Candles Industry ESG Thematic Report, 2023

Environmental, Social and Governance (ESG) in the Candles Industry

Integrating ESG into decision making and business strategies contributes to an effective due diligence and a better investment decision for the company as well as relevant stakeholders. Companies which fall under the candles industry don't disclose any ESG data.

This segment has significant impact on people and planet alike, mostly paraffin wax contains dangerous or toxic by-products such as toluene and around 300 toxic chemicals as per a study conducted in 2007. Bee wax, Soy wax, and plant-based waxes are present to minimize paraffin wax usage. Another major concern for candles is emission of volatile organic compounds (VOC’s), which can have serious negative health impacts when used in large quantities. In addition to this, Candles also pose allergic reactions to scented candles like sneezing, runny nose, and sinus blockage. Candles industry can be a potential local community engagement initiative to support people as it can be produced even from a small-scale industry.

Candles have been used due to religious and commercial value as it is also used in spa and massage centers and there won’t be any hindrance in the growth of this segment. However, this sector can influence ESG while being assessed from the framework of United Nations Sustainable Development Goals (UN SDGs).

ESG Trends

As mentioned, Candles have both environmental and social aspects to be addressed, starting off with emission of Volatile Organic compounds suggest that it poses significant negative health impact(SDG 3- Health and Wellbeing) such as headaches, skin irritation, fatigue, nausea and possibility of long-term exposure to cancer. Studies also indicate toluene is also another major emission from candles products along with 300 other toxic chemicals. The Environmental Protection Agency and European Candle   Association have been the legal bodies who monitor emission and environmental impact. Paraffin wax do cause above mentioned issues, consumer preference has changed to use more nature-based candles such as Soy wax, coconut wax, beeswax, vegetable wax etc. which poses lesser health issues. Consumer Product Safety commission also ensures and monitors reduced use of lead and other toxic chemicals in candles in the market. Even though it poses a health impact, transitioning to natural products makes the market more attractive for consumers. In addition to this it also provides an opportunity for the local community(SDG 12- Responsible consumption and production) as it doesn’t require much capital or investment in comparison with other markets.

ESG Challenges

The challenges are mentioned above, as this segment poses health issues minimizing usage of candles have been seen in many consumers.  Studies also show long term exposure could lead to cancer along with various other health issues. Consumers have preference for nature-based candles, which requires more capital for production in comparison with synthetic waxes.  Legal frameworks like European Candles Association (ECA) have not been able to capture a scientific study to analyze the health impact of paraffin wax   which is also one of the major concerns arising in consumer end. As candles use plastic packages, there has been no evidence in minimizing plastic usage or following sustainable practices in the value chain operations.  Environmental protection agency hasn’t addressed any information for the same, it has significant negative environmental impact.

Growth of the Candles Market

The candles market has a stable and most prolonged tenure in the market as it is having both religious and commercial value. Transition from synthetic candles made from paraffin wax to more nature-based wax makes candles more sustainable and better for business growth. Global candle market was valued at 3.45 billion USD in 2018, nature-based candles like soy wax candles are expected to have a CAGR of 8.5% to 2025.

Key Companies in this theme

    • Better Homes and Garden

    • Bath & Body Works

    • Bridgewater Candles

    • Colonial Candle

    • Circle E Candles

    • Diptyque

    • Jo Malone

Scope of the Candles 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 Candles Industry ESG Thematic Report

    • Developing a comprehensive understanding of macro-economic, Policies & Regulations and innovations affecting the market, globally

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

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

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