Avon Products
Avon Products, Inc. or simply known as Avon, is an Anglo-American[9] multinational company selling cosmetics, skin care, perfume, and personal care products, It is a multi-level marketing company based in London. In 2020, Avon had annual sales of $9.1 billion worldwide.[4]
"AVON" redirects here. For Other uses, see Avon.
It is the fourteenth-largest beauty company[10] and, with 6.4 million representatives, is the second largest multi-level marketing company in the world (after Amway).[11] The company's CEO is Angela Cretu who was appointed to the position in January 2020.[12]
In May 2019, the Brazilian multinational company Natura & Co announced its intent to acquire Avon; the deal closed in January 2020. Following the merger, existing Natura shareholders held 73% of the combined company, Natura Holding S.A., with former Avon shareholders owning 27%.[13] At merger completion, Avon became a privately held company, common stock was removed from the NYSE trading.[14]
Controversies[edit]
American corruption charges[edit]
Beginning in 2008, the conduct of various employees and executives of Avon were investigated for possible violations of the law, including bribery and violations of the Foreign Corrupt Practices Act.[44]
Avon began a probe of its China division after an internal whistleblower alleged bribery in June 2008.[44] At least four executives, both in Asia and in the United States, were suspended in 2010,[44] and later fired for their roles in the activities being investigated.[45] According to The New York Times, Avon spent over $170 million on legal fees and costs related to the investigation: $59 million in 2009 and $95 million in 2010, and $22.5 million for the first quarter of 2011.[46] The final tally was about $500 million.
The Times reported that Avon would report the findings to the United States Department of Justice and the Securities and Exchange Commission (SEC) and try to negotiate the penalties that those entities may impose.[46] On February 24, 2011, Avon filed a report with the Securities and Exchange commission highlighting the investigation as a corporate risk factor that could cause investor loss.[47]
In 2014, Avon settled the bribery charges for a total of $135 million; $68 million in criminal penalties, with the remainder in interest, disgorgement, and fines from a civil case brought by the SEC.[24][48]
Animal testing[edit]
Avon vowed in 1989 that as a company located in the United States, it would no longer participate in animal testing.[49] Avon has since claimed to be working globally to introduce safer methods of testing cosmetics that do not require animals. These methods include in vitro testing, computer simulations, and testing cosmetics on human volunteers.[49]
Although Avon does not practice animal testing of its cosmetics that are sold in the United States, certain specialty products do require extensive testing in other countries. In China, specialty products that require degrees of animal testing include but are not limited to: sunscreen products, whitening/pigmentation products, and hair dye/perm or growth products.[49] Despite laws that require animal testing in some countries, Avon chooses to distribute its products in those jurisdictions. Laws in various countries require companies to pay for animal testing through a commercial business in order to sell certain products in that country.[50] Because Avon is not globally animal-testing free, People for the Ethical Treatment of Animals (PETA) has not included Avon on their cruelty-free list.[51][52]
In 2019, Avon ended all regulatory-required animal testing, making it the first global beauty company selling in China to stop all animal testing of ingredients and products across all its brands by developing new ways to deliver products that do not require animal testing, such as reformulating products.[53] PETA has since announced that it has added Avon Products Inc. to their list of companies "Working for Regulatory Change".[54]
Withdrawal from major markets[edit]
In October 2013, Avon announced the closure of its branch in France at the end of that month. Its French employees accused it of keeping the workers in the dark for months and not acting in line with the company's publicly stated values of being a socially responsible company that upholds values of trust, respect and integrity and a culture of "open and candid communication."[55] As of January 2014, Avon France was in receivership.[56]
This was followed by an announcement via Facebook on February 15, 2018, that Avon Australia and New Zealand would close by the end of the year.[57] This decision resulted in the loss of 220 jobs and 21,400 sales representatives. The company has attracted criticism for poor communication with its customers and employees.[58]
Avon is still active in Russia and is recruiting more people and continuing to manufacture products as of January 2024.[59]
