More beauty brands are finding ways to minimize the impact they leave on the world.The stuff that beauty fans love is, in fact, connected to the climate crisis, because the $532 billion dollar industry that we support is implicitly linked to other industries that pollute the earth. The beauty industry contributes 120 billion units of packaging a year, according to some estimates, and the shipping industry, an integral part of the process, contributes more than 1 billion tons of CO2 a year — and this is just the world’s merchant fleet, not accounting for freight or air shipping.But more beauty brands are finding ways to minimize the impact they leave on the world when they make products. The “clean beauty” movement was worth $11 billion in 2016 and will likely be worth more than twice that by 2025. source
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At Ethically, we compile scores from over 700 verified sources to create a granular profile of more than 10,000 companies and brands, evaluating their impact on the environment, society at large, and good business. You can learn more about Ethically’s process in our Methodology and you can see the scores yourself by downloading the Ethically browser extension.
Sephora is a French multinational retailer of personal care and beauty products. Featuring nearly 3,000 brands, along with its own private label, Sephora Collection, Sephora offers beauty products including cosmetics, skincare, body, fragrance, nail color, beauty tools, body lotions and haircare. The company was founded in Limoges in 1970 and is currently based in Paris. Sephora is owned by luxury conglomerate LVMH as of 1997.
Ulta Beauty, Inc., formerly known as Ulta Salon, Cosmetics & Fragrance Inc., is an American chain of beauty stores headquartered in Bolingbrook, Illinois. Ulta Beauty carries cosmetics and skincare brands, men’s and women’s fragrances, nail products, bath and body products, beauty tools and haircare products. Each store is also equipped with a salon, Benefit brow bar and Dermalogica skin bar. Ulta Beauty currently has 1,196 stores across all 50 states.
These two companies, while often compared side by side, have a distinct gap when it comes to their ESG measurements. There are some major differences that put one above the other.
Overall, Sephora scored a 67/100 and Ulta scored a 47/100. This difference is highlighted in all three score categories but is especially seen in their environment and governance scores.
Let’s dive in (Reminder, check out our Methodology for definitions on each of these subtopic scores)
Impact on the environment
Impact on the environment relates to how a company or brand impacts the natural world around us. This could be related to the products they create, their manufacturing policies, or even their corporate response to climate change. Sephora and Ulta both impact the environment in a number of ways, from their manufacturing policies to the products they produce. Below are more details comparing these two companies.
Sephora significantly beats Ulta in this category, with the scores being 66 to 39. This category has to do with the companies’ compliance with environmental regulations, energy efficient operations and development of renewable energy and alternative environmental technologies.
Double clicking on that score difference, Sephora scored a 67/100 in Energy & Climate Change and a 64/100 in Resource Management. On the other hand, Ulta scored a 53/100 in Energy & Climate Change and a 45/100 in Resource Management.
Impact on social responsibility
Social responsibility includes all the things that make a company “good”. Whether that’s giving back to the community, standing up for equal rights, treating workers fairly. Sephora and Ulta both have a number of policies around LGBTQ+ rights, community outreach, and equal pay and rights for all.
Another distinct comparison can be noted within the Social Responsibility category, where Sephora scores a 66/100 and Ulta scores a 51/100.
The major differences were the respective companies’ Diversity and Labor rights rankings Sephora: 74 vs. Ulta: 50, Training, Health & Safety rankings Sephora: 73 vs. Ulta: 51 and Compensation with Sephora: 75 vs. Ulta: 52 score.
Quality of corporate governance
Corporate governance is much like social responsibility, but for how the company operates internally. Do they have a diverse board? Is there transparency in accounting? Are they doing what they need to do to survive and operate in an ethical and correct manner? Sephora and Ulta both are large public companies with shareholders and boards they answer to.
The most significant difference in scoring between both companies’ is the Governance ranking, where Sephora scores a 70/100 and Ulta scores a 47/100.These scores refer to leadership structure and the values that determine corporate direction, ethics and performance.
Upon further analysis, Sephora pulls away from Ulta in the rankings of Leadership & Ethics (67 vs 44) and in Transparency & Reporting (74 vs 44).
Ethically partners with CSRHub as a primary data source, which in turn, aggregates over 700 data sources, compiling them into simple, easy to digest grades.
Sephora and Ulta remain some of the largest beauty brands with products, policies, and actions that impact the world around them far beyond the simple brands people know them for.
Sephora’s scores are much higher than Ulta’s. Ulta Beauty also committed that all packaging sold from all brands will need to be made from 50% post-consumer recycled or bio-sourced materials, or recyclable or refillable by 2025. Sephora’s 2019 goals and progress on sustainability predominantly focus on the retailer’s stores, distribution centers and corporate offices. The retailer is part of the Sustainable Packaging Coalition and notes that it “encourages” brands to “embrace efficient [packaging] design” but doesn’t make it a requirement. source
If you want to stay up to date on how Sephora or Ulta is progressing with their scores, make sure you download Ethically. We pull data regularly to make sure our scores reflect how companies are doing today, not years ago.
As always, please check out our Methodology page for more details on how we get our ratings data.