Major brand owners such as PepsiCo, Unilever, and Colgate-Palmolive have announced that they will fail to reach their sustainable packaging objectives, in some cases diluting these from 50% to 33% in the use of recyclables and delaying targets from 2025 to time frames till 2030. What are the lessons for South Asia where discussion and investments have progressed but the achievements are still far away – from the number of accepted registrations on the Indian Government’s Plastic Waste Management website to waste collection and sorting or the use of recyclates?
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There is still a lack of clarity on the amount of financial penalties expected to bite brand owners, producers, and importers for non-compliance with the mandatory use of recycled plastic content from FY 2025-26 onward. The guidelines for imposing and collecting these are to be laid down by the Central Pollution Control Board.
Based on the Plastic Waste Management (Amendment) Rules, 2022 provided in the gazetted notification document, key timelines:
- The Extended Producer Responsibility (EPR) targets for producers, importers, and brand owners are FY 2021-22 – 25%; FY 2022-23 – 70%; and, FY 2023-24 –100%.
- Minimum recycling levels for plastic packaging waste collected under EPR start from 2024-25, with increasing percentages over the years.
- Mandatory use of recycled plastic content in packaging starts from 2025-26, with increasing percentages over the years.
- Reuse targets for certain rigid plastic packaging start from 2025-26.
The penalties for non-compliance are:
- Environmental compensation will be levied based on the polluter pays principle for non-fulfillment of EPR targets.
- The compensation amount can be returned partially if the shortfall is addressed within 1-3 years. These are, within 1 year – 75% return; within 2 years – 60% return; and, within 3 years – 40% return. 3. After 3 years, the entire environmental compensation amount will be forfeited. Further non-financial penalties are listed, but we are already three years behind with the lack of registrations, data submissions, and perhaps understandably – neither the enforcement nor quantification of financial penalties.
John Blake, a senior director analyst at Gartner, writes in the UK-based Packaging Europe about the retreat of several global brand owners, forecast in 2021. He writes, “2024 has signaled a shift in the sustainable packaging movement that kicked off six to seven years ago. . . “In the early 2000s, sustainable packaging was marked by nascent efforts characterized by the development of bio-based plastics, early programs to capture LCAs of packaging, and efforts to increase recycling. The global financial crisis of 2007-2009 put an end to many of those initiatives. In fact, efforts to reduce costs increased the use of multi-layer rigid plastics and high-barrier thin films.
“Then from 2018 to 2020, there was an unprecedented movement characterized by commitments to reduce or eliminate plastic, increase recycling, and reduce reliance on single-use packaging, many of the commitments targeting 2025. In 2021, Gartner, through its research efforts, predicted that most organizations with 2025 sustainable packaging commitments would fail to meet their stated goals.
“This analysis was largely driven by evidence of companies’ continued reliance on plastics and the lack of recycling and reuse infrastructure globally. Sustainable packaging is much more complex than many outside of packaging R&D or converting industries recognized at the time of setting sustainable packaging targets.”
In past months, “The ambitious targets have required recalibration and resets of deliverables and looking to a 2030-time horizon. One of the headwinds organizations have faced is the alignment to goals that became ubiquitous such as 100% of packaging being reusable, recyclable, or plastic-free. As these terms score well with consumers and bolster brand perception they were adopted before being fully vetted by R&D, supply chain, quality, procurement and manufacturing functions.
“The level of engineering and science that is inherent in common packaging formats is often misunderstood. Plastics for example have been highly engineered over several decades to provide the benefits of offering lightweight, safe, economic and convenient product protection. But they were not developed for easy or economical reuse or recycling. The industry has found that to unwind this innovation in a short timeframe isn’t yet technically or economically feasible.”
A timely assessment of the Indian Plastic Waste Management rules as notified in February 2022 is required. The process of collection and the amount of penalties need to be clarified and an overall recalibration of the processes, engineering, and scale required for their implementation plan and costs are needed. Otherwise, these will remain just words, to be ignored with impunity and those who have made courageous investments as innovators and early adopters will be left out to hang and dry. As Blake concludes, “Goals need to be designed with nearly as much detail as the products themselves.”
