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Sustainably wrapped: Overcoming barriers to circular packaging

Sponsored: Companies must be equipped to prepare for the Global Plastics Treaty: better data, innovation and collaboration for system-level change.

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Worker in Bali PET Recycling Center sorts plastics for processing in Java. Bali, March 2024. Image courtesy of Keyza Widiatmika and Delterra.

Article sponsored by Delterra.

The shift towards sustainable packaging is picking up speed, propelled by factors such as the upcoming global plastics treaty and increasing pressures from consumers and investors alike. As plastic pollution worsens and consumer awareness grows, the call for change is pressing. 

Sustainability teams are finding fertile ground for advocating changes, and leadership is increasingly open to change. Yet despite major companies pledging to adopt circular packaging and cut waste, challenges persist in implementing and scaling these commitments across different regions.

The path to sustainable packaging is complex and requires coordination across multiple company departments working towards the same goal. Our conversations with over 100 consumer packaged goods industry representatives have highlighted how a tool such as Packaging IQ can help solve three key barriers that complicate the journey towards a fully circular and sustainable packaging system.

1. A lack of data

Companies highlight data availability as a major barrier in their sustainability efforts, especially the challenge of accessing enough reliable data for decision-making across different markets. To make informed choices about packaging in each market they serve, decision makers need access to relevant and reliable data, such as end-of-life disposal options, recycling infrastructure availability, greenhouse gas (GHG) impacts and regulatory changes. Establishing standardized tools, frameworks and methodologies across the industry could facilitate data sharing among companies.

2. Competing priorities

Another barrier companies cite is the lack of an effective methodology to evaluate different solutions and understand the impact on critical environmental and economic indicators. Consumer goods companies and retailers must guarantee that their packaging adheres to circular principles, meets greenhouse gas reduction goals and minimizes primary material usage, while simultaneously remaining cost effective and posing no health risks to consumers. One respondent likened this to playing an intricate game of chess. To add further complexity, inconsistencies in strategic priorities between companies hinder collaboration efforts.

3. Local contexts

Local context, such as infrastructure, regulation and consumer behavior, greatly influence how effective packaging designs are. While packaging design decisions are often made at a company’s global headquarters, they must incorporate multiple local variables alongside global strategies.

Addressing these challenges

Creating a ripple effect for systemic change

Achieving system-wide change requires collaboration across all stakeholders. This involves aligning on common goals, pooling resources, developing innovative and harmonized packaging solutions, and backing efficient recycling and reuse processes. Only by working together can companies, governments, NGOs, data providers, and civil society address pollution from materials with short life cycles.

Addressing a broad spectrum

In handling packaging end-of-life, we’ve found that that levels of understanding, ownership and action vary extensively within the fast-moving consumer goods sector. Some are inactive, missing opportunities to make their packaging more sustainable, while others are leading the way with solutions that represent best practice in the sector, often making use of cutting-edge interventions. 

These levels vary extensively across regions, when comparing Global South and Global North countries, often due to disparities in access to technology, infrastructure and specialized workforces. 

Everyone has a role to play

For a system-level change to succeed, it’s vital that all stakeholders understand their roles and speak a common language. This means providing extensive capability building for companies of all sizes, including strategy development training for sustainability teams and education initiatives for departments such as marketing, R&D and leadership at both local and global levels. 

Data and innovation as enablers 

As we’ve seen, there is a growing need to equip companies with solutions to tackle these key barriers and create a ripple effect for change. Advanced technologies that enable data-driven decisions are essential enablers. 

Innovative tools exist, from GHG calculators such as the UNFCCC calculator to life cycle analysis software such as Ecochain, Recyclass online and SAP Responsible Design and Production. Brands and retailers are also increasingly using Plastic IQ, a scenario analysis tool developed by Delterra and Systemiq, to understand their current packaging footprint and model a variety of circular solutions. 

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Delterra’s Elise Hungaro leads a Plastic IQ Masterclass for companies in São Paulo, Brazil, June 2023. Image courtesy of Ricard Matsukawa and Delterra. 

Capability building and effective strategy development

In 2023, a Lite version of Plastic IQ was created to help small and medium businesses, especially those new to sustainability, improve their capabilities. A technological park in Brazil used this tool to train a number of resident companies, mostly startups unfamiliar with sustainability-focused packaging strategies. One company considering changes to its product line was pleasantly surprised to learn about the positive environmental impact of such changes.

Meanwhile, companies further along their sustainability journey are using the Pro version of Plastic IQ to build and combine sustainable packaging strategies. For instance, a beauty and personal care company in Indonesia used the tool to revamp its packaging design with upcycled materials, natural inks and fewer adhesives to simplify recycling. 

Based on use cases like this and feedback we have gathered over the past year, we are excited to announce that Plastic IQ will be transitioning to Packaging IQ. This transition will help companies balance various, often conflicting metrics, providing a holistic view that encompasses factors such as costs, emissions, pollution, recycling and policies on a product-by-product basis. 

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Packaging IQ will provide an aggregated view of environmental and economic metrics across a portfolio of SKUs under different scenarios. Image courtesy of Delterra.

Navigating the roadblocks to sustainable packaging

The path to a sustainable and consistent packaging ecosystem is currently littered with obstacles, from data deficiencies to regional disparities and conflicting priorities. To overcome these obstacles, a unified approach is crucial. 

But promising solutions are within reach. By fostering collaboration among organizations, sharing resources and using data effectively, we can drive innovation and establish industry-wide standards for recyclable packaging. This, in turn, will reduce waste, advance circularity and improve environmental outcomes on a global scale.

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