stakeholders and the online landscape. The ambition is to better understand the key issues and strengthen relationships to ensure resource remains highly targeted and to lend added credibility to both rebuttal and pro-active communications. “The fact that the CTPA liaises so closely with Government on safety issues also helps to bolster its credibility” Sheila Kelly, Chief Executive. Working with the Media CTPA held a media panel early in 2011 when twelve key health and beauty journalists debated the interesting topic, Does Beauty Matter? The discussions were used to better understand the media’s and consumers’ perceptions of the broader body confidence debate and the cosmetic industry’s role within it. Lucy Beresford, a writer, psychotherapist (UKCP registered), and media commentator who writes about human psychology and mental health and Dr Alex Clarke, the head of the psychology department within the Royal Free Hospital Department of Plastic and Reconstructive Surgery provided an interesting and credible catalyst to debate. Zoe Williams, the third speaker, provided a moving personal perspective on the importance of body confidence on self-esteem, having experienced the benefits of the Look Good, Feel Better programme while undergoing cancer treatment several years previously. And the insights from the event have now informed the tone and content of the CTPA’s communications approach going forward. A CTPA factsheet was developed following the panel and Psychologies magazine also developed a three-page article on the topic. The CTPA continues to monitor for key issues in the media that could undermine trust in the industry and its products. The CTPA provides background and quotes for media reports and articles and can also consider providing spokespeople. On average, the CTPA posted one reactive or pro-active statement on its consumer website each month during the past year often with wider associated activity with social or traditional media. These statements have rebutted common media-myth stories such as the claim that the use of certain cosmetics and, in particular, shampoos could be contributing to obesity. They’ve also acted as pro-active reminders for media and consumers to take various actions such as remembering to spring clean cosmetic bags. “The CTPA and brands alike must try to help hairdressers better understand cosmetic and toiletry products” Eileen Lawson, Secretary General 17. Information for Consumers The CTPA’s much referenced consumer website, www.thefactsabout.co.uk, seeks to provide factual information in a very relevant and easily understood manner. As part of the brand refresh strategy undertaken in 2011, the site received a facelift to provide better navigation to key topics. Sustainability Matters: with sustainability an increasing focus for companies and brands, the CTPA added a new section to its consumer website ‘Sustainability Matters’ to show the industry’s understanding of this complex and diverse issue and demonstrate its positive progress towards a sustainable future. The success of the 2011 activity is most clearly demonstrated by the significant rise in traffic (25%) to the site; 51,000 visits compared with 41,000 in 2010. By analysing Google Analytics on a regular basis and refreshing content where necessary, the CTPA has also ensured that the site has continued to increase the number of people who return; just under 14,000 compared with 11,000 the previous year. Indeed, the majority of visits to the site (64%) are driven by search engines, demonstrating the success of the site. www.thefactsabout.co.uk Beauty Matters: this section now houses new video material featuring renowned make-up artist Caroline Barnes which originated from work with InStyle.co.uk around the positive impact that taking care of our appearance can have on an individual’s self-esteem, and to society at large. Also included on the site are a series of video testimonials by Dr Alex Clarke, expert speaker at the Beauty Matters media panel. In them, Alex answers a series of questions around the positive role of the industry on self-esteem, reiterating many of the points made at the original media panel. Safety Matters: working with numerous stakeholders on key issues has become an important strand of the CTPA’s communication programme and during the year we liaised with Trading Standards and the Consumer Safety Department of the Business, Innovation & Skills Department (BIS) on ‘Brazilian’ hair straighteners and produced a safety factsheet to alert the general public to the dangers of illegal products. Hair colorants and allergy remained key topics throughout the year. Much work has been done with the professional organisations for hairdressers and allergy and the media to raise understanding around the issue of allergies generally and the importance of following the manufacturers’ instructions on hair colorants closely. Educational Initiatives Media Smart: CTPA provided industry’s expert input and seed-funding to a new Body Image module for 10-11 year olds produced by Media Smart. Media Smart aims to encourage an informed approach to understanding advertising images from a young age. The module was launched in conjunction with the Home Office as part of its Campaign on Body Confidence in the autumn of 2011. www.mediasmart.org.uk 18. Science, Innovation and the Cosmetics Industry Innovation – a much-used word that actually covers a very wide range of novel ideas. These can range from the steady but important product development process by which leading-edge developments trickle down to mainstream products, up to the real breakthrough ideas which are the source of the constant improvement of all products available to the consumer. While much research is carried out within company facilities, other companies are linked to academic organisations; there is no single model that fits all. Similarly, the direction of that research varies. Some companies seek novel ingredients and investigate their properties with a view to improving product characteristics or to provide new functional benefits: other research may be aimed more at a better understanding of the structure and function of those areas of the body with which the cosmetics industry concerns itself. In any event, the outcome is new knowledge, new insights and ultimately better products for the consumer. In many cases, we now find that it is the attainment of new biological knowledge that drives the development of new products that can capitalise on that knowledge, as opposed to new products arising simply from a need for something new. More and more, cosmetic products are being developed at the cutting edge of biological understanding of the structure and function of the skin, hair, nails, etc. As we come to know how skin ages, what the signs are of aged skin and what causes those ageing effects, so we can search for products and systems to help prevent them appearing and we are able to measure and thus demonstrate those benefits. This is very different from the somewhat serendipitous approach once adopted of trying ingredients seemingly at random in the hope of finding some beneficial attribute that can be utilised in a cosmetic. Although that approach has also resulted in many efficacious products. 