London, UK

Agnes Gendry-Hearn was both apprehensive and excited about stepping into the blacked-out Mercedes in front her. Her job as a buyer for British soap and cosmetic company Lush had taken her on all sorts of adventures. But standing with a group of notorious smugglers in Goa, India, was easily her most dramatic trip to date.

“We had no idea where we were. We had no means of getting back to anywhere. The situation was a little bit tense,” Gendry-Hearn says. She was with her colleague Simon Constantine, head perfumer and buyer, and the two of them stood out awkwardly among the Indian gang. Though the trip took place over a decade ago (in 2004), she still clearly remembers getting into the Mercedes and riding around the island for what felt like hours. They were finally taken to a huge warehouse at the end of a residential road and found what they were looking for—illegal sandalwood.

Sandalwood has long been harvested for its cosmetic and therapeutic value (it’s found in perfumes, skin-care products, and incense). But the tree, largely exported from India and Australia, takes over a decade to grow. A rapid increase in international demand resulted in sandalwood being ruthlessly cut down. In India, where it has long been illegal to cut, harvest, and sell sandalwood without getting permission from the state forest department, a clandestine trade flourished. Now, a kilogram of Indian sandalwood oil sells for around $3,000 (five times as much as silver). The rising demand has already led to annual price increases of between 20% to 25% for sandalwood worldwide.

 Gendry-Hearn and Constantine were in India to investigate the dark underworld of sandalwood smuggling. 

Gendry-Hearn and Constantine were in India to investigate the dark underworld of sandalwood smuggling. The trip ended after a meeting in a hotel with a smartly dressed man she described as “the big boss.” He entered with several bodyguards, sat across from them and put his gun on the table. Gendry-Hearn wasn’t scared. “My thought was: this is brilliant, this was exactly what we wanted,” she explains. The big boss boasted that the price of sandalwood oil would never go down as he was sitting on massive reserves of wood and would restrict what was coming through. “It strengthened my understanding of what we wanted and what we didn’t want,” Gendry-Hearn says. In short, they weren’t going to get sustainable sandalwood from India.

Her trip highlights the extremes Lush goes to in order to understand its global supply chain and ensure it meets its ethical standards. The buying team, made up of 15 employees in the UK, operates like a group of investigators. They travel across the world to improve the standard of their supply chain and build relationships with suppliers. Members of the team even attend training intended for investigative journalists. During one session on reporting in complicated regions, a journalist asked what a team from a soap company would need this kind of training for, to which, Gabbi Loedolff, the head of raw materials and safe synthetic sourcing, said: “We get into some interesting situations.”

Throughout the years, Lush’s eccentric strategy of “creative buying” has shown that ethical supply chains and profits are not mutually exclusive. The company has turned corporate social responsibility on its head, funding an array of direct action groups in the UK and US. For the year ending on June 2016, Lush generated revenue of £723 million ($943 million), an annual increase of 26%, and boasted a pre-tax profit of £43.2 million (an increase of 76%).

Lush has no interest in calling itself the perfect company. “We never say we’re perfect as a company, but we do say we’re transparent,” Loedolff says. Instead, they trace their success to their eagerness to learn and constantly evolve.

Cutting out the middle man

Each member on the Lush buying team goes on an average of 10 trips per year. This has remained a core working principle from the very beginning of the company, which was founded in 1995. The co-founders were keen to ensure that the company’s commitment to ethically sourcing their products went further than a tick-box exercise. Lush isn’t able to visit every location involved in its supply chain, but it has already built a strong relationship with the vast majority of its important suppliers.

“When I go, I ask every question under the sun because I want to know everything I can,” says Steph Newton, a buyer who has been working for Lush for the last three years. The buyers ask about different farming techniques, the hours people work, and, most importantly, what suppliers believe to be a fair price for their products.

Lush says it’s able to pay a fair price because it cuts out the middleman—and its suppliers agree. “Our cooperative will never forget Lush,” says Fatima Amehri, the president of the women’s argan oil cooperative in Morocco, known as UCFA (or L’Union des Coopératives des Femmes pour la production et la commercialisation de l’huile d’Argan).

Argan oil is produced from the kernels of the argan tree and is often used in shampoos and conditioners. Before the cooperative was set up in 1999, rural women in Morocco sourced argan oil alone at home, often giving their products to their husbands to sell at the local market. “Sometimes she gets money, sometimes she gets none,” Amehri explains.

