VALUING
plastic
The Business Case for Measuring, Managing
and Disclosing Plastic Use in theConsumer Goods Industry

Citation: UNEP (2014) Valuing Plastics: The Business Case for Measuring, Managing and Disclosing Plastic Use in theConsumer Goods Industry.
Copyright © United Nations Environment Programme (UNEP), 2014
This publication may be reproduced in whole or part and in any form for educational or non-profit purposes whatsoever without
special permission from the copyright holder, provided that acknowledgement of the source is made.

This publication is a contribution to the Global Partnership on Marine Litter (GPML). UNEP acknowledges the financial contribution of the Ministry of Foreign Affairs, Norway toward the GPML and this publication.

The Global Programme of Action for the Protection of the Marine Environment from Land-based Activities (GPA), as
Secretariat for the GPML, the Plastic Disclosure Project, its parent organisation Ocean Recovery Alliance, and Trucost havecollaborated and co-funded this publication.
Thank you to the project contributors (Alice Sireyjol Trucost, Anna Georgieva Trucost, Sarah Wainwright Trucost, Apurvee
Haridwaj Trucost, Siddartha Joshi Trucost, Steven Bullock Trucost, Chaoni Huang Trucost, Amudha Gunasekaran Trucost,
Bindhya Manoj Trucost); methodology reviewers (Chelsea Rochman Aquatic Health Program University of California Davis,
Mark Browne National Center for Ecological Analysis & Synthesis University of California Santa Barbara, Heather Leslie Institutefor Environmental Studies VU University Amsterdam); editorial reviewers (Vincent Sweeney UNEP, Heidi Savelli UNEP, Tessa
Goverse UNEP, Elisa Tonda UNEP, Aihnoa Carpenter UNEP, Doug Woodring Ocean Recovery Alliance, Emily Utter PDP, Erik
Floyd PDP, Pua Mench PDP, Nathaniel John Maynard PDP, Conrad MacKerron As You Sow, Saskia van Gendt Method Home,James Ewell Green Blue, Leila Munroe NRDC, Darby Hoover NRDC, Ben Ridley Credit Suisse, J.Robert Gibson City Universityof Hong Kong, Antony Wood AK Partners, Jill Boughton W2Worth Innovations, José Miguel Friz Valor Sustentable Chile).
Author: Julie Raynaud (Trucost), Editor: James Richens (Trucost), Andrew Russell (PDP),
Designer: Rebecca Edwards (Trucost)
Cover photo © Sablin - iStockphoto

ISBN: 978-92-807-3400-3
Job Number: DEP/1819/NA
Division of Environmental Policy Implementation

Disclaimer
The designations employed and the presentation of the material in this publication do not imply the expression of any opinion
whatsoever on the part of the United Nations Environment Programme concerning the legal status of any country, territory, city or area
or of its authorities, or concerning delimitation of its frontiers or boundaries. Moreover, the views expressed do not necessarily represent
the decision or the stated policy of the United Nations Environment Programme, nor does citing of trade names or commercial
processes constitute endorsement.
Whilst every care has been taken by Trucost in compiling this report, Trucost accepts no liability whatsoever for any loss (including
without limitation direct or indirect loss and any loss of profit, data, or economic loss) occasioned to any person nor for any damage,cost, claim or expense arising from any reliance on this report or any of its content (save only to the extent that the same may not bein law excluded). The information in this report does not constitute or form part of any offer, invitation to sell, offer to subscribe for or topurchase any shares or other securities and must not be relied upon in connection with any contract relating to any such matter.

2

VALUING
plastic
The Business Case for Measuring, Managing
and Disclosing Plastic Use in theConsumer Goods Industry

3

ABOUT UNEP
Established in 1972, the United Nations Environment Programme is the voice for the environment within the United Nations system.
UNEP acts as a catalyst, advocate, educator and facilitator to promote the wise use and sustainable development of the global
environment. UNEP’s Global Programme of Action for the Protection of the Marine Environment from Land-based Activities (GPA)
was adopted by the international community in 1995 and “aims at preventing the degradation of the marine environment from landbased activities by facilitating the realization of the duty of States to preserve and protect the marine environment.”

ABOUT THE GLOBAL PARTNERSHIP ON MARINE LITTERThe Global Partnership on Marine Litter (GPML) is a new global partnership that acts as a coordinating forum, bringing together
diverse organizations working in the same field and encouraging governments, non-governmental organizations, scientists andacademics to collaborate on marine litter issues. The new partnership, led by UNEP, was announced in June 2012 at a launch
event during the Rio+20 conference in Rio de Janeiro. It builds on the Honolulu Strategy and seeks to protect human health andthe global environment by the reduction and management of marine litter as its main goal. To join or learn more about the GPML
visit www.gpa.unep.org or contact the secretariat (UNEP/GPA) at gpml@unep.org

ABOUT PLASTIC DISCLOSURE PROJECTThe Plastic Disclosure Project asks organisations to measure, manage, disclose and benefit from more sustainable use of plastic.
It seeks a world in which plastic adds value for consumers and businesses without negatively impacting the environment. The PDP
requests annual reporting regarding the production, use, handling and management of plastic and plastic waste by organisations.
By measuring the amount of plastic that flows through an organisation, efficiencies can be gained in cost and waste reduction, newdesign, new materials, and better recycling. By reviewing how the material is managed, organisations can recognise risks and seize
opportunities that their competitors may miss. By disclosing, organisations demonstrate leadership, and attract benefits in
employee engagement, supplier management, customer loyalty, and access to capital. Initially designed for large corporates,
institutions such as hospitals, universities, government offices, stadia, clubs, facilities, events, sports associations and teams
participate and benefit. Interested parties are welcome to contact PDP at info@plasticdisclosure.org.

ABOUT OCEAN RECOVERY ALLIANCE
Ocean Recovery Alliance is a not-for-profit organisation based in Hong Kong and California. It is focused on bringing innovation,technologies, creativity and collaborations together to address some of the challenges that face the ocean and our broader
environment. The Ocean Recovery Alliance has three global projects focussed on plastic waste issues, namely the PDP and
Global Alert - both of which were announced as Clinton Global Initiatives; and the Plasticity Forum - a creative discussion on how toharness plastic in new ways, both “pre” and “post” consumer use.

ABOUT TRUCOST
Trucost has been helping companies, investors, governments, academics and thought leaders to understand the economic
consequences of natural capital dependency for over 12 years. Our world leading data and insight enables our clients to identify
natural capital dependency across companies, products, supply chains and investments; manage risk from volatile commodity
prices and increasing environmental costs; and ultimately build more sustainable business models and brands. Key to ourapproach is that we not only quantify natural capital dependency, we also put a price on it, helping our clients understandenvironmental risk in business terms.

4contents
Message from UNEP

p.7

Message from the Plastic Disclosure Projectp.8

Message from Trucost

p.9

Executive summary

p.10

•

Objectives

p.10

•

Methodology

p.10

•

Findings

p.10•

Recommendations

p.14

Introduction

p.15

•

Objectives of the report

p.16

•

The environmental and social impacts

p.16

•

The business case for managing plastic

p.18

•

Cutting costs and improving efficiency

p.19

Innovation in products and processes

p.19

Regulation

p.20

Reputation

p.21

Investor interest

p.21

The concept of natural capital as a tool to assess risks and opportunities

p.22

High-level methodology

p.23

Results

p.26•

Which sectors are the most plastic intensive?

p.26

•

What is the magnitude of the natural capital cost?

p.28

•

What are the most significant impacts?

p.30

•

Where do impacts occur?

p.33

•

What is the state of disclosure?

p.35

•

What are the natural capital benefits of good plastic management?