19. In this respect, the more targeted approach being adopted by some is analogous to the targeted approach of pharmaceutical companies. In this respect, the more targeted approach being adopted by some is analogous to the targeted approach of pharmaceutical companies. And therein lies a potential problem. Although cosmetic products are regulated strictly to ensure quality, efficacy and, above all, safety, people will draw parallels to medicines legislation and ask why cosmetics may be marketed without prior approval. We have seen this already with the introduction of pre-notification for products containing nanomaterials through the new EC Cosmetics Regulation. At the same time, such product development routes mean that cosmetics are becoming more effective in the way they can restore and maintain good condition. If the cosmetics industry is to maintain the business model of self-assessment married to in-market control rather than move to one of prior notification and perhaps even an approval process, it is essential that the rules governing the distinction between cosmetics and medicines are known and respected rather than eroded. Courtesy of Elizabeth Arden New York, image for PREVAGE® Face Advanced Anti-aging Serum 20. 07. Science, Innovation and the Cosmetics Industry What is a Cosmetic? Cosmetics today are more than just decorative products. Indeed, they have long been more than just decorative products: in 1541 BC Queen Hatshepsut of Egypt was buried with a skin balm, clearly showing that she used some cosmetics for their skin protective and restorative properties as well as others for their decorative effect. Today, cosmetics are much more tightly regulated than they were three-and-a-half thousand years ago and there is a legal definition of what is a cosmetic product. So, today, we know that in Europe cosmetics may protect, keep in good condition and restore as well as decorate. Thus, the definition today includes fragrances and personal care products, or toiletries, within the legal classification of cosmetics. When is a Cosmetic not a Cosmetic? Medicinal products may also be applied to the skin with a view to protecting, restoring or keeping in good condition, raising the possibility of a product falling under both definitions. An example might be a cream or lotion to be applied to irritated or inflamed skin. However the legislation covering each category makes clear that a product may be either a medicine or a cosmetic but may not be both at the same time. Thus, it is necessary to make a choice when faced with such a borderline situation. In practice, this initially seems relatively straightforward since medicines take precedence. In other words, if a product falls within the definition of a medicine, it is a medicine and not a cosmetic, even if it also complies with the definition of a cosmetic. A consequence of this is that products often described in marketing or media terms as ‘cosmeceuticals’ are legally cosmetics and must comply with the requirements of the EC Cosmetics Regulation, unless they are actually medicines; there is no middle legal category. However, although the Medicines and Healthcare Products Regulatory Agency (MHRA) issues guidance in this area, there are times when it is not so easy to determine on which side of the borderline a particular product falls. A product may be a medicine by function or by presentation, which means the product is a medicine either because it works (functions) as a medicine or because it is presented as a medicine. The latter situation is relatively straightforward. For example, if you make medicinal claims for the product (claims to diagnose, prevent or treat disease or the product is presented as doing any of these things) or if the presentation of the product as a whole gives the impression that the product is a medicine, it will be judged as being one and treated accordingly. It will for example, require marketing authorisation from the MHRA. 21. Photograph courtesy of John Frieda® - Kao Corporation Cosmetic products contribute to our well-being and self-esteem and without them we would all suffer from lack of confidence in social situations, in business and in our health generally. It is the area of ‘medicine by function’ that has been causing some confusion recently. A product is a medicine if it functions as a medicine, even if no specific claims are made. It has been said repeatedly and erroneously that cosmetic products must not have a physiological effect otherwise they would be medicines. This is quite wrong. Cosmetic products can and do have physiological effects, but could still be classed as medicines if those effects are brought about by specific mechanisms, which are described later. What is Physiology? Physiology is the study of nature (from the Greek φύσις - physis and λογία - logia) or, more specifically, the science of how the normal body functions. It studies, for example, why our normal body temperature is 37°C whether we are in the arctic or the tropics and how we maintain that temperature by creating heat through shivering or cooling ourselves through sweating. Consider then a typical antiperspirant: by stopping sweating, it has a significant effect on physiology, yet no one seriously proposes that antiperspirants should be anything other than cosmetic (toiletry) products. Of course, many medicines also have physiological effects: we have medicines to reduce blood pressure, to reduce stomach acid, to supress coughing, to induce sleep, to deaden pain, etc. Indeed, virtually all pharmacologically active medicines, i.e. drugs, act on the physiology of the body to some extent. To establish whether the physiological effect of a product is cosmetic or medicinal requires knowledge of how that effect is brought about; what is the mechanism of action? If the mechanism is pharmacological, immunological or metabolic, and is significant, the product is usually deemed a medicine. These terms require further explanation. Pharmacological activity Pharmacological activity is, essentially, a drug action. An active agent or drug is bringing about a change in the body’s activity. The effect requires the presence of the drug and the effect normally ceases when the drug is no longer present, although not exclusively so as some drugs may have long-lasting effects. But one might ask whether this is not also true of our antiperspirant since it only works when present on the skin. Immunological activity Immunological activity is unlikely to concern cosmetics and the discussion over borderline products since cosmetic products do not act by altering or engaging with the immune system. However, some ingredients used in cosmetics may have soothing effects on the skin and any inflammatory reaction inevitably involves the immune system so a link might be drawn. Metabolic action Metabolic action is, at first sight, also unlikely to involve cosmetic products since this mechanism is concerned with the internal functioning of individual cells and cosmetics do not set out to change that. Or do they? One of the most basic cosmetic products is the moisturiser. Whether a cream or lotion, at its simplest, it is a mixture of humectants to hold water, emollients to soften and lubricate the skin and water itself, made into an emulsion. When used on dry skin, the benefit is immediate and visible but with repeated use, there is a general improvement in the condition of the skin. Research has led to understanding how this benefit has been achieved and has shown that there is indeed a change in the metabolism of the skin cells as they mature and age, leading to the increased production of natural moisturising factor, increased water retention in the skin and reduction in the dry, flaky, scaly look of dry skin. This comes about through changes in the metabolism of the skin cells where different genes are expressed and different enzymes produced. But again, no one would expect a moisturiser to be classed as a medicine. What does this mean for our ability to reliably differentiate between a cosmetic and a medicine? Whilst we have seen that cosmetics can and do have physiological effects that are significant, and indeed must be significant to be efficacious, we had thought that the mechanisms by which medicines act, namely