The third part of this month's management briefing sees Ben Cooper look at the part played by recycling in the soft drink and bottled water sector.

The use of recycled content in their packaging and the degree to which packaging is recycled rather than being sent to landfill are among the most critical aspects of the sustainability challenge facing soft drinks and bottled water companies.

Any sustainability strategy which purports to take an entire lifecycle approach has by definition to encompass what happens to the product at the end of that lifecycle. 

The previous section of this briefing notes that large soft drinks producers can if they wish bring considerable pressure to bear on suppliers and service providers to mitigate the environmental impacts of their products along the value chain. How they collaborate with packaging suppliers regarding the use of eco-friendly materials can be included within that supplier dialogue but companies' aspirations on recycling specifically are dependent on factors over which they may have less direct influence, namely effective municipal collection systems and consumer behaviour.

Extended Producer Responsibility

In the US a vigorous debate is currently being played out among consumer goods companies and other stakeholders which speaks directly to the degree of control companies have over this crucial area of the value chain.

Extended Producer Responsibility (EPR) is a policy approach whereby producers take responsibility for the packaging waste created by their products. While many countries, notably in Europe, have policies in place which require companies to bear some or all of the costs at the post-consumer stage, it is strongly opposed as a policy option by many US companies.

However, EPR is supported by both Coca-Cola and Nestle Waters North America (NWNA) which argues that the system, while resulting in extra costs, offers the best chance to improve recycling rates. 

Packaging accounts for around 50% of the carbon footprint of a NWNA bottled water product, and while through packaging innovation it has steadily reduced the GHG impact of its bottles, the most effective way to move the dial further is by boosting recycling rates. 

"We recognise that the recycling rate for all PET packaging in the US is a dismal 30%, and that needs to improve," says Michael Washburn, NWNA's vice president sustainability. "Consumers can reduce the impact of the bottle by 20% simply by recycling it, and we can make a new bottle or use the material again to make new post-consumer products like clothing."

As part of its sustainability strategy, NWNA has set out to increase bottle recycling rates to 60% in the US by 2018, and it believes EPR would help in achieving that objective. "The most efficient way to reach this goal is to advocate and push for legislation for Extended Producer Responsibility ," Washburn continues. "EPR can invigorate recycling in the US and elsewhere by requiring that all packaging and recyclable material is indeed recycled. This effort has led us to collaborate with many different internal and external stakeholders and partners in industry, government and academia."

Washburn continues: "A fully operating EPR system invigorates recycling and provides additional material for post consumer recycled goods.  The more material recovered the more efficient the system."

NWNA maintains that involving the private sector more closely in the design of recycling programmes will result in a system more fit for purpose. "We believe American communities can get a better recycling system by bringing companies in not to just pay for it but to help in the design and unification of programmes. Too many programmes are collecting different materials and missing the chance to optimise value. More alignment and consistency along with good design standards, plus more accessible bins both curb-side and in public spaces is what we envision."

However, EPR is opposed as a policy option by many consumer goods companies. Notably, a report last year published by the Grocery Manufacturers Association (GMA), which represents food and drinks producers in the US, voiced concern about possible moves towards EPR by state legislatures. 

The report's key findings were that:

  • EPR does not necessarily result in improved overall recycling rates. At 24%, the recycling rate of all municipal solid waste in the US, where there is no packaging EPR, exceeds the rate in Canada (18%) and the in the EU (23%), where EPR is widely employed.
  • EPR does not necessarily prompt changes in packaging design and selection. Despite a faster-growing GDP, packaging use in the US declined at a faster rate than in the EU, where EPR is common.
  • EPR does not necessarily make waste and recycling systems more efficient or otherwise decrease costs.
  • States and municipalities already have at their disposal a suite of non-EPR policies that are both effective and efficient in terms of raising recycling rates. Together, they can achieve high recycling rates, without excess cost or administrative burden that results from EPR.

"The CPG [consumer packaged goods] industry is focused on responsible solutions that address solid waste across the entire lifecycle - from design to disposal to recovery - and that account not only for packaging, but food waste as well," says Meghan Stasz, senior director of sustainability at the GMA. "The most successful recycling and waste recovery programmes will result from comprehensive approaches that leverage industry innovation and collaborative partnerships between NGOs, government and industry, not one-size-fits-all mandates."

When asked whether NWNA has much support from its peers in its position on EPR, Michael Washburn, replied: "We cannot speak for other companies, but as the legislative battles play out they will become known. It is, however, fair to say that several consumer brands and the smaller manufacturers who supply them, and those familiar with the demands of high-quality recycled materials, are with us. It is also true that compelling political forces exist that are pushing services like recycling more and more into a conversation around 'how can the private sector do this better?' The need for states to find mandate relief may be the most important dynamic here."

Coca-Cola Enterprises, meanwhile, also attributes low recycling rates in the UK and France in part to systemic factors. Joe Franses, director of corporate responsibility and sustainability at Coca-Cola Enterprises, observes the higher recycling rates in countries, such as Belgium and the Netherlands, where one single uniform collection system is in place. "Part of the difficulty in France and Great Britain is that the infrastructures are much less harmonised," he says. Having a collection method which "differs from local authority to local authority" is "not helpful".

The Courtauld Commitment

Corporate engagement on waste and recycling in the UK quite literally entered a new phase last month. Major soft drinks and bottled water companies were among the 45 consumer goods manufacturers and retailers in the UK to sign up to the third phase of the Courtauld Commitment.

Courtauld Commitment Phase Three targets, to be achieved from 2013 to 2015 measured against a 2012 baseline are:

  • To reduce household food and drink waste by 5%, representing a 9% reduction in real terms to counter the expected increase in food purchased.
  • To reduce traditional grocery ingredient, product and packaging waste in the grocery supply chain by 3%. Signatories will have to make an 8% reduction in real terms to counter the expected increase in production and sales.
  • To improve packaging design through the supply chain to maximise recycled content as appropriate, improve recyclability and deliver product protection to reduce food waste, while ensuring there is no increase in the carbon impact of packaging. Signatories will have to make a 3% reduction in real terms to counter the expected sales increase.

"We're really pleased to be part of Courtauld Three," Joe Franses tells just-drinks. "Those kinds of commitments are really important in terms of driving waste prevention. Things like that do help to move the industry along."

In terms of boosting recycling rates, there is no more important stakeholder group to engage with than consumers. How soft drinks and water brands are addressing consumers directly on the issue is the subject of the final section of this briefing.

For the fourth and final part of this briefing, click here. All four parts can be accessed here.