Honest Company Inc., the consumer-products business co-founded
by actress Jessica Alba, is reformulating its laundry detergent and
other cleaning products, removing an ingredient that has created
controversy for the company, according to people familiar with the
matter.
The five-year-old Santa Monica, Calif., company sells household,
baby and personal-care products that it markets as made without
chemicals that it says are harsh or potentially harmful to health.
Many of the compounds that Honest says it avoids are found in
mainstream brands, which say they are safe to use.
In March, The Wall Street Journal reported that two independent
lab tests found samples of Honest laundry detergent contained
significant amounts of sodium lauryl sulfate, a cleaning agent that
is on a list of chemicals that Honest has pledged to avoid. The
detergent bottles for years have claimed the product is "free of"
SLS.
Honest disputed the labs' findings and said the company's own
testing didn't find SLS. Instead, it said it used sodium coco
sulfate, which Honest said was a different compound derived from
coconut oil and less of a skin irritant than SLS. Chemists
interviewed by the Journal said sodium coco sulfate is a mixture of
cleaning agents that includes a large amount of SLS.
Honest executives said in March the company had no plans to
reformulate the detergent.
The company is now preparing to roll out a new laundry detergent
in 2017 that doesn't contain sodium coco sulfate, according to
people familiar with the plans.
In response to an inquiry from The Wall Street Journal, Honest
said it is making changes to multiple products, including dish
soap, detergent and other cleaners, "utilizing an advanced
sugar-based surfactant technology to further improve the efficacy
of our products."
The company said its research team "consistently works to
innovate across our entire product line while adhering to The
Honest Company's uncompromising safety standards."
Replacing the laundry detergent with a new formulation that
doesn't contain sodium coco sulfate would remove ambiguity over the
SLS issue, which caused Honest to face backlash from some
customers.
One small customer, Sprout San Francisco, a children's boutique
that sells natural and organic products, earlier this year stopped
selling Honest detergent and the company's dish soap and
multi-surface cleaner because they contained sodium coco
sulfate.
"We decided the product wasn't what it was described to be,"
Sprout owner Suzanne Price said in an interview. Sprout continues
to carry other Honest merchandise like disposable diapers and
skin-care products.
The moves are coming at an important juncture for Honest. The
company has in recent months had discussions with several large
companies about a potential sale, say people familiar with the
matter, though it is unclear if there will be a deal or if Honest
will decide to pursue an initial public offering instead.
The company has had talks with consumer-products giants
including Unilever PLC, Procter & Gamble Co., Clorox Co. and
Johnson & Johnson, according to one person familiar with the
matter. The four companies declined to comment.
Honest currently generates roughly $300 million in annual sales,
and was valued at $1.7 billion during a private funding round in
August 2015.
Unilever recently discussed the possibility of acquiring Honest
at slightly over $1 billion, according to people familiar with the
talks, but earlier this month the European consumer-goods giant
said it was buying Seventh Generation Inc., one of Honest's primary
rivals.
Honest isn't the only natural-products company that is
rethinking its use of sodium coco sulfate. Hain Celestial Group
Inc., which owns several brands of shampoos and skin cleansers that
contain the ingredient, earlier this year told the Journal it was
reformulating dozens of products and dropping claims that they
don't contain SLS.
Honest, meanwhile, is fighting civil lawsuits brought by
consumers in California and New York who claim they were misled by
the labeling on the company's laundry detergent and household
products. The company has denied the claims.
During an appearance on NBC's Today Show in August, Ms. Alba,
who is Honest's chief creative officer, said the suits were
"baseless and have no merit" and her celebrity status has made her
a prominent target.
"Our customers are savvy enough to do research and understand
the integrity of our products," she said. "We stand by our
ingredients, the effectiveness of the products, and we are pretty
optimistic that we are going to win every case."
This isn't the first time Honest is launching new versions of
its products after facing scrutiny from consumers and the media. In
the summer of 2015, some people who said they were Honest sunscreen
users posted photos of their sunburns on social media and
questioned the efficacy of the product.
Honest executives including Ms. Alba defended the sunscreen at
the time, saying the product had gone through extensive testing and
met government-mandated standards. This year, the company released
a reformulated sunscreen product that contains higher amounts of
zinc oxide, the active ingredient that blocks ultraviolet rays.
Write to Serena Ng at serena.ng@wsj.com
(END) Dow Jones Newswires
September 30, 2016 17:15 ET (21:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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