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How sustainable is packaging? Making sense of sustainability labelling in the food retail industry
While a lot of attention has been, and continues to be, focused on sustainable products, one aspect that is often overlooked is that of packaging. The worldwide market for packaging is currently valued at US$429 billion, and is forecasted to surpass US$500 billion in sales within five years , at an annual growth rate exceeding the total global increase in GDP. Packaging is used in many sectors, although food and beverage packaging is by far the largest segment and accounts for 51% of the global market. Growing sustainability concerns regarding the energy required to produce and transport packaging, as well as the waste created both during production and disposal, have cemented the market’s large environmental footprint in the public eye. In the UK, it is estimated that 5.9 million tonnes of packaging waste are generated each year, representing approximately 20% of all waste. The demand and need for packaging will continue to increase with demographic and economic growth, associated with the proliferation of convenience-driven lifestyles and smaller households. With a growing need for packaging, but also an increasing emphasis placed on climate change and resource depletion, the packaging industry sometimes faces conflicting sustainability demands from legislators, consumers and other stakeholders. For example, though a consumer push for more sustainable packaging is rising, so is the potential conflicting need for convenience. The industry response to this issue is widespread, with most companies investing resources into the development of sustainable packaging – achieving both environmental and financial benefits. This paper will seek to identify which trends have been driving and will continue to shape the sustainable packaging market; in addition to assessing the factors considered to determine what sustainable packaging exactly is; before concluding that companies which do not follow the sustainable packaging trend are likely to fall behind those that do.
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handling. household and personal products such as cosmetics design particular shapes for their perfume bottles to appeal to certain customers. Introduction Basic definition of packaging Uses of packaging Packaging is an important part of our society as it connects production and consumption of a wide variety of products – protecting these and ensuring they are delivered in their original state. and restaurants need large amounts of packaging for “food-on-the-go” and fast food. Pharmaceutical packaging provides information on how to use medicine. selling & using products. . dishwasher tablets or washing up liquid need to be contained for transport & distribution. often depicts elaborate designs to attract consumers. 1. Household Products such as washing up powder. Beverages packaging. It increases access to products and improves distribution. moisture. technology hardware such as computers need protection to avoid breakage. its provenance. Food and beverage retailers. pharmaceuticals need a barrier to remain safe and sterile. Convenience Packaging is convenient as it provides the ability to cater for smaller portions. Information communication Packaging acts as a communication channel to inform users on product attributes. such as cans. Marketing Packaging is often used as marketing tool to differentiate a product and/or to convey a certain message or brand image.Making sense of sustainability labelling in the food retail industry 1. or use specific seals to prevent small children from accessing the content. while certain types of food and beverages need protection from temperature to stay fresh. Pharmaceutical packaging possesses certain features to guarantee products are not counterfeit. Containment Containment of certain goods is required to improve efficiency. dust and other contaminants. and take-away products. For example. Some types can include anti-theft devices or RFID tags. Food and beverages require oxygen-sealed packaging to avoid food spoilage.1 Functions Definition & Examples Physical protection applies to virtually all products containing packaging. side-effects and warnings. Security Packaging reduces risks by increasing resistance to tampering or by providing tamper-evident features like seals. Goods need protection from. Similarly. among others: shock and compression. its contents. For instance. Physical Protection Barrier Protection Packaging acts as a barrier against light. Packaging can be made from a number of materials and is used to fulfil one or more functions.
End-Use Market Share Other 21% Cosmetics 4% Healthcare 5% Beverage 19% Food 51% . It is also used in aerosols such as hair spray and paint. Plastics 38% Metal packaging such as cans and containers are particularly popular with food and beverages.g. Paper & Board 30% Paper-based packaging is used for primary & secondary packaging (e. Plastic packaging comes in various forms such as PET.: bleached board in cereal boxes. PVC & PS. or containerboard to make corrugated boxes). It is used across various types of products such as pharmaceuticals. beverages & spray cans. Other 5% Glas 8% Metal 19% Other types of packaging include ones made from non-traditional packaging materials such as biodegradable packaging. beverages & certain pharmaceuticals. Wood is converted into pallets & crates for distribution. This material also includes flexible packaging.Making sense of sustainability labelling in the food retail industry Material Market Share Glass packaging is often perceived as a higher quality container and is often used in cosmetics.
