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Case Details

Case Code: BECG152
Case Length: 18 Pages 
Period: 2007-2017   
Pub Date: 2018
Teaching Note: Available
Organization : Lush Cosmetics Ltd
Industry : Cosmetics
Countries : UK, Global
Themes:    --  
Case Studies  
Business Strategy
Human Resource Management
IT and Systems
Leadership & Entrepreneurship

Lush's Charity Pot – Sustainable Growth through Charitable Giving

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Constantine believed in creating products which did not force the customers to think about sustainability when they went out to buy products. He was of the view that sustainability should be a part of the culture of the organization, so that it would reflect in everything the company did and the products it sold. Lush aimed at coming up with the best products for a good value with good service and believed that this amounted to incentivizing the customers...

Business Ethics Case Studies | Case Study in Management, Operations, Strategies, Business Environment, Case Studies
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Right from the time Lush was incorporated, Constantine wanted to use natural, high quality, vegetarian ingredients. He said, “The plan was to make cosmetics that were as natural as possible and to avoid using synthetic preservatives.” Lush made and sold hand-made soaps, bubble bar slices, and fragrances. These were made from organic fruits, flowers, herbs, vegetables, essential oils, cocoa butter, shea butter, oils like olive oil, coconut oil, avocado oil, and almond oil and a few safe-synthetic ingredients. When Lush came to know that the practices to extract palm oil were disturbing the ecological balance, it stopped using palm oil and sodium palm kernelate in all its products. It used only vegetarian ingredients in all the products. Lush products were 100% vegetarian and about 83% were Vegan, 60% preservative free, without any animal based raw material like milk or honey. (Refer to Exhibit IV for different products sold by Lush).


Lush did not use animal fat in its products. It was against animal testing and the products were tested with volunteers. Lush did not procure raw materials from companies that tested their products on animals. ..


Lush used minimalistic packaging, and 38% of its products were packaging-free. These were popularly called naked products. According to Granger, “I’d like [the cosmetics industry] to stop being a subdivision of the packaging industry. It’s a farce how much packaging is used. For most cosmetics, you’re paying more for the packaging than you are for the product. Something like seven parts packaging and three parts contents is the norm, and that’s just for a branded package of shower gel.” .


In 2007, Hillary Jones, ethical director of Lush, and Constantine approached an environmental activist Rebecca Lush (Rebecca). The main purpose of the meeting was to associate with grassroots groups, which were active in the areas in which Lush was interested. The result of the meeting was a tub of cocoa-butter hand-and-body lotion which they decided to call ‘Charity Pot’, reflecting their idea behind the product. One of the unique aspects of this product was Lush’s promise to give 100% of the retail price of Charity Pot (minus taxes) to grassroots organizations working in the areas of environmental conservation, animal welfare, and human rights. ..


Charity Pot went on to become Lush’s bestselling hand and body lotion and the third bestselling product in Lush’s portfolio. The popularity of Charity Pot can be gauged from the fact that in 2016, about 225,000 units of this body lotion were sold in the US. In this process, US$ 2.2 million was given away as grants to 194 organizations. .


Some of the customers were not happy with the kind of groups to which Lush had lent its support. Several consumers in the UK were surprised to know that the money they had paid to buy Charity Pot lotion went to fund protests by Plane Stupid, the environmental campaign group which was campaigning against the building of an airport at Essex. Their protest left several thousand travelers stranded at the airport. But Hilary Jones, Lush’s ethical director, who had been with the company since its inception, explained: “We don't have a problem in supporting groups like Plane Stupid because we don't worry about our image; we aim to be braver in our giving, not grey and corporate.”


Exhibit I:Lush – Green Initiatives
Exhibit II: Lush – Mission Statement
Exhibit III: Lush – Values
Exhibit IV: Lush – Product Range
Exhibit V: Lush – SLush Fund
Exhibit VI: Some of the Organizations Featured on the Lids of Charity Pot