Investors Network Issues First Safer Chemical Management Recommendations for Consumer-Facing Brands
In our May 2025 report, Addressing Portfolio Risks of Chemical Hazards, the Safer Chemistry Impact Fund observed that while a growing roster of companies are restricting the use of known hazardous chemicals, most corporate reporting still relies on self-disclosure that can obscure hidden risks from hazardous chemicals that have not been fully characterized. Even accurate information about which chemicals are excluded from supply chains is not enough. Without information about which chemicals are being used in the manufacturing supply chain, or insufficient or incomplete information about a chemical's human and environmental health hazard, investment portfolios can harbor hidden risks to lawsuits, reputational damage, and regulatory shocks.
Now, for the first time, investors have called upon consumer-facing brands to adopt safer chemical management measures, citing global pollution concerns and increasing business risk.
The Investor Environmental Health Network (IEHN) a membership-based, investor collaborative that promotes the use of safer chemicals to enhance shareholder value, public health, and the environment, issued the guidance on July 15, 2025, entitled: Safer Chemical Management Recommendations for Consumer-Facing Brands.
The guidance includes best practice recommendations, milestones and metrics to measure progress, and lists of resources that can assist companies in reducing the use of hazardous chemicals in their products and supply chains. It also highlights more than 15 national and international brands that have implemented policies it recommends including consumer product icons Apple, Sephora, and Church and Dwight, as well as retailers including Target and Costco. A growing chorus of advocacy groups has urged both companies and their stockholders to take similar steps in recent years, but the IEHN statement marks the first time that investors themselves have spoken.
In its “Rationale for Action” IEHN emphasizes the growing risk from increasing chemical regulation and litigation, noting that the market capitalization of companies impacted by PFAS regulation alone is USD $30 trillion, and the impact of PFAS lawsuits may eclipse the $200 billion paid by the Big Tobacco Settlement. The recommendations also quote the Retail Compliance Center finding that, “A growing segment of consumers are demanding that suppliers move beyond compliance and ensure that chemicals in products are not just compliant with existing requirements but are ‘free’ of chemicals of concern.”
The IEHN guidance is informed by dozens of shareholder resolutions on chemical hazard reduction that it has filed in recent years, along with similar efforts by As You Sow, and activist investors such as Mercy Investments. These efforts, which often reference specific chemical hazard reduction strategies championed by the groups, have resulted in policy and operational changes by many of the companies heralded as leaders in the guidance document.
However, just as standardized carbon accounting metrics have become a means by which investors can evaluate a company’s success in identifying, reducing and tracking greenhouse gas emissions against goals, there are now consistent, reliable and practical metrics, including third-party verification, that investors can use to understand how well a company is identifying, reducing and measuring progress towards replacing high hazard chemicals in their products and supply chains with safer solutions.
We wholeheartedly endorse the exhaustive list of resources that IEHN has compiled for companies and investors can use to achieve these goals. Join us!
