Natura: Can we Reverse The Flow Of Degenerative Capitalism?
Reflections on a “deep dive” into the beauty company’s Amazonian supply chain
Believe it or not, the Amazon—the world’s biggest river in terms of the volumes of water discharged—once ran in the opposite direction, flowing into the Pacific. A geological example of how the apparently impossible can become first possible, then inevitable.
I was reminded of this by our youngest daughter as I prepared to fly to Amazonia for the first time. And, as our flight bumped into Belém through torrential rain and an electrical storm, whether we might ultimately achieve the same trick with our economic systems?
The story to date has been one of environmental degeneration. The great flows of human effort, money and natural resources that have shaped capitalism and markets have intensified habitat destruction worldwide, to the point where many scientist want to declare a new geological era, the Anthropocene.
Still, our small expeditionary group was not in Belém—billed as the “gateway to the Amazon River” and slated to host November’s COP30 climate summit—to assess the chances of a successful outcome from this latest COP jamboree. Instead, we were there to take a closer look at key Amazonian elements of the supply chain of Natura, a long-time champion of sustainable business.
Pathways to Regeneration
“This is the heart of Natura,” I was told as half a dozen of us carefully disembarked from a small popopô boat onto a skeletal wooden pier alongside the Amazon. The path led directly into the domain of families who harvest forest products for the company—as part of the Cofruta cooperative.
We were just an hour’s boat-ride from Belém, in the Brazilian state of Pará, but already the city seemed a world away.
In terms of its own vital statistics, Natura describes itself as a “multinational, multibrand and multichannel leader in the cosmetics, beauty and personal hygiene sector in Latin America.” Its workforce of over 14,000 people is spread through 14 countries, including operations in the US and France.
The retail side of their business largely operates through over 3 million beauty consultants spread across Latin America, alongside over 1,000 company-owned and franchised stores. They were also the first publicly-traded company to be certified as a B Corp by B Lab—which makes them first cousins for Volans, the first UK B Corp.
The story of Natura’s acquisition of The Body Shop International, another B Corp, founded in 1976 by Anita and Gordon Roddick, paralleled their acquisition of Aesop and Avon—but didn’t end well for The Body Shop. And Aesop, echoing an earlier stage in The Body Shop’s history, was later sold to L’Oréal. The Avon saga has also been complicated at times. But every business has its ups and downs. And, as Anita herself used to say, what doesn’t kill you makes you stronger.
Meanwhile, our small and intrepid group—made up of people from the Generation Foundation, Oxford University, Patagonia and Volans—was given a privileged early view of Natura’s Vision 2025-2050, sub-titled Pathways to Regeneration, to be launched later in the year. Happily, too, we were accompanied for much of the journey by key members of the team that put together the Vision 2025-2050 strategy.
Calling all (serious) regenerators
In any event, once we had all scrambled up from the boat and negotiated the pier, we were ushered into a wooden house built on stilts over a soggy forest landscape land. It was clear that the land all around seasonally floods to a considerable depth. Small crabs scuttled everywhere. And, in a traditional form of circular micro-economy, chickens and ducks darted underneath and around the house, making short work of any leftovers.
Once land like this might have been cleared for crops like sugarcane, with Brazil still the world’s largest sugar producer—and the second largest producer of ethanol, itself based on sugar. But we had come to get first-hand experience of a form of harvesting that has a dramatically lower ecological footprint.
Throughout, Natura stressed that the focus of the exercise was less on the company than on the need to build a “socio-bioeconomy” across Amazonia. The next step, at least in their minds, will be to assemble a wider consortium of regeneratively-minded businesses ahead of—and beyond—COP30.
Lungs of the world
Through the week, we gradually worked our way up Natura’s supply chain in the region. The day after we visited Vanildo and his family, for example, we participated in an equally extraordinary visit to the Campo Limpo (Aprocamp) community and cooperative.
There we had a truly fascinating exchange with founders and members of the community, where a surprising number of the locals spoke—a rarity in my experience. Shortly afterwards, delightfully, we found ourselves walking through a forest area where a hand-painted sign read: “Welcome to the lungs of the world.”
Nearby, we visited the extensive growing areas where aromatic plants are harvested—sampling leaves and flowers to get a sense of the complex bio chemistries at work. The quality of the aromas and tastes was astounding
Then that term, socio-bioeconomy, increasingly used by Natura and promoted by organizations like The Nature Conservancy. Though something of a mouthful, it refers to a model advancing sustainable economic development producing positive contributions both to biodiversity and communities. Crucially, it values traditional knowledge highly.
Other visits included one to a production site, where we saw some of the crushing and extraction processes used to extract aromatic oils. We also espied recently delivered stacks of Chinese solar panels, ready to be installed.