p.38

•

Summary

p.39

Case study - Raising awareness through innovation: Fishing for litter and the latest uses of ocean plastic

p.41

Roadmap for plastic footprint management

p.43

•

Measuring, reporting and monitoring

p.43

•

Product and packaging design

p.45

•

End-of-life management

p.47

Recommendations

p.48

Glossary

p.51

Acronyms

p.53

Appendix 1: Sector-specific results

p.54

Appendix 2: Types of plastic

p.77

Appendix 3: Methodology

p.78

Appendix 4: Focus on natural capital valuation

p.91

Appendix 5: Company analysis

p.101

References

p.108

Contact information

p.114

5

figures and tables
Figure 1: Total natural capital cost ($) and percentage of revenue at risk for each sector

p.11

Figure 2: Total natural capital cost of plastic in the ocean ($) and percentage contribution to total
natural capital cost per sector

p.12

Figure 3: Percentage on companies that disclose on at least one data point

p.13

Figure 4: Plastic production per region, 2012

p.15

Figure 5: Business risks and opportunities related to plastic management

p.19

Figure 6: High-level methodology steps

p.23

Figure 7: Plastic intensity per sector (tonnes per $1m revenue)

p.27

Figure 8: Total natural capital cost ($) and revenue at risk (natural capital intensity) per sector

p.28

Figure 9: Total natural capital cost ($) and revenue at risk (natural capital intensity) per sector,
normalised by service year

p.29

Figure 10: Upstream and downstream impact distribution

p.30

Figure 11: Plastic-in-packaging natural capital costs comparedp.32

Figure 12: Plastic-in-product natural capital costs comparedp.32

Figure 13: Total natural capital cost of plastic in marine ecosystems ($)

p.33

Figure 14: Natural capital intensity distribution ($ per tonne of plastic)

p.34

Figure 15: Distribution Natural capital impacts, by business sector

p.34

Figure 16: Percentage of companies disclosing on at least one data point

p.37

Figure 17: Percentage of companies disclosing on plastic use quantity

p.37

Figure 18: Percentage of companies disclosing on recycled and bio-based content

p.37

Figure 19: Natural capital cost savings due to current recycling and incineration with energy recovery rate

p.38

Figure 20: Natural capital savings due to the use of recycled content

p.39

Figure 21: Natural capital savings from selected Lush's initiatives

p.68

Figure 22: Scope and boundary

p.81

Figure 23: Focus on the environmental impact of different plastic types

p.84

Figure 24: Air pollution valuation

p.93

Figure 25: Impact pathway approach

p.93

Figure 26: Components of the total economic value of water

p.94

Figure 27: Disamenity costs (PPP adjusted) versus percentage of waste collected

p.97

Figure 28: Plastic chemical impacts framework

p.97

Figure 29: Impacts of macro and micro plastic

p.99

Table 1: Sector selection

p.23

Table 2: Plastic intensity per sector (tonnes per $1m revenue)

p.27

Table 3: Total natural capital cost ($) and natural capital intensity

p.29

Table 4: Total natural cost per sector split between product and packaging, upstream and downstream

p.31

Table 5: Companies assessed

p.35

Table 6: Disclosure analysis

p.36

Table 7: Types of plastic

p.77

Table 8: Selected sectors for Analysis

p.78

Table 9: Impact inclusion and exclusion

p.82

Table 10: Treatment routes sources and assumptions

p.85

Table 11: Impacts for each end-of-life routep.86

Table 12: Credits and burdens allocation for each end-of-life routep.87

Table 13: Valuation methodology summary

p.88

Table 14: Environmental Impacts considered

p.93

Table 15: Percentage of littered product and packaging reaching the ocean

p.96

Table 16: Companies’ sector, countries of sales, disclosure and source

p.101

6

message from unep
It is estimated that 10 to 20 million tonnes of plastic is finding its way into the world’s oceans each year, costing approximately
US$13 billion per year in environmental damage to marine ecosystems. This includes financial losses incurred by fisheries andtourism as well as time spent cleaning up beaches.
The total natural capital cost of plastic used in the consumer goods industry is estimated to be more than US$75 billion per year.
The cost comes from a range of environmental impacts including those on oceans and the loss of valuable resources when plastic
waste is sent to landfill rather than being recycled. The most significant upstream impact is greenhouse gas emissions released
from producing plastic feedstock, which is responsible for almost a third of the total natural capital costs.
Oceans are critical to sustaining life’s natural support systems. They contribute to the livelihoods, culture and well-being ofcommunities around the world. They also play a vital role in the global economy by providing food and a source of income formillions of people. Yet, with a fast-growing world population, the production of waste continues to increase faster than the efforts tocurtail it and prevent it from degrading the environment. More waste means more marine litter; and one of the main types of marine
litter is plastic debris.
About 280 million tonnes of plastic is produced globally each year and only a very small percentage is recycled. As society has
developed new uses for plastic, the variety and quantity of plastic items found in the environment, and this includes the marine
environment, has increased dramatically. Once in the ocean, plastic does not go away: it fragments, eventually breaking down into
smaller pieces known as microplastics, and acts as a vector for chemicals such as persistent organic pollutants that may be transferred into the food chain upon ingestion by marine organisms. Transported by ocean currents, few places around the globe havenot been infested by this material.
Proper measurement, management and disclosure of information on the use and disposal of plastic will help companies to optimize
its use and reduce its end-of-life impacts by fully incorporating environmental management within their business frameworks.
Forward-looking companies can improve their management of plastic by, for example, cutting costs through their more efficientuse, developing “closed loop” business models that recover the resources locked up in plastic, and winning customers by creating
sustainable products. Good management of plastic could save consumer goods companies up to US$4 billion per year.
Valuing Plastic: The Business Case for Measuring, Managing and Disclosing Plastic Use in the Consumer Goods Industry is ahighly informative publication on the valuation of plastic that allows us, for the first time, to put a figure on the costs companies
would incur if the damage caused by waste plastic was included in their accounting. The report highlights the urgent need forbusinesses to measure, manage and disclose information on their annual use and disposal of plastic, as many companies alreadydo with carbon emissions. It also provides a series of recommendations for companies that are designed to help ensure asustainable future for plastic.
The report additionally provides companies with guidance on how to achieve the same economic output with fewer inputs and lesswaste, leading to greater cost savings; all of which can further expand the global economy in years to come.
Through the Global Partnership on Marine Litter and other relevant initiatives, UNEP is committed to working with all stakeholders
to reduce the influx of waste into the ocean and to prevent plastic from getting into the environment in general. Progress on plastic
pollution will require companies to work in partnership with other stakeholders. This includes collaborating with governments todevelop effective legislation and waste management infrastructure, especially in developing countries.
I encourage all involved parties, particularly businesses, to fully digest the findings of this report and consider appropriate actions
aimed at implementing the recommendations in order to save money, boost profits and reduce the impact of plastic waste on theenvironment.
Achim Steiner
UN Under-Secretary General and Executive Director, UNEP

7

message from plastic
disclosure projectAndrew Russell, Director, Plastic Disclosure Project
The Plastic Disclosure Project (PDP) is delighted to share the findings in this report.
The findings reveal concerning impacts to natural capital stemming from plastic use in the consumer goods industry. The true
impacts are likely to be much more severe, as the report calculates only those that can be quantified. As science catches up withplastic use, the magnitude of impacts omitted or conservatively assessed will surely increase.
Moreover, this report highlights the risks and opportunities that plastic poses to business. The objective is to help companies respond to these challenges and become more sustainable businesses.
There is an opportunity at hand for businesses to act before legislators, consumers, investors, and community and activist NGOs
force action, eroding business value. Sustainable use of plastic, as with many other resources, makes good business sense.
Business opportunities will be unique from company to company. Reviewing how plastic and its waste are managed; the design ofproducts or packaging, including its recycled content or recyclability; and reducing the impacts of plastic on operations,communities and society at large, can unlock previously unrecognised benefits.
Such benefits are often good for business, for example, saving input costs and recovering value from waste; customer loyalty, suchas preferred products and enhanced brand value; employee engagement; community satisfaction, and improved access to capital.
The failure of a business to consider these benefits and/or to demonstrate action on these issues may bring about negative
impacts. Regulatory risk, reputational damage and loss of competitive advantage are all very real threats.
Companies in plastic intensive sectors theoretically have the most value-at-risk, and greatest opportunities ahead of them. Yet
all companies are in a position to mitigate risks and seize opportunities in relation to proactive plastic management. Indeed, PDP
recommends that all organisations measure and manage their ‘plastic footprint’.
Disclosure is an important step towards sustainable plastic use. This can be accomplished through a standalone declaration, or as
part of a sustainability report. Such action demonstrates an organisation’s commitment to the issue and demonstrating
year-on-year progress.
Whether a company chooses to formally sign on to the Plastic Disclosure Project, or follow its guidance informally, we ask
companies to become more aware of their plastic footprint. Measure it, consider the implications and explore better
management practices.
We hope this report is a clarion call for action on plastic, and that it compels organisations to take action.
We wish to thank UNEP, Trucost, all the contributors and reviewers, and the Oak Foundation for their support.