cannot be recycled indefinitely as 20% of fibres degrade or disappear when processed . the length of its supply chain. As such. This is because it uses less energy than virgin production processes. Recycling and reusing packaging not only reduces waste but reduces the carbon and energy intensity of packaging too. 76% of packaging companies’ sustainability efforts is focused on reducing packaging waste. Recycling aluminium. From traditional to sustainable packaging So what is sustainable packaging? A single definition of sustainable packaging is unfeasible. Some would even argue that there is no such thing as “sustainable packaging”. The US EPA identified the decomposition of paper as among the most significant sources of landfill methane. The recyclability and reusability of packaging varies according to the material used.1 Reduce. its use and finally its disposal options. For instance. metal is one of the most recyclable materials as it can be recycled endlessly without compromising its quality. food retailer Waitrose sells organic milk in “Eco Pack” bags which consumers use to fill a pitcher initially bought in store. Recycling and reusing packaging considerably lowers raw material and energy costs of production. rather there are improvements that can be made to the packaging’s attributes and its manufacturing process in order to reduce its life cycle impacts. carpets and even new containers. This initiative reportedly allows 75% of plastic to be saved. it is also possible to make distinctions in terms of recyclability or reusability. a GHG with 21 times the global warming potential of CO2. requires only 5% of the energy and emits only 5% of emissions compared to primary production . The inability to recycle or reuse packaging also inevitably means additional virgin resources are required to create new packaging – a process which is energy intensive in terms of sourcing and processing materials. For example. reusability & use of recycled content Minimising raw material use Logistics efficiency Carbon & energy intensity Use of alternative raw materials 2. reusability of packaging & use of recycled content: According to a recent study by AMR Research. on the other hand. For instance. Some features of sustainable packaging may include: • • • • • Recyclability. Paper.Making sense of sustainability labelling in the food retail industry 2. as the sustainability of a packaging material intrinsically depends on aspects specific to its lifecycle such as its manufacturing process. It is estimated that recycling a tonne of PET (polyethylene) bottles saves the equivalent of about 400 gallons of gasoline . For example. and diverts paper from landfills where it decomposes and creates methane. compared to the use of a one litre plastic bottle . reusability & use of recycled content Impact on the value chain: • raw material sourcing • production • disposal Recyclability. PET is a widely recycled plastic and can be converted into a large range of products that would usually require polyester such as clothing. It is therefore very important to consider the end-life of packaging when assessing its sustainability. reduces the need for chemicals and water that have large embedded GHG emissions. recover & reuse! Recyclability. there are often misconceptions about packaging’s sustainability. whereas PVC is not traditionally recycled. 4 . Within one type of packaging material. for example. many tend to think of metal cans as unsustainable while in fact. using recycled/recovered paper considerably reduces the environmental impact of paper at a number of stages in the lifecycle. Reusing packaging is also regaining popularity among businesses and consumers.
Energy & carbon intensity: The carbon intensity of packaging matters because packaging can account for a large percentage of a product’s carbon footprint. Reduce. for example. or the use of minimal materials. As such. while CO2 emissions decrease by about 17% for every 10% recycled glass in the glass-making process .: one truck versus two or more). recover & reuse! 5 . The ability to pack products closer together in higher volumes during transport increases efficiency by reducing the need for additional transport (e. Certain types of materials have better lightweighting properties than others. Unilever’s innovative deodorant design led to savings of 1960 tonnes of plastic per year. lessens energy use thereby also reducing GHG emissions. represents approximately 70% of overall product footprint. it is important to not simply transfer the environmental impact to another part of value chain – for instance by needing to increase secondary or tertiary packaging to prevent breakage of the initial product.000) each year . Kellogg’s was able to reduce the size of shipping cases. it is estimated that energy costs decrease by approximately 2-3% for every 10% of recycled glass used. The packaging of a can of carbonated drink. and considerable improvements have been made since the 1970s. thereby eliminating 24 metric tonnes of cardboard per year . Using recycled materials significantly reduces the carbon intensity as it takes more energy to collect. Aluminium cans are now 40% lighter and steel cans are 50% lighter than in they were at the time. and lowered energy consumption by 6 million kilowatt hours.The ability to do this will enable a company to lower storage and distribution costs. by changing how one of its snack products was stacked for shipping. For example. For glass packaging. Heinz reports that it saves 1400 tonnes of steel just by lightweighting its Easy Open Ends cans. The use of raw materials versus those that are recycled also plays a role in determining packaging’s carbon intensity. saving up to £404. For instance. a 330 ml aluminum can of