Once the cooperative was set up, women worked together to get a fair price between them. When the women worked with an intermediary, they were paid €16 ($19) a liter, but once they started working with Lush (and removed the middle man) that jumped to €21 ($25) a liter.

They kept the money they earned and all had an equal voice in how the cooperative was run. “Argan oil is the symbol of rural women emancipation in Morocco,” Amehri says, adding that Lush played a huge role in this change. “Before Lush, our women were not well fed. Before Lush, the price was low,” Amehri explains.

 “Argan oil is the symbol of rural women emancipation in Morocco.” 

Lush also works with businesses closer to home to get fresher products and simplify its supply chain. The cosmetics company uses powdered charcoal in a range of products, from soap and face masks to deodorant. While most of the charcoal in the UK is imported from unsustainable sources, Lush sources its charcoal from a local company, Dorset Charcoal Company.

Jim Bettle, founder and director of Dorset Charcoal, describes his relationship with Lush as “more personal,” adding, “I do feel like I can pick up the phone and discuss any issues I have.” It was Lush that helped Bettle comply with the European Union’s REACH chemical regulations. They talked him through his worries about Brexit as well how to sustainably grow his business. “There’s an element of collaboration and working together. With a lot of companies you don’t know where you stand, and with Lush I feel like I know where I stand.”

The Dorset woodland is a testament to their work. “After 20 years in business, I can take you round multiple woodlands in Dorset and show how vital, lively, and vibrant they are,” Bettle says. It comes down to how his company manages the local woodland to increase biodiversity and ensure the wood is cut in a sustainable manner.

Currently, Lush UK has around 380 suppliers. This covers raw materials, essential oils and fragrance components, product packaging, print and gift packaging. They might supply one, or multiple, materials or ingredients. Of these, around 240 are UK-based.

Loedolff admits that buying trips “mean time out of the office.” But she doesn’t believe that it slows down the team in the long-term. In fact, she points out it’s far easier to have detailed discussions and plan together in person than over email. “I would say that the initial time dedicated to these trips is more than recovered in the long run in the sense that we are able to ensure we are aligned, have a shared understanding, and are establishing strong relationships,” she explains.

It’s also difficult to compare the financial costs of a trip to the knowledge, alignment, and understanding the team gains, Loedolff says. “There is a cost involved with traveling to see suppliers, but I see it as an investment in the long-term stability of our supply base,” she adds.

Radical transparency

Under each product on its website, Lush lists the ingredients and includes information on where they’re sourced from. For example, customers interested the Charity Pot—a tub of cocoa-butter hand-and-body lotion that customers can buy to fund charitable causes—learn the Cocoa butter was sourced from Colombia, the Olive Oil was made from an Israeli Jewish and Arab collaboration, the Aloe Secundaflora comes from Kenya, Laikipia, and the Moringa from Ghana.

This intimate knowledge of its supply chain has sparked some of the company’s biggest campaign issues. It was after a member of the buying team visited its palm oil suppliers in Sumatra, Indonesia, in 2007 that Lush understood the devastation it wrought. To produce palm oil, which is used in a range of beauty products and food, ancient trees and local wildlife were being destroyed. Once Lush saw how it was leading to the decimation of rain forests, the company launched a campaign against palm oil—”wash your hands of palm oil“—and worked with local manufacturers to reformulate their soaps to remove the oil.

Lush’s biggest crisis to date involved a glittery mineral known as mica. In India, one of the world’s top-producing mica countries, children as young 10 were mining the mineral that’s widely used to add a shimmer to beauty products. Some of the world’s biggest cosmetics companies buy this material—and, until 2014, Lush did too.

 In India, one of the world’s top-producing mica countries, children as young 10 were mining the mineral that’s widely used to add a shimmer to beauty products. 

“At the time, the company we were working with was able to offer guarantees,” says Loedolff: They didn’t have any child labor in the supply chain and had programs to make sure kids were in school. Soon after launching a range of cosmetics with natural mica, Lush was informed that its supplier would be sold to another company. When they contacted the company to seek the same assurances and organize a visit, they were told it was no longer possible to get the same independent verification and were advised against visiting. (They were told audits had to be undertaken with armed guards present.)

Soon, reports came out that child labor was being used in mica mines. The revelations floored Lush—the coverage noted that the company was sourcing mica from a largely unregulated market with human rights abuses.

Lush eventually decided to remove all traces of mica from its products. It was a difficult decision to make, Loedolff explains, adding, “You want to work with people to make things better. You can’t do that if you walk away.” But it quickly became clear that wasn’t possible with mica. “We didn’t feel like we had the opportunity or buying power to be able to make the changes we would like to see.”

