Sustainable Ethanol procurement policy for suppliers

For Avon International*. 

Approved by Avon International CEO August 2024

1. Introduction

• At Avon International, we’re passionate about making the world a better place and doing beauty differently. Our sustainability vision is to create a better world for women, which is better world for all, and to have a positive impact on our climate and communities. As part of our sustainability journey, we recognise that some materials we use have significant social or environmental risks. We therefore aim for full traceability and/or certification of our critical supply chains (palm, soya, ethanol, mica, cotton, and paper) by 2025. We are also committed to source only from non-deforested or non-natural converted areas as defined by the Accountability Framework Initiative and to supporting forest conservation solutions for high conservation landscapes. We also expect support from suppliers to help us meet the Avon International commitment to become Net Zero by 2030 and set a carbon reduction pathway in line with the SBTi requirements.

• Key social and environmental risks: Ethanol can be made from sugarcane as well as other plant-based feedstocks, such as sugar beet, grains, and agricultural wastes. Regarding Human Rights, in sugarcane-based ethanol where mechanization isn´t universally applied to field tasks, manual harvesting, seed cutting, and irrigation work brings the severe risk via the premature death of sugarcane workers from heat stroke and heat stress driven chronic kidney disease (CKD)1which is driven by poor labour protections in. For mechanized sugarcane and non-sugarcane crops, the main risks are negative environmental impacts on climate and biodiversity associated with heavy use of agrochemicals and water, especially for sugar beet production. Traceability, certification, and joint projects with suppliers are tools Avon International is using to manage and eliminate these risks in our supply chains.

• Scope:Avon International uses ethanol primarily in fragrance products, as well as in homewares and as a component in cosmetic raw ingredients. All ethanol, finished goods and ethanol-containing ingredients supplied to Avon International must meet the sustainability requirements set out below. These requirements will be applied in Avon International tender, supplier, and material approval processes, and are applicable to all ethanol used in goods for resale or indirectly, whether manufactured internally or by third parties. Should we find that any purchased goods or materials do not meet these requirements, we will engage the supplier to improve practices and/or revaluate our relationship with them.

• Traceability and certification requirements in brief: All Avon International suppliers must provide accurate information on the plant feedstocks and geographic origin of the feedstock for all ethanol materials in scope. All ethanol supplied for use in fragrance products, homeware products, or as a component of finished cosmetic ingredients, for all Avon Internationalmust be certified to acceptable certification standard as set out in Appendix 1 .

• Supplier milestones:

2. Detailed Requirements

Traceability

All Avon International suppliers of products and ingredients containing ethanol must provide (at a minimum) accurate information on the feedstocks and origin country/ies of ethanol feedstock cultivation for the materials supplied, as part of Avon International tenders, supplier, product and ingredient approval procedures and annual reporting. Failure to provide accurate and timely traceability information on request may result in rejection. All ethanol-based ingredients and goods must be certified to an acceptable third-party standard by the end of 2025.

Certification requirements

All Avon International suppliers must provide valid evidence for the applicable third-party certification standard for the ethanol materials supplied, and (where applicable) supplier chain of custody, in the format required by Avon International. Acceptable certification standards differ by use and brand as outlined in appendix 1.

Unacceptable sources of Ethanol

Suppliers with no capability to deliver commercially viable traceable, certified ethanol-based ingredients and finished goods, as per the requirements of this policy, will not be used to supply ethanol-based ingredients or finished goods to Avon International after 31/12/2023. Any suppliers found to be involved in human rights violations, environmentally destructive practices specially deforestation, or otherwise violating the Avon International supplier code of conduct may be exited.

3.Collaboration and contact

Above and beyond these requirements, we encourage you and your suppliers to participate in and support collaborations to ensure that poor labour conditions and environmental damage, in particular deforestation, are eliminated from ethanol supply chains. Avon International will work with suppliers to identify resources to address remaining gaps coming forward with proposals for more traceable, sustainable, and regenerative ethanol-based ingredients and finished goods that we can use in our business.

For further information on this policy, possible exceptions and Avon International plans to achieve 100% traceable and /or certified ethanol by 2025, please contact critical.materials@avon.com

Flow chart – requirements for ethanol containing ingredients and finished goods

APPENDIX 1 – Acceptable certification standards

Acceptable certification standards for ethanol in Natura fragrance products

By 31/ 12/ 2025 latest, all ethanol supplied for manufacture of Avon International fragrance products must be certified to at least one of the third-party standards below.

Additional third-party standards may be added to this list if they provide acceptable levels of traceability, social and environmental sustainability assurance in ethanol supply chains.

Use of credits / waivers

In limited situations, for example, where ethanol is a residual component in a complex finished cosmetic ingredient, where the supplier demonstrates there are no available physical certifications for the ethanol in the material supplied, and the supplier has a plan in place to achieve ethanol certification within an acceptable timeframe. Natura may consider a temporary waiver of these certification requirements. In these cases, Avon International may purchase (or require the supplier to purchase) certified sustainable ethanol credits through an acceptable credit trading system.

*Avon International refers to Avon operations in globally, except for United States and Latin America