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Anthesis’ UK Practice Lead for Sustainable Production and Consumption Beth Simpson reflects on how companies are responding to the strong possibility that they will not meet their 2025 packaging targets and explores what they can do to mitigate the consequent risks.
Beth’s experience of leading the Anthesis Plastics and Packaging teams over the last five years has provided unique insight into the challenges and opportunities faced by packaging producers across the value chain. In this piece, Beth shares some of the tools and templates that can support a journey for change and urges businesses to continue to prioritise sustainable packaging, even in complex operating markets and against a backdrop of delayed regulation.
Evidence suggests that if a room full of global packaging professionals were asked whether they predicted that they would hit their 2025 sustainable packaging targets (and they were all feeling honest), only 20% – 30% would respond positively.
This figure leaves a huge 70% – 80% of companies which predict that they will miss their 2025 packaging targets – companies which are, presumably, trying to work out what to do now. Who should they tell, what reason should they give, and how far should they push out their sustainable packaging target deadlines? To 2030? 2035? All the while, the global crises of resource overconsumption, climate change and biodiversity loss continue to worsen.
Hopefully, they are also considering what went wrong, how they can learn from past mistakes, and what they can do to ensure that action is taken to meet their new targets. As a global society, we are running out of time. The impact of our current patterns of production and consumption will not wait for us to meet a future target. Our planetary boundaries will not let us ‘catch up’ later. The global climate crisis will continue, with devastating outcomes for businesses across the world, our planet, and its citizens. Production and consumption patterns must be prioritised and taken seriously today.
Let’s backtrack to 2018, when sustainable packaging targets and the need to act on packaging ‘problems’ hit the headlines. Propelled by shocking media images depicting the impact of marine plastic on sea-life, and the corresponding public outcry, companies began pledging to improve and reduce plastic packaging use. In October 2018, Ellen MacArthur Foundation (EMF) launched its global plastic commitment, and 2025 was proposed as the year by which all plastic packaging would be recyclable, reusable or compostable.
As one Packaging Technologist told me, “The targets were set by the head office because our competitors were announcing them and aligning with the EMF global commitment. The targets were then pushed out to the business units, with no roadmap, budget or resources – nor was tracking and reporting considered. We were told to ‘figure it out’. There were a lot of grassroots activities but no leadership support or decision-makers to help. The targets didn’t feel achievable then, and I don’t expect them to be met by 2025.”
For many in 2018, 2025 seemed a long way away, with plenty of time to reach these targets – how hard could it be?
As it turns out, harder than it sounded.
- The EMF Global Commitment Progress Report 2022’s number 1 finding was that ‘whilst strong progress is being made in some areas, key 2025 targets are expected to be missed’.
- McKinsey’s 2022 survey showed that over 75% of organisations had sustainable packaging commitments and only c.30% are well prepared today to meet them.
- WRAP has acknowledged that the PACT targets will not be met by 2025.
Since 2018, the world’s population has experienced several unprecedented global phenomena. From the global health pandemic and a war in Europe to the rising costs of doing business, the challenges facing raw material providers, manufacturers and retailers could not have been predicted.
We have seen similar situations repeated in packaging teams across multiple industries. Too often, packaging teams are expected to meet sustainable packaging targets in difficult operating environments, within current or reducing resources and budgets, without significant C-suite commitment to altering ‘business as usual’ activities – all while also supporting business growth plans and cost reduction targets.
It is for this reason that the UK Department for Environment, Food & Rural Affairs (DEFRA) recently announced the backwards movement of the Extended Producer Responsibility (EPR) deadline for UK compliance reform from 2024 to 2025. I feel that this sets a precedent, implying that it is acceptable for sustainable packaging targets to be missed or postponed. Even more worrying is that we are seeing similar approaches to other forms of sustainability targets, which suggests that these too could risk being missed.
This does not paint a positive picture for the mitigation of the effects of the current climate and biodiversity crises – and missed targets also mean missed opportunities for companies to reduce their environmental burden and increases pressure on the systems these targets are aiming to protect. So, when I am asked by clients ‘what would you do?’, I have a simple 5-point star that I recommend:
- Maintain your sense of ‘true north’: Maintain progress as if you were aiming for your 2025 goal. Take time to reflect on the challenges that have been faced to date and the opportunities to overcome those, and from there build a stronger platform upon which to operate going forward. Simultaneously, try creating an analysis of gap to goal, and a roadmap which shows which interventions and levers can achieve the ambition within certain timelines.
