Environment and Sustainability

The Group's environmental and social responsibilities are important to its long-term success, and key environmental goals have been embedded within its long-term strategy, with the aim of continually improving all aspects of environmental performance, as far as economically feasible. We are proud of the progress we have made to date and continue to strive for a future where the planet is cared for and value is created, not only for our Company, but for the collective success of all our stakeholders.

The Group is prioritising the ESG issues that offer the greatest potential for the Group to create shared value, and has adopted a sustainability strategy focusing on four key pillars:

·        Planet: In 2024 the Group continued to work with Planet Mark to measure and report against its Scope 1 and 2 emissions, review onsite energy, water and recycling management, and to support the development of our factory sustainability assessments. Warpaint and Badgequo have achieved a year 2 business certification with Planet Mark, demonstrating the Group’s measurement of key environmental measures. In 2024 our work with Planet Mark was extended and a plan formulated for measuring and reporting on a fully certified basis against Scope 3 emissions, which will commence in 2025.

·        Products: The product and packaging reduction and alternative strategy introduced in 2022 has been further developed through 2024,accelerating compliance with product and packaging regulations, and rationalising the Group's packaging supply sources. 

·        People: Warpaint's commitment to its employees remains at the forefront of its focus along with the development of corporate and community charity initiatives.

·        Performance: The Group's progress against defined goals and targets will be measured and reported on for the year ended 2025.

Our Planet and the Environment

Planet Mark

Climate change is one of today's greatest challenges, profoundly affecting all regions of the world and all sectors of society. All individuals and industries must work together to halt the climate crisis and embrace long term sustainability.

CO2 is a powerful greenhouse gas that has been proved to have the biggest impact on air pollution and global warming, and by 2050 every UK business must be net-zero by law.

The measurement of the Group’s carbon footprint plays a fundamental role in creating an environmental strategy that mitigates risk and maximises the opportunities to reduce CO2 emissions and start the journey towards net-zero.  As a business Warpaint is committed to reporting its progress with transparency, verifiable data and science-based methodologies to support its long-term strategy and drive improvements.

In 2024 the Group continued its work with Planet Mark, an independent consulting group experienced in the measurement, development and communication of carbon and social data and goals which provides a sustainability certification for organisations and their products.  In 2023the Group collated the necessary energy consumption, waste and water usage data to enable an initial measurement to be produced and adopted, resulting in the Group’s first Planet Mark certification being obtained in Q4 2023, in respect of the year ended 31 December 2022. The Group is measured in each calendar year and the certification produced in the following year.  This process has continued throughout 2024 and the Group’s second full year of key measurement metrics for the year to 31 December 2023 were certified in Q4 2024 as follows: 

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•276.1 tCO2e measured emissions/2.1 tCO2e per employee including:

•Buildings: 98.1 tCO2e

•Travel: 130.6 tCO2e

•Waste: 45.9 tCO2e

•Water: 0.4 tCO2e

•Procurement: 1.0 tCO2e

•Home Working: 10.7 tCO2e

Continuous improvement will be tracked against these key measurement metrics.

Targets and goals against these base level metrics will be further developed, monitored and communicated and disseminated throughout the Group and beyond to ensure that stakeholders are engaged and fully aligned with the Group’s aims, in order that progress may be achieved.  

Certification for the 2024 year is expected to be available in Q4 2025.

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SECR Streamline Energy and Carbon Reporting

The Group reports annually against the SECR Streamline Energy and Carbon Reporting (”SECR”) requirements and details are set out in the Directors’ Report of the Annual Report. Using an intensity metric based on Group sales, for the year ended 31 December 2024 the energy and GHG emissions from business activities involving the combustion of gas, the purchase of electricity, and business mileage was 1.02kg tCO2/£mil in the year (2023: 1.16kgtCO2/£mil).

Our Premises and Logistics

The Group includes energy efficiency measures whenever possible in carrying out its business, and when making operational decisions. In2024, the Group completed the upgrade of internal and external lighting to LED units throughout all its sites. In 2024 Warpaint completed the installation of solar panels to the roof at its largest warehouse site, to provide electricity throughout the year and to return any surplus energy back to the grid. The number of electric cars utilised by Group employees increased in 2024.