Coca-Cola Classic emits 170 grams of carbon emissions during production. When considering the carbon intensity of packaging materials. depending on the product it contains. has been widely adopted by packaging companies. process and treat raw materials than it does to do the same with recycled ones. while reducing a primary packaging’s weight. Also. while the weight of one litre washing-up liquid packaging is down by 64% . metal is much lighter than glass.000 (approximately € 600. The carbon intensity varies greatly according to the type of packaging materials. and requires fewer raw materials – all of which are financially beneficial.g. For example.Making sense of sustainability labelling in the food retail industry Minimising raw material use: Lightweighting. Logistics efficiency: Lightweighting is not the only improvement which reduces the impact of distribution. The weight of a regular sized yoghurt pot shrunk by 67% between the 1960s and 2008. while a glass bottle of the same size has a footprint of 360 grams. it is important to consider a number of factors such as the carbon intensity of the production process and packaging’s lightweighting properties which will increase or lessen carbon intensity during distribution. it is estimated that recycled material can save as much as 95% of the energy required to make virgin ones . the weight of 24 empty metal cans equals the weight of one empty glass bottle. Reducing the size and weight of packaging impacts the entire supply chain: it decreases weight during shipments. more emphasis is also being placed on increasing packaging density during transportation. In terms of metal.
bioplastics should not be entirely disregarded as their improvement potential remains large. 2. Legislation: Packaging and its associated waste have been directly targeted by regulations.1% annually to $4 billion in 2012 . recover & reuse! Use of alternative materials: While all the initiatives described above are essentially cost reduction oriented.2 Key market drivers The impact of. with 38-60 grams of CO2 emitted per bag. while it is estimated that 8% of oil is converted into plastics. Packaging regulations focus on a large range of packaging attributes such as its design. packaging companies can also opt to develop packaging made from non-traditional materials. and packaging manufacturers are increasingly under strict pressure to address packaging’s sustainability. These two types of packaging materials account for more than 65% of the total market share. Coca-Cola introduced the “PlantBottle” made from a blend of petroleum materials. pressure to make packaging more sustainable has risen with growing awareness of society’s environmental impact. Though higher costs have hindered bioplastics’ market growth. encouraging the introduction of legislation to minimise packaging’s impact. Packaging waste present in landfills contributes to pollution and can lead to contamination of the environment. such as groundwater sources. the use of certain materials.” The directive sets out targets to reduce the amounts of biodegradable waste reaching landfills. These 20 million tonnes represent about 17% of municipal waste in Europe . but they still rely on petrol as an energy and materials source during the manufacturing process. the 1994 EU Packaging and Packaging Waste Directive aims “to harmonise national measures in order to prevent or reduce the impact of packaging and packaging waste on the environment” and sets out recycling and recovery targets. Paper packaging is heavily reliant on fossil fuels as energy costs account for approximately 25% of total costs for paper and pulp manufacturing. soil and air. fuelling consumers’ growing demand for sustainability and driving packaging manufacturers’ investment into the development of more efficient solutions. For example. equalling 20 million tonnes of packaging waste per year . and releases less GHGs as they biodegrade. it is predicted that demand for these materials will grow 7. have recently been introduced in various forms. while a switch to non-food crops would substantially improve their sustainability. as would further developments in terms of their reusability and recyclability. on average. 139 kilos of packaging per person. As the price of oil has increased in price 500% since 1990s. However. Bioplastics tend to be considered as more sustainable than traditional plastic as they rely less on fossil fuels. Technological advances will allow them to become more reliable and cost-competitive. In recent years. Alternative materials. it is clear why from a financial point of view packaging manufacturers strive to make packaging more sustainable. fossil fuels plays a role in the push for sustainable packaging as more industries reliant on fossil fuels turn to alternative sources.Making sense of sustainability labelling in the food retail industry Reduce. corn or starch. such as bioplastics made from vegetable oil. but the tonnes of waste packaging ending up in landfills contribute to global warming by emitting GHGs. In Europe. this year. and dependence on. These environmental concerns are pushing the sustainable packaging agenda. 6 . the elimination of toxic materials and its disposability at its end-of-life. The more recent 1999 EU Landfill Directive aims to “prevent or reduce as far as possible negative effects on the environment from the landfilling of waste. recycled-content requirements. plant-based materials and recycled plastic. of which 41 kilos are wasted. Not only is packaging a resource intensive sector in an increasingly resource constrained world. A recent study in Finland examined the lifecycle impact of five types of carrier bags found that the biodegradable ones emitted the most. Europeans consume.
