How Businesses Can Make Plastic Sustainability Core to Growth

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  • “Our planet is choking on plastic.”

    This dire warning from the United Nations is, unfortunately, no exaggeration. Consumers worldwide buy a million plastic bottles every day, amounting to 400 million metric tons of plastic waste a year. Half of all plastic is used once and thrown away. Today, less than one- seventh (14%) of global plastic packaging is collected for recycling.

    But plastic pollution is more than an environmental problem. It’s also a business problem. For organizations everywhere, pressure is coming from many fronts to close the gap between what they could do and what they are doing to promote sustainable practices, especially with plastic pollution.

    In 2022, the U.N. passed a resolution on plastic manufacturing and recycling as the first step toward an international legally binding instrument. The U.N. Plastics Treaty is part of the worldwide push toward a circular economy: an approach to keeping materials and products in circulation as long as possible to help solve global challenges including climate change, pollution, and biodiversity loss.

    The Plastics Treaty is not theoretical. It will come to life by 2024. And already, forward-thinking Asia Pacific & Japan (APJ) organizations are looking at the push toward a circular economy as more than a compliance obligation.

    For APJ sustainability leaders, the environmental push offers an opportunity to get ahead of their competitors by building business models that make sustainability core to their growth strategies. Such companies are now limiting plastic pollution both downstream, through collection and recycling, and upstream, through sourcing sustainable materials.

    Today, some of these companies are taking inspiration from sustainability innovators outside APJ that demonstrate ways to get even greater results from a circular-economy strategy, designing products meant for reuse and recycling based on a deep understanding of their actions across the supply chain, production, and sales.

    Reshaping Business Models

    Mohawk, the world’s largest flooring company, is thoughtfully reshaping its business models to reduce plastic pollution.

    The U.S.-based company once made its carpets entirely from virgin polyester. Today, Mohawk fashions its carpet fibers completely from plastic bottles—roughly 6.6 million bottles are used annually. In one recent year, Mohawk saved $4.3 million on landfill and haul-away costs as well as the costs of treating and discharging water to public sewer systems.

    Mohawk relies on the sustainability partnership of big-box retail partners like Home Depot, Lowe’s, and ACE Hardware. “We do not sell to the end consumer,” says Jana Kanyadan, SVP and CIO, Mohawk Industries, “but the end consumer touches our product every day, whether at home or work. We need to make sure the end consumer is knowledgeable about our products, and we are appealing to them.”

    Many organizations see consumers as eager participants and advocates for mitigating plastic pollution. With the help of its audience, Chilean vending-machine start-up Algramo has eliminated single-use plastics, changing its model to incorporate reusable packaging that encourages people to pay for products, not packaging.

    Customers who use Algramo’s app to order pet food, laundry detergent, and many other goods refill their own containers with their purchases at vending machines. Now piloting its model in New York and in Chile, Algramo aims to lead a “refill evolution” that demonstrates the type of ingenuity driving the circular economy.

    Identifying Trouble Spots Through Technology

    Plastic taxes on businesses have focused on how products are made and discarded, but coming regulations will likely place more obligations on the level of use of plastics, their material flows, and how customers use, reuse, recycle, and reclaim them.

    To position themselves ahead of competitors, some organizations are raising their own accountability for plastics use across their sourcing, production, and sales functions.

    Fashion retail is one of the highest polluting industries on the planet: 87% of fiber input ends up in landfills. Understanding how retailers may feel paralyzed by such ambitious objectives as achieving 100% sustainability by 2030, Stephanie Benedetto created Queen of Raw in New York to help stores identify valuable waste in their supply chains—and tap into a marketplace that lets them buy and sell unused textiles that would otherwise be burned or buried.

    A lack of data along the lifecycle of plastics and gaps in monitoring have long stymied companies that want to reduce their use of plastic. Queen of Raw helps fashion retailers capture such data through artificial intelligence, machine learning, and blockchain to help identify trouble spots and cut their plastic pollution.

    As the pressure to address plastic pollution mounts, organizations can succeed only by understanding the types and volume of plastics they use and where it sits in their value chain. Organizations using a circular-economy strategy need to couple data transparency with collaboration across both their upstream and their downstream supply chains. And they will increasingly need to align their environmental, sustainability, and governance outcomes, including plastic pollution, with financial processes and decisions.

    Doing good for the Earth is a business imperative. More and more, sustainability goes hand in hand with profitability. And organizations that take advantage of growing consumer demand and regulatory mandates to reduce and reuse plastic may find they lead competitors that ignore the signs—competitors that might be dumping not just their plastic but their profits into the landfill.

    Discover how a circular economy can help you tackle the impact of the linear economy on the planet, on people, and on business. Learn more about how to calculate extended producer responsibility obligations, plastic taxes, and corporate commitments to optimize material choices.

    SAP invites you to respond to our Sustainability Survey (

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