New technologies continue to be considered in order to improve the environmental performance of the Group’s sites, to reduce energy consumption and improve overall energy efficiency throughout the business.

Reducing physical waste is also a key part of the Group’s sustainability objectives, and progress continues to be made in ensuring that onsite recycling is easily accessible across the Group’s offices and warehouses, including glass, plastics and paper recycling and Terracycle recycling boxes for cosmetic packaging. The Group’s industrial waste removal programme has also been strengthened.

Warpaint continues to be mindful of its carbon footprint in the shipping and transportation of our products from suppliers to the Group’s warehouses and customers, seeking to minimise its carbon footprint as much as possible, for example shipping direct from China to the US for product sales there, and using air carriage only when unavoidable. The Group is encouraged by its shippers who are increasingly investing in the reduction of their own carbon footprint with the development of their own reduced carbon vessels and solutions. These shippers are utilised wherever practicable.

In 2025 the Company will be taking occupation of premises at Frontier Park, Burnley, which will operate as a single warehouse and logistics hub for Technic products. It is also planned that the site will handle logistics for other brands within the Group. This is anticipated to have a positive impact on the Group’s logistics model and will offer operational and environmental benefits

Most interactions with suppliers and retail customers take place online. This is encouraged wherever practicable, with travel (and particularly air travel) limited, and customer, supplier, management and employee meetings held virtually where feasible. Face-to-face meetings are still held only where this is considered necessary and conducive to a more productive relationship. This aims to reduce the environmental impact of the Group’s travel and is reflected in its travel policy, which encourages essential travel only. Where air travel is deemed necessary the use of airlines that provide carbon offsetting is encouraged wherever possible. The Group’s direct presence in the manufacturing region also helps in this regard.

Attendance at trade shows and exhibitions has reduced overall. Virtual trade shows are attended wherever possible, with only key events attended face-to-face and, where practicable, these are combined with other customer or supplier visits. As the Company grows its investor base, and attracts more investment banking interest it receives invitations to investor roadshows and conferences held

internationally. These are attended where it is considered beneficial for investors as a whole and the Company will participate virtually, where that is an option.

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Our Products

Product Testing

The Group’s products are “cruelty free” and are not tested on animals irrespective of where the products are being supplied. The Group supports cruelty free alternatives to animal testing to become compulsory and animal testing overall to cease globally.

The Company joined and remains committed to the PETA “Beauty Without Bunnies Program”, a globally recognised programme demonstrating a commitment to PETA’s Global Animal Test-Free standard. In line with this standard, Warpaint agrees that it will not conduct, commission, or pay for animal testing of any products, nor will it conduct, commission, or pay for animal testing of ingredients used in, or formulations of, such products. Warpaint commits to continue to ensure that its suppliers of ingredients do not conduct, commission, or pay for tests on any ingredients used in its products. Warpaint will continue to ensure its suppliers/manufacturers of finished products do not and shall not conduct, commission or pay for animal testing of any products.

Warpaint proudly displays the PETA company logo on our products for all new products and as packaging is updated. Warpaint’s commitment to the PETA programme is Group wide and covers all brands within the Group apart from Brand Architekts’ Skin & Tan products, which are approved under Cruelty Free International’s Leaping Bunny programme.

‍Product Ingredients

All newly developed Warpaint products are manufactured vegan friendly and without parabens. Any existing products that contain parabens have now all been reformulated. The Group had a dedicated vegan range, Very Vegan, but this was fully discontinued in 2024 and the W7 brand is now entirely vegan.

No heavy metals such as TBTO (preservative) and other ingredients of concern are added to the Group's colour cosmetic products, and all raw materials comply with the strict regulations applicable in the UK, EU,US and Canada and other markets in which we operate.

CTPA Membership

The Warpaint Group companies are full members of the Cosmetic, Toiletry & Perfumery Association (CTPA). The CTPA is the trade association for the UK cosmetic and personal care industry, and through its membership the Group ensures it remains aware of industry news, issues, and regulatory compliance both in the UK and globally. The Group has employees sitting on both the Compliance and Regulatory Committee – providing advice, on-going support and guidance on all regulatory and compliance matters regarding the placing on the market of cosmetic products in the UK and EU, and the Scientific Committee – providing advice, on-going support and direction on all scientific matters pertaining to the safety and integrity of cosmetic ingredients and technical aspects of manufacturing cosmetic products.

