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Packaging Policy Predictions: How Will You Be Affected?

If you want to lead on sustainable packaging, you need to make sure as a baseline you are compliant. Here’s our packaging policy predictions toward and beyond 2025 which will help you identify where you’re exposed and make a plan to set aside budget or resource to address these vulnerabilities.

This article is by Root’s Policy Lead, Hannah Worthington, and Senior Policy Lead, Sarahjane Widdowson.

In 2023 we saw a deluge of global packaging policy changes. This continual change of variable goalposts is becoming increasingly difficult for businesses to navigate. In parallel, we experienced a significant rise in requests from businesses who needed support to understand the impacts of policy changes and advice on the steps they need to take to take to mitigate global regulatory risk.

Businesses will need to adopt simpler, easy to recycle materials to minimise compliance costs

1. Financial Drivers of Sustainable Packaging

Global economic conditions are impacting consumers and investors’ appetite to invest in sustainable packaging, but financial mechanisms to drive more environmentally friendly packaging are being planned and implemented globally by policy makers. Plastics taxes are planned in the USA and already in place across the EU. In tandem with increased taxes on businesses using single-use packaging in countries like Germany as they pass on the cost of levies charged to national treasures by the EU. Taxes and fees on specific packaging are likely to be used by central governments to put the pressure back on producers as budgets are stretched.

2. Material Alignment

Composite materials and packaging face an uncertain future with national EPR programs aligning to modulated fees that penalise hard to recycle packaging. In amendments to Europe’s proposed Packaging and Packaging Waste Regulation (PPWR), the majority material of the packaging (e.g. plastic or paper) is becoming a key feature used to define sustainability alongside real-world recyclability. Investment and innovation in collection and sorting infrastructure for multi-material or complex component packaging is slow and reprocessors are facing challenges extracting commercially viable volume of recyclate. 

Legislators are aiming to simplify the waste streams and promote design for recycling within current state of the art infrastructure. As a result, businesses will need to adopt simpler, easy to recycle materials to minimise compliance costs.

Bioplastics and renewable feedstocks are facing changes. Regulators will need to balance the demand for non-fossil plastics with upcoming deforestation regulations and food shortages. Post-consumer recycled content is facing issues around supply and profitability, especially for contact sensitive applications. Regulators are beginning to consider bio-based materials as viable legislative alternatives to virgin and recycled plastic materials. 

For sectors such as beauty, pharma and quick service restaurant packaging will be one of the areas where a notable reduction in biodiversity, carbon and water impacts can be achieved

3. Global EPR Development

The next 3 years will see the development of EPR schemes in North America and more Southeast Asian nations and including Thailand, Philippines, Vietnam, Malaysia, Singapore, Japan, South Korea, and Taiwan. The cost of selling products in these countries will increase, impacting multinational consumer goods brands as governments address problematic plastic packaging waste in many of these nations. We predict an increase in single-use bans and packaging taxes in parallel with reuse mandates over time. 

4. International Cooperation Will Help Harmonise National Changes

UNEP’s Global Plastics Treaty and the PPWR are beginning to influence debates around single-use vs reuse and exports of waste in nations that produce more waste than they can handle domestically. The impact of waste exports is felt more so in nations where waste management infrastructure requires rapid development to handle the increase in hard to recycle waste that is being produced. Bans on exporting waste may put pressure on Extended Producer Responsibility (EPR) systems to incentivise packaging that can be recycled locally, leading to more developments in eco-modulation. Reuse legislation is also likely to increase for closed loop events and some B2B cases as a result of national targets not being met in the take-away sector.

A knock-on effect of this may be felt by the chemical (advanced) recycling industry. As we saw at COP, there is an appetite in countries with a strong petrochemical history to utilise the existing infrastructure as oil and gas production is scaled back. 2024 will be an interesting year to see how this technology is legislated for, or against, especially in the USA and Middle East.

5. Carbon + Nature

Businesses impacted by mandatory environmental reporting such as those captured Corporate Sustainability Reporting Directive (CSRD), will be looking for high impact areas with easy reductions. For sectors such as beauty, pharma and quick service restaurant packaging will be one of the areas where a notable reduction in biodiversity, carbon and water impacts can be achieved. 

We expect to see legislators follow businesses by focusing on policies that create positive headlines rather than exclusively on impact reduction as elections draw nearer around the world – 64 countries representing half of the global population will head to the polls this year. This could be reflected in the policy as a focus on reducing PFAS, replacing single-use plastic, and promoting a transition into (or out of) nostalgic formats such as cans and cartons to reassure voters that progress is being made towards environmental goals.

Book a free 30min no-obligation call if you or one of your colleagues needs help to make sense of the regulatory landscape to inform future-proofed packaging decisions.