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BUSINESS Monday 23 SepteMber 2019
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Honest Co.'s CFO shares lessons learned and his vision ahead

By ANNE D'INNOCENZIO search and development the larger (consumer prod-
Associated Press in-house. uct) companies haven't or
NEW YORK (AP) — The Hon- Honest, infused with a $200 couldn't because of not
est Company, known for its million investment last year having a direct relation-
eco-friendly diapers, wipes from private equity firm L. ship.... And of course, there
and cleaning products, is Catterton, is expanding its is a macro (trend): health
back on the upswing after presence in stores. And this and wellness is here to stay.
a series of stumbling blocks. past summer, it moved be- Q. Your brand isn't just for
The digital native com- yond North America for the higher-income shoppers.
pany was founded by ac- first time, taking its beauty A. The idea and vision from
tress Jessica Alba in 2012. business to Western Eu- Jessica was always to cre-
It attained unicorn status rope with an exclusive deal ate these clean, safe, ef-
— when a privately held with German retail chain fective products and make
startup attains valuation Douglas. This month, Hon- them accessible to every-
of more than $1 billion — est Beauty will launch in the body.
three years later. Its for- United Kingdom with beau- Q. You had a series of stum-
mula? Honest successfully ty and health chain Boots. bling blocks. What were the
built an online community Honest declined to reveal lessons learned?
of young parents looking annual sales, but half of its A. To me, the challenges
for safe, affordable prod- total revenue is generated can't define you. You learn
ucts for their children. It from stores, and 45% comes from them and you grow.
initially started out with dia- from diapers. One of the earlier mistakes
pers and wipes along with The Associated Press re- we made was not focusing
household cleaning prod- cently interviewed Honest on quality control and R&D.
ucts and then expanded Co. Chief Financial Officer This undated image provided by The Honest Company shows It was too many things, too
into beauty and other Muhammad Shahzad, a The Honest Company Chief Financial Officer Muhammad fast. We've redone 95% of
items. But the Playa Vista, former investment banker Shahzad. the products over the last
California-based company who joined the company Associated Press two and a half years. We
struggled with a series of in 2014, on stage in Boston have a lot of momentum.
setbacks over the next two at an online industry con- Q. Why such instant suc- created a brand that reso- Q. What are your plans for
years ranging from a volun- ference called eTail. During cess? nated with our community expanding your presence
tary recall of baby wipes to the interview, he shared his A. Our mission has always of parents. They tend to in physical stores?
a class action lawsuit over thoughts about the com- been to empower people be millennial and much fo- A. Domestically, the busi-
ingredients used in some pany's instant success, les- to live healthy and happy cused on clean, better for ness keeps growing at Tar-
products. In response, sons learned and his vision lives. Jessica herself and you products. We always get, Costco, Whole Foods,
Honest hired a new CEO, for growth. The conversa- the founding team had understood and had a among many others where
cut back on some prod- tion has been edited for a relentless focus on the pulse on the consumer in a we've been for a few years.
uct lines, and brought re- clarity and length. consumer and ultimately way that perhaps some of q

Big money urges governments to tackle climate change

Associated Press have committed to keep- and energy transition path- Institutional investors have the Paris goal of capping
A group of more than 500 ing global warming well be- ways." become increasingly vocal global warming at 2C. By
major institutional investors low 2 degrees Celsius (3.6 The investors want govern- about the need to confront contrast, the research-
called Thursday for gov- Fahrenheit), ideally aiming ments to speed up the shift climate change lately. ers found that about 20%
ernments to boost efforts for an increase of no more from fossil fuels to renew- In a separate investor- of the 59 electric utility
to tackle climate change, than 1.5C (2.7F) by the end able energy, back rules re- backed study released companies examine are
warning that failure could of the century compared quiring companies to report Wednesday, the London- aligned with that target.q
have serious economic with pre-industrial times.
consequences. But the investment firms,
The banks, insurance com- which together say they
panies and pension funds manage $35 trillion in as-
said in a joint statement sets, cited a gap between
ahead of next week's U.N. the modest steps pledged
climate summit in New by governments — which
York that current national in themselves fall short of
commitments could lead what's needed to meet the
to an "unacceptably high Paris goals — and actual
temperature increase that measures taken so far.
would cause substantial "This ambition gap is of
negative economic im- great concern to inves-
pacts." tors and needs to be ad-
The group includes finan- dressed, with urgency," the
cial giants such as France's companies said. "It is vital This Aug. 13, 2019, file photo, shows the boat Malizia as it is
Amundi, which manages for our long-term planning moored in Plymouth, England Tuesday, Aug. 13, 2019.
1.487 trillion euros ($1.64 tril- and asset allocation de- Associated Press
lion); Canada-based Man- cisions that governments
ulife; and Insight Investment work closely with inves- climate-related information based Transition Pathway
in the United States. tors to incorporate Paris- in their financial statements Initiative said none of the
Countries that signed the aligned climate scenarios and put a meaningful price world's top 50 oil and gas
2015 Paris climate accord into their policy frameworks on carbon emissions. companies are in line with