Packaging plays a key role in the modern economy. It protects goods, facilitates their efficient distribution and serves as a communication medium. Despite the benefits it provides, packaging is under intense scrutiny. It is perceived as a source of waste and a symbol of the modern throw-away society. Littering has devastating effects on nature, especially on marine wildlife.
Thanks to increasingly strict environmental legislation, national bans on the importation of plastic waste and public pressure, packaging manufacturers, consumer goods producers and retailers are being forced to rethink their approach to packaging.
One example of more stringent legislation is the European Union’s amended Directive 94/62/EC on Packaging and Packaging Waste, which prescribes higher recycling targets for certain packaging materials. The mandatory 55% recycling rate for plastic packaging by 2030 is an especially challenging target for the packaging value chain. Another example is a California law which has required plastic beverage containers to contain specified amounts of postconsumer recycled plastic since January 1, 2022.
In addition to more restrictive legislation, consumer expectations around packaging are also high. To be sustainable from the consumer’s perspective, packaging should be produced with a minimum of resources, be plastic-free and fully recyclable, but still look nice.
But are companies responding appropriately to meet all packaging requirements? And most importantly, are they focusing on the right aspects of packaging sustainability?
Considerations for Sustainable Packaging Solutions
Driven by these developments, recyclability and the carbon footprint of packaging are drawing increasing attention. This has led some producers to switch to paper-based solutions or bioplastics, which are typically more recyclable or compostable, have a lower carbon footprint or are bio-based rather than fossil-based. But in many cases, these seemingly sustainable solutions aren’t actually very sustainable. The drawbacks can be manifold, including reduced functionality, increased packaging weight, and higher environmental impacts, e.g., greater biodiversity loss.
Sphera strongly recommends taking a broader perspective on sustainability in packaging. Looking at packaging through the lens of Life Cycle Assessment (LCA) often brings surprises and helps avoid burden shifting between different impact categories. Aside from the potential environmental impact of their packaging choices, companies should also consider aspects like social sustainability, supply chain resilience and packaging functionality.
To move companies toward adopting more holistic sustainability practices, the European Commission has passed a proposal for a Directive on Corporate Sustainability Due Diligence, which aims to foster sustainable and responsible corporate behavior throughout global value chains. The directive will require companies to identify and, where necessary, prevent, end or mitigate adverse impacts of their activities on human rights (e.g., child labor and exploitation of workers) and on the environment (e.g., pollution and biodiversity loss).
The Need for a Comprehensive, Holistic Sustainable Packaging Strategy
Packaging design decisions are governed by various factors, such as technical feasibility of the design, functional requirements for packaging properties, material requirements, associated costs and customer expectations, to name just a few. We have often seen that companies are overwhelmed with the complexity of the issue when trying to comply with requirements. As a result, businesses often focus on individual elements of sustainable packaging rather than take a big picture view of all the necessary components of a holistic, science-based packaging strategy.
This short-sighted, reactive approach to sustainable packaging often results in important aspects being neglected, which can lead to reputational damage and high costs in the long term. For example, McDonald’s was accused of greenwashing when it replaced plastic straws with a more “environmentally friendly” alternative. But when the new paper straws proved to be difficult to recycle, the company advised consumers to dispose of them in the general trash.
So how can companies navigate the jungle of current and upcoming packaging-related regulations and requirements to develop a holistic, fact-based sustainable packaging strategy?
Below are four questions your company should be able to answer before launching any packaging sustainability initiatives:
1. Do we have an overview of our packaging portfolio?
Knowing your company’s packaging portfolio is essential for prioritizing your actions and spending. This requires a comprehensive understanding of many parameters, such as the amount of packaging, materials used and their origin, packaging usage, recycling options and more.
Although knowing one’s own packaging portfolio sounds obvious, many companies don’t know the exact material composition of their packaging and may not know what happens to their packaging after it’s discarded. Enabling a strategy requires basic knowledge about materials used, recycled content, where it is sourced and where it ends up after use. A company should have an understanding of the fate of its packaging, from creation to disposal.
2. Do we consider and address all relevant current and future environmental, social and legal aspects of our packaging solutions?
Packaging engineers know about the legal implications of packaging solutions, but do they also have an overview of the environmental and social impacts associated with packaging materials and supply chains? It is important to assess the real impacts of packaging and comply with current regulations and laws, as well as monitor future trends and legislation. Impacts and regulations that are not foreseen might turn into real financial risks in the future.
For example, recyclability has become an important topic in recent years. Companies must be aware of legal requirements and extended producer responsibility schemes in their end markets. Hard-to-recycle packaging results in higher packaging fees in some European countries (e.g., the Netherlands).
Another example is reputational risks. Large beverage companies are accused of being primary contributors to plastic waste in oceans; in order to avoid further damage to their reputations, they must foresee other potential environmental impacts of their products and packaging.
3. Do we know which sustainable packaging aspects have the greatest impact on our overall Environmental, Social and Governance (ESG) strategy and goals in the short, medium and long term?
Everyone knows the carbon footprint is important, as is the recyclability or circularity of the packaging solution. But what about water consumption? Or biodiversity loss that might be caused by your packaging supply chain? Human exploitation? Child labor? Does your company monitor these impacts? Do they pose any risks to your business? Are they already embedded in your corporate ESG strategy, or do you need to add them?
One prominent example is the Directive on Corporate Sustainability Due Diligence, which might place supply chain working conditions high on the sustainability agenda in the foreseeable future.
4. Do we have all ongoing packaging-related projects on our radar and are we engaged with relevant internal and external stakeholders?
Companies usually carry out many different packaging-related projects simultaneously. But these projects are rarely centrally managed and funded. Instead, they are tackled whenever stakeholder pressure is greatest. This carries a financial risk, as money may be spent on projects that are not relevant or where results are already available from other projects. This approach poses further risks that can be avoided if someone has the overview and centrally manages all packaging-related projects. Sustainability agendas must be located at the C-level, with their own budgets, to effectively monitor and guide all relevant stakeholders.
The ability to answer these questions positively provides a solid, fact-based foundation for the definition of a holistic sustainable packaging strategy that addresses all current and future packaging-related impacts and requirements.
With more than 20 years of experience in delivering sustainability and ESG projects for various industrial clients worldwide, Sphera has helped companies like Ball Corporation, Rewe, Abena, Pandora and Naturata quantify and improve the sustainability performance of their packaging solutions while advancing their packaging sustainability strategies. Sphera’s unique combination of software, data and consulting expertise empowers companies to make data-driven and fact-based decisions on their journey to sustainability and ESG excellence.