Circular economy, regulatory activities and VUCA: Report from the presentations at the 17th German Packaging Congress

20 May 2022

Under the motto "Packaging as a pioneer - in the transformation to a circular economy", leading minds from business, NGOs and politics discussed concrete paths and strategies for a sustainable future and the red-hot challenges of the present at the German Packaging Congress on 17-18 May.

Shaper of globalisation: Packaging has other tasks than saving the climate.

In his keynote speech at the start of the 17th German Packaging Congress, mathematician, economist and globalisation shaper Prof. Dr. Dr. h.c. Franz-Josef Radermacher gave an insight into the topic of CO2 and climate protection that was as exciting as it was clear. At the beginning of his lecture, Radermacher emphasised how important packaging is for life and a successful civilisation.

Basically, biodiversity, hunger and climate are existential problems that primarily affect poorer countries. Accordingly, the most important issue is still the exploding world population. With an annual increase of 80 million people, the world population will grow by 2.5 billion by 2050. And this is especially true in regions where housing, infrastructure, heating and cooling systems have yet to be built. According to Radermacher, the steel and cement needed for this should be at the centre of our concerns. Because these materials are the largest sources of emissions of greenhouse gases, at around 5 billion tonnes per year. Every year, they account for 1.5 times the total volume of emissions in the EU.

Unfortunately, according to Radermacher, the countries of the rich world are busy navel-gazing. As "climate nationalists", their ambition is to shine at home instead of putting money, time and energy into solving the growth processes of developing countries. German cyclists could not save the world. The point, she said, is to concentrate on the big things with the big volumes and not to get lost in the small things. A central instrument for this, he said, was the capture, use and storage of CO2 (Carbon Capture, Use and Storage; CCUS). Packaging should rather be evaluated in terms of its benefit for our civilisation and quality of life. In the "big picture", it does not make the difference to the climate.

Federal Environment Agency: focus on reusability and recyclability

According to Dr. Bettina Rechenberg, head of UBA Division III "Sustainable Products and Production, Closed Substance Cycle Waste Management" at the Federal Environment Agency, the appropriate levers for keeping the environment in a condition that will in principle enable global prosperity and a good life in the future have long since been identified: A pollutant-free and circular economy and resource conservation are two of the central political fields of action. According to Rechenberg, this would require us to double the use of recycled materials in the next ten years and at the same time reduce the use of materials. The development of the volume of packaging poses a great challenge.

Rechenberg also emphasised the importance of packaging, which protects products and resources. The problem is that packaging also requires resources that end up as waste after only a short period of use. Rechenberg sees the way out of the increase in packaging consumption caused by demographic factors and changes in lifestyle and consumer behaviour in the expansion of reusable systems. Further factors for a trend reversal are material efficiency and the avoidance of oversized packaging. Another decisive factor is high-quality recycling, which includes recycling-friendly design, a further increase in the amount of recycled material and the use of recyclates.

UBA is sceptical about the use of bioplastics, which would lead to further pollution of our soils and biodiversity. In Rechenberg's opinion, the advantages and disadvantages of this are merely different. As far as the recycling of plastics is concerned, Rechenberg said the industry was making good progress. She admitted that politicians have a responsibility to release recycled materials more quickly and consistently for use in the food contact sector. Politicians are also considering setting and recording separate quotas for the use of recyclates with and without food contact. The question of financial incentives also needs to be solved. So far, these have not been satisfactory.

Rechenberg concludes: "We have already achieved a lot. However, there are still major challenges. But we know the levers. If we take an even bolder approach and all work together as stakeholders, we can make it."


EUROPEN: Regulatory Tsunami?

Francesca Stevens, Managing Director of the European Organisation for Packaging and the Environment (EUROPEN), gave the congress participants an overview of the manifold regulatory activities of the EU in the field of packaging.

These include the Single Market, the Packaging and Packaging Waste Directive (PPWD), the Sustainable Products legislative Initiative (SPI), Green Claims, Food Contact Materials (FCM), the Reach Review, the Water Framework Directive (WFD), the Waste Shipment Regulation (WSR) and the area of taxonomy.

According to Stevens, the many activities and measures do not necessarily represent overregulation. However, the question is how far the regulations should go in each case. For example, banning certain types of packaging or concrete regulations on which packaging should be used for certain products is not conducive.

Stevens also emphatically pointed out the problem of further shaping European activities at national level, which would multiply the multitude of regulations and could lead to serious problems with regard to the Single Market. As an example, Stevens points to the field of labelling. In EUROPEN's opinion, the different national regulations, for example with regard to information on correct disposal or on the sustainability of products or packaging, lead to real problems. The market is becoming increasingly fragmented as a result. The uncertainties and ambiguities for the market participants increased to the same extent as the effort, since different regulations applied to each market. The same challenges also arose in the case of bans or restrictions on certain types of packaging or materials. The increasing restrictions on the cross-border transport of packaging waste are also negative.

In order to keep an eye on the multitude of regulations, the dvi, as a member of EUROPEN, has been offering its members a monthly newsletter since this year, which follows and summarises the activities and measures of the EU.

PepsiCo: What is needed is consistency and a secure future.

Kai Klicker-Brunner, Head of Policy & Government Affair at PepsiCo DACH is an "old hand" in the Circular Economy. When he started working on the topic of the circular economy as a lobbyist 12 years ago, it was still considered a nerd. That has changed. Klicker-Brunner began his talk by recalling the circumstances that drive regulators to their current activities. He recalled 300 million tonnes of plastic produced annually, the fact that less than 15 per cent of it is collected and recycled worldwide, and the catchy imagery of marine litter caused by the unwanted entry of 8 million tonnes of plastic into the oceans each year.