pharmacological, immunological and metabolic, were not likely to be directly invoked by cosmetics and certainly not to a significant degree. However, the picture is perhaps not so clear and research has established that even the most basic cosmetic products might well lead to metabolic changes, might be deemed to act through pharmacological mechanisms and, who knows, might even have an impact upon our immune systems. Although the advice given by MHRA recognises this possibility and states that minimal pharmacological, immunological or metabolic effects would not automatically lead to a product being classed as a medicine, as we enter into exciting new areas of research in skin science, future cosmetic products may well come under closer scrutiny as borderline products. If we are to ensure that common sense prevails and that safe, effective and high quality cosmetics can bring innovations to market in a rapid and cost-effective fashion, we ought to remind ourselves that, in essence, medicines take the diseased and return them to normal whereas cosmetics take the normal and make further improvements. Cosmetic products contribute to our well-being and self-esteem. Without them we could well suffer from lack of confidence in social situations, in business, and in our health generally. But innovation is about the unknown and the exciting new developments still to be discovered. If those benefits are to be brought to the public, the level of regulation must be appropriate. 22. Cosmetic Industry in Figures The UK cosmetic industry maintains its growth pattern The UK cosmetic industry continues to grow total value sales year-on-year, growing +4.1% vs 2010. In the special collaborative report for CTPA on the GB market from Kantar Worldpanel and SymphonyIRI Group, Steve Jones comments : “Colour cosmetics and fragrances were again the fastest growing sectors, growing +8.4% and +4.5% respectively. However, this value growth is mostly driven by average price increases: total unit sales in the cosmetic market grew by only +0.1% vs 2010, held back by skincare (-3.3%) and haircare (-0.4%). This picture hints that in some sectors consumers may well be cutting back on their purchases as economic uncertainty, rising unemployment and below-inflation salary increases continue to bite. There are other more tangible factors at work here too: within skincare, handcare (unit sales -14.7%) lip salves (unit sales -13.1%) were the biggest drivers of unit sales decline, and we know that the unseasonably warm Oct-Dec period will have impacted these traditional ‘cold weather’ categories. By the same token, another disappointing summer in the UK (as well as people potentially cutting back on holidays abroad) may well have driven the -4.9% decline in sun preparations unit sales. The star-performer categories again show us that in times of recession consumers often look to treat themselves: mass fragrance (value sales +13.5%), nail cosmetics (value sales +23.8%) and hair colorants (value sales +12.9%). The growth in hair colorants in particular could be linked back to the economic climate – as consumers look to curb their discretionary spend they are bringing ‘in house’ treats that they might previously have gone to a salon for, such as changing hair colour. The trends in personal care mirror what we are seeing across FMCG – growth in volume, units is slowing or declining across a number of macro categories, thanks to economic hardship and increasing average prices. However, value sales continue to increase as the volume declines are not enough to counter the impact of rising prices. To try and incentivise consumer purchase during this unprecedented economic environment, levels of promotion are increasing consistently across almost all FMCG categories, and cosmetics categories are amongst the most heavily promoted. For example, deodorants, shampoos and conditioners all see more than 70% of volume sold with a trade promotion, compared to a total FMCG average of just over 50%. Average price discounts are also significantly higher in beauty / cosmetics / personal care than the total FMCG averages.” CTPA category estimates December 2011 Fragrance* Female Fine Fragrance Male Fine Fragrance Female Mass Fragrance Male Mass Fragrance Unisex Fine Fragrance Unisex Mass Fragrance £000s Dec 10 £000s Dec 11 % Change 1,277,664 1,334,979 4.5 707,408 397,976 85,781 57,452 26,367 2,680 736,651 407,838 96,400 66,154 25,067 2,869 4.1 2.5 12.4 15.1 -4.9 7.1 1,218,333 1,320,690 8.4 464,837 368,061 196,985 169,220 19,230 507,751 381,070 208,232 209,497 14,140 9.2 3.5 5.7 23.8 -26.5 * includes gift packs/coffrets Colour Cosmetics Face Lips Eyes Nails Gift Packs 23. Skincare Prestige Skincare Total inc Gift Packs Face Care Non Medicated Face Care Medicated Face Care Male Hand Care Body Creams & Lotions Baby Care Products Lipsalves Sun Preps Haircare Conditioners Hair Colourants Incld Lightening Home Perms Shampoo Hair Sprays & Setting Sprays Hair Creams/Waxes and Gels Settings Lotions and Mouses Salons Toiletries Toothpaste Depilatories Foot Preparations Deodorants Shaving Soaps Mouthwashes Talcum Powder Bath Additives Shower and Body Wash Liquid Soap Toilet Soap Grand Total £000s Dec 10 £000s Dec 11 % Change 2,005,416 2,043,419 1.9 428,048 901,835 78,450 71,172 47,215 170,403 19,496 47,936 240,860 463,554 932,391 74,395 70,754 42,751 167,027 18,993 44,130 229,424 8.3 3.4 -5.2 -0.6 -9.5 -2.0 -2.6 -7.9 -4.7 1,587,730 1,652,772 4.1 257,873 259,816 1,991 383,378 157,904 92,944 29,210 404,614 263,142 293,284 1,787 404,541 169,770 87,205 28,429 404,614 2.0 12.9 -10.2 5.5 7.5 -6.2 -2.7 0 1,938,929 2,003,982 3.4 399,758 50,997 22,427 564,352 81,435 156,550 17,951 117,482 307,610 131,515 88,852 420,896 51,882 21,173 596,250 81,969 152,133 17,508 114,784 315,375 144,208 87,804 5.3 1.7 -5.6 5.7 0.7 -2.8 -2.5 -2.3 2.5 9.7 -1.2 8,028,072 8,355,842 4.1 The GB cosmetics market saw a 4.1% increase in value at retail sales price taking the total market to £8,356m in 2011. 24. 08. Cosmetic Industry in Figures GB Market Statistics Overview Fragrances Colour Cosmetics Skincare Haircare Toiletries Total £000s Dec 10 £000s Dec 11 £Share Dec 10 £Share Dec 11 % Change Dec 11 Contribution to Growth Dec 11 1,277,664 1,218,333 2,005,416 1,587,730 1,938,929 1,334,979 1,320,690 2,043,419 1,652,772 2,003,982 15.9 15.2 25.0 19.8 24.2 16.0 15.8 24.5 19.8 24.0 4.5 8.4 1.9 4.1 3.4 17.5 31.2 11.6 19.8 19.8 8,028,072 8,355,842 100.0 100.0 4.1 100.0 Sector Share (%) of Category Dec 11 vs Dec 10 by Value (rsp) Sector Share (%) of Category Dec 11 vs Dec 10 by Units Sector Share (%) Dec 11 £8,355,842 Sector Share (%) Dec 11 - 2,626,713 units Fragrances 16.0 Fragrances 2.4 Colour Cosmetics 8.3 Colour Cosmetics 15.8 Haircare 19.8 Skincare 24.5 Toiletries 51.8 Skincare 17.5 Toiletries 24.0 Haircare 20.0 Sector Share (%) Dec 10 - 2,623,930 units Sector Share (%) Dec 10 £8,028,072 Fragrances 15.9 25. Colour Cosmetics 15.2 Skincare 25.0 Haircare 19.8 Toiletries 24.2 Fragrances 2.3 Colour Cosmetics 7.9 Skincare 18.1 Haircare 20.1 Toiletries 51.6 8.4% 4.5% 4.1% 3.4% Appendix: Methodology & Data Sources SymphonyIRI Group market tracking data: Census EPoS data from Asda, Boots, Iceland, Morrisons, Sainsburys, Superdrug, Tesco, Waitrose, Wilkinson, The Cooperative Group (including Somerfield). 