To Package or Not to Package? 3 Critical Steps to Advance Sustainable Food Packaging

By Kate Daly

May 06, 2021

Today, brands and manufacturers are faced with endless choices and tradeoffs when it comes to food packaging. Take the packaging options for cheese. From individual foil-wrapped wedges to a round of Camembert packaged in its own rind to plastic-wrapped singles, to resealable plastic bags of shredded cheese, the multitude of options reflect the broader trend of diversifying packaging designs. Yet, which is the most cost-efficient option? Which creates less waste? What supports the longest shelf life? In today’s food system, these questions are relevant to every packaged food item — and packaging design determines not just how much packaging waste results, but also plays a role in how much food waste is generated.

From a packaging perspective, the more sustainable option is often assumed to be the option that looks the most natural, or organic — the one with less plastic, or less material overall. In many cases this is true, but the assessment of “sustainability” becomes more complex when the package’s contents are food — one of the biggest sources of greenhouse gas emissions when mismanaged and wasted.

In its recent U.S. Climate Summit, the Biden administration set the ambitious goal of reducing GHG emissions in the U.S. by 50 to 52 percent by 2030, compared to 2005 levels. It remains critical to keep the significant climate impact of the food system top of mind. The energy used to produce food and transport it to our plates is enormous. According to a United Nations study, one-third of global greenhouse gas emissions caused by human activity can be attributed to the way we produce, process and package food. And despite all the energy used to create this food, in the U.S. we throw away $43 million worth of it into landfills, where food waste emits greenhouse gases as it decomposes.

Since the earliest days of global food supply chains and industrial food manufacturing, food, food packaging and environmental impact have been intrinsically linked. At Closed Loop Partners, we invest in companies and business models that create innovative, waste-free solutions that prevent resource loss. When looking at the intersection of packaging and food, we believe that setting the course for a more sustainable path forward begins with three initial steps.

1. Consider the tradeoffs

Let’s revisit the cheese packaging options. The choices with bigger servings in their own rinds or in less packaging may seem more environmentally responsible overall, the rationale being the less packaging the better. And ideally the packaging used is widely recyclable or compostable. For households where all the cheese will be eaten within a certain time period, these options with little to no packaging might be the lowest waste option. But what if not all the cheese is eaten before it spoils? That’s food waste that could have been avoided if a smaller portion, albeit with a higher ratio of packaging to product, was chosen. Today, 31 percent of shoppers buy fresh produce in bulk to avoid unnecessary packaging. When aiming to reduce packaging waste, this is an effective tactic. But 53 percent of consumers have said that they waste more food when buying in bulk. According to the National Zero Waste Council, for many types of foods, “any GHG reductions achieved by not pre-packaging food are quickly outweighed by even a minor increase in food waste.”

57% of U.S. consumers want more resealable packages, and 50% want more variety in product sizes.

As eating and cooking habits change, more consumers today are looking for packaging that caters to storing food in their kitchens for longer, using small quantities at a time or buying smaller quantities at a time. Fifty-seven percent of U.S. consumers want more resealable packages, and 50 percent want more variety in product sizes. Particularly, they want to see baked goods, bagged salad, bread and meat available in smaller package sizes. How can we ensure that these preferences, which align with a reduction in food waste, can be met with more sustainable packaging options?

2. Invest in smarter packaging design

Innovation in packaging design can help reconcile the tradeoff between food waste and excess packaging. Smarter packaging works not only for the benefit of the food it contains, but also for the retailers and customers it serves. Emerging “active” and “intelligent” technologies help slow spoilage, giving information on food quality or safety, as well as enabling transparency across supply chains.

Where are we seeing progress? Closed Loop Partners invests in companies across the food and agriculture sector to strengthen every stage of the value chain — from farm to transport, retail, consumption, waste collection, food scrap and organics processing and back to the farm. We have invested in TradeLanes, a company that digitizes trade execution for container ships, increasing transparency in the global trade system to make the process faster, easier and more profitable. By better understanding where and when goods are in port versus in transit, we can ensure the right storage and create the optimal conditions for the transportation of food.

