Second Quarter 2018
- Plastics play a beneficial role in many products, yet widespread insufficient management of plastic waste, primarily from low-value plastic packaging, poses serious environmental risks, as well as risks to human health.
- Companies are focusing their efforts on reducing usage of plastic packaging and sourcing recyclable materials in their products.
- We believe increasing awareness of plastic waste among companies and regulatory organizations through engagement and proxy voting can help contribute to long-term solutions.
Addressing the Threat of Plastic Waste
From bottled water to grocery store shopping bags to coffee cup lids, plastic is ubiquitous in our everyday lives. While plastic creates convenience, and is one of the most efficient ways to package and store food, irresponsible or excessive use of plastic products and the insufficient management of plastic waste pose serious environmental as well as business risks for companies that produce or use significant volumes of plastic packaging.
A full 95% of plastic packaging material value is lost to the economy after a short first use, resulting in annual losses of $80 to $120 billion (Exhibit 1). The Ellen MacArthur Foundation estimates that without profound changes in the way plastic waste is managed, about 30% of plastic packaging will never be reused or recycled.1 While stark, these numbers should be viewed from a broader perspective. For instance, most plastic waste comes from low-value consumer products that account for about 10% of global plastic production. The remainder goes into high value, durable products. The solution is not to eliminate all plastics, which are incredibly vital: plastics lower the weight of new cars, saving on energy, and are cheaper than other substrates, which also improves access for low-income consumers. Instead, we take an approach with companies that targets recyclability and collection.