8

message fromtrucostDr. Richard Mattison, Chief Executive, Trucost
This is an exciting time for Trucost, the world’s leading natural capital valuation company, to be working with the Plastic Disclosure
Project (PDP) and the UN Environment Programme. Plastic is an essential material for many businesses, yet its environmental
impacts cannot be ignored. Nor would any responsible company want to.
This report lays the foundations for the Plastic Disclosure Project’s drive to convince companies of the need to disclose informationon their annual use and disposal of plastic. Trucost’s analysis demonstrates a sound business case for disclosure as the first stepon the road to making companies’ use of plastic environmentally sustainable.
This business case includes a range of risks and opportunities for intensive users of plastic. For the consumer goods sector,
protecting brand reputation is crucial and plastic is an issue that presents significant reputational risk. There are also bottom-line
benefits from cutting the costs of excessive packaging and turning plastic waste into a useful resource.
Yet plastic is just one of a host of environmental issues that companies must cope with alongside climate change, water scarcity
and air pollution. Of course companies should measure and report data on plastic, just as they already do on these other impacts.
But how can they make sense of this blizzard of information? How can they turn it to their advantage?
Companies need a single tool that measures environmental impacts in an integrated way together with other business issues. This
is where natural capital valuation comes in. As demonstrated in this report, the technique enables companies to put a financial
value on a range of impacts, including plastic, so environmental management can be fully embedded within the business. Investors
can also use it to assess their exposure to environmental impacts through the equity they own in companies.
One of the most important insights revealed by natural capital valuation in this study is the ‘value at risk’ in consumer goods
companies. This is the proportion of revenue that could be lost if companies are held accountable for the damage caused by plastic
use and disposal.
Toy manufacturers have the highest plastic intensity in the consumer goods sector, at 48 tonnes of CO2 equivalents per US$1
million revenue, due to their use of plastic in products. As a result, they have the highest value at risk at 3.9% of annual revenue.
This would wipe out the profits of several companies if they had to pay the full cost of environmental damage caused by plastic.
That is a finding that should make the chief financial officer sit up and take note.
Companies can also use natural capital valuation to identify ‘hotspots’ of pollution or resource use in their supply chains. This reportshows that sectors such as retail and food have the highest supply chain plastic intensity, while soft drinks and personal products
have the highest plastic-in-packaging intensity. This analysis can be used by companies to target efforts to optimise plastic use andreduce end-of-life impacts.
We all urgently need to address the issue of irresponsible production, consumption and disposal of plastic. I encourage businesses
to embrace the Plastic Disclosure Project’s ethos of measuring, managing and disclosing their plastic use; and welcome thebusinesses interest in using natural capital valuation to weigh their impacts on the environment.

9

Executive summary
This research was
conducted bynatural capital
analysts Trucost on
behalf of the Plastic
Disclosure Project(PDP). It was
supported by theUnited Nations
Environment
Programme and the
Global Partnership on
Marine Litter (GPML).

OBJECTIVES
Plastic is one of the most useful and important materials in modern society. Life without thevast range of products and technologies it enables is almost unthinkable. Plastic preserves andprotects food and medicine helping us lead healthy lives. It is used to make electronic devices likecomputers and smartphones that bring people together, and it helps make transport more fuelefficient through its use in vehicles. The versatility and low price of plastic compared with alternatives
is reflected in the rapid growth of the market for the material.1,2
But the environmental impacts of plastic cannot be ignored. Concerns are growing about its
impact on the world’s ecosystems. Marine wildlife is particularly vulnerable, and harmed throughentanglement and ingestion of plastic. There is a risk of microscopic particles of plastic transferring
toxins into the food chain. Fields, streets and beaches are increasingly littered with plastic bottles,
bags and other trash. Plastic manufacturing processes use non-renewable resources, such as oil,and release greenhouse gases into the atmosphere contributing to climate change. In addition, theuse of chemical additives in plastic may be hazardous to human health. All of these impacts are
gaining increased attention from stakeholders such as non-governmental organisations (NGOs),international institutions, governments, and the general public.3,4,5,6
The objective of this report is to help companies manage the opportunities and risks
associated with plastic use. It articulates the business case for companies to improve theirmeasurement, disclosure and management of plastic use in their designs, operations and supply
chains. In order to provide a sense of scale, the report sets out to quantify the physical impacts ofplastic use translated into monetary terms. This metric can be seen as the current value-at-risk to acompany, should these external impacts be realised internally through mechanisms likestrengthened regulation, loss of market share, or increased price of raw materials and energy.
This metric can also be used to help understand the magnitude of the opportunities, and the tangible
benefits to stakeholders, including shareholders, of using plastic in an environmentally
sustainable way.

METHODOLOGYThe use of plastic causes environmental and social impacts. For example, incinerating plastic at
its end-of-life has associated air pollution impacts. Applying ‘natural capital valuation’ allows these
impacts to be expressed in monetary terms, reflecting the scale of damage caused. The overallvalue or ‘natural capital cost’ gives an indication of the financial cost to companies were they tointernalise impacts associated with their current practices. These costs can also be factored intobusiness and investment decision making.
In order to quantify the natural capital cost of the impacts of plastic, the high-level methodology
follows six steps: sector selection, plastic use quantification, scope and boundary selection, impact
quantification, and natural capital valuation and application.
As with any innovative research, there are some limitations. For instance, while the upstream
impacts of producing plastic feedstock are included, the impacts of the manufacturing stage areexcluded due to their diversity. Downstream impacts, in particular of plastic waste reaching theocean when littered, are likely to be underestimated due to the absence of robust data and scientificresearch, for example around the impact of microplastics.
Finally, this report looks at plastic in isolation. It was beyond the scope of this study to identify
alternatives, and contrast the impacts of plastic with each of these alternatives. For example, thereduced greenhouse gas emissions due to lighter transport of plastic bottles, or the high reuse rates
and low toxicology of glass are not considered here.

RESULTS
The analysis identifies a range of risks and opportunities facing companies that are
intensive users of plastic. Institutional investors are also exposed through the shares they own
in these companies as well as the project finance they provide. Pension funds, for instance, have afiduciary duty to protect the value of their investments.
Risks include the impact of tougher environmental legislation such as bans on disposable plastic
bags, carbon pricing schemes and chemicals regulation, damage done to the reputation of brands
targeted by campaigners over their association with plastic litter, clean-up costs and disruption to10

the plastic supply chain caused by resource scarcity and price volatility. Opportunities include cutting
costs through more efficient use of plastic, developing new revenue streams through ‘closed loop’
business models that recover plastic as a useful resource, and winning customers by demonstrating
more sustainable products.
The research identifies where plastic is used most intensively by focusing on 16 consumer
goods sectors where plastic is commonly used. The data is presented by sector, and divided into
the plastic used directly within products and packaging, and indirectly within their supply chain. This
information provides valuable insights to help companies focus their efforts to manage plastic.
The toy, athletic goods and durable household goods sectors use the most plastic in products per
US$1 million revenue. The soft drinks, personal products and pharmaceutical sectors are among themost intensive users of plastic in packaging. The retail, restaurant and tobacco sectors use the mostplastic per $1m revenue in their supply chains. This could be explained by their position down the
supply chain and their reliance on the agricultural sector.
This research then analyses the exposure of companies to these risks and opportunities byexpressing quantities of plastic used as a natural capital cost. The results show that the total
natural capital cost of plastic used in the consumer goods industry is over $75bn per year. Broken
down by sector, food companies are by far the largest contributor to this cost, responsible for 23%of the total natural capital cost (see figure 1).The results also show each sector’s natural capitalintensity – or its natural capital cost per $1m of annual revenue. The toy sector has by far the highest
intensity, at 3.9% of revenue.
Figure 1: Total natural capital cost and intensity of selected sectors
TOTAL NATURAL CAPITAL COST

23%

4%

16,00014,0003%

12,00010,000

12%
10%

8,000

9%
8%

6,000

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4,000
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$75bn

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PERCENTAGE OF REVENUE AT RISKTOTAL NATURAL CAPITAL COST ($m)

18,000The natural
capital cost of
plastic in the
consumer goods
sector per year

PERCENTAGE OF REVENUE AT RISKCorresponds approximately to over 80 million tonnes of plastic. Trucost calculations derived from, but not limited to, World Bank [7];PlasticsEurope [8]; Eurostat [9], and the US EPA [10] datasets (full set of references and methodologies available in appendices 3
and 4 of this report).