In 2002. a plastic flexible pack typically uses 50% less material than a rigid plastic container or bottle for the same application. and can lead to a company gaining competitive advantage over another. GlaxoSmithKline partnered with its suppliers to revamp its Aquafresh toothpastes’ packaging enabling it to have a smaller impact on the environment by being more recyclable and by simplifying the supply chain. Sainsbury’s encourages its customers to return the bags to its stores where it collects them for recycling. 79% believe products are over-packaged. fines such as these are likely to become more frequent and to increase in size. In 2008. driving businesses to improve manufacturing efficiency and to highly consider packaging’s end-life. At the same time. encouraging consumers to opt for reusable bags instead. In Finland. Red Bull was fined £271. where such a scheme is applied for cans. reducing the number of plastic bags used in a year by 66% and saving 1. and up to 75% less material by volume than a glass container or bottle . Even in emerging markets such as in China and India. China banned supermarkets and retailers from providing free plastic bags to customers. This “PlasTax” led to a 95% reduction in their use . for instance. Ireland introduced a 15 cent tax on plastic bags. Certain packaging companies have also developed innovative solutions such as flexible packaging which can offer certain benefits compared to more rigid options. a recent study resulted in similar findings with 80% believing that a reduction in packaging should be a priority in trying to achieve sustainable consumption . raw materials costs and distribution costs. Failing to comply with packaging regulations can also prove to be costly for businesses. the return rate for beer and soft drinks bottle is 95%. Amcor. glass bottles and some PET bottle. Though sustainable packaging is unlikely to become a decision-factor in purchasing decisions for consumers overnight. Food and beverage manufacturers and retailers are thus pursuing this trend to meet consumer demand and to seek new market opportunities. Innovation & collaboration: The packaging sector’s major customers such as food and beverage companies are progressively collaborating with their suppliers to bring about sustainable packaging innovations. implemented a supplier scorecard in 2006 enabling it to “evaluate its suppliers on the sustainability of their packaging and offer suggestions for improvement” – the company aims to become “packaging neutral” by 2025. equivalent to 1 billion shopping bags per year. Consumer demand for sustainability: As sustainability is increasingly present in the public agenda.6 million tons of petroleum . In France. an Australian packaging manufacturer. while alcoholic beverages are returned at an 80% rate. Various countries have also adopted beverage container deposit schemes. 7 . Collaborating to innovate sustainable packaging can thus offer financial benefits for both suppliers and clients by cutting energy. recently cooperated with Sainsbury’s to convert its fresh produce bags from non-recyclable polypropylene to recyclable polyethylene. A recent study in the UK found that 51% of British consumers say they are personally concerned about the amount of packaging. The survey also found that 93% of respondents claim to use reusable bags frequently. For example.800 in the UK for failing to recover and recycle its packaging waste. In 2007. the percentage of consumers concerned about packaging in the household good market reached 56% and 53% respectively . it has also gaining importance in consumers’ purchasing decisions.Making sense of sustainability labelling in the food retail industry Both of these have had significant repercussions on packaging’s entire life-cycle. thus closing the loop. Wal-Mart. while 52% claim to pay considerable attention to packaging while shopping. while 82% agree that packaging is a major environmental problem . it is likely to increasingly play a role in influencing a consumer’s perception of the company and its sustainability practices. A good example of the influence of regulation on packaging is seen in the ban or tax of plastic shopping bags which has recently grown in popularity around the world. Though this only represents a small proportion of the company’s total sales.