1.9% Sample EPoS data from Symbol Grocers, other Coops, independents and chemists. Toiletries Haircare Skincare Colour Cosmetics Fragrances Sector Year on Year % Change by Value Sector Year on Year % Change by Units 5.2% 5.1% Other data representation (audit and estimation methodology) from convenience stores, petrol forecourts, drugstores and other impulse outlets. Kantar Worldpanel Purchasing data (Worldpanel) Individual purchasing data from a panel of 25,000 households which for this report will cover other GB outlets not mentioned above plus Aldi, Costco, Holland & Barrett, Lidl, Marks & Spencer, Wilkinsons, Savers, Netto, Bodyshop and other smaller outlets. Kantar Beauty Panel A panel of 15,000 individuals who record their purchasing of fine fragrances, colour cosmetics and skincare products across all relevant outlets (including department stores, Bodyshop, Internet, mail order and direct sales) via online data entry. Report Definitions Measures: Value Sales = £ sold (in 000s) % Chg = % change versus same time a year ago Haircare -0.4% Toiletries Skincare Colour Cosmetics Fragrances -3.3% 0.5% Contact Details SymphonyIRI Group: Steve Jones SymphonyIRI Group Tel: +44(0) 1344 746033 E-mail: Steven.Jones@SymphonyIRI.com www.SymphonyIRI.co.uk Kantar Worldpanel: Tim Nancholas Kantar Worldpanel Tel: +44(0) 20 8967 4442 E-mail: Tim.Nancholas@kantarworldpanel.com www.kantarworldpanel.com 26. 08. Cosmetic Industry in Figures Cosmetics/ Toilet and Liquid Soap 201 (£ Sterling in millions - trade data) Categories by import 2011 (2010) & largest market Perfumes Beauty (skincare/decorative) Haircare Oralcare Men’s shaving Deodorants & Antiperspirants Bath preparations Depilatories & other toiletries Toilet soap Liquid hand soap 0 200 400 600 800 1000 2011 2010 588.4 1240.4 413.5 164.3 45.6 134.6 66.7 49.2 66.3 118.2 565.3 1222.0 376.1 133.1 52.6 115.5 55.4 42.4 61.2 109.1 Key trading partner (% share of category) France France France Germany France Germany Italy France Germany Germany 235.7m 268.8m 110.6m 23.9m 15.3m 44.4m 25.4m 9.2m 13.9m 46.6m 40% 22% 27% 15% 34% 33% 38% 19% 21% 39% 1200 2011 UK imports worldwide UK’s largest worldwide import markets £2887.1m / % share worldwide market France 2011 £678.4m (2010) (£653.3m) Germany £450.1m (£429.9m) USA £386.8m (£392.3m) Poland £190.4m (£170.9m) Italy £182.0m (£174.8m) China £155.1m (£138.3m) Irish Republic £122.2m (£104.4m) Spain £119.2m (£116.5m) Belgium £106.4m (£94.1m) £87.8m (£83.3m) Western Europe £95.9m / 3.3% Eastern Europe £10.6m / 0.4% EU 27 £2024.8 m / 70.1% North America £416.4m / 14.4% Other America £6.6m / 0.2% ME & North Africa £22.6m / 0.8% Asia & Oceania £299.6m / 10.4% Sub Saharan Africa £10.7m / 0.4% Key: Value year on year Imports 2011 27. Up Netherlands Down Perfumes Beauty Hair Oral Mens Deos Bath Dep Soap Liquid Soap EU 27 Western Europe Eastern Europe North America Other America ME & North Africa Sub Saharan Africa Asia & Oceania 463.5 23.8 0.1 67.5 1.9 3.2 0.0 28.3 743.2 55.1 0.4 248.8 0.4 4.6 9.2 178.7 318.5 1.7 2.9 69.4 0.9 6.0 0.8 13.3 135.2 3.7 0.0 10.5 3.2 3.7 0.2 7.9 42.2 0.4 0.0 1.7 0.0 0.2 0.0 1.0 123.0 0.4 3.2 4.0 0.0 1.6 0.0 2.4 53.1 0.3 0.0 0.6 0.0 0.3 0.0 12.4 32.1 2.4 0.0 3.7 0.0 0.1 0.4 10.4 31.0 6.1 0.0 6.0 0.2 2.0 0.0 20.9 83.0 1.9 4.1 4.1 0.0 0.9 0.0 24.3 Total 588.4 1240.4 413.5 164.3 45.6 134.6 66.7 49.2 66.3 118.2 Trade data sourced from www.uktradeinfo.com SITC Codes 553 (excluding air fresheners) and 554 (toilet soap and liquid soap only) * Balance of trade - Worldwide £95.3m / Extra-EU £88.4m Categories by export 2011 (2010) & largest market Perfumes Beauty (skincare/decorative) Haircare Oralcare Men’s shaving Deodorants & Antiperspirants Bath preparations Depilatories & other toiletries Toilet soap Liquid hand soap 0 200 400 600 800 1000 2011 2010 Key trading partner (% share of category) 529.5 1113.1 299.1 268.6 134.4 295.2 56.0 85.3 74.1 127.1 498.1 997.4 271.3 227.7 128.2 219.2 44.8 78.5 74.5 88.8 Germany Irish Republic Irish Republic Germany Russia Netherlands Irish Republic France USA Germany 216.8m 211.9m 101.1m 35.2m 13.7m 42.9m 10.6m 9.2m 16.3m 26.8m 41% 19% 34% 13% 10% 15% 19% 11% 13% 21% 1200 2011 UK exports worldwide UK’s largest worldwide export markets £2982.4m / % share worldwide market Western Europe £155.1m / 5.2% Eastern Europe £103.9m / 3.5% EU 27 Irish Republic 2011 £472.5m (2010) (£488.9m) Germany £433.9m (£353.9m) Belgium £259.2m (£212.4m) USA £167.8m (£163.9m) France £142.3m (£113.7m) Netherlands £125.0m (£112.5m) Italy £112.1m (£93.7m) Poland £100.4m (£99.4m) UAE £95.7m (£75.2m) Spain £92.3m (£82.5m) £2031.7m / 68.1% North America £191.4m / 6.4% Other America £14.1m / 0.5% Asia & Oceania £247.8m / 8.3% Sub Saharan Africa £58.9m / 2.0% Key: Value year on year Exports 2011 Up ME & North Africa £179.5m / 6.0% Down Perfumes Beauty Hair Oral Mens Deos Bath Dep Soap Liquid Soap EU 27 Western Europe Eastern Europe North America Other America ME & North Africa Sub Saharan Africa Asia & Oceania 379.8 11.3 7.4 42.3 1.0 31.5 3.6 34.6 700.9 85.2 47.7 86.4 5.9 57.1 11.7 118.2 226.6 12.2 6.3 12.5 0.3 12.2 8.5 20.6 200.5 12.9 0.6 0.6 2.7 39.4 2.5 9.5 80.1 4.3 18.4 7.8 0.9 9.8 3.0 10.1 240.8 14.6 17.5 1.8 0.4 4.8 3.2 12.0 38.9 2.1 1.2 3.5 0.5 3.7 1.0 5.1 28.0 5.4 0.9 10.2 1.0 9.1 20.6 10.2 35.8 3.5 2.3 17.3 1.2 5.4 3.1 5.5 82.4 3.6 1.7 8.9 0.2 6.5 1.8 22.0 Total 529.5 1113.1 299.1 268.6 134.4 295.2 56.0 85.3 74.1 127.1 28. CTPA Members Members’ support of the Association’s work is fundamental to the success of the CTPA’s ability to help shape the environment in which companies do business. Visit www.ctpa.org.uk/members for the most up-to-date list and links to members’ websites. Contract Laboratory Services a Anaytical b Claims Testing/Support c Stability Testing d Microbiological Services e Formulation Creation f Safety Assessment Raw Materials g General Ingredients h Speciality Ingredients i Fragrance Ingredients/Mixtures j Colours k Certified Organic Ingredients l Natural (Not Organic) Ingredients Other Services m Contract Manufacturer/Supplier n Packaging Supplier o Other 29. Full Members Acheson & Acheson m Albion Cosmetics (UK) Alida Health & Beauty Alliance Boots • Boots Company, The • Boots the Chemist • Boots Healthcare International • Boots Manufacturing m Amway (UK) Anglo Indian Trading Avlon Europe Avon Cosmetics ET Browne (UK) Elizabeth Arden New York (UK) Espa International (UK) Estée Lauder Companies • Aromaderme UK (Darphin) • Aveda • Clinique Laboratories • Estée Lauder Cosmetics • Jo Malone • Make-up Art Cosmetics FDD International Bayer Beiersdorf UK Broad Oak Toiletries m Bronnley & Company, H m Chanel • Bourjois Chattem (UK) Church & Dwight Colgate-Palmolive (UK) Combe International Cosmarida 2010 Cosmetics Laboratory Coty UK GlaxoSmithKline Consumer Healthcare GoJo Industries Guthy-Renker UK Hampshire Cosmetics m HCT Europe Henkel Herb UK Herbalife (UK) HMC m Hoyu Inline Health and Beauty m International Cosmetic Suppliers m DCS Manufacturing DDD • Dendron • Fleet Laboratories m • Trinity Scientific Deb Group Denman International Jeyes John Gosnell & Company m Johnson & Johnson Kanebo Cosmetics Kao (UK) • Goldwell • KMS • KPSS Keyline Brands • Inecto Kimberly-Clark Europe Laleham Healthcare m LF Beauty (UK) m Linco Care m Liz Earle Beauty L'Oréal UK • PBL Europe Lornamead Luster Products LVMH Perfumes & Cosmetics • Guerlain • LVMH Fragrance Brands UK • Nude Brands UK • Parfums Christian Dior (UK) Maclaren Europe Mary Kay Cosmetics Mavala (UK) Meller Design Solutions m Mentholatum Company (The) Mibelle m Mix Labs Montagne Jeunesse Morgan's Pomade Company Neal's Yard (Natural Remedies) Nice-Pak International m Novartis Consumer Health Orean Personal Care Original Additions (Beauty Products) Pacific World Pascalle Periproducts Pfizer Pharmacare Europe Procter & Gamble UK PZ Cussons (UK) • PZ Cussons Beauty Quantum Beauty Company (The) Reckitt Benckiser Healthcare (UK) Retra Holdings • Badgequo Revlon International Corporation Revolymer Robert McBride m Saaf International Salon Success S C Johnson UK Shiseido UK Company • Carita • Decleor Sleek Makeup Solent International Surefil Beauty Products m Swallowfield m • Aerosols International • Cosmetics Plus Unilever UK Home & Personal Care Universal Products m