These findings hold significant impacts for companies. On the one hand, companies in the food,soft drinks and non-durable household goods sectors have the largest natural capital costs inabsolute terms and thus are more likely to face reputational and legislative risks from theirassociation with the environmental impacts of plastic, especially litter from packaging. On the other
hand, companies in the toy, athletic goods and footwear sectors have the highest natural capitalintensity, meaning that a higher proportion of their revenue is at risk. Economic, reputational,
legislative and other risks, or missing related opportunities, could extract significant value from thesebusinesses if they had to internalise the full cost of their plastic use impacts.
The research compares the natural capital cost of plastic for sectors depending on thelongevity of the product they make. Companies in sectors such as food and non-durable
household goods, which make disposable plastic products and use plastic packaging, may face11With current knowledge, across all consumer goods sectors, over 30% of the natural capital costs
come from greenhouse gas emissions released upstream in the supply chain from the extractionof raw materials and manufacturing of plastic feedstock. The most significant downstream impact
is marine pollution, which has a natural capital cost of at least $13bn (see figure 2). This study isthe first to apply natural capital valuation to impacts of plastic on the marine environment. Trucost
supplemented its existing modelling techniques by gathering and analysing academic studies on
the impact of plastic on marine ecosystems. Impacts include economic losses incurred by fisheries
and tourism as well as time spent cleaning up beaches.

PERCENTAGE CONTRIBUTION TO TOTAL NATURAL CAPITAL COSTSOCEAN COST25%

TOTAL NATURAL CAPITAL COST ($m)

6,000
5,000

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4,000
15%
3,000
10%
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PERCENTAGE CONTRIBUTION TO TOTAL NATURAL CAPITAL COSTSFIGURE 2: TOTAL NATURAL CAPITAL COST OF PLASTIC IN THE OCEAN ($) AND PERCENTAGE
CONTRIBUTION TO TOTAL NATURAL CAPITAL COST PER SECTOR

O

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IC
ED
M

The total natural
capital cost to
marine ecosystemsof plastic littering
per year

The research drills down into and assesses the main quantifiable impacts of plastic use inproducts and packaging. It relies upon the best available research to date. However, because of
the nascent science in this field, several known or suspected impacts could not be fully assessed.
This is particularly true regarding downstream impacts, i.e. impacts relating to littering and disposal.

N

$13bn

much higher risks than those in sectors such as cars and athletic goods where products have amuch longer lifetime. This is because the use of plastic in these instances may not seem efficient,given the durability of the material and the short service life of the product and packaging types
they manufacture.

Total natural capital costs corresponds approximately to over 80 million tonnes of plastic. Trucost calculations derived from, but notlimited to, World Bank [7]; PlasticsEurope [8]; Eurostat [9], and the US EPA [10] datasets (full set of references and methodologies
available in appendices 3 and 4 of this report).

The impacts of plastic vary around the world, based on background conditions andmanagement practices. Companies face higher natural capital costs if they purchase or treat
plastic at its end-of-life in Asia as opposed to North America, Europe or Oceania. This is due tohigher pollution intensity levels of manufacturing in Asia and its lack of adequate waste
management facilities. The finding is of concern given the growth in Asian economies. A limitationof this study is that transboundary waste trade has not been taken into account. The downstream,
or end-of-life, natural capital costs of certain regions, such as Oceania shipping part of its waste toother countries, may thus have been underestimated.
This study focuses on plastic impacts in absolute terms, not in comparison to any alternatives.
However it should be noted that recent studies commissioned by plastic manufacturers
associations, such as the American Chemistry Council (ACC) and Plastics Europe, suggest that
there are significant benefits (in terms of energy used and greenhouse gas emissions) associatedwith the use of plastic (mainly in packaging) such as reduced food waste and lower fuel use intransportation.11,12 Similarly, this report suggests that current recycling and energy recovery
practices save consumer goods companies around $4bn per year. The emphasis should not beon systematically moving away from plastic but rather in using it in an efficient and environmentallysustainable way.

12

The research also shows whether companies disclose information on plastic. Due to low disclosurelevels, most of the data has been modelled and should only be considered indicative of themagnitude. As the impacts of plastic gain more prominence, companies may be expected by theirstakeholders to improve rates of disclosure. For example, this information is useful to informinstitutional investors interested in protecting the value of their investments. Asset managers could
engage with these companies to find out how they plan to manage the risks and opportunitiesof plastic.
Levels of disclosure on plastic are poor. Only around half of the 100 companies assessedreported at least one item of quantitative data on plastic (see figure 3). Disclosure rates vary widelywith no companies in the footwear and athletic goods sectors reporting any useable quantitative data
points, compared with 88% of firms in the durable household goods sector and 71% in the personal
products sector. Quantitative data points span from total quantity of plastic used per year by thecompany to tonnage of plastic saved due to one recycling initiative; data coverage varies widely andis often poor. Even when a company is classified as a “discloser”, it may mean that this company
disclosed only one data point with limited coverage. Disclosed data was used in the researchwhere available.
FIGURE 3: PERCENTAGE Of COMPANIES THAT DISCLOSE ON AT LEAST ONe DATA POINT

100%
PERCENTAGE OF COMPANIES DISCLOSINGON A LEAST ONE DATA POINT

90%
80%
70%
60%
50%
40%
30%
20%

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TW
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R

10%
0

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N

Over a quarter ofthese savings weregenerated throughinitiatives in the foodsector and 17% in thesoft drinks sector.

The research assesses the largest publicly-listed companies of each of the 16 target sector
by revenue - 100 in total. Each company’s plastic usage is estimated, using industry data,
modelling, and any disclosures specific to that company. The report contains 16 analyses that offer
sector-specific results and company-level insight.

DU

The amount savedby consumer goods
companies throughgood management ofplastic, throughrecycling forexample.

N$4bn

Good management of plastic, through recycling for example, saves consumer goods companies$4bn per year. Over a quarter of these savings were generated through initiatives in the food sector
and 17% in the soft drinks sector.

Trucost calculations derived from companies’ public disclosures (full set of references and methodologies available in appendices 3
and 4 of this report).

Currently, there is no correlation between a sector’s disclosure rate and its plastic intensity
or absolute natural capital cost due to plastic. This means that sectors which face the mostsignificant risks to their revenues from legislation, competition and consumer demand regarding
plastic need to consider being more transparent about how they are managing the potentiallymaterial issue. It also suggests that disclosure may be more driven by external factors, such as
legislation and reputation, rather than an internal understanding of risks and opportunities.

13

RECCOMMENDATIONS
Based on these findings, the research makes a series of recommendations to companies.
Taking action to reduce the risks of plastic while benefiting from the opportunities first involves
raising the awareness of a company’s executive board. The findings of this research provide theinformation needed to build a business case for the board to sanction action. The research
recommends that companies establish a strategy to reduce the impacts of plastic, including setting
targets with deadlines.
Companies can mitigate plastic-related risks and take advantage of the opportunities by improving
their measurement, management and disclosure of plastic. Initially, this means measuring andreporting their use of plastic, as many companies already do with carbon emissions and otherenvironmental impacts. Best practice frameworks to support companies in doing this in astandardised way include the Plastic Disclosure Project.
In order to properly identify the risks and opportunities, and manage these properly, this study
recommends that companies greatly improve the quantity and quality of the information they gather
and report on plastic. Relevant data includes the tonnage of plastic used in a company’s operations
and supply chain. This figure could be broken down into different types of plastic, such aspolyethylene terephthalate used in drinks bottles and polystyrene used in hamburger boxes, as well
the amount of recycled plastic or bio-plastic used (although bio-plastics do not always provide anenvironmentally-positive alternative to conventional plastics). Companies could also disclose how
plastic is used in products and packaging. Reporting on the fate of plastic at the end of its life isrelevant, such as whether it is disposed of to landfill or incineration with or without energy recovery,or whether it is recycled or reused.
By publicly reporting on plastic management, companies can demonstrate to stakeholders including
governments, investors and campaign groups that they take their environmental responsibilities
seriously. Companies that move quickest to report are most likely to gain credit by being seen as aleader on the issue.
In the longer term, progress on plastic is likely to require companies to work in partnership. The
research recommendations identify a range of organisations and suggest broad areas forcollaboration. This includes working with governments to develop effective legislation and waste
management infrastructure, especially in developing countries. Innovation often requires a range ofparticipants along the supply chain to work together, possibly with an official body acting as
coordinator. Companies could also support research institutions in their efforts to deepen our
understanding of the impacts of plastic in the environment.
An example of identified action is to reduce the weight of plastic used in products and packaging
through improved design. Companies could also switch to using recycled plastic and form joint
ventures to ensure sufficient supplies. In addition they could investigate the potential of bio-based
plastic, although there is much uncertainty about its benefits and impacts. Users of plastic could
engage with suppliers on issues such as phasing out hazardous substances.
The research includes several case studies of companies striving to implement good practice onplastic management, including Lush cosmetics, electronics companies Apple, Dell and Hewlett
Packard, and soft drink company Coca Cola, as well as awareness-raising initiatives working
through innovation to collect and reuse oceans plastic (e.g. Interface and Method).

