Consumers are being duped into buying cosmetics promoted as organic despite many products not being certified by any of the recognised organic groups in Australia and with some not even containing natural ingredients.
CONSUMERS are being duped into buying cosmetics promoted as organic despite many products not being certified by any of the recognised organic groups in Australia and with some not even containing natural ingredients.
The organic food market has boomed in the past 20 years. The most recent figures show it has grown from a retail value of $28 million in 1990 to
$947 million in 2010.
But while consumers can be confident that almost all the food products that are labelled organic on supermarket shelves meet stringent requirements, the same does not apply for the burgeoning organic cosmetics market.
Andrew Monk, the convener of standards at the Biological Farmers of Australia, said the certification of organic food was now at a point where consumers could be guaranteed they were buying genuine organic.
''But we are at least two or three years away from that with cosmetics, which is still a grey area,'' Dr Monk said.
Dr Monk said there were shampoos that claimed to be organic but were lucky to contain any natural products.
''They might use the word organic in their name, but then only contain a tiny bit of aloe vera,'' he said.
The Biological Farmers of Australia's regulatory arm, Australian Certified Organic, is the country's largest certifier of organic products and is behind the ''bud'' logo found on about 80 per cent of organic food and beverage products sold in stores.
Coles stocks 540 organic products, including 170 of its own brand, carrying the bud logo, while Woolworths stocks 402 organic food products, including 289 in its private-label range.
Their product ranges have been increasing each year.
''We think it is pretty much as good as it is going to get when it comes to food labelling,'' Dr Monk said.
Grace Culhaci, owner of the Sydney company Pure & Green Organics, a certified organic skin-care brand, said consumers were increasingly wanting to use organic cosmetics, but could be misled by labelling.
Ms Culhaci said Australian organic cosmetics must contain a minimum of 95 per cent organic ingredients and must be certified by a government-approved body. But, she said, the same strict conditions did not apply to imports.
She said one brand, Dr Organic from Britain, now had a large presence in Australia but many of its products contained very few organic ingredients, yet its name suggested that it was a legitimate organic brand.
''If 1 per cent of the product is organic ? then that really is greenwashing,'' Ms Culhaci said.
Carla Oates, Biological Farmers of Australia's spokeswoman on cosmetics who also owns her own organic skin-care range, said organic manufacturers invested a lot of money developing their products, but had to compete against cheap imitations.
''Regulations are really loose around labelling of cosmetics and I really don't think it is fair,'' she said. ''Manufacturers spend a lot of time and money formulating their products, but then they are sold next to something that is much cheaper, which is false marketing because they are not what consumers expect them to be.''
Frequently Asked Questions about this Article…
How big is the Australian organic market and why should investors care about organic cosmetics?
The article notes the organic food market grew from $28 million in 1990 to $947 million in 2010, showing strong consumer demand. For investors, that growth highlights opportunities in related sectors like organic cosmetics — but the cosmetics segment currently lacks the same certification certainty as food, creating both upside for trusted brands and risk from misleading products.
Are organic cosmetics in Australia reliably certified?
No — unlike organic food, organic cosmetics are described in the article as a 'grey area.' Experts say certification and consistent standards for cosmetics are still a few years away, so many products labeled 'organic' may not be certified by recognised Australian bodies or may contain few natural ingredients.
Which certification bodies and labels matter for organic products?
The article highlights the Biological Farmers of Australia and its regulatory arm, Australian Certified Organic (which uses the 'bud' logo). ACO is the country's largest certifier and backs about 80% of organic food and beverage products sold in stores — a label investors can look for when assessing product credibility.
How do major retailers like Coles and Woolworths feature in the organic products market?
According to the article, Coles stocks 540 organic products (including 170 private‑label items carrying the bud logo) and Woolworths stocks 402 organic food products (including 289 private‑label). Their expanding ranges show large retailers are investing in organic lines, which can benefit certified suppliers but also raise competition from private labels.
What is 'greenwashing' and why is it a concern for investors in organic cosmetics?
The article describes greenwashing as products that use 'organic' in their name but contain only tiny amounts of organic ingredients — one example cited was a brand with possibly just 1% organic content. For investors, greenwashing can damage consumer trust, harm brand value, and create regulatory or reputational risk for companies in this space.
Do imported cosmetic brands face the same organic standards as Australian-made products?
The article states that Australian organic cosmetics must contain a minimum of 95% organic ingredients and be certified by a government‑approved body, but the same strict conditions do not always apply to imports. That gap can affect competition and consistency in the market.
What competitive pressures do certified organic manufacturers face?
Certified organic manufacturers invest significant time and money developing products, but the article notes they must compete against cheaper, uncertified imitations and potentially misleadingly labelled imports. Loose cosmetics labelling regulation can make it harder for genuine producers to differentiate themselves.
How can everyday investors assess companies in the organic cosmetics sector based on these issues?
Investors should look for clear certification (such as the Australian Certified Organic bud logo for locally certified products), check ingredient transparency, note whether a brand is domestic or an import, and consider the reputational and regulatory risks around loose labelling. These signals help distinguish companies likely to benefit from genuine consumer demand from those relying on marketing alone.
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