Firmenich UK i Fragrance Oils (International) i Givaudan UK i Innospec h Innovant Research f o International Cosmetics & Chemical Services f Intertek Toxicology Assessment a b c d f o ITS Testing Services b f Kingfisher Colours j k l Litmus Research b Rockwood Additives g h Vivalis • Constance Carroll • Fade Out • Jerome Russell Schulke & Mayr UK h SGS United Kingdom d Skinnovation b e o STR (UK) b c d f Surfachem h Yves Rocher (London) Thor Specialities (UK) a d h Associate Members Univar e g h Akzo Nobel Surface Chemistry h Arch UK Biocides g h Ashland g h Aspen Clinical Research b o Aston Chemicals g h j Azelis b c e g h i j l Vivimed Labs Europe j f o j Walt Disney Company (The) o Wren Consulting f Retail Associate Members CMA (UK) f o Connock, A & E (Perfumery & Cosmetics) h i k l Cornelius Group g h o CPL Aromas i Croda International g h Cutest Systems b Arcadia Group Body Shop International, The Marks & Spencer Next Retail Sally Salon Services Danisco (UK) h Delphic HSE Solutions f dR Cosmetic Regulations o Dyecat e o 30. CTPA Committees Sub-committees, Panels and Working Groups The lists below reflect the current membership of CTPA Committees, Sub-committees, Panels and Working Groups. In addition to the above groups, ad hoc task forces and panels are set up as necessary. These currently include: Health & Safety Advisory Panel, Oral Care Combined Technical Toothwhitening Group, Risk Management Guideline Working Group. The CTPA Secretariat also maintains ‘contact lists’ of Members with special interests. Commercial Advertising Claims Group (CACG) Andrew McCarthy (Chair) Gill Baverstock Avon Cosmetics Steffi Bogart Estée Lauder Companies Dr Hitesh Chauhan Unilever UK Home & Personal Care Dr Raniero De Stasio L’Oréal (UK) Fredrik Hallin Guthy-Renker UK Ian Marlow Alliance Boots Julie McManus L’Oréal (UK) Richard Read Unilever UK Home & Personal Care Kathy Rogerson Procter & Gamble UK Sandy Stevenson Johnson & Johnson Mark Tarantino-Hind Revlon International Jenny Wild Beiersdorf UK Dr Judy Woodford Kao UK Communications Advisory Group (CAG) L’Oréal (UK) Louise Terry (Chair) Kathy Rogerson (Vice-chair) Procter & Gamble UK Caroline Almeida Johnson & Johnson Alison Cairns Unilever UK Home & Personal Care Kathy Davy Colgate-Palmolive (UK) Sarah Griffiths Estée Lauder Companies Stephen Johnson Alliance Boots Iona Maclean GlaxoSmithKline Consumer Healthcare Jessica Rouleau Schwarzkopf & Henkel Packaging Committee Steve Paul (Chair) PZ Cussons (UK) Jim Thomas (Vice-chair) Deb Group Gill Baverstock Avon Cosmetics Catherine Davies Reckitt Benckiser Healthcare Helen Dunham Revlon International Pam Green Alliance Boots Jim Hathaway Beiersdorf UK Julie McManus L’Oréal (UK) Nashila Nourmamod Reckitt Benckiser Healthcare Kathy Rogerson Procter & Gamble UK Dr Wazir Sohal Sally Salon Services Tony Taylor Unilever UK Home & Personal Care Agnieskza Trzesicka Estée Lauder Companies (Whitman Laboratories) 31. REACH Working Group Kalima Alibhai Dr Dalida Chouchi Elizabeth Colson Duncan Halliwell Sarah Henly Dr Marie Kennedy Chris Martin Penny Schuler Mark Tarantino-Hind Kimberly-Clark Alliance Boots Robert McBride PZ Cussons (International) Avon Cosmetics Elizabeth Arden (UK) CMA (UK) The Body Shop Revlon International Responsible Advertising Working Group Dr Chris Flower (Chair) CTPA Gill Baverstock Avon Cosmetics Steffi Bogart Estée Lauder Companies Laura Collister Unilever UK Kathryn Davies Procter & Gamble UK Paul Gaff Chanel Sarah Griffiths Estée Lauder Companies Ian Marlow Boots Company Andrew McCarthy Julie McManus L’Oréal (UK) Colleen O'Hare Johnson & Johnson Kathy Rogerson Procter & Gamble UK Louise Terry L’Oréal (UK) Dr Judy Woodford Kao UK Scientific Scientific Advisory Committee (SAC) L’Oréal (UK) Dr Raniero De Stasio (Chair) Dr Marie Kennedy (Vice-chair) Elizabeth Arden (UK) Sue Butler Schwarzkopf & Henkel Anne Connet CPL Aromas Alison Cowan PZ Cussons (UK) Polly Falconer Kimberley-Clark June Graham Robert McBride Garry Ho GlaxoSmithKline Consumer Healthcare Dr John Hopkins Innovant Research Stephen Johnson Alliance Boots Dr Amanda Long Avon Cosmetics Dave Preston Colgate-Palmolive (UK) Beatrice Poirier Reckitt Benckiser Healthcare Kathy Rogerson Procter & Gamble UK Mark Tarantino-Hind Revlon International Sue Wemyss Estée Lauder Companies (Whitman Laboratories) International Committee Revlon International Chris Martin (Chair) Pamela Bloor Unilever UK Home & Personal Care Iain Brunning Alliance Boots Dr Dalida Chouchi Alliance Boots Stuart Elliott Procter & Gamble Technical Centres Polly Falconer Kimberley-Clark Noel Hitchcock ICDA Dr Marie Kennedy Elizabeth Arden (UK) Dr Amanda Long Avon Cosmetics Becky Milner Reckitt Benckiser Healthcare Herve Olivier Espa International Jane Pett The Body Shop Debra Redbourn Keyline Brands Nia Roberts Nice-Pak International Sue Wemyss Estée Lauder Companies (Whitman Laboratories) GMP Sub-committee Colgate-Palmolive (UK) Dave Preston (Chair) Elizabeth Aspinall Estée Lauder Companies (Whitman Laboratories) Mark Crawley Laleham Healthcare Brendan Marken GlaxoSmithKline Consumer Healthcare Stephen Rawling GlaxoSmithKline Consumer Healthcare Clare Stott Unilever UK Home & Personal Care Arthur Tinnion Procter & Gamble UK Microbiological Sub-committee PZ Cussons (UK) Andy Brack (Chair) Amanda Baila Boots Manufacturing Dr Alex Blanchard Procter & Gamble UK Clare Clark Schulke & Mayr UK Chris Martin CMA (UK) Dave Preston Colgate-Palmolive (UK) Stephen Rawling GlaxoSmithKline Consumer Healthcare Dr Kenneth Seal Thor Specialities (UK) Hair Preparations Sub-committee Kathy Rogerson (Chair) Procter & Gamble UK Iain Brunning Alliance Boots Sue Butler Schwarzkopf & Henkel Dr Raniero De Stasio L’Oréal (UK) Michèle Elbaz Shiseido Ruth Fenwick Alliance Boots Chris Martin CMA (UK) Peter Matthewson Procter & Gamble Technical Centres Julie McManus L’Oréal (UK) Debra Redbourn Keyline Brands Mark Tarantino-Hind Revlon International Sue Wemyss Estée Lauder Companies (Whitman Laboratories) Sun Products Sub-committee Julie McManus (Chair) L’Oréal (UK) Mike Brown Alliance Boots Dr Hitesh Chauhan Unilever UK Home & Personal Care Dr Jack Ferguson Skinnovation Dr Amanda Long Avon Cosmetics Debra Redbourn Keyline Brands Kathy Rogerson Procter & Gamble UK Toni Roman Johnson & Johnson Mike Salmon LF Beauty (UK) Sue Wemyss Estée Lauder Companies (Whitman Laboratories) Jenny Wild Beiersdorf UK Hair Salon Working Group Julie McManus (Chair) L’Oréal (UK) Michelle Cole Schwarzkopf & Henkel Dr Raniero De Stasio L’Oréal (UK) Michèle Elbaz Shiseido David Macklin HBSA Peter Matthewson Procter & Gamble Technical Centres Shayne Meadows Schwarzkopf & Henkel Debra Redbourn Salon Success Kathy Rogerson Procter & Gamble UK Sue Wemyss Estée Lauder Companies (Whitman Laboratories) Toxicology Advisory Panel (TAP) Stephen Kirk (Chair) Alliance Boots Elizabeth Colson Robert McBride Rhian Eckley Unilever UK Home & Personal Care Dr John Hopkins Innovant Research Dr Catherine Mahony Procter & Gamble Technical Centres Dr Bob Priston STR (UK) Mary Spurgeon Unilever UK Home & Personal Care 32. CTPA and Members’ Representatives to Cosmetics Europe (formerly Colipa) Board of Directors Dr Chris Flower CTPA Active Association Members (AAM) Dr Chris Flower CTPA Strategic Project Teams (SPT) A maximum of 5 temporary groups, created by the Board to manage the major issues and key priorities. Task Force linked to SPT Alternatives to Animal Testing Dr Joanna Rowland GlaxoSmithKline Consumer Healthcare Sue Wemyss Estée Lauder Companies (Whitman Laboratories) EU Cosmetics Regulation Re-cast Dr Chris Flower (Vice-chair) CTPA Dr Marie Kennedy Elizabeth Arden (UK) Andrew Wilson GlaxoSmithKline Consumer Healthcare Graham Wilson Procter & Gamble Technical Centres TF Annex I Dr John Hopkins Stephen