‍Responsible Sourcing and Manufacturing

“Good Manufacturing Practice Certificates” are provided by suppliers for all of the factories used in the manufacture of the Group’s goods. The Group’s main suppliers also produce for many international brands, and additional comfort is taken from the public ethical and sustainability stance around the world of these brands. The Group’s suppliers are encouraged to share the results of their BSCI and Sedex audits when they have taken place and, for all its branded products the Group has adopted a vendor assessment policy that includes ethical and sustainability criteria. 

Warpaint is committed to ethical and responsible sourcing practices aligned with international standards and protocols for human rights, worker rights, environmental and human health and safety. In support of this commitment, the Group seeks to enhance its responsible and ethical sourcing practices to better address the risks and challenges in an increasingly complex global supply chain.

Sustainable Products and Packaging

The Group is committed to becoming an industry leader for sustainable products and packaging. 

The Group has a robust strategy to eliminate all unrecyclable plastics as per the ‘UK Plastic Pack’, an accredited body who drives improvements to industry standards through DEFRA (UK Department for Environment, Food and Rural Affairs). All unrecyclable plastics have now been removed from outer gifting packaging, and the Group is progressing well with its journey of removing unrecyclable plastics from the packaging of all year-round products as well. The Group has also changed certain products into alternative fully recyclable materials, and has proactively removed the majority of plastics from most outer packaging, aiming to use paper and cardboard product packaging wherever practicable. This enables the Group, its customers and end consumers to recycle the waste effectively.  

Some Group products are already plastic free, and there are plans in place to change to sustainable FSC, virgin or recycled packaging where feasible, with ambitions to become one of the leaders in this area. 

The use of plastics in product casings has previously been challenging to remove, but with material developments and understanding, the Group is actively working on testing and sampling new materials. Where the use of plastic is unavoidable, recyclable packaging will be used wherever possible. By providing clear instructions on our product labelling, consumers will knowhow to dispose of the packaging in sustainable ways. The Group is encouraged by the progress made by its product teams in building processes to challenge the plastics in product casings and is equally encouraged by the support received from suppliers in the move to more recyclable packaging. This will continue to be challenging until the most recyclable materials become available at an appropriate price for the mass market. In the meantime, a large proportion of the Group’s NPD in 2024 continued to pass through our changed protocols and this will continue in the coming years. NPD processes for the Technic brands also include an accompanying packaging development protocol alongside the development of the products themselves, to ensure that recyclable packaging is considered with all NPD, wherever possible.

Management is confident that current unrecyclable plastics within the Group’s products will be replaced with the most reusable and recycled plastic materials available, ensuring the achievement of Government Guidelines for brand and producer responsibilities. This will help the Group comply with the new Extended Producer Responsibilities (EPR) regulations which came into force in early 2025. The NPD team is actively engaging with DEFRA on the introduction of the new EPR regulations, participating in seminars and surveys, wherever possible. The Group’s dedicated Packaging and Sustainability Lead has recently been appointed to the CTPA Taskforce, which has been set up to assist, advise and steer the EPR process within the cosmetics and personal care industry in the UK.

The Group’s dedicated Packaging and Sustainability Lead is responsible for seeking sustainable solutions for products and packaging, aligned to our environmental responsibilities and goals. This individual is also responsible for ensuring Group compliance with the increasing regulation in this area, enabling its mission to provide an extensive range of high-quality cosmetics at an affordable price and to grow the business for the benefit of our stakeholders can be continued.

The Group seeks to ensure no product is wasted, and for example in conjunction with Tesco, any W7 products remaining in store after short term promotions are donated to be placed in the food bank collection points, which are positioned at the front of all large Tesco stores. Any Technic and Body Collection excess stock is also donated to local hospital staff and charities such as the “Look Good Feel Better” cancer charity, having a positive social impact on the community as well as supporting waste reduction. Our subsidiary, Badgequo also actively works with end of range retailers such as The Company Shop to ensure products continue to their natural intended use, and with charitable organisations such as Age UK to support these supply routes with the same aims.

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