We’ve also invested in Mori, a company that has commercialized silk-based edible coatings that prevent food spoilage in transport and at retail and reduce the need for packaging. Its innovations — coatings applied directly to food, films to replace plastics — can be applied to whole or cut produce, prepared food, raw meat, seafood and processed foods. The edible coating is safe to eat, invisible, tasteless and virtually undetectable. Because it keeps food fresher for longer, less food goes to waste, which benefits the grower, farmer, shipper, processor, retailer, consumer and planet.

Improved package design and active and intelligent packaging also have a combined net annual financial benefit of $4.13 billion.

3. Collaborate to accelerate systemic change

To create system-wide change, stakeholders across the plastics and packaging and food and agriculture sectors and recovery systems need to be at the table together. We’ve seen the power of collaboration thanks to our work in the NextGen Consortium, launched by our Center for the Circular Economy to convene leading brands, industry experts and innovators to reimagine foodservice packaging and reduce waste. The Center’s new Compostable Packaging Consortium is deploying a similar pre-competitive, collaborative approach to identifying greater opportunities for the recovery of compostable packaging, in particular the role packaging can play in increasing food waste diversion from landfills.

In line with this work, we are partnering with the Sustainable Packaging Coalition (SPC) and its new initiative, Food Waste Repackaged. The initiative brings together experts and innovators to address the urgent challenge of food waste, exploring and advancing the role of packaging in addressing this waste in consumers’ homes, food service and retail and spurring new packaging innovations. Closed Loop Partners is proud to partner with SPC, together with GreenBiz, Packaging Europe, ReFED, RILA and Ubuntoo, on a Learning Series, Innovation Challenge and Mentorship Program to help tackle this problem.

When done thoughtfully and collaboratively, packaging reduction and design innovations present robust environmental, economic and social benefits. Preventing food waste is a top solution to climate change, and changes to packaging design could help prevent 650,000 tons of food waste a year in the U.S. Improved package design and active and intelligent packaging also have a combined net annual financial benefit of $4.13 billion. Catalyzing these solutions, and inviting dialogue across multiple stakeholders, brings us a step closer to building a more efficient, less wasteful food system.

Originally published in GreenBiz.

Circular Economy Infrastructure Will Build Value For All Americans

By Ron Gonen

May 03, 2021

The circular economy is becoming big business in America. For example, just one piece of the circular economy, the recycling industry, generates over $100 billion in economic activity, nearly $13 billion in federal, state and local tax revenue and supports over 500,000 jobs annually.

On a more personal level, as global supply chains began to crack during the COVID-19 pandemic, our domestic recycling infrastructure saved us from major shortages of critical consumer products — like toilet paper. But that is only a fraction of the value the circular economy can provide on both a local and national level.

A policy known as Extended Producer Responsibility (EPR), now being introduced at the state and federal level, would create a massive investment in local recycling and circular economy infrastructure. Through a fee paid by consumer goods companies, thoughtfully-constructed EPR will save billions of dollars spent annually in landfill disposal fees. It would create hundreds of thousands of local jobs and provide consumer goods companies a reliable and cost-effective alternative to their current dependence on limited raw materials, which generate enormous amounts of greenhouse gas (GHG) emissions during extraction.

In the past, advocating that companies take responsibility for the sustainable management of their products was the sole domain of environmentalists. But we are now seeing multiple stakeholders, including CEOs, politicians, customers and shareholders align on the view that when brands invest in local recycling and circular economy infrastructure to protect the environment, it creates value for businesses too. In New York this January, State Sen. Toddy Kaminsky (D) introduced an EPR bill that has gained broad support, and similar legislation has been introduced or is being considered in California, Colorado, Hawaii, Maryland, New Hampshire, New York, Oregon, Vermont and Washington state.

A select group of CEOs of major consumer goods companies have recognized that what happens to a product after its initial use poses a risk — but when managed properly, can be an opportunity to secure long term value. Mark Schneider, the CEO of Nestlé, wrote recently, “[B]old and meaningful action in this space can become a competitive advantage, contributing to improved market share and growth.” Former Unilever CEO, Paul Polman, saw the opportunity to meet consumer demand years ago and trailblazed with sustainable business practices and products. During his decade-long tenure as CEO from 2009-2018, Unilever’s stock price increased by 290 percent. Investors took notice. Alan Jope, Unilever’s current CEO, has continued to expand Unilever’s commitment to sustainable business practices.