. In North America. Europeans consume. Not only is packaging a resource intensive sector in an increasingly resource constrained world. the 1994 EU Packaging and Packaging Waste Directive aims “to harmonise national measures in order to prevent or reduce the impact of packaging and packaging waste on the environment” and sets out recycling and recovery targets. of which 41 kilos are wasted. in recent years. In Europe. while it is estimated that 8% of oil is converted into plastics. such as groundwater sources.” The directive sets out targets to reduce the amounts of biodegradable waste reaching landfills. When developing new packaging. In 2008. These environmental concerns are pushing the sustainable packaging agenda. while other initiatives include companies such as PepsiCo partnering with other stakeholders to increase recycling. The more recent 1999 EU Landfill Directive aims to “prevent or reduce as far as possible negative effects on the environment from the landfilling of waste. and contain on average of 41% recycled content while in Europe. companies are not only in a position to reduce the amount of packaging going to waste. and packaging manufacturers are increasingly under strict pressure to address packaging’s sustainability. on average. it established a partnership with an environmental NGO to improve management of domestic solid waste in India. and dependence on. aluminium and steel benefit from highly efficient recycling infrastructure. fuelling consumers’ growing demand for sustainability and driving packaging manufacturers’ investment into the development of more efficient solutions. but the tonnes of waste packaging ending up in landfills contribute to global warming by emitting GHGs. equalling 20 million tonnes of packaging waste per year . 52% of aluminium cans were collected in 2006. encouraging the introduction of legislation to minimise packaging’s impact. Packaging waste present in landfills contributes to pollution and can lead to contamination of the environment. soil and air. but they can also improve their efficiency and reduce raw materials costs. These 20 million tonnes represent about 17% of municipal waste in Europe . 2. These two types of packaging materials account for more than 65% of the total market share. Packaging regulations focus on a large range of packaging attributes such as its design. 60% of beverage cans are recycled . Pepsi cans featured a “Keep America Beautiful” design to encourage and educate consumers on the benefits of recycling. manufacturers assess the ease with which a new material will be able to enter the existing infrastructure. fossil fuels plays a role in the push for sustainable packaging as more industries reliant on fossil fuels turn to alternative sources. In recent years. As the price of oil has increased in price 500% since 1990s. pressure to make packaging more sustainable has risen with growing awareness of society’s environmental impact. recycled-content requirements. the use of certain materials. it is clear why from a financial point of view packaging manufacturers strive to make packaging more sustainable. Paper packaging is heavily reliant on fossil fuels as energy costs account for approximately 25% of total costs for paper and pulp manufacturing. 139 kilos of packaging per person.3 Key market drivers The impact of. Fortunately.Making sense of sustainability labelling in the food retail industry Growing recycling infrastructure: The lack of recycling infrastructure such as municipal or commercial collection system can hinder the growth of sustainable packaging. By supporting the development of recycling infrastructure. Many packaging stakeholders are also becoming involved in improving recycling infrastructure and efficiency. In North America and in Europe. many countries have invested in such infrastructure. Legislation: Packaging and its associated waste have been directly targeted by regulations. the elimination of toxic materials and its disposability at its end-of-life. In 2005.
www. “Q-Series: The Green Consumer”. 2009.com/investmentresearch EU.crioc. europa. www.ubs. www. 2008.com Adoption rate is a percentage based on units of the Index product sold compared to units sold for the entire merchandise category.europa.htm Wal-Mart’s ‘Live Better Index’. “Q-Series: The Green Consumer”. “Le label écologique européen”. 2009.livebetterindex.Making sense of sustainability labelling in the food retail industry 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Sustainable Products Corporation.pdf Crioc (Centre de Recherche et d’Information des Organisations de Consommateurs). “Sustainability Issues in the Retail Sector” http://ec.be TerraChoice. 2009.com .sustainableproducts. 2007. Press Release. www. www. UBS. “Seven Sins of Greenwashing”.terrachoice. 2008. www.com Ipsos MORI.ubs.do?reference=IP/09/339 Ipsos MORI.com/investmentresearch Ipsos MORI. www.livebetterindex. 2008 “Sustainability: Are consumers buying it?” Organic monitor 2008 UBS.eu/rapid/pressReleasesAction. www. “Sustainability Issues in the Retail Sector” PriceWaterHouse Coopers. (2007) 2009. and Crioc.com Wal-Mart’s Live Better Index. “Acheter sain: les signes de qualité”.oivo-crioc. 2008.org/files/fr/2099fr.eu/public_opinion/archives/eb_special_en. “Sustainability Issues in the Retail Sector”.
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