Case: Natura cosmeticas

1. Natura Cosméticos, S.A.
and the future of Integrated Reporting

2. Executive Summary
• This Case discusses the Integrated Reporting process at Natura Cosmetics;
a Brazilian company and a leader in the cosmetics, fragrance & toiletries
market.
• Natura utilizes an integrated management model that focuses on the
economic, social and environmental throughout the process of the
Company.

3. bien estar bien
• Brazilian manufacturer and marketer of products in the CF&T* category
• Enjoys majority market share over companies like HUL, Revlon Inc. and
Estee Lauder Companies Inc.
• An eco-friendly, sustainable company
• A master of lean innovation
• 7000 happy employees and 1.2 million direct sales consultants
• Often referred in popular culture as the ‘Google of Brazil’.

4. Core Strategy
• A new strategy focused on corporate
social plus environmental
responsibility and sustainable
development
• Strategic purpose defined in terms of
progress on Economic, Social &
Environmental performance
• New Strategy requires new
integrated reporting process

5. Measures the financial,
social and environmental
performance of the
corporation over a period of
time.
Triple Bottom
Line

6. Tata Steel -
Jamshedpur
Economic
• Market
conditions
• Input costs
• Labour
Social
• Rehabilitation
• Community well-
being
• Health and
Sanitation
Environmental
• Deforestation
• Use of natural
resources
• Pollution of
resource bodies
in the vicinity
Functions that impact the
integrated reporting
process for a major steel
plant

7. The need for Integrated Reporting
• A new standard for corporate communication, and helps to complete
financial and sustainability reports.
• Creates provision for concise representation of how an organization
demonstrates stewardship and how it creates and sustains value.

8. Integrated Reporting Process at Natura has
evolved and adapted to time
Stakeholder
Dialogue
Communication
Plan
KPIs including
GRI
Integrated
Management
Culture
Integrated
Management
Culture
Stakeholder
Dialogue
Engagement &
Relationship
Development
The Power of
Digital
Reporting and
Communications

9. Features of Integrated Reports at Natura
• New Strategy required a new integrated reporting process
• The integrated reporting process appends to the organization’s value chain
and defines priorities and commitments
• Supports dialogue and mutual collaboration between stakeholders like
consultants, employees, management, vendors and suppliers

10. Salient Indicators* of Integrated Performance
Economic Social Environmental
• Net revenues totalled R$5.1
Billion with a growth of 21.1%
• Net income of R$744.1 Million
achieved.
• Geographical expansion with
international operations
commencing in Argentina
• 1.2 Million happy consultants – a
growth of 17% over previous
year
• Development programs of the
company receive R$10 million in
funding.
• 73% employees give overall
favourable response on working
conditions
• Reduced water consumption by
10% using efficient methods
• Introduction of organic and bio-
degradable packaging material
• 33% reduction in GHGs ( Green
House Gases) emissions.
*2010 data points

11. Key Learnings from Natura – 3 Bullet Points
• Despite having sustainable methods inbuilt to most processes which has a
cost function to it, Natura has managed to be one of the most profitable
companies in Brazil
• Has been accepted widely across customer segments due to brand affinity,
clean reputation and despite the premium pricing
• From an organizational point of view, a sustainable strategy from day zero
has defined the organizational structure

12. Points of Contradiction
• Reporting process too focused on stakeholders
• Does not take into cognizance competitor actions in terms of social
responsibility
• The KPIs are limited to a specific geography and may not apply in other
markets

13. The reporting process in the future intends
to go from informative to transformative.
The organization’s integrated reporting must
tell an inspiring story of sustaining
profitability.
Future Forward

14. déjà vu
Abhishek | Arisha | Ananya | Avijit | Chirag | Nandini | Rahul | Sampad