As hopes mount for a new, post-COVID “normal,” many systems are in flux and the state of sustainable packaging is once again in question. How will businesses adapt? Or re-adapt? Or un-adapt? Shelton Group CEO Suzanne Shelton and the Sustainable Packaging Coalition’s Adam Gendell share their insights.
Eyes are brightening as they look towards the future. Spring is around the corner, vaccines are beginning to roll out, and visions of a new, post-COVID “normal” are beginning to come into focus. As hopes mount for this potential inflection point in the 21st century, changes are once again on the horizon and the state of sustainable packaging is once again in question. How will businesses adapt? Or re-adapt? Or un-adapt? How should the past, current, and future states of sustainable packaging be viewed in light of the rapid pace of change?
Adam Gendell: Let’s start by recapping what’s happened in the world of sustainable packaging over the past year or so. It’s been an interesting ride; and while there are themes, it’s challenging to generalize across the whole industry. Corporate approaches to sustainable packaging during the pandemic have varied considerably.
Overall, I don’t think the “pause button” was hit the way I expected it to, although we know that many companies did have to put their sustainable packaging projects in cryogenic stasis. Some of those projects were literally physically impossible to continue: Research and development labs were closed; employees were ordered to work from home; hands-on trials were suspended. Some of those projects were eventually resumed — some were not. Other projects were scuttled due to financial uncertainty, though I don’t perceive that to have been an overarching trend. The cynic in me thinks that sustainability is easy for companies to put on the chopping block whenever budgets are tight, but the evidence we’ve seen suggests that it largely escaped the crunch. That’s a promising sign! If sustainability was once viewed by business as a “nice to have,” I think it’s worked its way into being considered an essential line item. This was a true test of that; and for packaging, it appears that the test was passed. I think we can be encouraged by this.
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So, the forward-looking work has mostly persevered through the pandemic; but we can’t say the same about the sustainable packaging measures that were supposed to be in place through 2020. I don’t think anything was more impacted than reusable packaging. Just as so many companies were taking bold steps into that great unknown, hygiene skyrocketed to the top of consumers’ minds. Reusable packaging hadn’t yet built trust with consumers around hygiene; and for reasons real or perceived, it had to return to the backburner while single-use packaging resurged — sometimes with a bit of cringeworthy “I told you so” messaging from the single-use packaging suppliers.
The other big hit was that companies weren’t able to use as much recycled content as they had planned. The already-volatile recycling system was jolted, supply chains were disrupted, and the pricing and availability of recycled content became highly unpredictable. Nothing was hit harder than PET — as the majority of companies using recycled PET in packaging need food-grade material that is predominantly supplied by the bottle redemption centers in “bottle bill” states, which were largely suspended for months on end.
Ultimately, the pandemic created an atmosphere in which many asked for the benefit of the doubt — promising that their sustainability commitments were still intact and offering assurance that any instance of standing still or stepping backwards was a regrettable but necessary, temporary measure. This mindset wasn’t at all exclusive to packaging — 2020 felt like a year where everybody asked for a “free pass” for something, and those requests were largely accepted. I think the big question now is: Is industry still getting a “free pass” these days? And, if so, what happens when that expires?
Suzanne Shelton: So, let’s ground this in some of Shelton Group’s ongoing Pulse™ data: Pre-pandemic, 67 percent of Americans said companies had ‘some’ to ‘very much’ responsibility for the end-of-life disposal of products they manufacture. As of May 2020, smack in the middle of the pandemic, that number dropped to 54 percent. So, we have indeed seen some “backslide,” or at least willingness for consumers to give manufacturers and brands a pass — for now. It’s also worth noting that only 16 percent of Americans said in May 2020 that manufacturers had zero or little responsibility for the disposal of their products at the end of life.
Based on what we saw in our data through the 2008 financial crisis, I believe we’ll see this revert once we’re on the other side of COVID. In 2006-7, we saw an increasing interest in sustainability and increasing expectations from Americans of the companies they buy from. When the economy hit the skids, all of that contracted. But as the economy got on solid footing again, we saw interest and expectations for sustainability rise. We think we’ll see a similar situation here. Further, it’s not like the plastics-in-the-ocean problem is going away, unfortunately. It’s getting worse. And horrifying images of consumer products harming marine life will continue to proliferate social media. Those images are incredibly emotionally jarring and make us as humans feel like accomplices. That could be my soda ring strangling that cute otter! My straw up the sweet turtle’s nose!
