– Unsafe chemicals can result in fines, product recalls and damage to brands –
A new report finds companies that do not actively manage their use of chemicals can face millions in fines and recall costs. By contrast companies that actively manage their use of hazardous chemicals reduce risk, avoid harm to their brand, and build long term value.
Mike Schade, Mind the Store campaign director for Safer Chemicals, Healthy Families said:
“Toxic chemicals are not only hazardous to our health, but can be costly to a major retailer’s bottom line. This new report highlights the real financial and reputational risks companies face when they do not actively manage dangerous chemicals in their supply chain. It underscores the need for the nation’s biggest retailers to work with their suppliers to adopt comprehensive programs to identify, eliminate, and safely substitute for dangerous chemicals.”
MORE ABOUT THE REPORT
The report notes that, over a three-year period, Walmart, Target, Walgreen Co., CVS Pharmacy and Costco Warehouse paid a total of US $138 million in fines because of chemicals of concern found in their products.
Product recall costs can also be significant: Sony’s recall of its PlayStation in 2011 due to illegally high cadmium levels cost the company more than US $150 million in lost sales and product reformulation costs; Mattel’s recall of more than nine million toys in 2007 due to lead in their paint cost the company $110 million in recall expenses and its stock price tumbled 18 per cent; and RC2 Corporations 2007 recall of toy trains, also due to lead paint, cost $48 million and halved its stock price.
The United Nations Environment Programme (UNEP) report was prepared in collaboration with the environmental NGO Clean Production Action. Clean Production Action is a member of the Safer Chemicals, Healthy Families coalition.