- Be bold: Acknowledge that these targets cannot be met by relying on a business-as-usual approach, even within new regulatory frameworks. Collaboration and voluntary activities will need to play a significant role in delivering change, so working in partnership with trade bodies such as the Institute of Grocery Distribution (IGD), which have created resources to support the industry packaging ambition (to reduce environmental impacts from packaging in the sector by 50%) will be a key part of any successful packaging strategy.
- Think long term: Build a long-range financial plan and supporting business case for the C-suite, which goes beyond just one financial year – and make sure sustainable packaging and the public declaration of related targets is on the corporate risk register. Use the regulations to drive senior-level commitment, from CSRD ERS E5 (which assigns mandatory responsibilities at the most senior levels within a business for resource consumption and reduction policies, baselines and action plans) to the PPWD, ESPR and EPR (even if it is delayed) to demonstrate the importance of acting promptly to reduce future packaging costs, supply chain volatility and compliance risk.
- Be inclusive: Create stakeholder governance groups that are cross functional and have senior sponsors from the C-suite. Undertake regular meetings to keep communications and awareness at their optimum to deliver the change strategy needed. Don’t be afraid to include key/strategic suppliers in your communications, it’s not uncommon to find that they have received sustainable packaging requests from other customers and might already be able to meet more sustainable specifications.
- Be resourceful: There is no need to reinvent the wheel, as there are lots of useful resources from organisations who are already working on this agenda. The IGD heatmap highlights the biggest opportunities for actions in supermarket packaging, and the switching guide is a tool that helps integrate sustainable thinking into packaging design and selection processes to support choices that deliver packaging targets.
There is also a growing movement which is supporting a shift to voluntary EPR for packaging, which is being initiated by some of the leading players in the industry and their trade bodies. As these discussions are likely to gain momentum following the recent decision from DEFRA to postpone the reforms to the EPR regulations by another year, there could well be a chance to influence and shape an industry-led response to deliver good practices. This might sound counter intuitive, given that DEFRA itself has cited the poor economic and trading conditions as a key reason for the delay. However, sometimes brave leadership pays dividends, and taking control of the systems, and therefore the costs, could be an appropriate longer-term investment for business, society and planet.
One of my favourite authors, speakers and mentors on brave leadership is Bene Brown. I have been struck by this quote from her, which I think is particularly relevant in the context of taking brave decisions to deliver sustainable packaging and change management programmes. She says, “The only thing I know for sure, after all of this research, is that if you’re going to dare greatly, you’re going to get your ass kicked at some point. If you choose courage, you will absolutely know failure, disappointment, setback, even heartbreak. That’s why we call it courage. That’s why it’s so rare.” But she also says:
There are still 18 months until 2025 and the packaging industry is known for its agility and ability to innovate. If, despite implementing all of the actions in my 5-point star, yours is still one of the businesses that is going to be unable to deliver on its targets, I would suggest having a robust review of the reasons behind your challenges and a clear narrative on the next steps and corporate priorities.
Include corporate affairs and communications colleagues and flag the associated risk of exposure in 2025. If you must, set a new target date and be ambitious but realistic. Use industry benchmarks and leadership analysis as well as your own gap to goal calculations to help understand the rate of change in the sector and your opportunity to benefit or influence it. Co-ordinate new timelines with other industry parties, such as trade bodies and collaborative groups, and use the same language and levels of transparency as they do. Most importantly, however, do not use this as an opportunity to reduce the business imperative for urgent packaging change.
There is still time to move to a more responsible model of production and consumption, but we will only do so by engaging fully with the sustainability targets and timelines that have been proposed in regulatory frameworks, voluntary commitments and independent businesses. We will also only meet these targets if we are willing to take the actions that these targets compel us to take, no matter how hard they are, or how difficult the operating environment is for global commerce.
The sooner the reality sinks in that the industry needs to deliver substantial business change, the easier it will be for companies to take the action needed to meet their sustainability targets. The narrative around meeting these targets could quickly change from “this needs to happen within ‘business as usual’ parameters” to “how does the business need to change to reduce risk and optimise opportunity, over what timeline can we meet these targets, and who owns that journey?”.
At Anthesis we work with packaging teams across the globe, and we regularly share resources to support our clients.
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