Kirk Dr Joanna Rowland Sarah Tozer Dr Emma Meredith Task Force Claims Dr Raniero de Stasio Andrew Wilson Dr Chris Flower Innovant Research Alliance Boots GlaxoSmithKline Consumer Healthcare Procter & Gamble Technical Centres CTPA L’Oréal (UK) GlaxoSmithKline Consumer Healthcare CTPA Robert McBride Estée Lauder Companies Alliance Boots CTPA Elizabeth Arden (UK) Boots Manufacturing Task Force Nano Notification Iain Brunning Boots Manufacturing Sue Wemyss Estée Lauder Companies (Whitman Laboratories) Dr Lindsay Holden CTPA 33. Task Force India Unilever UK Home & Personal Care Dr Robert Polywka Meena Sabarwal Procter & Gamble Technical Centres Sue Wemyss Estée Lauder Companies (Whitman Laboratories) Olivia Santoni CTPA Task Force Russia Olivia Santoni CTPA Self Regulation On Advertising Dr Chris Flower (Vice-chair) CTPA Graham Wilson Procter & Gamble Technical Centres Task Force Cosmetovigilance Liz Colson Beverley Harris Stephen Kirk Dr Emma Meredith Task Force Notification Dr Marie Kennedy Iain Brunning International Convergence Dr John Humphreys (Chair) Procter & Gamble Technical Centres Sue Wemyss Estée Lauder Companies (Whitman Laboratories) Graham Wilson Procter & Gamble Technical Centres Olivia Santoni CTPA Sustainable Development David Duncan (Chair) Paul Crawford Unilever UK Home & Personal Care CTPA Task Force Life Cycle Assessment / Carbon Footprint Alliance Boots Andrew Jenkins Core Competencies Committees (CCC) To provide expert support to Strategic Project Teams. Task Force linked to CCC Advocacy Committee Sophie Crousse GlaxoSmithKline Consumer Healthcare Internal & External Communication Committee Caroline Almeida Johnson & Johnson Sarah Griffiths Estée Lauder Companies Debbie Hunter CTPA Dr Chris Flower (Board mentor) CTPA Task Force Integrated Communications Debbie Hunter (Chair) CTPA Sarah Griffiths Estée Lauder Companies Legal Committee James Barnes Scientific Dr Raniero de Stasio Dr John Humphreys Dr Joanna Rowland Dr Carl Westmoreland Dr Emma Meredith L’Oréal (UK) Procter & Gamble Technical Centres GlaxoSmithKline Consumer Healthcare Unilever UK Home & Personal Care CTPA Technical & Regulatory Committee Dr Raniero de Stasio L’Oréal (UK) Dr John Humphreys Procter & Gamble Technical Centres Dr Marie Kennedy Elizabeth Arden (UK) Andrew Wilson GlaxoSmithKline Consumer Healthcare Paul Crawford CTPA Unilever Expert Teams (ET) Appointed by the Board to manage specific technical fields that require a high level of expertise. The Board can transform an ET into an SPT if the subject becomes a key priority. Task Force linked to ET Hair Preparations Sarah Henly Dr Robert Polywka Dr Kim Rich Dr Emma Meredith Avon Cosmetics Unilever UK Home & Personal Care Procter & Gamble Technical Centres CTPA Hair Colorants Consumer Information Group Dr Emma Meredith CTPA Ingredients Defence Dr Lindsay Holden (Chair) CTPA Dr Marie Kennedy Elizabeth Arden (UK) Dr Amanda Long Avon Cosmetics Dr Kim Rich Procter & Gamble Technical Centres Sue Wemyss Estée Lauder Companies (Whitman Laboratories) TF D4/D5 Dr Lindsay Holden Oral Care Andrew Wilson Perfumes Dr John Humphreys (Chair) Reach Dr Marie Kennedy (Vice-chair) Paul Crawford (Vice-chair) Sarah Henly GlaxoSmithKline Consumer Healthcare Procter & Gamble Technical Centres Elizabeth Arden (UK) CTPA Avon Cosmetics CTPA Microbiological Protection of Products Dr Alex Blanchard Procter & Gamble Technical Centres Lorraine Caskie Unilever UK Home & Personal Care Dave Preston Colgate-Palmolive (UK) Nanotechnologies Dr Amanda Long Dr Joanna Rowland Dr Lindsay Holden Natural/Organic Products Procter & Gamble Technical Centres Graham Wilson (Vice-chair) Gill Baverstock Avon Cosmetics Dr Robert Polywka Unilever UK Home & Personal Care Sue Wemyss Estée Lauder Companies (Whitman Laboratories) Paul Crawford CTPA Avon Cosmetics GlaxoSmithKline Consumer Healthcare CTPA Sun Care Products Mike Brown Dr Paul Matts Alliance Boots Procter & Gamble Technical Centres Traces Neil Bolton (Vice-chair) Dr Amanda Long Procter & Gamble Technical Centres Avon Cosmetics Triage Olivia Santoni CTPA 34. Directors’ Report & Financial Statements 12.1 The Cosmetic, Toiletry & Perfumery Association Limited (Limited by Guarantee) Directors’ Report Year ended 31 December 2011 The directors present their report and the audited financial statements of the company no. 398046 for the year ended 31 December 2011. This report has been prepared in accordance with the special provisions of Part 15 of the Companies Act 2006 relating to small companies. Directors Risk management The members of the Board are the directors of the company. The current directors, and the directors who acted at any time during the financial year, appear on page 1. The Association has identified a number of risks including a potential shortfall in income from member subscriptions, an IT systems failure and/or security breach leading to a break-down in the expected membership service levels, a breach of UK/EU competition law by either our staff or members whilst on Association business/premises and a conflict of interest and/or related party transactions with Board members. Internal controls have been developed to reduce these risks including the alignment of budget with membership renewal levels, the funding of an IT systems business continuity programme, the highlighting of the need for staff and members to conduct themselves according to the CTPA’s Competition Guidelines which are re-issued, highlighted and reviewed at appropriate times. These controls are reviewed periodically by the Board of Directors. Regular enquiry will be made of Board members to ensure there are no conflicts of interest between CTPA and its Board members. Principal activities and review of operations The principal activities of the Association are to organise, study, protect, promote and further the interests of the cosmetic, toiletry and perfumery industry in the United Kingdom. These remained unchanged during the year under review and all the Association’s work came within that general description. In carrying out this work the Association involved itself deeply in the work of the European cosmetic trade association, Cosmetics Europe (formerly known as Colipa). It is the Association’s intention to continue to operate within the same general framework. The Association’s financial policy is to match income and expenditure over a period of years, subject to the need to maintain adequate working capital. Subscriptions for 2012 have been set at a level which takes into account the financial position at 31 December 2011. 35. Financial statements The financial statements show a deficit for the year after taxation of £5,407 (2010: £4,423 surplus) which, together with the surplus brought forward of £527,249 results in a balance to be carried forward of £521,842. Charitable contributions The Association has continued to support the Look Good ...Feel Better Programme in the UK by providing access to meeting facilities and administrative support to the registered charity Cosmetic, Toiletry & Perfumery Foundation (CTPF). In 2011, the CTPA’s Director of Commercial Affairs also acted as Company Secretary to the CTPF. No charge is made for these services. Going concern The Association has adequate financial resources and is well placed to manage the business risks. Our planning process, including financial projections, has taken into consideration the current economic climate and its potential impact on the various sources of income and planned expenditure. We have a reasonable expectation that we have adequate resources to continue in operational existence for the foreseeable future. We believe that there are no material uncertainties that call into doubt the Association's ability to continue. The accounts have therefore been