Key recommendations for companies:•

Raise awareness of the risks and opportunities of plastic at executive board level.

•

Measure plastic use in products, packaging, operations and supply chains and publish the results in annual reports and, forexample, through the PDP.

•

Commit to reducing the environmental impact of plastic and set targets with deadlines to ensure this goal is achieved.

•

Innovate products and processes to increase resource efficiency and recycling of plastic.

•

Collaborate with governments to develop legislation to facilitate sustainable management of plastic, such as throughextended producer responsibility and waste management infrastructure, especially in developing countries.

•

Support data collection and further research into the impacts of plastic, especially in the marine environment, in partnershipwith academic institutions and conservation groups.

14introduction
Plastic is an all-encompassing word referring to a family of synthetic materials. While thisreport refers to plastic in general, there are different types of plastic with a range of different
properties and applications, from polyethylene terephthalate in soft drink bottles to acrylonitrile
butadiene styrene in toys. Table 7 in Appendix 2 highlights this diversity.
FIGURE 4: PLASTIC PRODUCTION PER REGION, 2012

7%

5%

3%
24%
20%

16%

Latin America

Japan

NAFTA

Middle East, Africa

Rest of Asia

CIS

China

Europe20%
5%Based on PlasticsEurope data [1]Plastic’s strength, low weight and malleability makes it the preferred option for a range ofapplications such as cars, window frames, smartphones and packaging. The versatility andlow price of plastic compared with alternatives is reflected in the rapid growth of the market for thematerial in a context of increased consumerism and drive for convenience. Plastic production has
increased by 8.7% year on year from 1.7 million tonnes in 1950 to 288m tonnes in 2012. China is
the world’s biggest producer, accounting for almost a quarter of output.1 Consumption is forecast to
increase, with regions like Asia leading the growth.
Plastic has many social benefits. Plastic packaging keeps food fresh and safe for humanconsumption and prevents food waste. Plastic helps save lives through a wide range of medical
applications such as packaging for pharmaceuticals and manufacturing healthcare equipment.
There is also large potential for future applications in renewable energy generation and improving
transportation.2 In addition, the plastic industry makes an important contribution to employment. In
2012, the European plastic industry employed more than 1.4m people and earned revenues of €300
billion (or $390m), according to Plastics Europe.1
Studies commissioned by the plastic industry have found that plastic can help reduce someenvironmental impacts. A study commissioned by Plastics Europe found that if other materials
were used instead of plastic in packaging, the packaging mass would on average increase by afactor of 3.6 and greenhouse gas emissions by a factor of 2.7 or 61m tonnes of C02-equivalent per
year over the full life cycle, in particular during the use phase through decreased food losses andfuel use in transportation.12 The same study commissioned by the American Chemistry Council(ACC) found that the use of plastic for packaging applications in the United States had agreenhouse gas emissions benefit over other materials of 75.8m tonnes of C02-equivalent per year
and a cumulative energy demand benefit of 1,110bn MJ.13 While these figures depend on a numberof assumptions and could be debated, they illustrate the point that plastic has some benefits for theenvironment, in this case compared to using other packaging materials.
Despite these positives, plastic has a range of negative environmental and social impacts
throughout its lifecycle which must be properly managed. Negative impacts include the use ofchemicals which can potentially escape in the environment and harm local populations, customers
and workers, the aesthetic, health, economic and ecological impacts of plastic litter, and theconsumption of non-renewable petroleum products as an ingredient and fuel in manufacturing.

15

objectives of the report
Good management of plastic across its lifecycle from production to end of life is lacking inmany businesses and places around the world. By measuring and understanding plastic and its
associated impacts, businesses can identify context-specific measures to maximise the benefits ofthe material while decreasing its negative consequences. The first step on the road to goodmanagement of plastic is for companies to measure, elaborate and implement appropriate
management plans, in collaboration with other stakeholders.
Disclosure underpins any robust plastic management strategy. While some companies canchoose to act but not report publicly, reporting is a central transparency, communication andcollaboration tool. Reporting targets and achievements reassure stakeholders about thetransparency of a company’s approach and add credibility to an overall company’s sustainability
programme. It is also useful as a communication tool, in order to keep stakeholders updated on the
progresses made. By extension, disclosure may trigger collaboration, by supporting the identificationof common areas of interest and challenges.
The objective of this report is to demonstrate the business case for plastic measurement,
disclosure and management by quantifying the risks of plastic to a company’s activities.
The use of plastic causes environmental and social impacts that can be expressed in monetary
terms to reflect the scale of damage caused – the ‘natural capital cost’. Natural capital encompasses
natural resources such as clean air and water, and environmental services such as food and climate
regulating services. Economic activity depends on these resources and services; however, they are
not often factored into corporate accounting.
Natural capital valuation translates physical environmental impacts, such as tonnes of plastic
reaching the ocean, into a monetary value. Put simply, it puts a price on pollution and use ofresources. This allows companies to make informed decisions, for instance, over how best to reduce
their environmental impacts, or whether to invest in new equipment and what technology to use. It
serves as a representation of the value-at-risk to a business through its plastic use.
In particular, the report:•

Identifies the main impacts of plastic use within 16 consumer goods sectors.

•

Maps the plastic supply chain upstream and downstream from raw material extraction,
manufacturing and use to the end of its life.

•

Assesses the plastic-related natural capital cost and intensity of the largest puclicly-listedcompanies per sector, 100 in total.

•

Estimates the impact of companies’ plastic use based on disclosure from public sources anddata modelling in the absence of company disclosure.

•Highlights the natural capital benefits of more sustainable use of plastic, such as recycling.

•

Presents three case studies of business excellence in plastic disclosure and management.

•

Provides recommendations for companies.

The next section highlights the impacts of plastic, followed by a discussion of the business casefor the proper management of plastic and natural capital valuation as a useful tool to assess risks
and opportunities.

the environmental and social impacts
Approximately 4% of oil production is used as feedstock and another 4% is used to fuel theplastic manufacturing process as well as other resources such as natural gas, water andchemicals.2 Extracting and processing these raw materials into plastic feedstock generates carbon
emissions and other air, land and water pollutants. Plastic pellets from the manufacturing process
may also enter the waste stream and the ocean in the form of microplastics, which are small
particles of plastic with a maximum diameter no greater than 5mm. Microplastics are easily ingested
by sea life, and now even outweigh plankton in some areas of the high seas.3 Initiatives from theplastic industry to tackle this issue include Operation Clean Sweep which promotes the better
handling of plastic pellets at the manufacturing stage.14 Finally, there is an opportunity costassociated with the use of these non-renewable resources which may not be available tofuture generations.
Impacts may also arise from chemical additives used in manufacturing plastic items.
Chemical additives are added to plastic feedstock in order to enhance their performance, in termsof strength and heat resistance for example. These include fillers, plasticisers, stabilisers, flame
retardants and colourings. Some of these substances are toxic, bioaccumulative, and persistent in16

