The CSR Newsletters are a freely-available resource generated as a dynamic complement to the textbook, Strategic Corporate Social Responsibility: Sustainable Value Creation.

To sign-up to receive the CSR Newsletters regularly during the fall and spring academic semesters, e-mail author David Chandler at david.chandler@ucdenver.edu.

Tuesday, March 19, 2019

Strategic CSR - Refillables

The articles in the two urls below (which appeared together on the same page of The Wall Street Journal) offer competing versions of our attempts to minimize the role of plastic in our lives. The first article reports that companies such as Unilever and P&G have announced they will trial refillable containers. The goal, as expressed by Unilever's new CEO, Alan Jope, is to combat the "accusation that we're in the branded litter business:"
 
"Procter & Gamble Co., Nestlé SA, PepsiCo Inc. and Unilever PLC are among 25 companies that, this summer, will start selling some products in glass, steel and other containers designed to be returned, cleaned and refilled."
 
The arguments against this working are, in essence, human nature:
 
"Critics question whether the project will achieve scale in the face of high costs and entrenched consumer behavior. But, if successful, the companies say the efforts will reduce waste from single-use packaging. It could also woo eco-conscious consumers, glean data and foster brand loyalty."
 
Interestingly, the program at Unilever is being run by TerraCycle (see Strategic CSR – TerraCycle):
 
"Unilever will sell nine brands in refillable containers … and stat with 5,000 shoppers in New York and Paris in May. The pilot will extend to London later this year and cities including Toronto and Tokyo next year."
 
If successful, the plan will result in a significant reduction in the amount of plastic packaging being used:
 
"Unilever estimates a refillable steel container for its Axe and Dove stick deodorants will last eight years—long enough to prevent the disposal of as many as 100 traditional deodorant packages."
 
In many ways, however, this is not so much a new initiative as the revival of an old practice:
 
"In 1947, refillables made up 100% of the soft-drink containers by volume and 86% of beer containers, according to the Container Recycling Institute. … By 1998 those figures had dropped to 0.4% and 3.3% respectively."
 
It will only work, however, if people are willing to pay the upfront costs:
 
"The products will cost roughly the same as the versions in single-use containers, but users will also have to pay a deposit of $1-$10 per container. Shipping charges start at roughly $20, decreasing with every item added."
 
In contrast, the second article reports on the growing role of compostable materials as an alternative to plastic packaging:
 
"Compostable bags, cups and cutlery are becoming more popular amid the mounting backlash against plastic waste, but many aren't making it to the compost heap."
 
While this may seem to be a positive, due to a lack of awareness and a lack of infrastructure (particularly in cities, where opportunities to compost are rare), companies are marketing this packaging as 'green,' but the effect of this packaging is worse than plastic (at least some of which gets recycled):
 
"The problem is most compostable products don't break down on their own. They need high heat and moisture, conditions found in special industrial facilities."
 
In other words, this packaging cannot decompose unless it has the right conditions, which do not occur when it is thrown in the trash:
 
"Compostable products are then burned or sent to landfills, where—deprived of oxygen and microorganisms—they don't degrade."
 
And, because of the general lack of awareness about the packaging, it seems that recycling facilities struggle if people place it in recycle bins ("Through the washing process, compostables can degrade, contaminating the plastic"), while composting facilities "struggle with the same problem in reverse" as they have to process recyclable materials that they cannot compost. The problem is exacerbated because not all composting facilities will accept the new packaging:
 
"A 2018 study by BioCycle … found that just 50 of 103 U.S. food-waste composting facilities said they accept compostable plastics."
 
Yet, because they are perceived to be 'green' initiatives, companies are jumping on the bandwagon to adopt this technology without waiting to see if their 'solution' is, in fact, creating more problems than it is solving:
 
"The number of certified compostable products in the U.S. has risen 80% over the past 3½ years to 9,000, according to the Biodegradable Products Institute, a certification body."
 
As always, it is easier to pretend to effect change than actually taking the time to do something meaningful.
 
Take care
David
 
 
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Marketers Hope You Want to Refill
By Saabira Chaudhuri
January 25, 2019
The Wall Street Journal
Late Edition – Final
B1
https://www.wsj.com/articles/big-brands-to-test-refillable-containers-11548316801

Items Meant to Cut Down on Plastic are Going to Waste
By Saabira Chaudhuri
January 25, 2019
The Wall Street Journal
Late Edition – Final
B5