prepared on the basis that the Association is a going concern. Auditors Insofar as each of the directors of the company at the date of approval of this report is aware there is no relevant audit information (information needed by the company’s auditors in connection with preparing the audit report) of which the company’s auditors are unaware. Each director has taken all of the steps that he/she should have taken as a director in order to make himself/herself aware of any relevant audit information and to establish that the company’s auditors are aware of that information. Crowe Clark Whitehill LLP has expressed its willingness to continue as auditor for the next financial year and a resolution proposing their reappointment will be submitted to the forthcoming Board Meeting. By order of the Board J Traylen, Secretary 27 March 2012 Statement of Directors’ Responsibilities The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice. Company law requires the directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the company at the end of the year and of the surplus or deficit of the company for the period. In preparing those financial statements the directors are required to: • select suitable accounting policies and then apply them consistently; • make judgements and estimates that are reasonable and prudent; • prepare the financial statements on the going concern basis unless it is inappropriate to assume that the company will continue in business. The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements comply with the Companies Act 2006. The directors are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud or other irregularities. The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company’s website. 36. 12. Directors’ Report & Financial Statements Independent Auditor’s Report to the Members of the Cosmetic, Toiletry and Perfumery Association We have audited the financial statements of the Cosmetic, Toiletry and Perfumery Association for the year ended 31 December 2011 which comprise the Income and Expenditure Account, the Balance Sheet and the related notes numbered 1 to 14. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of directors and auditors As explained more fully in the Statement of Directors' Responsibilities, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors Opinion on financial statements In our opinion, the financial statements: • give a true and fair view of the state of the company's affairs as at 31 December 2011 and of its deficit for the year then ended; • have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and • have been prepared in accordance with the requirements of the Companies Act 2006. Opinion on other matters prescribed by the Companies Act 2006 In our opinion the information given in the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements. Matters on which we are required to report by exception We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: • adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or • the financial statements are not in agreement with the accounting records and returns; or • certain disclosures of directors' remuneration specified by law are not made; or • we have not received all the information and explanations we require for our audit. Scope of the audit of the financial statements An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the company's circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Directors’ Report to identify material inconsistencies with the audited financial statements. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report. 37. Tina Allison Senior Statutory Auditor For and on behalf of Crowe Clark Whitehill LLP Statutory Auditor London 4 May 2012 12.2 Financial Statements 31 December 2011 These accounts are prepared in accordance with the special provisions (of Part 15) of the Companies Act 2006 relating to small entities. Income and expenditure account for the year ended 31 December 2011 Notes 2011) £) 2010) £) 3 1,514,691) 1,475,220) (1,535,984) (1,487,668) (21,293) (12,449) Subscription income Administrative expenses The notes on pages 39 to 41 form part of these statements. Income from other member activities and events 20,370) 47,030) Approved by the Board on 27 March 2012 and signed on its behalf: Associated direct expenses (7,536) (35,153) 12,834) 11,875) Lady Jay (Sylvia) CBE Chairman Operating deficit 4 (8,459) (572) Other income 7 3,827) 6,323) (4,632) 5,751) (775) (1,328) (5,407) (4,423) Balance at 1 January 2011 Deficit/(surplus) for the year 527,249) (5,407) 522,826) 4,423) Balance at 31 December 2011 521,842) 527,249) Notes 2011) £) 2010) £) 9 221,719) 154,285) 10 272,359) -) 1,143,345) 228,406) 800,000) 475,445) 1,415,704) 1,503,851) (1,115,581) (1,130,887) Net current assets 300,122) 372,964) Total assets less current liabilities 521,842) 527,249) Accumulated surplus 521,842) 527,249) Ged O’Shea Vice-chairman (Deficit)/surplus before taxation Taxation Anand Rangaswamy Vice-chairman John Harold Honorary Treasurer 8 Deficit for the year There are no recognised gains or losses in either year other than as disclosed above. Balance sheet at 31 December 2011 Fixed assets Tangible assets Current assets Debtors Short term deposits Cash at bank and in hand Creditors: amounts falling due within one year 11 38. 12. Directors’ Report & Financial Statements 12.3 Notes to the financial statements 31 December 2011 1. Status of company The company was incorporated on 23 August 1945 and is limited by the guarantee of its members. The guarantee of each member is restricted to one pound sterling. 2. Accountiing policies a) Basis of preparation The financial statements have been prepared under the historical cost convention and in accordance with applicable accounting standards. The financial statements have been prepared on a going-concern basis as discussed in the Directors’ report on pages 35 and 36. b) Depreciation of tangible fixed assets The cost of tangible assets is written off on a straight line basis over their expected useful lives as follows: Office furniture Office fixtures Office equipment - 10 years - over the period of the lease on buildings - 3 to 5 years The carrying values of tangible fixed assets are reviewed for impairment if events or changes in circumstances indicate the carrying value may not be recoverable. d) Foreign currencies Transactions in foreign currencies for which forward exchange contracts have been entered into as a hedge against potential exchange rate movements are translated at the relevant forward contract rates of exchange. All other transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into sterling at the year end rate of exchange. Exchange differences arising from this retranslation are taken to the income and expenditure account. e) Pension costs The company provides defined contributions to personal pensions. Contributions are charged in the income and expenditure account as they become payable in accordance with the rules of the scheme. c) Subscription income Subscription income is recognised when received and is allocated to the financial year to which the subscription relates. Subscriptions received in advance are recorded as deferred income. 3. Subscription income Subscription income comprises subscriptions receivable, exclusive of VAT, in respect of continuing activities. 4. Operating loss 2011 £ 2010 £ 96,628 99,576 8,900 8,800 75,000 75,000 7,850 7,919 The operating loss is stated after charging: Depreciation of tangible fixed assets Auditors’ remuneration Rent of leasehold property Office equipment lease rentals 39. 