the environment. These substances can leach out of plastic into the environment, affecting the healthof wildflife.2 Some additives are also of concern to human health. An example is the potential leachingof bisphenol A from plastic containers into the food it contains. Another is the possible migration offlame retardants from plastic computer enclosures into dust that humans breathe. Workers can also
be exposed to additive leachate during the manufacturing stage. For example, trimethlytin chloride
due to the use of methlytin stabilising agents in PVC products is linked to the increased risk ofdeveloping kidney stones in workers in the United States and China.15
Plastic presents further risks and costs once it is thrown away at the end of its life. Globally,
between 22% and 43% of plastic waste is disposed of in landfills, where the resources it contains arewasted. Landfill sites can blight local communities due to their undesirable nature and by using up
valuable space. If plastic is mixed with other materials, sorting the waste to collect useful materials
becomes more complex, costly and dangerous. Some plastic waste goes to incineration – up to 21%
in developed countries where most incineration plants are designed to generate energy. However,generating such energy from these waste plants is in some cases inefficient, requires pollution
abatement to control air emissions, and the incinerator ash is classified as a hazardous waste.
Waste management, while necessary and better than littering, is costly and wastes resourcesthat could be put to good use through recycling. Inadequate waste management is expensive tosociety and often not internalised by businesses. Collection costs range from $20 to $250 per tonne
depending on the region, while landfill costs $10- $100/tonne and incineration with energy recovery$40-200/tonne.8
According to the World Bank, the quantity of waste and related cost is likely to double by 2025.8 With
many countries un-prepared to handle this increase, waste and resource management will be anincreasingly important issue in the years to come for companies, particularly those who operate
across borders. Plastic is one of the toughest waste streams to handle, and though the weight ofplastic waste might not be as big as that of other materials, its durability and volume often account fora large proportion of a country’s waste issues.
The highest profile impact of waste plastic is when it is littered. Once littered, it is costly torecover and becomes a multigenerational problem due to its long degradation time. Although it istypically only considered an eyesore, its impact is felt throughout our communities, environment andincreasingly the ocean. Litter has an impact on land use, transport, animal and human health, safety,
flooding, community spirit and clean-up costs. It often makes its way to the ocean over time, due to its
light weight and durability, blown by the wind or via rivers and drains. While there is much uncertainty
about the extent of the problem, a report by the United Nations Environment Programme (UNEP)
estimates that 6.4m tonnes of litter enter the ocean every year – some eight million items every day.5
This figure is likely to be an underestimate as the underlying research was published in 1975. Other
studies suggest between 10m and 20m tonnes a year.16,17
Plastic is the most common type of marine litter, comprising up to 80% of total waste inmarine litter surveys. Most (over 80%) comes from land-based sources, with marine-based activities
such as shipping, cruise lines and fishing accounting for the remainder.5 Studies show that levels oflitter in the ocean are increasing in spite of efforts to control the problem. Industry bodies, businesses,
governments, civil society and international institutions are recognizing the magnitude of the issue
and the need to tackle it. As an example, many joined UNEP’s Global Partnership on Marine Litter(GPML) and the global plastic associations have signed a declaration to develop solutions tomarine litter.18
Over two thirds of plastic litter ends up on the seabed with half of the remainder washed up on
beaches and the other half floating on or under the surface, according to a report from UNEP.5
Over time, ocean currents drive plastic waste on the surface of the sea together into vast ‘ocean
gyres’ such as the ‘North Pacific Gyre’, which has been nicknamed the ‘Plastic Vortex’ or the ‘Great
Pacific Garbage Patch’. In reality, these gyres are more like a soup than a patch.19 Even the great
depths of the ocean are polluted with plastic. Researchers using a remotely operated underwater
vehicle to explore an area of seabed covering less than 1% of Monterey Bay in surface recorded over
380 pieces of plastic debris, with similar findings in the Mediterranean and North Sea.20,21,22
Plastic litter in the ocean kills, injures and harms wildlife. Larger items such as plastic bags,
plastic strapping for packages and abandoned fishing gear can strangle marine animals. Bottle caps,
plastic cutlery, pens and cigarette lighters can be ingested and harm animals through internal damage
and starvation. There has been a 40% increase in the number of species reported to be affected byingestion and entanglement between 1997 and 2012, across all marine debris types. Of 319
publications reviewed in the same 2012 report, the majority of reports (76%) described encounterswith plastic debris as opposed to other types of material.6 Ingestion of microplastics may also have17

severe impacts on wildlife. In addition to intentionally manufactured microplastics, microplastics are
created as larger items of plastic break down in the environment. Other microplastics have been
deliberately designed for use in products, such as facial scrubs, and cannot be caught in sewage
treatment works before they are discharged into the sea.23
Plastic waste found in the marine environment can potentially leach chemicals into theenvironment as well as attract and communicate hazardous chemicals from the ocean towildlife. For example, plastic waste in the Pacific Gyre has become contaminated with persistentbioaccumulative toxic pollutants (PBTs) including polychlorinated biphenols.19 PBTs are chemicals
which degrade slowly in the environment and as a consequence accumulate in the tissues oforganisms. Due to its chemical characteristics, plastic absorbs PBTs present in the ocean.24,25
Marine life then receives a concentrated exposure to PBTs, when the marine plastic is consumed,building up the food chain to potentially reach humans.
Plastic waste in the ocean has a direct economic impact. The Asia-Pacific Economic
Cooperation (APEC) estimates that the cost to the tourism, fishing and shipping industries was$1.3bn in that region alone. For example, vessel damage can be caused by plastic waste
becoming snarled up in a ship’s propellers.26 In Scotland, the approximate economic cost of marine
litter is £17m per annum, or $28m per annum.27 Local authorities have to bear the cost of cleaning
up plastic litter from beaches. In the UK, the annual costs are put at $24m.28 In the US, communities
on the west coast spend more than $520m per year to curtail litter.29 Another study found that closing
a Lake Michigan beach could cost as much as $ 37,030 per day.30

the business case for managing plastic
In spite of the impacts described in the previous section, compared to climate change,
awareness of the environmental impacts of plastic is low among most companies. Yet thecase for addressing emerging risks and seizing opportunities is strong and growing. Many of thechallenges of plastic could be addressed by improving management of the material across its
lifecycle. This does not mean companies should stop using plastic. But there is a case to use lessplastic through improving efficiency. There is also a case for making much better use of waste plastic
through reuse and recycling.
Major risks and opportunities can be grouped in five categories: operational costs, innovation in
products and processes, regulation and litigation, reputational, and investor interest. These risks andopportunities are dynamic and may vary depending on the region, industry sector and over time. As
science on the impact of plastic develops further, these risks may acquire a higher profile amongexternal stakeholders. Where there are risks, there are opportunities which businesses can turn totheir advantage.
Measurement and disclosure underpin any effective management strategy to mitigate risks andrealise opportunities associated with environmental impacts. Measurement is vital so that companies
have accurate information on the performance of their business. And disclosure builds trust withstakeholders within the business, supply-chain, government, financial markets and conservation.
Plastic is no exception. Just as for carbon, greenhouse gases, water and forestry, businesses canimprove their own sustainability by measuring, managing and disclosing their “plastic footprint”.

18

FIGURE 5: BUSINESS RISKS AND OPPORTUNITIES RELATED TO PLASTIC MANAGEMENTMEASURING, REPORTING AND MANAGING PLASTICRISKS TO BUSINESSOPPORTUNITIES FOR BUSINESSREPUTATIONAL

MARKET & PRODUCTMARKET & PRODUCTREPUTATIONAL

BRANDED WASTE

LOSS OF MARKET SHARE TO OTHER
BRANDS/PRODUCTS/COMPANIESGAIN MARKET SHARESPONSORED CAMPAIGNS & PRODUCTS

ENCOURAGE INNOVATIONPOOR EMPLOYEE MORALE

IMPROVED EMPLOYEE ENGAGEMENTOPERATIONAL COSTSRISK OF LONG-TERM PRICE INCREASERISK OF SHORT-TERM PRICE VOLATILITYDISCLOSURENONDISCLOSUREOPERATIONAL COSTSREDUCED & STABLE INPUT COSTS &END-OF-LIFE-FEES VIA ALTERNATIVE MATERIALSAND E.G. REUSE, RECYCLING & REPAIR

REGULATIONS & LITIGATIONREGULATIONS & LITIGATIONREPORTING & FINANCINGREPORTING & FINANCINGEXPOSURE TO WASTE TAXES & FINESPROTECT REVENUE FROM TAXES & FINESRISK FROM FUTURE LEGISLATION