Removing mica from its supply chain was particularly challenging as the company had just released a whole range of products that used the material. Nonetheless, Lush worked frantically to carefully use the supply of natural mica it did have (reducing the amount that went into each product so its reserve would last longer).

Some would suggest that even using the supply would be unethical if it was from a company that couldn’t guarantee assurances. But Loedolff says Lush can’t guarantee that issues won’t arise from its supply chain, but they can improve how they respond to such problems. “It’s a constant journey and it’s about being willing to learn,” Loedolff explains, adding being perfect isn’t an achievable goal, but after the mica scandal the company is even more committed to sharing its challenges and how it overcomes them more widely. “That can only benefit everyone along the way,” Loedolff

Lush eventually switched to synthetic mica, made by a company in Germany that does not test on animals. The company released a statement explaining what happened, and blogged about the benefits of using synthetic mica.

“It was confirmation you can never rest on your laurels,” Loedolff says.

Towards a regenerative supply chain

Monitoring supply chains isn’t enough for Lush. The company describes its relationship with its suppliers as a two-way street; It’s not just about how the suppliers can be more sustainable, but also what Lush can do to be a better global company. “We are the first to say, ‘how can we do something better?’” Newton says.

Lush’s approach to its supply chain may not come as a surprise to its loyal fan base. Lush raised and donated over £8 million ($10.8 million) to charitable causes in 2016. The vast majority of this money was raised through the Charity Pot. The donations have supported Campaign Against Arms Trade, Plane Stupid (a group opposing an expansion at Heathrow airport), and Disabled People Against Cuts, which held the protest at Westminster Abbey.

 “Sustainability is not enough anymore. Sustainable in the situation we are in now is basically, ‘let’s not do any worse.'” 

The company also works in partnership with certain organizations to campaign on specific issues. For example, in 2008, Lush worked with Reprieve, an organization that provides legal support for vulnerable prisoners across the world, to create the “Guantánamo Garden bath ballistic” to raise money and awareness of prisoners in Guantánamo Bay. Lush has led a 24–hour mass hunger strike in support of Guantánamo Bay prisoners, supported Black Lives Matter, and campaigned against lethal drone strikes.

Lush says it’s keen to move beyond sustainability. “Sustainability is not enough anymore. Sustainable in the situation we are in now is basically, ‘let’s not do any worse,’” Gendry-Hearn explains. The company doesn’t want to minimize or limit damage, it wants to work toward a supply chain that regenerates damaged environment and supports suppliers to move away from harmful farming practices. In short, it wants a regenerative supply chain.

Lush understands that as the company grows, the pressure it puts on suppliers and the environment does too. So during its visits, Lush inquires about the resilience of farming communities—are farmers able to produce products for Lush without damaging the environment? Are they able to produce products as well as enough food for their community?

A notable example of Lush’s commitment toward regenerative projects is permaculture—a traditional farming technique that tries to reverse land degradation. Lush has worked with Paul Yeboah, director of the non-profit Ghana Permaculture Institute, since 2010. By 2013, Lush was finally able to buy Moringa oil—grown in these regenerated lands—to use in its products.

Lush visits Ghana Permaculture Institute about once a year. It usually tours the institute to see new developments, talk to the farmers, and look at the institute’s financial background to see the income it generates, how much workers are paid, and the percentage of the surplus that goes into new developments.

“Without Lush’s support, we can’t reach where we’ve reached so far,” says Yeboah. When he started the Ghana Permaculture Institute, it was just him. Now the institute employs 30 permanent staff as well as 10 casual workers (ones without permanent contracts who work seasonally). Yeboah is keen to point out he’s now in a position to pay the workers himself. “I told them I want to become financially sustainable,” he explains.

Lush has shared the main principles of permaculture through its SLush Fund. (While the term is often used to describe money used for illicit purposes, at Lush it’s a project to build partnerships with communities to put regenerative farming practices in place). The fund has helped 44 ongoing projects in 21 countries, from helping a group of farmers on Rusinga Island in Kenya to growing a sustainable, traceable rosewood supply chain in the degraded Peruvian Rainforest.

Loedolff calls for more companies to follow in Lush’s environmentally friendly footsteps, and to be honest about the struggles they have along the way. “More voices can make faster change happen,” she explains. For now, members of the buying team are awaiting their next trip—and the stories they’ll help uncover.