5. Directors’ emoluments None of the Board members received any remuneration for their services to the company during the year. 6. Staff costs Wages and salaries Social security costs Other pension costs The average monthly number of employees during the year was 2011 £ 2010 £ 541,623 66,841 56,503 524,609 62,110 53,962 664,967 640,681 10 10 2011 £ 2010 £ 3,827 6,323 7. Other income Bank and other interest receivable 8. Taxation The tax charge for the year of £775 (2010: £1,328) represents UK corporation tax on the income from bank and other interest of 21% for the period 1 January 2011 – 31 March 2011 and 20% for the period 1 April 2011 to 31 December 2011. 9. Tangible fixed assets Office Furniture and fittings £ Office) Equipment) £) Total) £) Cost At 1 January 2011 Additions Disposals 97,328 1,005 0 437,367) 163,058) (93,900) 534,695) 164,063) (93,900) At 31 December 2011 98,333 506,525) 604,858) Depreciation At 1 January 2011 Charge for the year Disposals 62,650 8,191 0 317,761) 88,437) (93,900) 380,410) 96,628) (93,900) At 31 December 2011 70,841 312,298) 383,138) Net Book Value At 31 December 2011 27,492 194,227) 221,719) At 31 December 2010 34,678 119,607) 154,285) 40. 12. Directors’ Report & Financial Statements 10. Debtors Other debtors Other taxes recoverable Prepayment and accrued income 2011 £ 2010 £ 174,339 0 98,020 108,873 43,661 75,872 272,359 228,406 11. Creditors: amounts falling due within one year Trade creditors Corporation tax Deferred income (subscriptions) Accruals Other taxes and social security 2011 £ 2010 £ 93,164 775 712,325 17,494 291,823 67,286 1,328 832,495 11,490 218,288 1,115,581 1,130,887 12. Financial Commitments The annual commitments under non-cancellable operating leases were as follows: Leasing expiring: In two to five years (office equipment) In two to five years (land and buildings) 2011 £ 2010 £ 7,850 75,000 7,919 75,000 13. Forward exchange contract CTPA has entered into a forward contract for settlement on 25 May 2012 to purchase €159,500 at a rate of €1.15:£1 as a hedge relating to the payment of the 2012 subscription to Cosmetics Europe (formerly Colipa). 14. Capital commitments At 31 December 2011, CTPA had contracted but not provided for capital expenditure totalling £nil (2010: £nil) 41. 12.4 Detailed income and expenditure 2011) Quick guide to income and expenditure Subscription income Ordinary Members Associate Members Total income 2011/2010 2011: £1,530,577 Other operating income Surplus from seminars, publications, etc 2010: £1,492,090 Interest receivable Bank interest receivable Other interest receivable Less provision for corporation tax Total expenditure 2011/2010 2011: £1,535,984 2010: £1,487,667 (Deficit)/Surplus 2011/2010 2011: (£5,407) (10) Total Income £) 2010) ) £) 1,480,774) 33,917) 1,514,691) 1,442,303) 32,917) 1,475,220) 12,834) 11,875) 4,508) (681) (775) 3,052) 4,196) 2,127) (1,328) 4,995) 1,530,577) 1,492,090) 688,227) 8,165) 75,000) 40,948) 13,511) 11,429) 26,250) 112,222) 28,583) 7,850) 11,803) 34,393) 0) 105,634) 3,527) 34,806) 8,900) 166,716) 21,984) 3,294) 12,106) 10,000) 7,759) 0) 99,515) 3,369) (7) 661,991) 9,036) 75,000) 27,050) 9,097) 11,756) 24,673) 84,938) 27,506) 7,919) 15,474) 24,162) 0) 103,224) 9,768) 26,349) 8,800) 204,746) 27,014) 1,308) 12,063) 10,000) 1,300) 0) 102,393) 2,100) 0) 1,535,984) 1,487,667) (5,407) 4,423) 2010: £4,423 0 10 Administrative expenses 2011 6. 5. 1. 4. 3. 2. 1. Staff and other costs 45.3% 2. Communications 6.9% 3. Cosmetics Europe 12.5% 4. Depreciation, disposal, exchange rate variance 6.5% 5. Office premises & other services 10.0% 6. Other expenditure 18.8% Administrative expenses Staff costs Other personnel expenses Rent Rates Service charges Heat, light and utilities Telephone, communications, post CTPA websites, IT network, database Printing, journals, supplies Office equipment leasing costs UK travel, functions, meetings & staff training Overseas travel and expenses Chairman's expenses Communications Professional subscriptions Professional services Audit Cosmetics Europe - subscription - SCAAT - general assembly Office insurances and sundries Higher education grants Educational resources Donations Depreciation, disposal, exchange rate variance Bank charges Adjustment - VAT creditor Total Expenditure (Deficit)/Surplus for the year 42. CTPA Who’s Who 1 2 3 4 5 Dr Chris Flower Director-General Dr Emma Meredith Head of Scientific & Technical Services Paul Crawford Head of Regulatory & Environmental Services Dr Lindsay Holden Scientific Affairs Manager Ingredient issues. Hair products. Sun products. Technical guidance. Regulatory. Labelling claims & borderline. Chemicals/REACH. Environment. Scientific enquiries. Researching & tracking ingredient issues. Nanomaterials. Sun products. Alternatives to animal testing. Eleanor O’Connor PA to Director-General / Communications Co-ordinator Strategic direction. Public voice. External stakeholder engagement. International relations. PA to the D-G. Media monitoring. Communications. 3 1 2 5 4 8 6 10 9 7 6 7 8 9 10 Olivia Santoni Regulatory Affairs Manager Julia Hewitt Commercial Affairs Co-ordinator & Database Manager Debbie Hunter Director of Commercial Affairs Joyce Traylen Company Secretary Amanda Isom Technical Affairs Manager Regulatory enquiries. Labelling. Packaging. Transport of dangerous goods. International enquiries. 43. Membership services. CTPA Newsletter. CTPA events. Office administration. Strategic communications. Board management. Membership relations and services. Company management, accounts and office systems. Membership accounts. Events. Publications. Website controller. Technical enquiries. Ingredient tracking. CMRs. PIF. CPNP. CTPA Membership What can we do for you? “…membership is what you make of it – the value comes from contributing and using the vast resources at your disposal.” Debbie Hunter, Director of Commercial Affairs Representing Members worldwide Key Objectives • Over 100 Members representing small, medium, large and multi-national companies supplying the UK market • Work with all key stakeholders to provide creative, pragmatic solutions to new issues • Companies include manufacturers, distributors, ingredient suppliers, contract laboratories, contract manufacturers, retailers of own brand • Individual confidential advice provided to members by experienced regulatory, scientific and technical staff on anything from ingredient issues to best practice manufacturing guidance • Representing around 80% by value of the £8,356 million UK market supply Working with Members • Intercept media issues with fast, robust rebuttal • Positive proactive communications to build confidence and trust in the industry’s safe, effective products • 24/7 Members’ only intranet full of useful guidance, up-to-date news and with time-saving issue tracking – everyone in your company can access this tool wherever they are in the world • Promote the CTPA’s www.thefactsabout.co.uk website as the research resource for journalists, consumers, stakeholders and members • Cosmetics Basics - free workshops for members at CTPA to help maximise your membership • Be seen as the leading trade association, offering value for money to members and setting the bar high • Topic-specific seminars and committee meetings driven by area of competence or issue • CTPA presentations at your company and at external meetings For more details about joining the CTPA see our website : www.ctpa.org.uk Cover photograph of Keri-anne Payne, Olympic Swimmer and Ambassador for Max Factor and Oral-B Design & art direction Wybo Haas (UK) Limited | +44 (0)1483 890091 | www.wybohaas.com | Printed by Bishops | +44 (0) 23 9233 4900 | www.bishops.co.uk 44. The Cosmetic, Toiletry & Perfumery Association Limited Josaron House, 5-7 John Princes Street, London, W1G 0JN. Tel. +44 (0)20 7491 8891 Fax. +44 (0)20 7493 8061 Web www.ctpa.org.uk E-mail info@ctpa.org.uk Visit our consumer website at www.thefactsabout.co.uk