Three considerations are key to make EPR successful. First, stakeholders should gain consensus on the goal for EPR and incentivize brands to achieve it. Second, we should update the definition of “recyclable” to ensure that only products that are profitable for municipal recycling programs are designated as recyclable. Third, we must allocate funds from an EPR program directly to municipal recycling programs and empower local leaders to invest the funds in the infrastructure required to achieve their waste reduction goals. Styrofoam is an example of a packaging material that is challenging to recycle and has a limited market, while aluminum is infinitely recyclable and has a strong market.

For true accountability, all parties should set a goal for the policy and decide how to measure progress. Experience shows us that the best objective would be a recycling rate percentage well above today’s average recycling rate of around 30 percent, and a percentage of post-consumer recycled content used in the manufacturing of a product or packaging. EPR fees charged to consumer goods companies should not be viewed as the goal, but as a means to achieve the goal of a fully circular production system, where reliance on natural resource extraction and landfills is limited. Therefore, incentives for brands — fee waivers, designation to consumers and public recognition — are key for products to achieve a high recycling rate and use of recycled content. Where it’s not possible for producers to currently meet such goals for a particular product due to technical or economic limitations, this system and waiver could help incentivize producers to switch to recyclable or compostable materials or adopt reusable packaging models.

Which brings us to the next: a clear definition of what “recyclable” means. Recyclable has traditionally been defined as the ability of a product or material to be collected and sorted by a recycling facility in the United States. This does not take into account the economics of the recycling industry and the municipal recycling programs that are expected to remain solvent and grow. The result: consumer goods companies claiming that a product is recyclable, while municipal recycling programs struggle to find profitable end markets for it.

“Recyclability” should be defined as “a product whose primary material is sold by a municipal recycling facility for a profit.” Therefore, in order to receive a designation of “recyclable,” a product should have a market value of above the processing cost of materials (paper, metal, glass, plastic) at municipal recycling facilities across the United States. This stipulation would encourage producers to be more rigorous from the outset regarding their packaging design, connecting the diverse pieces of the system, from designer to producer to recycler, so that all stakeholders are in agreement that a product has value in a circular system. The EPR fee structure should be designed to motivate brands to ensure that their product is recyclable (per the definition above), is recycled and uses all or mostly recycled content in manufacturing.

Third, we should allocate funds from an EPR program directly to municipal recycling programs, empowering local leaders to invest the funds in infrastructure and innovation. It is critical that legacy policies, such as bottle bills that conflict with municipal recycling collection programs, be phased out as EPR policy is adopted. There are a number of leaders that have accomplished amazing things with limited funding, showing that investments made directly in local municipal recycling programs and at the direction of local leaders will yield the best results.

While EPR won’t solve all of our waste issues, thoughtfully-constructed EPR will provide the foundation for the development of comprehensive recycling and circular economy infrastructure in the United States. And with thoughtful incentives, companies that strive to be leaders in reducing waste, will be recognized and rewarded.

We are a country that has demonstrated that when the interest of business aligns with the interest of policy makers and local communities, we can develop infrastructure that creates massive long-term value. Thoughtfully-constructed EPR has the potential to do just that.

Ron Gonen is the CEO of Closed Loop Partners, a circular economy-focused investment firm and innovation center and author of “The Waste Free World: How the Circular Economy will Take Less, Make More, and Save the Planet.”

Originally published in The Hill.

The Recycling Partnership Announces Three Grants to Improve Polypropylene Curbside Recycling for Millions of Americans

March 31, 2021

Polypropylene Recycling Coalition brings total awards to nearly $3 million in grants, impacting 7.2 million people nationally

FALLS CHURCH, Va., March 31, 2021 — The Recycling Partnership today announced a second round of grant funding through its Polypropylene Recycling Coalition, distributing nearly $1 million in catalytic grants to advance polypropylene recycling in the U.S. Launched in July 2020, the Polypropylene Recycling Coalition (Coalition) is a cross-industry collaboration supported by steering committee members Keurig Dr Pepper, Braskem, NextGen Consortium, and the Walmart Foundation, along with other members of the polypropylene value chain. Polypropylene, sometimes referred to as No. 5 plastic, is used in an array of food and non-food packaging and is in strong demand as a recycled material.