PLAN FOR FUTURE LEGISLATIONFAILURE TO CAPITALISE ON INVESTOR INTEREST

IMPROVED ACCESS TO CAPITALPERCIEVED FAILURE TO ACCOUNT FOR RISKMEET REPORTING REQUIREMENTS i.e. GRI & CDP

CUTTING COSTS AND IMPROVING EFFICIENCY
There is an increasing amount of evidence that companies which proactively manage
environmental issues have better financial performance. A Style Research study found that the
top 20% of developed country carbon-efficient companies outperformed the rest of the market.31
A Harvard Business School study, using a sample of 180 companies, found that companies which
voluntarily adopted sustainability policies more than 15 years ago significantly outperformed othercompanies over the long-term in the stock market.32 Similarly, a study from Goldman Sachs showsthat companies with better environmental, social and governance performance generate higher cash
returns, higher incremental returns year-on-year and less volatile return on capital.33
One reason is that such companies tend to be more efficient; cutting energy consumption leads tolower energy bills as well as lower carbon emissions. Another is that they are perceived to be better
managers and custodians of the environment by their stakeholders. Additionally, they demonstratethat they are in tune with their stakeholders’ needs, including their “social license to operate”, which
de-risks the company in the eyes of investors.
Better management of plastic can help companies decrease their direct costs and reduce therisk of price increases. While plastic is a comparatively cheap material compared to alternatives,
there are likely to be many opportunities to cut costs from using plastic more efficiently. Most typesof plastic are petroleum-based products that also rely on fossil fuels to provide energy for the
manufacturing process, making them vulnerable to price volatility as oil and geopolitical balances
shift. In addition, depending on its grade, the price of recycled plastic is less that of virgin plastic.
Companies that do not know how much plastic they use will be unaware of these potential savings.

INNOVATION IN PRODUCTS AND PROCESSES
Thinking more innovatively about plastic could create opportunities for companies bydesigning more sustainable products. For example, although recycling plastic in each community
is to a large extent dependent on infrastructure and available technology, the use of recycled content
in products today is viable in a vast range of products. The percentage of recycled content usedcomes down to one of economies of scale, availability, consumer perception, and understandingthat such material can be effectively substituted for virgin grade product. Product design has a partto play by enabling plastic products to be reused or easily dismantled so that the resources they
contain can be put to good use rather than sent to landfill or incinerated.

19

Innovative production processes could also be considered, reducing costs and improving
supplies of raw materials. Concerns around the quality and quantity of recycled plastic have led
companies to implement in-house recycling systems. For example, Interface’s ReEntry process
allows the company to recycle a higher quantity of post-consumer material while achieving lower
contamination rates. The process constitutes a real innovation in the sector, with the lowest
embodied energy than any other recycling system in the carpet sector.34
Companies that act first are usually the ones to profit most. Cosmetics company Lush benefits
from its campaign asking people to bring back items to recycle by increasing customer foot fall in its
stores. Replenish multi-surface cleaner, which is sold in concentrated form for dilution at home,results in 90% less plastic, oil and CO2 emissions than a pre-mixed cleaner. The product has
achieved double-digit market share and international reward recognition not simply because of its
environmental credentials but because of its innovative design and ability to deliver a quality productat a lower cost.35

REGULATIONAs concern about the impacts of plastic on the environment and human health grows, sodoes pressure on policymakers to introduce tougher regulations. Companies that produce orconsume large quantities of plastic, but which fail to prepare for tighter controls, are exposed to risks
such as lower sales due to restrictions or bans on products and packaging, or chemicals used intheir manufacture. For example, there have been concerns over the use of bisphenol A (BPA) usedwidely in hard, clear plastic commonly found in food and drink containers. Canada was the first
country to declare BPA toxic in 2009. From March 2011, the European Commission banned the useof BPA in plastic feeding bottles, followed by the US in 2012.36
There is an increasing range of global and national legislation covering the environmental
impacts of waste including plastic. An important focus is preventing damage done by marine litterin the world’s oceans.
Historically, marine pollution has been addressed by regulating disposal of waste at sea, forexample, with the 1972 Convention on the Prevention of Marine Pollution by Dumping of Waste andother Matter (with its London Protocol) and the 1973 International Convention for the Prevention of
Pollution from Ships (Annex V of MARPOL).37 However, these initiatives do not address the impactof plastic litter which enter the sea from land and is said to account for over 80% of plastic waste in
the marine environment.5 The Global Programme of Action for the Protection of the Marine
Environment from Land-based Activities (GPA) has had marine litter as one of its priority source
categories since 1995. The GPA is implemented at the regional level by the Regional Seas
Conventions and Action Plans, several of which have Protocols on Land-based sources/activities ofpollution.38 More stringent legislation is likely to be introduced at national levels to control
land-based sources of plastic pollution. This could affect not only users of plastic but the entire
plastic supply chain.
In March 2011 the Fifth International Marine Debris Conference (5IMDC), organised by the
UNEP and the National Oceanic and Atmospheric Administration, contributed to thedevelopment and subsequent finalisation of a global framework strategy to prevent andmanage marine litter. The ‘Honolulu Strategy’ identified several areas of focus, including helping
develop, strengthen and enact legislation, improving regulatory frameworks, and promoting bestpractice among industry. Emphasis was also put on market-based mechanisms.39 In 2012,
representatives of 64 Governments and the European Commission emphasized the importance ofthe Honolulu Strategy in the Manila Declaration on Furthering the Implementation of the Global
Programme of Action for the Protection of the Marine Environment from Land-based Activities(GPA). They also recommended the establishment of a Global Partnership on Marine Litter (GPML)
which was launched in June 2012. UNEP GPA provides the Secretariat. UNEP’s marine litter related
activities also feed into the workplan of the UNEP-led Global Partnership on Waste Management.
This ensures that marine litter issues, goals and strategies are tied to global efforts to reduce andmanage waste. The GPML seeks to protect human health and the global environment by the
reduction and management of marine litter as its main goal.
In March 2013, the European Commission published a green paper seeking views on how totackle the problem of plastic waste as part of a review of waste legislation to be completed in
2014.16 Despite a number of European Union (EU) laws directly pertaining to packaging whereplastic use is most prominent, there appears to be an ongoing realisation that plastic is underregulated. The commission stated its intention to introduce more legislation in the near future.
In a resolution agreed by Parliament in January 2014, members of the European Parliamentstressed that plastic waste is damaging the environment due both to weak enforcement of EU
legislation on waste and the lack of specific EU laws on plastic waste. Among their aims is toban the most hazardous plastic and certain types of plastic bags by 2020, and to introduce specificand binding targets for recycling, the economic potential of which is said to be largely unexploited.40

20

Plastic bags are one of the most obvious sources of pollution and are the subject of national
legislation in many countries. In November 2013, the EU Commission published proposals toamend the EU packaging waste directive by requiring member states to reduce consumption oflightweight plastic bags using measures such as taxes, national reduction targets or bans. A numberof EU countries such as Italy, as well as China and South Africa, have already banned some types ofplastic bags. In 2014 the European Parliament called for a ban on single use plastic bags by 2020.40
Ireland has a plastic bag tax, with Belgium, England, Germany, Spain and Norway following suit.
In the United States, more than 17 states have passed ordinances banning plastic bags in several
hundred municipalities.41
Similar activity is likely regarding microplastics. These are small plastic particles, either directly
used in products such as cosmetics, or broken down from larger plastic pieces which can beswallowed by marine wildlife causing harm and potentially transferring toxins into our own foodchain. Mounting concern over this issue is likely to result in more stringent regulations alreadyproposed in New York and passed in California.42,43,44