The vision his company sets against this, he says, is a world where plastic never becomes waste. According to Klicker-Brunner, the cornerstones of PepsiCo's activities in this context can be summarised under the keywords Reduce, Recycle and Reinvent.

According to Klicker-Brunner, it is of elementary importance for companies to have reliable and uniform systems throughout Europe. Addressing the regulators, the Head of Policy & Government Affair formulated his demands for more efficient waste management systems, a more robust market for secondary raw materials and partnership-based cooperation in recycling.

Klicker-Brunner was also specific about the need for an innovation-friendly definition of recyclability. Here, one should not limit oneself to what is currently possible, but create incentives for recycling infrastructures that could also recycle packaging that has not been recyclable or hardly recyclable so far. Likewise, a broad definition of recycling is needed that includes all models according to the four quadrants of the Ellen MacArthur Foundation.

Not without pride, Klicker-Brunner pointed out that PepsiCo would achieve 100 per cent rPET for its beverage bottles in eleven markets as early as this year. The necessary amount of recyclate had been secured thanks to a purchasing process started two years ago and a very good partnership with suppliers. Basically, Klicker-Brunner sees rPet as a bridging technology in terms of sustainability. "It is not the last word in wisdom. We are working hard to make our current main packaging material obsolete for the future. But it is currently the best we have," says Klicker-Brunner.

BMUV: Focus on new EPR trends and litter funds

In his lecture, Dr. Matthias Klein, officer at the Federal Ministry for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection, dealt with the implementation of the Extended Product Responsibility (EPR) in Germany, the adaptation through the amendment of the Packaging Act, new developments as well as the status quo regarding the Single-Use Plastic Fund Act and the Littering Fund.

According to the EU requirement, member states must ensure "that extended producer responsibility regimes covering all packaging are introduced by 31 December 2024 in accordance with Articles 8 and 8a of Directive 2008/98/EC." In Germany, such regimes are already currently implemented in special legislation and through the Packaging Act with regard to all packaging.

With regard to the new developments in the EPR, Dr. Klein highlighted two trends. Firstly, he highlighted the inclusion of the development and manufacturing phase. The aim is to promote recycling. According to Klein, the guidelines and incentives for improving the recyclability of packaging include the ecological design of participation fees and the planned introduction of a fund model for participation fees. The fees should have a stronger focus on recyclability. Modulated fees are also an issue for the EU, which has not yet been decided in detail.

The second trend, according to Klein, concerns the inclusion of end-user behaviour. Interestingly, the BMUV understands this to mean shifting the cleaning and disposal costs of littered waste from the general public to the manufacturers of packaging. According to Dr. Klein, the manufacturers' obligation to bear the costs includes awareness-raising measures, disposal via public collection systems and cleaning campaigns including disposal. The BMUV counts manufacturers of certain disposable plastic articles, especially to-go disposable plastic packaging for food including beverages, among the addressees.

When asked what steering effect was expected from this regulation with regard to the end consumers, Dr. Klein referred to a "certain causality", because only certain, particularly polluting waste was affected. He pointed out that municipalities would be overburdened with the idea of littering and the collection and disposal in public spaces. With regard to the double burden of system fees already paid and now additional fees, Dr. Klein explained: "Every burden should serve its purpose. The system payment is basically for the infrastructure of household-related collection. This does not cover what is not close to the household. They are just different tasks."


Berndt+Partner: Out of crisis mode - towards securing the future

Jenny Walther-Thoß, Senior Consultant Sustainability, Berndt+Partner Consultants began her presentation by showing the chain of crises that have come our way since 2008. From the financial crisis in 2008 to Fukushima in 2011, the sanctions against Russia due to the Crimean annexation in 2014, the America first trade war with China in 2018 and the corona pandemic from 2020 to Russia's recent invasion of Ukraine.

Your legitimate question in view of this chain of events: Why are we actually surprised again and again? Crises would come more frequently and faster one after the other in the areas of energy supply, raw materials and supply chain disruptions. This will not change worldwide. The problem: according to Walther-Thoß, many companies have learned only limited lessons from past crises. There is a lack of systematic risk assessment of long-term risks, trained staff with an eye for risk-conscious action and a culture of lessons learned.

Walther-Thoß subsequently showed that risks in the supply chain continue to increase while risk monitoring is predominantly limited to supplier analysis and evaluation with the indicators quality, performance, financial ratios and creditworthiness. Comprehensive early warning signals, on the other hand, are on the radar of less than half of the companies. Cyber risks were even on the radar of only 12 percent. Overall, only 8 percent of companies monitor their risks in an automated process. 58 percent still relied on manual work and Excel tables.

According to the Senior Consultant Sustainability, risk management should encompass both the company's own production sites and business models as well as the supply chains. If applied correctly, it leads to a more agile company. It is advisable to use the tools that digitalisation makes available to us. Apart from the current crisis mode, an update of risk management is also advisable because the EU is forcing companies to adopt a more holistic approach in this area within the framework of its Corporate Sustainability Reporting Directive.

Walther-Thoß named multi-regionalisation instead of globalisation, partnership-based supplier and customer relations, diversification of raw material sources, diversity instead of standards and transparency as important building blocks for a more resilient future.

Even if holistic risk management initially increases complexity, companies subsequently benefit from more resources, specifically trained staff, more agile corporate processes and a digitalisation push. Since all the risks addressed are also sustainability risks, the benefits are twofold.

Full article (German) – klick here.

Source: Deutsches Verpackungs Institut