Baby Diapers Industry ESG Thematic Report, 2023

Environmental, Social and Governance (ESG) in the Baby Diapers Industry

The consolidation of Environmental, Social, and Governance (ESG) within the investment and decision-making processes contributes to responsible investing. Investment into ESG has shot up since 2013; in fact, the market, can be seen as a powerful tool for achieving certain ESG goals across the globe has witnessed a large infusion of investment capital since 2020.

The baby diapers industry has been a crucial sector especially disposable diaper contributed around two third of the global market back in 2020. However, many across globe had faced difficulty to afford diapers in the past years, but few legal measures like “the End of Diaper act” had helped low-income families. This aspect impacts the social part in ESG as it can create a significant negative impact on companies in line with United Nations’ Sustainable Development Goals (SDG) 11 which focuses on reduced inequalities among minorities.

Adequate waste management for disposable diapers have been also a rising concern along with sanitary pads. Thus, companies in this sector must focus on reducing waste which is a key SDG – Responsible production and consumption (SDG 12). In recent years, diaper quality is a major talking point in the market space, which gives a competitive edge to the peers. Toxic/chemical usage in disposable diapers can lead to significant health impacts and if the waste is not managed properly can create harmful emissions. This turns the focus to usage of biodegradable diapers.

The demand for swim pants is driven by increasing awareness about the maintenance of personal hygiene among babies, especially in public swimming pools. The use of swim pants could help in avoiding the risk of bacterial infection as it prevents feces and infection-causing germs from contaminating the pool which contributes better product quality which is a social sustainable part of the product in ESG. “Bdiapers India” had launched the country’s first-ever hybrid cloth diapers with disposable or reusable inserts. The product is a patented design of hybrid diapers that works in a two-part system with a cloth cover and a waterproof pouch that holds the disposable nappy pad

ESG Trends

Baby diapers space has various area of concerns inclusive of both social and environmental areas. One of the main focal points is higher female workforce throughout these industries, as diversity and inclusion is a very crucial aspect in ESG. Companies in this space are also emphasizing on sustainable packaging.  for example, Johnson and Johnson, when designing new products or optimizing existing products, identify opportunities to integrate sustainability early in the process to avoid potential environmental impacts across the product lifecycle. Thus, companies in this sector are constantly monitoring consumer demand in terms of sustainability and are developing sustainable methods like usage of biodegradable diapers instead of disposable ones.  Furthermore, companies in the industry conduct various community awareness initiatives on a global scale, not only for their product but also general healthcare for infants and children alike. These companies are also monitoring climate transition action plan or environmental targets with regards to respective countries agenda to cope up with Paris agreement or attaining carbon NetZero and /or Carbon neutrality.

ESG Challenges

Major challenges faced by baby diapers industry is affordability and waste management in the diapers which hinders inclusiveness of minorities and contributes to significant end-of-life waste of products. Baby diapers are quite expensive for a low-income family sector, to cope up with that many legal acts and subsidies have been introduced. Waste management for diapers, despite being a highly discussed topic have seen challenges with biodegradable diapers have been introduced which contributes to an environmentally responsible product use. However, these diapers might be still unaffordable for certain segments in the society.  Disposable diapers do pose a threat as it contains toxic chemicals which in turn harm human and environment alike causing significant negative impact in terms of social and environment of ESG. 

Growth of the Baby Diapers Market

The global baby diapers market size has been valued at USD 75.9 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 4.6% from 2021 to 2028. The market is projected to portray higher demand over the coming years owing to the rising awareness regarding child health. The shifting inclination for high-quality and eco-friendly baby products is the major factor boosting the demand for biodegradable diapers across the globe. In addition, manufacturers are working on developing bio-ingredients based baby diapers, which is also anticipated to encourage market growth over the coming years. Bdiapers India had launched the country’s first-ever hybrid cloth diapers with disposable or reusable inserts. The product is a patented design of hybrid diapers that works in a two-part system with a cloth cover and a waterproof pouch that holds the disposable nappy pad

Key Companies in this theme

    • The Procter & Gamble Company (P&G)

    • Kimberly-Clark Corporation

    • Hengan International Group Company Ltd.

    • Unicharm Corporation

    • Johnson & Johnson

    • First Quality Enterprises

    • Ontex Group

    • The Hain Celestial Group, Inc.

    • The Honest Company, Inc.

    • Essity AB

Scope of the Baby Diapers Industry ESG Thematic Report:

    • Macro-economic and ESG-variable analysis of the industry, including regulatory, policy, and innovation landscape

    • Key insights on infrastructure developments and ESG issues affecting the theme

    • Identify key initiatives and challenges within the industry

    • Identify ESG leaders within the industry

    • Understand key initiatives and the impact of companies within the sector to fuel an informed decision-making process

    • Analysis of industry activities based on multi-media sources, including significant controversies and market sentiment

Key Benefits of the Baby Diapers Industry ESG Thematic Report:

    • Developing a comprehensive understanding of macro-economic, Policies & Regulations and innovations affecting the baby diapers industry space, globally

    • Key insights into environmental developments and ESG issues affecting the theme

    • Identifying ESG risks and opportunities to business among leading players in the market

    • Obtaining a clear and relevant understanding of company actions, progress, and impact and find opportunities for investment into the sector