WHAT GREEN BEAUTY GAINS FROM ACQUISITIONS

What Green Beauty Gains from Acquisitions

With the recent acquisition of Schmidt’s Natural Deodorant by consumer goods conglomerate Unilever, the green beauty community has been in uproar, strongly voicing their opposition over Schmidt’s decision to “sell out”. I personally never cared for Schmidt’s deos, but the same thing happened a few months ago when my favorite natural deo brand, Native, was bought by Procter & Gamble (P&G). Initially I experienced the same frustration that many of you have expressed upon hearing the news about Schmidt’s.

As I was ranting about this topic to my boyfriend, who is currently enrolled in an MBA program at a top business school, we ended up having a really eye-opening conversation about the acquisition. I know that publishing this post is a bit like opening a can of worms within the green beauty community, but I think that if we really want to influence others to adopt clean beauty, we have to be rational and willing to look at things with an unbiased view. Do I despise Monsanto? Absolutely. But I’m preaching the power of green beauty because I want every single person on this Earth to be free to be their healthiest selves. And the truth is that right now, green beauty is pretty exclusive. Keep reading to find out what green beauty gains from acquisitions.

This perspective is from a business standpoint so I want to first discuss some terminology. Almost every company is built with funding from shareholders (owners). These are people have invested money into the company, often times from its inception. Most companies in the US today are C-Corporations, which means that they have a legal obligation to maximize shareholder value, above all. Recently, B-Corporations have emerged to suit the more conscious companies. These corporations not only have a fiduciary duty to maximize profit for their shareholders, but also have equal duty to take responsibility for their environmental and societal impact. Meaning when offers with large premiums are made to acquire a company, it is often hard (if not verging on illegal) to turn down. From the surface, it’s easy for us to see the headlines and say things like, “I can’t believe they sold out! How could they betray us?! Where is their integrity?!”. But when you realize that most companies are legally set up to prioritize the needs of shareholders and profits, you begin to understand why “selling out” is the only option for many companies like Schmidt’s when conglomerates approach them with an acquisition offer.

Here are a couple of the most common arguments I’ve seen from the natural community opposing acquisitions of green/natural/organic companies by conglomerates and some reasoning which you’ve maybe never considered.

When a small, honest company “sells out”, all of their values are disregarded by the conglomerate who acquired them.

I’m in no way involved in the deal between Schmidt’s & Unilever (or any other deals, for that matter). I have no idea what the terms of their specific agreement are, but I’ll explain the most common processes that usually happen in these types of acquisitions. Obviously only people working the deal have all of the facts, but more often than not, mergers have many conditions. This can include, but is not limited to, requiring all current employees to remain in leadership of the company that’s being merged for X amount of time until operations are running smoothly. Some may even remain in the company long after the logistics are sorted out. Again, this must be argued on a case by case basis, but there usually isn’t much interest from the conglomerates to alter the acquired company or compromise its values in any way. Companies like Schmidt’s are acquired for a reason. Unilever can see that consumers are looking for more clean and natural underarm products and that Schmidt’s values resonate with those consumers- they are willing to go out of their way to buy these products and pay more money for their inherent values. Unilever acknowledges that value and knows that if they disregard it, consumers will in turn disregard Schmidt’s, hurting their profits. A big argument that falls under this category is animal testing, as Unilever allows animal testing of their products’ ingredients by third parties when necessary. I’m not quite sure that it’s untrue to say that Schmidt’s can no longer be cruelty free, but the fact of the matter is that we don’t know all of the details. Schmidt’s could have written an agreement into the deal that they will remain a cruelty free brand, prohibiting their products from being sold in markets where animal testing is mandatory. The best way to know the answers to these questions after mergers and acquisitions is to check the brands FAQ’s page or ask them directly on a social media channel, such as their Facebook wall. Fighting against causes such as animal testing is important, but we need to let the companies who uphold these values voice their beliefs to their new leadership in order to change industry standards and practices from the inside out.

If small companies really had good values, they would never “sell out” by handing their business over to a conglomerate.

Ah, here we are again. As we learned above, many companies truly don’t have the luxury of turning down acquisition offers. Founders need investors to get their company off the ground and once it’s flying, they legally can’t inhibit the company from making exponential profits. In an ideal world, money wouldn’t be the bottom line but we don’t live in a perfect world and like it or not, money is the bottom line not only in our economy, but also in our society (just look at Washington…). And here’s something you maybe haven’t thought of-  do you think these companies who have pioneered this movement toward conscious health & wellness did so solely to make money??? Maybe a handful, but I’ll bet that most of these health-conscious entrepreneurs began their businesses in order to change these corrupt & deplorable industries for the better. Schmidt’s website states that their mission, from the beginning, was to “change the way people think about deodorant”. As educated, health-conscious consumers, we already know what’s really lurking in conventional antiperspirants. But the average girl picking up another stick of Degree in the aisle of Wal-Mart probably doesn’t. Instead of looking at these acquisitions as greedy companies eager to rake in a large paycheck, let’s look at it as an opportunity for them to achieve their missions on a larger and more inclusive scale. For better or worse, conglomerates hold A LOT of power but when you think about the possibility that in a few years, more people in this country could be using natural deodorant than toxic antiperspirant- that’s a HUGE win in the fight for safe cosmetics! Healthy products shouldn’t be reserved for the well-educated and the well-off- they should be available, accessible, and affordable to everyone and in today’s market, only conglomerates have the power to stock every supermarket shelf with safe products.

Whew! Virtual high-five if you made it till the end of this post- I know it’s a wordy one. I just felt so compelled to talk about this topic after seeing so many people within the green beauty community lashing out against Schmidt’s decision. My intention was not to offend anyone, but just to encourage you to think about acquisitions from a new perspective. It’s the unfortunate truth that the movement toward cleaner and safer products is in the hands of the very corporations we’ve come to despise. But how amazing is it that we’re witnessing the revolution that we’ve built begin to be not only accepted, but to be in high demand! The fact that mega-corporations are investing in green beauty proves that we, the consumers, DO in fact, hold the power. With our wallets and our dollars. Corporate America simply follows the money. Let’s continue to point them in the direction of our values and accept that what green beauty gains from acquisitions is so much bigger than our pride.

What Green Beauty Gains from Acquisitions

Shop Schmidt’s, Native’s, and Vapour’s Non-Toxic Deodorant Formulas

What Green Beauty Gains from Acquisitions
What Green Beauty Gains from Acquisitions
What Green Beauty Gains from Acquisitions

2018-01-17T04:12:32+00:00 January 3rd, 2018|Green Beauty|2 Comments

2 Comments

  1. Traci January 4, 2018 at 10:08 am - Reply

    Yes! This is SO well-said and encouraging. Widespread change is happening, and that’s a GOOD thing! Thanks for such a thoughtful and balanced take on this issue!

    • Emily January 4, 2018 at 4:43 pm - Reply

      Thank you for reading, Traci! ❤️️

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