Through its second round of grant funding, the Coalition will provide an additional three grants to Materials Recovery Facilities (MRFs) across the United States to boost sortation of polypropylene and support targeted consumer education efforts. To date, the Coalition has awarded grants for seven MRFs across the U.S. These investments aim to improve curbside polypropylene recycling access for an additional 3% of all U.S. households, impacting a total of 7.2 million people nationally. This aims to increase the recovery of polypropylene by an estimated 4,300 tons annually to be made into new products, such as consumer packaging and automotive parts, rather than being sent to landfills or incineration.

“The Polypropylene Recycling Coalition is leading the effort to rapidly drive meaningful, measurable change that will improve and increase the capture of polypropylene in U.S. curbside recycling. We continue to encourage all companies that use polypropylene to join us in being part of the solution to ensure greater and better capture of this recyclable material,” said Sarah Dearman, Vice President of Circular Ventures, The Recycling Partnership. “This fast, meaningful, and collaborative work will support jobs, preserve natural resources, and help support the transition to a circular economy in the United States.”

The Coalition awards grants to MRF candidates that face significant challenges in their ability to effectively sort and recycle polypropylene. With these strategic investments, polypropylene will now be accepted curbside in more communities and sent to established end markets, encouraging the shift to a circular economy. Further supporting the shift, community members in these areas will also be educated as to what is and isn’t accepted in their curbside recycling.

The three newest grantees include:

American Recycling in Candler, North Carolina
DEM-CON in Shakopee, Minnesota
Independent Texas Recyclers in Houston, Texas

The combined geographic reach of the first two rounds of grantees includes MRFs across the Northern, Southern, Eastern, and Western regions of the U.S. The widespread interest and commitment from MRFs across the U.S. to growing the collection and sortation of recyclable polypropylene clearly demonstrates the market strength for this material nationwide.

The Coalition received a strong response to both the first and second rounds of requests for proposals and continues to accept grant applications to further its efforts to advance polypropylene curbside recycling. The next grant proposal request is due June 30, 2021. MRFs interested in sorting and recycling polypropylene are encouraged to apply.

The mission-driven work of the Coalition is supported by contributions from organizations representing all segments of the material’s value chain, including the Coalition’s newest member, Sabert Corporation. In addition to the aforementioned steering committee members, other members of the Coalition include American Chemistry Council, Campbell Soup Company, Danone North America, EFS-plastics, The Kroger Co. Zero Hunger | Zero Waste Foundation, KW Plastics, LyondellBasell, Merlin Plastics, Milliken & Company, Nestlé, PolyQuest, Procter & Gamble, St. Joseph Plastics, and Winpak. The Polypropylene Recycling Coalition is advised by industry leaders including: Association of Plastic Recyclers, former EPA Administrator Carol Browner, Closed Loop Partners, Sidewalk Infrastructure Partners, Sustainable Packaging Coalition, and World Wildlife Fund.

The Coalition is part of The Recycling Partnership’s Pathway to Circularity, an initiative creating scalable solutions to packaging and system challenges to accelerate the shift to a circular economy that uses fewer finite resources.

To learn more about the Polypropylene Recycling Coalition, its members, and how to get involved in supporting its goals, visit recyclingpartnership.org/polypropylene-coalition. For MRFs interested in applying for a grant, the application is available on our website.

