Water Management: A Strategic Challenge for the Cosmetics Industry

As the summer of 2026 has already set new records for both temperatures and drought conditions, water is becoming one of the defining challenges for the future of industry. Water efficiency is no longer a sustainability initiative:  it is a business necessity. Companies must begin planning now, if they have not already.

Water restrictions introduced during drought periods expose the entire cosmetics value chain to reduced water withdrawal allowances, potentially limiting production capacity and business growth. Understanding how water is used throughout the value chain, as well as the regulations that may affect these uses, is therefore essential. Equally important is identifying and implementing the operational levers that enable more efficient water management.

Water remains a key ingredient in many cosmetic formulations, serving as a solvent, excipient, active carrier, aqueous phase of an emulsion, or texturizing agent. It must comply with strict quality standards and, in some cases, may possess specific characteristics, such as thermal spring water.

This is considered consumptive water use, meaning that once withdrawn, the water is not returned to the environment. It represents the most visible aspect of water use in cosmetics, particularly from a consumer perspective. However, it is only the tip of the iceberg.

Manufacturing cosmetic products also requires significant volumes of water throughout the production process, including heat and steam generation, cooling systems, equipment and facility cleaning, as well as various manufacturing operations such as dilution and solvent applications. Unlike consumptive water, process water is generally withdrawn and then returned to the environment after treatment.

Beyond manufacturing itself, water is also required upstream and downstream across the value chain: irrigation of plant-based raw materials, extraction processes such as distillation, packaging production, and ultimately product use by consumers.

In practice, understanding a cosmetic product’s true water footprint requires a full life cycle assessment. Some naturally derived ingredients, for example, can have a particularly high water footprint despite their sustainable image.

Like all industrial sectors, the cosmetics industry is increasingly affected by cross-sector water regulations designed to promote water efficiency, improve resource availability, and protect water quality.

In France, this is reflected in the 2023 National Water Plan (Plan Eau), which aims to improve long-term water resource management. Under this framework, the decree of 30 June 2023, commonly referred to as the Water Restriction Order, requires classified industrial facilities to reduce water withdrawals according to drought severity:

• Alert: 5% reduction
• Enhanced Alert: 10% reduction
• Crisis: 25% reduction

Certain facilities may qualify for exemptions, particularly those that have already reduced water withdrawals by at least 20% since 2018 or those using at least 20% reclaimed water.

Reclaimed water sources, often referred to as non-conventional water resources, include rainwater, greywater, swimming pool water, and groundwater from wells. Water reuse remains relatively limited in France, representing only around 1% of network water compared with approximately 14% in Spain. Although the regulatory framework governing reclaimed water can be complex, particularly depending on whether a site falls under France’s classified installation regime (ICPE), it deserves careful consideration.

At the European level, the Water Resilience Strategy further reinforces this direction through five strategic priorities:

• Improving water quality through stricter treatment standards and broader pollutant coverage;
• Promoting circular water use through greater reuse;
• Supporting a competitive European water industry by encouraging innovative technologies;
• Developing sustainable financing mechanisms, including Extended Producer Responsibility (EPR);
• Strengthening water risk management.

The Urban Wastewater Treatment Directive (Directive (EU) 2024/3019), which replaces the 1991 directive, introduces a significantly more demanding framework for wastewater management. It establishes stricter discharge standards, regulates tertiary and quaternary wastewater treatment, defines enhanced water quality monitoring requirements, and introduces Extended Producer Responsibility to finance quaternary treatment technologies.

At present, the European Commission identifies the pharmaceutical and cosmetics industries as the two largest contributors to micropollutants in water, making them responsible for approximately 92% of the associated financing.

However, according to the French cosmetics association FEBEA, the European Commission’s impact assessment contains methodological shortcomings that overestimate the cosmetics industry’s contribution. While cosmetics are estimated to account for only around 1.5% of micropollutants, the sector could ultimately bear approximately 26% of Extended Producer Responsibility costs. This remains an evolving regulatory issue that the industry continues to monitor closely.

The cosmetics industry did not wait for new regulations to begin addressing water management. However, these challenges have now become strategic priorities.

For water used directly in formulations, reducing consumption is often difficult because of water’s unique functional properties. In many formulations, water is an essential ingredient that cannot simply be removed without fundamentally redesigning the product. Waterless formulations therefore require not only formulation innovation but also significant consumer education.

Greater opportunities often exist in indirect water use, including manufacturing processes, agriculture, extraction and cleaning operations, provided companies first analyze how water is currently being used.

Potential improvement levers include:

• Identifying and reducing unnecessary water consumption and waste;
• Optimizing manufacturing processes, for example by adjusting cleaning frequencies;
• Matching water quality to actual operational needs, for example, determining whether potable water is truly required or whether reclaimed water would be sufficient;
• Assessing whether current water volumes are genuinely necessary, such as for equipment rinsing;
• Expanding water reuse wherever feasible;
• Exploring alternative extraction technologies, such as supercritical CO₂ extraction, or optimizing existing methods like distillation;
• Prioritizing ingredients with lower water footprints or promoting more sustainable agricultural practices;
• Continuously identifying new opportunities for water efficiency throughout operations.

Sometimes, the greatest impact lies in unexpected places, particularly during product use.

For example, a waterless solid shampoo that requires large quantities of water to rinse may ultimately have a higher overall water footprint than a conventional liquid shampoo. As with carbon emissions, evaluating water performance requires considering the product’s entire life cycle, using recognized methodologies such as ISO 14046.

As water is embedded throughout every stage of cosmetic product development and manufacturing, water resilience is rapidly becoming a strategic business imperative.

The regulatory landscape continues to evolve, leaving companies with little room for inaction. In France, the National Water Plan aims to reduce industrial water withdrawals by 10% by 2030.

The most effective solutions will vary from one organization to another, but every initiative that improves water efficiency contributes to greater operational resilience. These investments should be planned well before drought periods occur. Protecting water resources ultimately means protecting business continuity, and investment decisions should be assessed against the operational and financial costs of future water restrictions rather than in isolation.