Sustainability in Packaging coverage: Insights from PepsiCo, S.C. Johnson, and Nestle

March 21, 2012

Hey guys!

The 6th Annual Sustainability in Packaging Conference was held at the Omni Orlando Resort at ChampionsGate, Florida, March 12th-14th. The first day of the conference was reserved exclusively for intensive workshops that were not included in the price of registration. I attended this event last year when, as a speaker, I got to attend the workshops for free! It was here I met Dr. Ramani Narayan, who lectured on the value proposition of bio-based plastics for four hours (see my post from March 24th, 2011)! Anyway, the titles of this years’ workshops include: “Four Things Green Marketing Gets Wrong” (Shelton Group), “Understanding and Implementing Sustainable Packaging Concepts—Using Biobased Carbon Content and Design for End-of-Life Options” (Michigan State University), Packaging your Sustainability Strategy (PAC NEXT), “End of Life Options and Challenges” (Darby Marketing), and “Plastics—Sustainability from Use through End-of-Life” (ACC).

The first day of the conference began with opening remarks from John Kalkowski of Packaging Digest, who reflected on the past six years of the Sustainability in Packaging conferences. Beginning with a “what the heck is sustainability” mentality, Kalkowski explained how, with each passing year, the dialogue became more sophisticated, the number of registered attendees increased, and science moved to center stage. For Kalkowski, “it’s exciting to see how its grown,” which speaks to the industry’s commitment to sustainability.

He concluded his introductory remarks by highlighting the main theme we were sure to hear resonate from the various voices included in the conference agenda: that sustainability drives innovation, and visa versa. 

The first panel titled “Driving Packaging Innovation in the Supply Chain to Keep the Value Proposition” included presentations from PepsiCo, S.C Johnson and Nestle.  

First up was Tony Knoerzer of PepsiCo—he is the gentleman responsible for the Sun Chips compostable bag. In explaining his experiences bringing the compostable bag from R&D to market, Tony provided insight into how PepsiCo integrated innovation into the supply chain. Here are a couple presentation take-aways:

Knoerzer touched on the age-old debate of using food (corn) to produce compostable plastics—as in the case with the PLA-based Sun Chips bag—when so many people are starving, by emphasizing the importance of “context.” According to Knoerzer, in the US, 40% of the corn grown is harvested for conversion into ethanol due to governmental subsidies. Therefore, it is in PepsiCo’s opinion that compostable plastics should not be targeted for compromising the food supply because so much more is being harvested for ethanol when compared with that used for PLA production.

Knoerzer inquired, “How do you create value in supply chains?”

Historically, it has been by leveraging scale in order to attain operational excellence and organizational capability. Innovation, however, by its nature lacks scale; therefore, organizations need time to achieve organizational excellence.

The way to facilitate this transition is through collaboration with suppliers with whom you develop a shared knowledge strategy. This relationship looks to build trust and a long-term agenda; to replace anecdotal data with hard facts; and, allow for the interaction of technology, which rests entirely on the ability to move past a pre-competitive strategy. “A supplier is not a grocery store of technology to be acquired. Invest in what you need to know, with the right horsepower; if you think knowledge is expensive, try ignorance.”

A low chuckle murmurs throughout the crowd. After an enthusiastic applause, Will Archer of S.C. Johnson takes to the podium.

Archer’s presentation is titled “Sustainable Packaging Advances in the Marketplace” and looks to demonstrate how S.C. Johnson’s approach to sustainability works to meet the sustainability needs of the consumer AND the company simultaneously.

A couple presentation take aways:

Archer asked, “What is sustainable product development?” 

There is the “green brand approach,” which looks to develop a “sustainable product” for the conscious consumer; and, the “holistic approach,” which looks to “green the whole company.” S.C. Johnson is of the later camp. It’s logo “People Planet Profit” represents the firm’s value driver that “sustainability is about sustaining the company as well as the planet.”

Archer referenced the case study of S.C. Johnson’s cleaning product concentrates as example of how both the sustainability needs of the consumer and company were met:

Cleaning product concentrates use less packaging, decreasing shipping impacts and reducing waste. However, US consumers prefer not to refill their cleaning bottles; this has resulted in stores refusing to stock concentrates and companies hesitant to create them.

Taking this into consideration, S.C. Johnson launched its Windex mini concentrates, which sold online paired with a trigger bottle in each package. This approach to selling cleaning product concentrates resonated with the consumer, who found ease with purchasing online and appreciated the “starter kit” format. S.C. Johnson also quantified the environmental savings for the consumer, including language like, “Using the Windex mini concentrates instead of the traditional Windex product is the equivalent to removing xxxx cars off the road…”

Archer concluded, “It’s about progress, not perfection.”

Next up was Lars Lunquist of Nestle. The name of his presentation was “Driving Packaging Research in the Health Food and Wellness Industry.” He began,

“There is need for alignment around common principles, definitions…the role of packaging in the supply chain.”

When understanding “sustainability” as it pertains to food packaging, it is important to understand the following context: The three industries with the largest degree of environmental negative impact, from least to most, are furnishings, transport, and food. Recent studies by WRAP and others have shown we waste 40% of food in developing countries before it reaches the consumer due to inefficient logistics. Food product packaging represents only 21% of the food product total LCA. Therefore, packaging protecting and preserving the food product is key when discussing issues of sustainable packaging in the food industry.

Then Lundquist moved onto a discussion of the structure of Nestle’s packaging research program:

“For a company with 10,000 products, LCA is not the appropriate tool to feed innovation.” It is too slow, and it usually comes at the end of product development when the cost of change is extremely high.

Therefore, Nestle uses PIQUET—a LCA-based assessment tool tailored to food and beverage packaging—in the product/packaging developmental process. This tool allows Nestle to understand its impact categories, isolating hot spots and areas of improvement.

Lundquist then moved onto a discussion of end-of-life management for packaging. Consider the following take-aways:

“Bioplastics—are they compostable or renewable or both?”

For Lundquist, compostability is inherently interpreted as good for the environment, though few understand the environmental impact of composting. Aerobic composting “doesn’t deliver any value; it is one of the worst end of life scenarios.”

There is more potential in the renewable aspect of these materials. But, one must take into account the agro-related impacts i.e. eutrophication, water, mineral and biotic consumption, etc.

With recycling, people talk about it as though it is the panacea of waste management practices for packaging. However, “there are limits to recycling.” We need to consider waste-to-energy and other recovery options.

Lundquist concluded by emphasizing the need for a “holistic approach” to understanding packaging and sustainability, referencing the work of the Global Packaging Project.

For the GPP, Lundquist explained, the emphasis is not on the packaging exclusively, but the interaction between the package and product and packaging system through which the item is fulfilled, distributed, and recovered.

My next post will move on to a discussion of the following panel titled, “Global Packaging Project and the Proliferation of Tools: How to Quantify and Choose the Tools that Work.” 

One Response to “Sustainability in Packaging coverage: Insights from PepsiCo, S.C. Johnson, and Nestle”

  1. Awesome information provided throughout the blog. I was stuck at each word until I was done reading. Recycling is often the most talked about topic which however doesn’t get the right attention despite so much hype. Green brand approach sounds fantastic which can develop sustainable products for global consumers. The going-green phenomenon sounds realistic in near future.

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