About The Recycling Partnership
The Recycling Partnership is the action agent transforming the U.S. residential recycling system for good. Our team operates at every level of the recycling value chain and work on the ground with thousands of communities to transform underperforming recycling programs and tackle circular economy challenges. As the leading organization in the country that engages the full recycling supply chain, from working with companies to make their packaging more circular and help them meet climate and sustainability goals, to working with government to develop policy solutions to address the systemic needs of the U.S. recycling system, The Recycling Partnership positively impacts recycling at every step in the process. Since 2014, the nonprofit change agent diverted 230 million pounds of new recyclables from landfills, saved 465 million gallons of water, avoided more than 250,000 metric tons of greenhouse gases, and drove significant reductions in targeted contamination rates. Learn more at recyclingpartnership.org

About the NextGen Consortium

The NextGen Consortium is a multi-year, global consortium that addresses single-use food packaging waste globally by advancing the design, commercialization, and recovery of food packaging alternatives. The NextGen Consortium is managed by Closed Loop Partners’ Center for the Circular Economy. Starbucks and McDonald’s are the founding partners of the Consortium, The Coca-Cola Company, Yum! Brands, Nestlé, Wendy’s and Jacobs Douwe Egberts are supporting partners. World Wildlife Fund (WWF) is the advisory partner and IDEO is the innovation partner. Learn more at www.nextgenconsortium.com.

Media Contact:
Samantha Kappalman
[email protected]
(443) 223-3322

SOURCE The Recycling Partnership

Unilever North America Investment Will Recover More than Half of its Plastic Packaging Footprint

March 16, 2021

Company will collect more plastic than it sells by 2025 through Closed Loop Partners investment and shift to recycled plastic

ENGLEWOOD CLIFFS, N.J.–(BUSINESS WIRE)–Unilever North America announced today a $15 million investment in Closed Loop Partners’ Leadership Fund to help recycle an estimated 60,000 metric tons of U.S. plastic packaging waste annually by 2025, an amount equivalent to more than half of Unilever’s plastics footprint in North America. The impact of Unilever’s new investment and its continued use of post-consumer recycled (PCR) plastic packaging, which is approximately 59,000 metric tons per year, will underpin the delivery of its commitment to collect and process more plastic packaging than it sells by 2025.

Closed Loop Partners’ Leadership Fund is a private equity fund that acquires and grows companies across the value chain working to increase recycling and keep valuable materials in the circular economy and out of landfills.

“We believe plastics’ place is inside the circular economy where it is reused, and not in the environment,” said Fabian Garcia, President of Unilever North America. “We’re advocating to transform the recycling system for a waste-free world, and we urgently need business investment to help make it happen.”

“Unilever is a pioneer and leader when it comes to recognizing the economic, social and environmental value of embedding circular economy principles throughout their business, critically moving from ambitious commitments and goals to tangible action and progress,” said Ron Gonen, Founder and CEO of Closed Loop Partners. “Unilever’s investment in Closed Loop Partners’ Leadership Fund, in addition to its existing investment in our Infrastructure Fund, will help accelerate the shift toward more circular supply chains by scaling best-in-class circular business models and supporting the technological breakthroughs and sustainable innovations that keep valuable materials continuously cycling in manufacturing supply chains.”

Unilever’s goal to collect and process more plastic packaging than it sells is a part of its ambitious set of “Waste-Free World” commitments. Those global commitments include halving use of virgin plastic; ensuring all of its plastic packaging is reusable, recyclable or compostable; and using at least 25 percent recycled plastic in its packaging.

Half of the 118,000 metric tons of plastic packaging used by Unilever North America is PCR plastic. Many of its brands, including Dove, Hellmann’s, and Seventh Generation, already use 100 percent PCR bottles. The investment in Closed Loop Partners’ Leadership Fund will help secure additional PCR plastic supply for Unilever brands and increase access to recycled plastic feedstock processed by the companies the Fund invests in.

In addition to its private investments to improve recycling, Unilever is advocating for producer responsibility legislation that would significantly increase broader investment needed from the industry to transform the recycling system. The company is working with major CPG companies through the Circular Economy Accelerators to promote a plan for brands to fund needed recycling infrastructure investments in the U.S. In Canada, Unilever North America participates in extended producer responsibility programs in provinces with established programs.

Note to Editors:

Unilever’s Waste-Free World commitments:

By 2025, Unilever will:

Halve our use of virgin plastic, by reducing our absolute use of plastic packaging by more than 100,000 tons
Help collect and process more plastic packaging than we sell
Ensure that 100 percent of our plastic packaging is designed to be fully reusable, recyclable or compostable
Increase the use of post-consumer recycled plastic material in our packaging to at least 25 percent

Unilever will transform its approach to plastic packing through its ‘Less plastic. Better plastic. No plastic.’ internal framework. The framework – which was implemented in 2017 – outlines the approach to achieving its commitments and guides its innovation.