80 percent of Americans say the bare minimum they can do for the environment is to recycle. And we claim to be diligently chucking stuff in our blue bins. Now, we all know most Americans don’t actually understand what’s really recyclable, so we’re “recycling” a lot of things that aren’t actually recyclable. But the point is that people can’t get their heads around this problem: “I’m doing my part, and I see my neighbors doing their part ... we’re all rolling our overflowing recycling bins to the curb. How can we have so much plastic in the ocean? Why isn’t it getting recycled?” We already see a tide of frustration turning towards manufacturers. I predict in the next 3-4 years that frustration will grow to outrage from mainstream Americans that manufacturers are actually allowed to make packaging that’s not recyclable.
AG: The relationship between the packaging community and the recycling community has always been a bit tenuous, and I sense that the pandemic has elevated many of the issues. There’s a massive collision happening. Brand owners have been making substantial pledges framed around recycling being the solution; and municipal governments, who act as the chief financiers of recycling, are feeling the pain of budget crunches and a financial recycling equation that has trended negatively for some years. The question of “who’s supposed to pay for all this?” has come front and center, and I think we should expect that debate to rage on.
It’s not all bad news around recycling, though. Many folks thought that recycling would be a casualty of the pandemic; and for the most part, it hasn’t suffered the way many thought. There was a news burst about recycling programs getting cut and speculative concern about the safety and sanitation of recycling; but recycling was deemed an essential service, and nearly all of the programs that were suspended — the vast majority of which occurred in smaller communities — have resumed. “Suspension,” it turns out, was not secret code for “we’re playing the virus card as justification to cancel something we wanted to cancel anyway.” I think that public outcry around waste and the environment translates well into political pressure to maintain recycling.
But that’s the new crux of it: “Maintaining” recycling isn’t good enough. For industry to make good on its promises, recycling has to undergo transformative growth. This isn’t a question of whether recycling can survive through uncertain times, but rather a question of how recycling can reach ambitious new heights in uncertain times. I’m not sure that there’s sufficient public pressure to expand and grow recycling. There’s industry pressure, but that brings us back to the debate of who pays. It’s a delicate situation. The economy appears to be recovering; but no municipality wants to choose between recycling and things like schools, roads, hospitals and social services. For industry to alleviate those consumer concerns, something has to change.
So, the next question is: What needs to change? What does industry need to do to meet consumer expectations around sustainable packaging?
SS: Given the trend lines we saw pre-COVID, and our experience with the Great Recession, I think consumer expectations will align with a lot of the 2025 goals manufacturers have. Although, based on the qualitative insights work we’ve done over the years, I don’t think most Americans will think 25 percent recycled content in 2025 is enough. They don’t understand that there’s literally not enough recycled content to go around, and I don’t think you win by trying to get them to understand that. I think you win by helping consumers understand what you’re doing to help upgrade the recycling system and upgrade your packaging designs to ensure every package you make is truly easily recyclable — and even circular.
The most sustainable package would probably be one you can use over and over. But the truth is, most mainstream Americans don’t really want to have to hassle with refillables/reusables. It’s pretty easy if we’re talking about water bottles (except when you’re on a road trip and there are no refilling stations), but it’s hard for just about every other area — like remembering to bring your own take-out containers to a restaurant or, worse, remembering to clean and then bring laundry detergent bottles to the store. What Americans really want from industry is to figure it out. Make everything from 100 percent recycled content and make everything 100 percent recyclable. Better, make most packaging biobased and biodegradable, so we don’t even have to worry about plastics in the ocean ... everything that’s single-use just returns itself to the earth.
To many people reading this, that likely sounds like a fantasy. And you may be thinking, “Right ... who will pay for all of this?” The truth is that most Americans think Corporate America is rolling in dough. They think executives are way overpaid, companies have lots of profits sitting around, and companies should just cover the cost. We’ve grown to depend on Corporate America to innovate because it has traditionally done that so well. Look at how many things we all have now at such a low cost! If we can make computers that we carry around in our pockets that only cost a few hundred bucks, can’t industry solve the waste problem — and do it so it doesn’t cost the consumer a lot of money? Again, not my point of view — but that’s how average Americans see it. And that’s what industry needs to contend with as it looks to meet their expectations.
Between the perseverance of corporate pledges, the expected resurgence of consumer pressure, and the rapidly evolving relationship between industry and policymakers, plenty of twists and turns will be made on the next leg of the sustainable packaging journey. We can expect areas such as recycling, reusable packaging, and recycled content to receive a renewed sense of urgency; and in many ways, the conversation on sustainable packaging will pick up right where it left off pre-pandemic. Regardless of 2020, the need for sustainable packaging has remained heightened — and it’s clear that even a worldwide disruption isn’t capable of changing the overarching trajectory of sustainable packaging.