Ms Hässig, wars, crises, economic weakness: the German economy is seeing no growth for the fourth year in a row. How is the beauty and home care industry faring?

Gabriele Hässig: We cannot entirely escape the general environment. As in other industrial sectors, a wave of costs has swept through our companies as well. A significant cost driver has been the sharp rises in energy prices. In addition, the Iran war has led to the most severe disruption to supply chains since the Covid pandemic. The burden on companies and suppliers is immense, whilst at the same time consumer sentiment has deteriorated. However, people do not want to cut back on the products of our member companies. They are essential to daily life. Looking at the development of the beauty and home care industry over the past five years, it is clear: we are a pillar of stability in times of weak economic growth.

Mr Keiser, what factors are contributing to the industry's stable development?

Thomas Keiser: Consumers tighten their belts in times of crisis. Despite the difficult conditions, the growth trend of recent years has remained stable. In 2025, our turnover rose by 2.9 per cent to 35.6 billion euros. Since 2020, the industry has been growing against the trend at an average of 4.4 per cent per year. Particularly in a challenging economic environment, we make the most of our particular strengths: an understanding of consumer needs, a drive for innovation, and the ability to actively shape markets.

What influence does cost development have on companies' sustainability strategies?

Gabriele Hässig: Sustainability has long since ceased to be a "nice-to-have" — it is active future-proofing. As such, IKW companies continue to pursue their long-term sustainability goals consistently, regardless of the ebb and flow of global politics. This applies equally to ecological, economic, and social sustainability. Our industry is actively driving sustainable developments in many areas — from energy- and resource-efficient production and more climate-friendly processes through to innovations in formulations, packaging, and consumer information.

Are there any burdens on companies beyond cost developments?

Gabriele Hässig: Reducing unnecessary bureaucratic burden remains a central concern of our member companies. Nobody objects to clear regulations that provide planning certainty. Planning certainty means investment certainty. But what makes no sense in practice must go. Relief measures urgently need to be felt in practice.

Thomas Keiser: I completely agree. Far too many people within companies are still occupied with meeting reporting obligations without any demonstrable added value for the environment or society. These are resources that are lacking for core business tasks.

What does the IKW now expect from policymakers in Germany and Europe?

Gabriele Hässig: My impression is that our positions on cutting red tape and creating competitive conditions are being heard and understood by those in positions of political responsibility. However, the relief measures introduced so far are often too piecemeal and tentative. In day-to-day business practice, they have so far had little effect at best. Our appeal, therefore: more courage and more speed in reducing bureaucracy and simplifying regulation. Once again: we need to make progress so that companies and households can feel real relief.

How does EU legislation affect the industry?

Thomas Keiser: The IKW has its hands full ensuring that the industry's concerns are effectively represented in Berlin and Brussels. We support the EU's goal of making the economy more sustainable. In detail, however, we see considerable need for adjustment in various directives. One example is the EU Urban Wastewater Directive, under which the cosmetics and pharmaceutical industries would have to bear 80 per cent of the costs for new technology in wastewater treatment plants. This is unfair, as it does not reflect the polluter-pays principle.

We have made some progress towards averting the threatened ban on the important ingredient ethanol. The European Chemicals Agency has since recommended approving ethanol for use in, for example, hand and surface disinfectants. The Committee for Risk Assessment must now act. Here it is essential to avoid drawing on data based on the voluntary consumption of alcohol.

And the EU Packaging Regulation, which enters into force this year, contains provisions in its detail that are far removed from real-world practice or even run counter to the actual purpose of packaging, namely product protection.

None of these are obscure niche issues. They have serious implications for companies. Sustainability goals can only be achieved if careful distinctions are made and operational requirements are understood and taken into account.

What do you expect for 2026?

Gabriele Hässig: I remain optimistic. A general upturn or major changes in consumer sentiment are unlikely in 2026. What matters is this: our industry has demonstrated that we can handle it. Closeness to people and good solutions for everyday life are the foundation of resilience. The current IKW Future Study also underlines why we should look ahead with confidence and optimism. It shows that the industry is capable of far more than simply following trends or counter-trends. It is shaping the future.