Embracing Sustainability for your Brand
A framework for creating green packaging.
Sustainability — being green — has gone mainstream. Major brands in every sector from fast food to fashion have spent significant resources making sure their products and corporate image stack up well in terms of environmental and social impact.
Consumers are demanding solutions that are better for the planet. Sales of LOHAS (Lifestyles of Health and Sustainability) products reached $300 billion in 2008, up 36 percent from 2005. Today, about 80 percent of U.S. adults are looking for more sustainable offerings.
Manufacturers and retailers are setting goals and protocols to increase sustainability. On the manufacturer side, for example, P&G has published a scorecard meant to measure and reward improvement across its supply base. On the retailer side, Wal-Mart’s sustainability scorecard is meant to drive transparency and competition among suppliers and to reduce the cost and impact of packaging.
But what does being green really mean in packaging? This article digs into a set of important assertions:
- Put sustainability into context: We review three questions that help define the right frame of reference for your sustainability approach.
- Pull the right levers: We share a comprehensive sustainability framework with multiple levers you can pull.
- Pick your partners wisely: We highlight the importance of finding partners that walk the talk and can help you navigate the many options available to you.
Before we begin, we will first turn to some of the complexities of sustainability to highlight how important it is to have a vision and strategy in mind.
>The Devil is in the Details
Sustainability is not an easy topic. Sustainability buzzwords abound — organic, regrind, eco-friendly, toxin-free, renewable, all-natural, biodegradable, paraben-free, carbon footprint, bio-resin, lightweighted. With no standardized definitions, this world of new terminology can be misleading and confusing. There are some governing bodies and some volunteered guidelines, but much of this is a grey area.
Consumers, unsurprisingly, get confused. Indeed, some consumers are skeptical of companies’ green claims. And other consumers have outdated impressions and bad data in their heads (like “aerosols destroy the ozone”). Between the skeptical disbelief, the misinformation and the volume of new information on this topic, it’s hard to keep it all straight. As a result, what consumers say they want and what they are willing to pay for are often two different things.
Even experts can be confused or confusing. For example, ask a glass company if glass bottles are more sustainable than plastic bottles; they will say they are. Ask a maker of plastic bottles the same question, and they will give you the opposite answer. Who is right, and who is wrong? It really depends on what variables you want to include and how broad of a system you want to consider. For instance, glass takes more energy to form, but it comes from plentiful sand. Plastic is lighter and easier to transport, but it comes from scarcer petroleum. The one that’s more sustainable depends on how you weigh each variable in the equation and what your goals are.
Of course, all of these complexities serve to muddy the waters even further for consumers.
>Put Sustainability into Context
In general, consumers want packaging that is beautiful, functional and more sustainable. But only a minority of passionate consumers is really willing to pay more for sustainability.
Sorting out what role sustainability has in a company’s overall strategy is important, because this notion provides the critical context for how much to invest in or rely on sustainability as a tactic. Indeed, most companies have a balanced scorecard; is sustainability meant to improve the financial and shareholder metrics or the social and community metrics — or both?
While each company will have different aims, we’ve found three questions help drive clarity in the role of sustainability in packaging and corporate strategy:
What are your sustainability goals?
Is sustainability meant to be a direct revenue booster (where consumers go out of their way to buy your product due to specific features and benefits) or an indirect revenue booster (where a positive aura of sustainability lifts your sales broadly)? Or are your aims more focused on profitability, thereby requiring a close analysis of unit volume, unit prices and product costs (with all the puts and takes that sustainability creates)? There are, of course, many more angles one could put on this question, but the issue is essential nonetheless. Because smart strategy is about making tradeoffs, what are you willing to trade off to have more sustainable solutions?
How do you perform today vis-à-vis sustainability?
Look at your company through an objective lens and see where you’re already doing well or lacking compared to your competition, what your customers are asking for and what consumers in general want. Then compare this feedback to your goals to determine whether there are small changes that can move the needle or whether larger initiatives are required. For example, research indicates that consumers generally place more value on recycled content and lightweighting than on the efficiency of your manufacturing footprint. Does this apply in your market?
What changes do you anticipate?
First, from a consumer view, what are you counting on? How much are you betting on market share gain or willingness to pay more for certain changes? Second, what types of changes are in scope for your infrastructure and supply chain? Enhancing packaging sustainability can impact filling lines, raw material suppliers and your warehousing network. Contemplating what degree of change is possible or expected can help shape your green strategy.
With this context established, we can turn to a comprehensive framework with multiple ways to improve packaging sustainability.
>Pull the Right Levers
Packaging can contribute to the overall sustainability of a product by being made from responsibly sourced materials that are safe, manufactured using clean production technologies, efficiently recoverable after use, in line with consumer needs and choices, cost-effective and designed holistically with the product itself. Juggling all of these factors can be a challenge.
In simple terms, however, these considerations can be boiled down to four families of actions that can improve packaging sustainability: Material Inputs, Material Outputs, Energy & Climate and People & Community. A sustainable package or supply chain will likely draw from all four categories, allowing you to choose the elements that best fit your goals, current sustainability status and the resources at hand.
Goals: Reduce toxicity, increase renewability, and consider extraction.
Examples of actions:
Increase usage of post-consumer and post-industrial materials.
Use bio-based and petroleum-free resins.
Phase out PVC or polycarbonates.
Reduce plasticizers and phthalates.
Use non-bleached papers.
Switch to sustainably harvested wood pulps.
