Organizational Governance Materials & Packaging

2 Steps Forward, 1 Step Back:
LEGO Is Latest Company to Disclose Sustainability Setback

The world’s largest toymaker acknowledged the issues it encountered in pursuit of a more sustainable alternative to its oil-based plastic bricks, illustrating the still-circuitous path to sustainable solutions.

By Maxine Perella | Published 1 year ago | About a 7 minute read

Image: LEGO

Each year, 60 billion plastic bricks roll off the production lines at Lego factories worldwide — a simply staggering number. Given most of this manufactured output is in the form of ABS (Acrylonitrile Butadiene Styrene) — a hard, petroleum-based plastic — it’s little wonder the world’s biggest toy manufacturer has been working hard over the past decade to try and find a more sustainable alternative for its iconic building blocks.

Back in 2015, Lego announced it would invest 1 billion DKK (Danish Kroner) and establish a Sustainable Materials Centre at its Denmark headquarters to help drive this focus. Then, in 2021, the company hailed a breakthrough – a prototype brick made from recycled plastic (rPET) water bottles. During the development process, more than 250 variations of PET materials and hundreds of other plastic formulations were tested to ensure strict quality, safety and play requirements could be met.

Stumbling blocks

Fast-forward to 2023 and this work has hit an unexpected setback: Lego confirms that the rPET brick won’t be put into full-scale production: “When we announced a prototype, we were optimistic about its potential; but after two years of testing, decided not to progress — as ultimately, it wouldn’t have helped us reduce carbon emissions,” a company statement explained.

Substituting virgin fossil-fuel-based materials for recycled or biobased ones is rarely a straightforward swap; the process Lego had developed for its prototype involved combining the rPET formulation with strengthening additives to ensure it was strong enough. In an interview with the Financial Times last month, global head of sustainability Tim Brooks explained that because the recycled plastic was softer, it needed more energy to process it.

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“It’s like trying to make a bike out of wood rather than steel,” Brooks said. “In order to scale production [of rPET], the level of disruption to the manufacturing environment was such that we needed to change everything in our factories. After all that, the carbon footprint would have been higher. It was disappointing.”

Ditching rPET for carbon reasons has surprised some sustainability observers. Mike Tregent, a chartered environmentalist working in strategic waste planning, suspects there may be more factors at play. He points to a lifecycle assessment (LCA) infographic published by the National Association for PET Container Resources (NAPCOR), which shows that rPET demonstrates significant energy and emissions saving over virgin plastics.

As he told Sustainable Brands® (SB): “Is this more about product quality, logistics and security of supply? In terms of the supply chain, it needs to be recognized that for secondary materials, it is not so mature and can be more variable in terms of price, quantities and quality.”

Emma Burlow, a circular economy strategist and founder of Lighthouse Sustainability, maintains that so-called ‘breakthroughs’ need to be commercially viable — “and this one clearly wasn’t.”

“I frequently hear that rPET is in high demand and high volumes are needed to keep prices viable for food-contact items; so, using it for Lego is perhaps a waste or at least prevents other markets from accessing it as easily,” she told SB.

In terms of material choices, Mark Shayler — founder of UK-based strategy firm Ape — says he’s not sure why Lego opted to invest in rPET rather than recycled ABS (rABS).

“ABS is a strong and reliable plastic that withstands wear and tear and has great compressive strength. It is simple to use in injection-molding applications; there is a supply of recycled ABS and the nirvana is a closed-loop system of Lego bricks. [rPET] is a softer polymer and more prone to misshaping and damage. This feels like a quality issue. The decision runs counter to consumer interest and net-zero targets,” he told SB.

Brick by brick

So, where does Lego go from here? The company emphasizes that rPET is just one of many prototype materials it is testing to replace virgin ABS plastic, and it remains committed to making its products more sustainable. This includes a pledge to triple spending on initiatives like this to $1.4 billion in the four years to 2025.

Going forward, expect some compromise on ABS as the company looks to take a phased approach by gradually incorporating more recycled and biobased material into the polymer blocks. This won’t be without its difficulties, however.

“There may be options to blend materials; but this can also come with toxicity challenges, as different plasticizers may have to be used,” Tregent says. He adds that use of biobased plastics may also pose quality issues, given the longevity of Lego products as a key selling point.

The toymaker says it is also following fellow toy brands such as Mattel in looking at circular business models that involve takeback and reuse. It’s a potentially exciting shift in thinking; but can it be pulled off? There are already plans to expand the Lego Replay program, which donates used bricks to children’s charities and other organizations; and the learnings from this could help inform a more commercial offering, where consumers might be incentivized to hand back their built sets to Lego for recirculation.

“This is a systems and business-model challenge, rather than a materials challenge. Leasing/rental is unlikely to work here, as people like to own their Lego. But a buyback scheme is different,” Shayler says — adding that his consultancy worked with a client, RS Components, to develop a circular model via product buyback and achieved a significant increase in sales as a result.

Burlow says given Lego’s high customer loyalty, trade-in schemes could work well — but that handling and redistribution costs would need to be factored in.

“I’d be interested to see whether a secondary market for Lego could be commercialized by them; I think it would be popular with customers but would be fairly radical. This secondary market could offset revenues from virgin bricks in time,” she adds.

Burlow has undertaken some work on community reuse models for Lego in the past and believes there’s huge scope for community and retail-focused reuse. She says that community reuse is often overlooked as it’s expensive to facilitate, but suggests Lego could run a hands-off campaign to facilitate local collection points and parties to build viable networks.

“There is already a thriving secondhand market for Lego and it retains its value very well. The question for me is, when will they realize the value they are missing out on? If they could prove a carbon reduction through reuse, then this might incentivize them to get more involved in secondary markets,” she says.

Whether Lego can go circular with what many regard to be the ideal product, given its durability and appeal, remains to be seen. Certainly, some within the sustainable business community feel the company should focus more on reducing production of bricks, rather than finding solutions to make new ones. Shayler feels that ultimately, Lego faces a tough balancing act in this respect.

“Anything that fires creativity is a good thing in my eyes; the challenge is the loss of atoms into the environment. Closing the loop is the answer, even if its a bigger loop,” he says.