Late last year, research and advisory firm Gartner claimed that 90% of public sustainability goals will not be met by 2025. To dig deeper into this announcement and learn more about how businesses can seek to achieve their goals, we spoke with report author John Blake, principal analyst director at Gartner Supply Chain Practice.
Gartner has stated that 90% of sustainable packaging commitments will not be met by 2025. Could you tell us why you think this will be the case?
Given the commitments made by organizations, we find that ambitious goals such as 100% recyclable packaging or committing to very high recycled content are problematic depending on product, processing, supply chain, supply and infrastructure.
Another way to think about it is that the vast majority of products and packaging warrant custom goals rather than common goals. If an organization currently uses highly recycled materials such as corrugated cardboard, glass, aluminum or rigid PET, a 100% recyclable packaging goal is more achievable than if its packaging is primarily made of thin films, multi-layered mixed materials or if its products contaminate the packaging resulting in non-recyclable packaging.
Packaging that is not currently recycled and does not have a clear path to be recycled in its current form will require organizations to rely on innovation to replace these materials or an overhaul of their product, manufacturing or their packaging.
Many sustainable packaging goals depend on vast improvements in recycling infrastructure and investments by processors and raw material suppliers.
One of the main issues is setting goals that aren’t based on the technical aspects of internal (such as product requirements, manufacturing, and cost) and external (such as supply base, infrastructure, etc.) factors. recycling, the economics of secondary markets). Other challenges include the lack of infrastructure for the collection, sorting and treatment of packaging waste. Additionally, supply shortages of sustainable packaging materials are preventing organizations from meeting their recycled content commitments.
Another challenge is the lack of fundamental packaging specification data to capture the amount and types of packaging an organization consumes and produces. Much of this data currently sits in siled functions and is managed in systems that require significant manual intervention to review SKUs and regions to capture and manage packaging production and consumption as a whole.
Could you give us a behind-the-scenes look at the research undertaken by your team to reach this conclusion?
The research was part of one of Gartner’s formats called “Predict”. Predict research identifies critical trends over a 1-3 year planning cycle. Forecasts help inform tactical planning and short-term investment decisions and overall long-term strategy. We examined several sources of data in the research process.
This includes proprietary Gartner research methods and in-depth analysis of public reports from various foundations and initiatives in which members have committed to providing detailed reports on their progress as well as their challenges. Additional data points come from reports on bio-based and recycled plastic production forecasts, data on global recycling rates for various materials, and adoption rates for reusable, biodegradable, and compostable packaging.
Now let’s look at some potential solutions. You highlighted eliminating unnecessary packaging and reducing the size of packaging. Could you talk a bit about how these strategies can be put into practice effectively and introduce the idea that they can also help drive innovation upstream?
This really goes to the heart of achieving sustainable packaging goals. We need to move from incremental improvements such as reducing footprint, downsizing packaging, and alternative practices such as swapping virgin resin for recycled resin or bundling products with paper to instead of plastic to transformational change through upstream innovation. There is room for incremental change, and we are seeing measurable improvement in the types and amount of packaging used. Waste reduction is a great example.
If you follow the waste hierarchy, prevention is the most preferred option. It also tends to have an attractive return on investment and can be relatively easy to implement. But there are limits to what we can do when basing our future sustainable packaging goals on a portfolio of designs, packaging features and manufacturing processes from the past. Much of the innovation in reusable packaging seems to be stuck in pilot mode.
There must be a commitment to invest in new business models and customer experiences. If we take waste reduction to the extreme, we can envision reusable primary packaging that is refilled in-store, from bulk dispensing units, changing the way we think about transportation and primary packaging. Product innovation is also essential, we cannot separate sustainable packaging innovation from product innovation.
In the context of the transition to sustainable profit, could you tell us more about how businesses can successfully leverage reusable and refillable packaging?
Sustainable profit is the idea of organizations adapting and embracing circularity, resource stewardship and community protection. It also forces organizations to account for the consequences of their activities and actions which unwittingly fall on other parties – think of the increase in EPR legislation on packaging or the UK tax on plastics to offset the impact of packaging waste management on local municipalities.
Finally, it takes into account the concerns of stakeholders other than shareholders. An example of this may be retailers or B2B customers and the impact difficult-to-manage packaging has on their business or ESG goals. Reusable and refillable packaging can address all three of these areas by reducing waste, maximizing the use of limited resources and creating more efficient business models.
Values-aligned ecosystems: what are they and how can they be effectively implemented in the context of packaging sustainability?
An ecosystem is a community of organizations that share and combine capabilities and develop equitable relationships to generate and exchange value among participants. Competing with the help of an ecosystem of partners is essential in today’s complex and competitive supply chain and is a necessity to overcome the biggest challenges that stand in the way of an industry. more sustainable packaging.
Organizations must integrate partners by going beyond linear interactions and extending the ecosystem to a larger network of entities. For sustainable packaging, this includes Tier 2 suppliers and above, end customers, innovative start-ups, government agencies and competitors. Supply chain, procurement, and R&D teams must support interactions with business partners to form an effective ecosystem to benefit the entire company and the industry as a whole. Competitors must work together because the challenges of sustainable packaging are greater than any one organization or function can tackle alone.
You say that 90% of packaging sustainability commitments will not be met. What about the remaining 10%? What are they doing correctly? And more generally, what constitutes a sustainable commitment to successful packaging?
It comes down to data – clearly understanding the types, quantity and where of use of packaging that organizations sell and buy. It may sound simple, but many organizations struggle with the massive amounts of data needed to look at material categories across their entire business.
Organizations also need a very clear understanding of the dynamics of processes and practices that are beyond their direct control. For example – how do material recovery facilities deal with our packaging – is it too small or too big or the wrong color – does it prevent it from being recycled in practice?
Are suppliers as a whole investing in line with our vision of sustainable packaging? Finally, several functions must participate in the definition of sustainable packaging objectives. Goals can’t be set in a vacuum – they can’t just be driven by high-level ESG brands or teams. They require the involvement of purchasing, R&D, manufacturing, supply chains and suppliers. All parties should contribute to the feasibility assessment and the development of the roadmap for an achievable sustainable packaging strategy.