Use soy-based inks.
Goals: Reduce waste, increase reusability, and consider end of life.
Examples of actions:
Incorporate biodegradable materials or additives.
Improve recyclability by designing for component disassembly.
Improve recyclability by using all-plastic components.
Use black or non-colored resins to improve post-consumer applications.
Use heat-transfer or poly labels to improve regrind.
Adopt reusable pallets and tray liners.
Energy & Climate
Goals: Reduce emissions, increase locality, and consider energy use.
Examples of actions:
Improve plant operations — energy conservation, water reclamation, renewable energy use and reduced heavy metal and carbon emissions.
Select materials and processes thoughtfully. For example, HDPE and polypropylene resins use less energy to produce and process than PETE; post-consumer resins are more efficient than virgin resins.
Consider transportation efficiencies — pallet optimization, increased top-load strength, nesting for better pack-out and localized manufacturing.
People & Community
Goals: Reduce liability, increase visibility, and consider alliances.
Examples of actions:
Look to third-party certifications — accreditation of materials, processes, facilities and personnel by governing bodies.
Embrace worker conditions — green workspace design and human rights audits.
Create NGO alliances — charitable donations,community outreach and corporate dashboards.
While the nuances and details of each action family are beyond the scope of this article, this framework can guide deep discussions with your suppliers and partners to turn these ideas into reality.
>Pick Your Partners Wisely
Not all packaging suppliers embrace sustainable solutions with equal commitment. A 2011 survey conducted by Berlin Packaging showed that less than 50 percent of respondents (manufacturers of packaging) comply with predominant retail sustainability scorecard metrics.
Sustainability Dashboard Compliance
|Energy & Climate|
|Reduce your corporate greenhouse gas emissions||59%|
|Publicly available greenhouse gas reduction targets||13%|
|Measured the total amount of solid waste generated||45%|
|Publicly available solid waste reduction targets||12%|
|Publicly available water use reduction targets||9%|
|Nature & Resources|
|Publicly available sustainability purchasing guidelines||23%|
|Obtained third-party certifications||45%|
|People & Community|
|Know the location of 100% of the facilities||77%|
|Process for managing social compliance at the manufacturing level||52%|
|Resolve issues found during social compliance evaluations||36%|
|Invest in community development||36%|
As you decide which levers are most important to your sustainability strategy, you will want to survey your suppliers and partners to make sure they can execute.
Improving packaging sustainability doesn’t need to be a big bang. There are many ways to dial in improvements over time. Start by building a roadmap that can guide any changes. You can do this by:
- Collecting feedback from your key constituents — your consumers, customers and suppliers — and researching how you compare to your competitors. Can sustainability be a source of competitive advantage and, if so, in what ways?
- Deciding on your overall goals and what role sustainability plays in your overall strategy. How can it be incorporated on your corporate scorecard?
- Determining the degrees of freedom you have with sustainability. Are there certain things about your go-to-market approach and offering that you can and can’t change?
With this information in hand, the next step is to review the four levers in the sustainability framework to identify the best tactics to accomplish your goals. At this point, you will be ready to choose the right supply chain partners to support your efforts.
Sustainability is good for the earth, good for your community and can be good for your business. Sustainability is here to stay, and packaging can play an important role in a sustainability strategy. The challenge is to sift through the complexity to define what the right strategy is for you. Understanding where sustainability fits on your corporate dashboard and what tradeoffs you’re willing to make is essential in building this strategy. Once you have established that foundation, you can select the best tactics and actions to meet your goals. The four major families of actions can improve packaging sustainability — Material Inputs, Material Outputs, Energy & Climate and People & Community — and they can all play a role. Ultimately, delivering sustainable solutions and delivering excellent business results can go hand in hand with a well-designed roadmap and supportive partners.
Spotlight on Detailed Dashboards
The Sustainable Packaging Coalition (SPC) is an industry working group dedicated to implementing sustainable packaging solutions. The SPC published an outstanding study, the “Sustainable Packaging Indicators and Metrics Framework.” The study is available at http://www.sustainablepackaging.org. This study presents an exceptionally comprehensive set of metrics to evaluate and benchmark packaging solutions.
The framework was refined by the Global Packaging Project (GPP). A useful summary of their approach and conclusions are presented in “A Global Language for Packaging and Sustainability.” This can be found at bit.ly/hGdTHi.
The GPP proposes a slate of 40 metrics; a partial summary is provided here:
Environmental Attributes & Life-Cycle Indicators
> Life-Cycle Indicators
Economic & Social Attributes
Corporate Performance Checklist
These scorecards can get very complex very quickly. Considering your overall sustainability goals and the four major categories of actions outlined in the article (Material Inputs, Material Outputs, Energy & Climate and People & Community) will be a smart way to get started.
Sustainability at Berlin Packaging
Berlin Packaging is a leading supplier of rigid packaging. Sustainability is not a separate practice area or discipline within Berlin Packaging; instead, it is part of the regular dialogue of meeting the unique needs of each customer.
Indeed, as part of Berlin Packaging’s commitment to increasing the net income of its customers, Berlin takes pride in being a comprehensive resource for cutting-edge technologies and trends within the packaging industry. Sustainable packaging solutions are an important part of this.
Some of the ways Berlin Packaging has pushed the sustainability agenda include:
From regulatory issues and retailer preferences to the latest available green material or processing platforms, Berlin Packaging works to help customers stay ahead of the curve.