Our concluding Natura visit was to their Ecoparque, or Ecopark, an industrial and innovation complex located in Benevides. The Natura plant here is bigger than anything else we saw. Very much state-of-the-art, it manufactures soaps—with 94 percent of the company’s soap demand in Latin America met by this single site last year.
Among the intriguing features of the Ecopark is its “Filtration Garden,” used to treat some site effluents. The site is also designed to serve as an evolving hub for Amazonia’s embryonic socio-bioeconomy.
I imagine that these aspects of Natura’s ambitions will be very much in the spotlight in November at the time of COP30—which brings us to the company’s Vision 2025-2050 document.
Pathways to regeneration
As we travelled around the region, I saw plenty of reasons for concern, including the spread not only of drug crime through the region, the rapid growth in Chinese influence (though their ability to offer cheap renewable energy systems is truly impressive) and the proliferation of evangelical churches. The conservative slant of the latter on social issues is attracting growing comment, as it their likely future impact on the country’s already feverish politics.
Against these dark clouds, the new Natura strategy might seem like a small light, however brightly it may burn. But I see it as part of the growing business and investor interest in—and commitment to—regeneration.
The near-70-page strategy document launches with an introductory letter from the three founders of Natura, Luiz Seabra, Guilherme Leal and Pedro Passos. Though founded as a private company, they explain, “Natura was never just a profit-making vehicle.” Profits may be essential to keep the show on the road, but the focus has always been on wider social benefits, too, which they see as best achieved through relationships.
They conclude that we are in an era of transformation which will impact every level of our economies, societies and communities. But they see no need to break with the past, rather they argue the urgency of doubling down on their long-standing economic, social and environmental goals. Indeed, their letter ends with the intriguing line:
As we head down the path toward regeneration, we’re undertaking these deep changes in order to continue being what we have always been.
The core of the new strategy builds on Natura’s long-standing commitment to sustainability but notes that the term became diluted along the way as people saw it as calling for better trade-offs—rather than more powerfully integrated strategies across the triple bottom line and ESG agendas.
As they observe:
... we must return to a more systematic way of thinking, returning to the non-reductionist origins of sustainability. This is the context in which we see the rise of another concept: regeneration.
They spell out what they mean by regeneration as follows:
Regeneration is an attribute of life, which is organized in dynamic, interconnected and interdependent networks. It’s an idea that goes beyond “sustaining”—as in maintaining or returning to a moment of the past. Instead, it’s the intrinsic capacity a natural system has, when its relationships are healthy, to continually renew itself and evolve toward ever-growing states of health and abundance that may not even resemble anything that has previously existed.
Natura’s bottom line
A key tool for the company has been its Integrated Profit and Loss (IP&L) management and accounting system. In addition to Natura’s financial performance, and “Produced Capital,” this approach embraces Natural, Social and Human forms of capital. For more details, see here.
Significantly, a key conclusion in the Vision 2025-2050 strategy runs as follows: “Our business will become truly regenerative only when every category of capital shows positive results on its own.”
Still, a critical deciding factor in all of this will be the degree to which a truly regenerative business can be made attractive—indeed irresistible—to investors, and truly regenerative products and services can be made sufficiently seductive to consumers.
As Natura puts it:
To create regenerative products, we must develop scalable solutions with accessible prices and high levels of desirability that appeal to all our client profiles—inviting them to consider themselves as our allies in the search for a better world.
Natura has been investing in Amazonia since 1999—and we saw some of the fruits of on our travels. Personally, I learned an immense amount—and others felt likewise. Indeed, if Natura decide to offer similar learning journeys to others, I would recommend them highly.
One desirable outcome will be new conversations, relationships and partnerships among those involved in defining and driving systemic change. The new strategy’s systemic change section argues that:
The crises that plague the world today demand profound, systemic changes—solutions that go beyond isolated positive impacts to transform our reality in a lasting, even permanent, way.
Indeed, that’s the central theme in this evolving series of “Rewilding Markets” posts. But rarely have I come across a company that is so committed to catalyzing the sort of change we now need—and trying to disrupt the certainties and platitudes that will be no doubt be endemic at and around COP30.
In the process, the efforts of such businesses give me at least some hope that the great global tide of environmental degeneration can be slowed, stalled and even reversed. The key next step will be to ensure that consumer, corporate and financial markets reward them for pulling of this seemingly impossible task.
Dear @John! It is great to see this experience with your eyes! Glad also to have been part of Natura’s history with you. I recall your first visit to Cajamar’s site. Do you remember? And yes, I do believe that regeneration and Socio- bioeconomy is one way to build the future we envision! Big hug!
PS: Love the term "socio-bioeconomy".