‘Less plastic’ is about cutting down the amount of plastic used in the first place.
‘Better plastic’ is about making products recyclable and eliminating problematic materials. Specifically, it’s about getting recycled content into our packaging.
And ‘no plastic’ is about thinking differently – using alternative materials such as aluminum, glass, paper and board where possible and removing plastic where it is not necessary.

Learn more on Unilever’s Waste-Free World hub.

About Unilever North America
Unilever is one of the world’s leading suppliers of Beauty & Personal Care, Home Care, and Foods & Refreshment products, with sales in over 190 countries and products used by 2.5 billion people every day. We have 149,000 employees and generated sales of €50.7 billion in 2020. Over half of our footprint is in developing and emerging markets. We have around 400 brands found in homes all over the world. In the United States and Canada, the portfolio includes iconic brand such as: Dove, Knorr, Hellmann’s, Lipton, Magnum, Axe, Ben & Jerry’s, Degree, Dollar Shave Club, Q-tips, Seventh Generation, St. Ives, Suave, TRESemmé, and Vaseline.

Our vision is to be the global leader in sustainable business and to demonstrate how our purpose-led, future-fit business model drives superior performance. We have a long tradition of being a progressive, responsible business. It goes back to the days of our founder William Lever, who launched the world’s first purposeful brand, Sunlight Soap, more than 100 years ago, and it’s at the heart of how we run our company today.

The Unilever Compass, our sustainable business strategy, is set out to help us deliver superior performance and drive sustainable and responsible growth, while:

improving the health of the planet;
improving people’s health, confidence and wellbeing; and
contributing to a fairer and more socially inclusive world.

While there is still more to do, we are proud to have been recognized in 2020 as a sector leader in the Dow Jones Sustainability Index and – for the tenth-consecutive year – as the top ranked company in the 2020 GlobeScan/SustainAbility Sustainability Leaders survey.

For more information on Unilever U.S. and its brands visit: www.unileverusa.com

For more information on Unilever Canada and its brands visit: www.unilever.ca

About the Closed Loop Leadership Fund at Closed Loop Partners
The Closed Loop Leadership Fund is Closed Loop Partners’ private equity fund, focused on acquiring best-in-class circular business models that are fundamental to keeping plastics and packaging, food and organics, electronics and textiles out of landfills and within a circular system. Closed Loop Partners is a New York-based investment firm comprised of venture capital, growth equity, private equity, project-based finance and an innovation center focused on building the circular economy. The firm’s business verticals build upon one another, bridging gaps and fostering synergies to scale the circular economy.

To learn about the Closed Loop Leadership Fund, visit Closed Loop Partners’ website.

Disclaimer:

This publication is for informational purposes only, and nothing contained herein constitutes an offer to sell or a solicitation of an offer to buy any interest in any investment vehicle managed by Closed Loop Capital Management or any company in which Closed Loop Capital Management or its affiliates have invested. An offer or solicitation will be made only through a final private placement memorandum, subscription agreement and other related documents with respect to a particular investment opportunity and will be subject to the terms and conditions contained in such documents, including the qualifications necessary to become an investor. Closed Loop Capital Management does not utilize its website to provide investment or other advice, and nothing contained herein constitutes a comprehensive or complete statement of the matters discussed or the law relating thereto. Information provided reflects Closed Loop Capital Management’s views as of a particular time and are subject to change without notice. You should obtain relevant and specific professional advice before making any investment decision. Certain information on this Website may contain forward-looking statements, which are subject to risks and uncertainties and speak only as of the date on which they are made. The words “believe”, “expect”, “anticipate”, “optimistic”, “intend”, “aim”, “will” or similar expressions are intended to identify forward-looking statements. Closed Loop Capital Management undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future developments or otherwise. Past performance is not indicative of future results; no representation is being made that any investment or transaction will or is likely to achieve profits or losses similar to those achieved in the past, or that significant losses will be avoided.