REPUTATIONThe risk of damage to corporate and brand reputation is one of the main reasons why
companies should take early action on managing their plastic footprint. Brand valuation
studies have found than in certain cases, brand accounts for over 70% of the total value of thecompany.45 Environmental campaign groups often call for consumer boycotts of well-known brands
to raise awareness about an issue, such as Greenpeace’s campaign against Coca-Cola’s oppositionof container deposit taxes aimed at stimulating recycling in Australia. As part of the campaign, theorganisation emphasised the wildlife damage caused by plastic bottles though organised protests
outside the company’s headquarters, boycotts of the product, and negative social
media campaigns.46
In the past, campaigns portraying a corporation’s negative impact on biodiversity have been
known to threaten profitability. A recent example is the high profile 2010 Greenpeace campaign
against Nestlé’s palm oil sourcing practices using flagship brand Kit Kat as target, which resulted in
Nestle changing its policy and severing contracts with its major palm oil producer Sinar Mas.
Greenpeace then campaigned against HSBC who eventually dropped their investment in
Sinar Mas.47,48
In the age of social media, images of plastic litter washed up on a beach or linked to thedeath of whales and dolphins can spread across the world in seconds. Although in manycases brand origin is unidentifiable, the potential for negative publicity on plastic in general could
affect companies. Other times, brand origin is identifiable. #Litterati social media photo campaign
encourages users to photograph litter before disposing of it and share the image on Instagram. The
resulting “digital landfill” is expected to be used to work with communities and large corporations toprevent litter.49 Another example includes the Plastic Soup Foundation’s “Beat the Bead” application
which allows the user to know whether there are microplastic within the product they are about
to buy.50
By using social media and other communication tools, companies can demonstrate they arepart of the solution to these problems. For example, in 2012 a group of California elementary
school students gathered more than 90,000 signatures on a petition asking marker pen company
Crayola to “make its mark” on recycling its used products. Crayola initially responded that it had no
way to do so. The campaign inspired a competitor, Dixon Ticonderoga, to launch its own program forrecycling used marker pens. The publicity and potential loss of business led to Crayola to announce
its own recycling programme for used plastic markers.51,52

INVESTOR INTEREST
There is growing interest among investors in how companies manage environmental risks
and opportunities. For instance, the UN’s Principles for Responsible Investment (PRI) has some
1,200 signatories among asset owners and investment managers which collectively control almost$35 trillion.53 Its members are committed to incorporating consideration of environmental, social andgovernance issues into their investment decisions.
The investor-led CDP (formerly the Carbon Disclosure Project) has had enormous successencouraging companies around the world to disclose their carbon emissions and plans to
reduce them. Its climate change program is backed by 722 investors with $87tr in assets undermanagement. In 2013, 81% of the world’s 500 largest stock-exchange listed companies reported to
the CDP. The CDP has widened its efforts to encourage disclosure on other issues such as water,
forests and supply chain impacts.54
A survey commissioned by the Plastic Disclosure Project found strong interest among
investors in encouraging companies to disclose their plastic consumption. Almost 90% of
those surveyed said they would support the Plastic Disclosure Project including respondents from21

HSBC, BNP Paribas, Credit Suisse, Bank of America, JPMorgan and First State Investments andothers. Together they control assets worth some $5.8tr.55 Companies can demonstrate leadership andengage with investors by proactively disclosing on their plastic use before they are asked to do so.

the concept of natural capital as a tool to assess risks
and opportunities
Plastic use has impacts associated with it, depending on how well it is understood andmanaged. These impacts can potentially translate into risks, or opportunities, to businesses.
In order to understand the potential magnitude of these risks and opportunities, this report
uses a technique called “natural capital valuation”. This technique translates physical impacts
into a monetary figure, which expresses the potential value that companies would have tointernalise if they were held accountable for their impacts. As such, natural capital valuation
helps assess the magnitude of the financial risks and opportunities faced by companies.
Natural capital is the term used to describe the renewable and non-renewable natural
resources that companies rely on to produce goods and deliver services. Businesses depend
on natural assets that are non-renewable (e.g. fossil fuels and minerals), as well as renewableecosystem goods and services, such as freshwater, timber and a stable climate. Business decisions
around site operations, supply chains and products drive the use of natural resources. The capacity
for renewable natural resources to regenerate over time affects the availability of stocks. Their ability
to absorb unwanted by-products of production such as pollution and waste is limited. But the value ofaccess to land, clean air and plants that provide critical inputs such as food, energy and fibre isusually excluded from financial accounts.
Business activities such as extraction and production can damage natural capital and cause
economic costs that are largely external to market prices. Increasing environmental degradation
and resource depletion combined with growing demand are highlighting the need to value natural
capital. Companies need to improve the way they manage annual flows of natural capital to reduce
economy-wide costs. To do this, they need to understand sources of value and risk. Measuringphysical flows of resource use, pollution and waste provides a starting point to evaluate whichecosystem goods and services businesses depend on.
Natural capital valuations convert physical impacts measured in terms of cubic metres ofwater used or tonnes of plastic entering the marine environment into a monetary value,
expressing the damage caused to the environment and society. Valuation is essential tounderstand the true value of environmental assets, according to an authoritative study by The
Economics of Ecosystem and Biodiversity (TEEB) initiative. It says that despite uncertainties,
economic valuations of ecosystem services can improve decisions around risk management.56
Trucost research for the PRI and UNEP Finance Initiative (UNEP FI) valued resource use, pollution
and waste linked to the 3,000 largest publicly-listed companies at over $2tr in 2008.57 In addition,
several companies have already conducted and publicly disclosed environmental profit and loss
accounts (EP&L) such as Puma, Becker Underwood and Novo Nordisk.
Applying economic valuations to these quantities is one approach that is gaining ground tostrengthen decision-making and risk management. Initiatives such as TEEB and World BusinessCouncil for Sustainable Development (WBCSD) Guide to Corporate Ecosystems Valuationencourage businesses to evaluate natural capital so that decisions consider related financial risks
and benefits. To make this possible, companies need to measure and report relevant information. In
June 2012, 196 governments at the UN Conference on Sustainable Development committed to taking
steps to encourage companies to consider integrating sustainability information into reporting cycles.
Fifty-seven countries and the European Commission, along with 86 companies, backed an initiative tofactor the value of natural assets such as clean air and water, forests and otherecosystems into business decision-making and national accounting.58
This approach to environmental economics and accounting underpins the methodologies usedby Trucost in this report. The natural capital valuation of plastic impacts allows companies to:•Understand the potential materiality of environmental impacts.

•

Prioritise environmental issues to address in operations, supply chains and investments.

•

Identify opportunities to reduce risk and optimise capital allocations and expenditure.

•

Develop strategies to reduce the environmental impacts of plastic use.

•

Build the case for monetary incentives to reduce environmental impacts.

In order to quantify the natural capital cost of these impacts, the methodology followed six steps:
sector selection, plastic use quantification, scope and boundary selection, impact quantification, andnatural capital valuation and application (see figure 6). Appendices 3 and 4 explains the methodology
in more detail.

22

HIGH LEVEL METHODOLOGYSTEP 1: SECTOR SELECTION
Trucost focused its research on 16 consumer goods sectors that were likely to use large volumesof plastic in products and packaging (see table 1). Other sectors which are large users of plastic,
such as agriculture, were excluded from the analysis but may be included in future research. For thedescription of each sector, please refer to Table 8 in Appendix 3.
FIGURE 6: HIGH-LEVEL METHODOLOGY STEPSSECTOR
SELECTION
AND MAPPING

PLASTICSECTORUSE
QUANTIFICATIONTOTAL NATURALLEVELCAPITAL COSTAPPLICATION

OF SECTOR A ($)

NATURALSCOPE ANDCAPITAL

BOUNDARY

INTENSITY,
OR $ PER

SELECTION

application
at sector
or company
level$1m REVENUECOMPANYTOTAL NATURALIMPACTLEVELCAPITAL COST OFQUANTIFICATIONAPPLICATIONCOMPANY A ($)

NATURALCAPITAL

PUBLICLYVALUATIONAVAILABLE DATATABLE 1: SECTOR

SELECTION

Food

Personal productsSoft drinks

Durable household goods

TobaccoConsumer electronics

Furniture

Automobiles

Clothing and accessories

Athletic goods

FootwearToys

Non-durable household goods

RetailMedical and pharmaceutical products

Restaurants and bars

23

STEP 2: PLASTIC USE QUANTIFICATION
Trucost calculated the tonnage of plastic used in the consumer goods sector based on its
expenditure in key plastic manufacturing industries. This gave the plastic intensity, expressed as
tonnes per $1m of revenue, for each of 16 sectors. The amount of plastic was categorised into
three types:•

Plastic-in-product includes plastic used in products such as a child’s plastic toy or apolyester T-shirt.

•

Plastic-in-packaging includes plastic used as packaging such as carrier bags andshampoo bottles.

•

Plastic-in-supply-chain includes plastic used by suppliers such as bags containing fertilizer usedby farmers supplying the food sector. Trucost calculated the volume of ‘plastic-in-supply-chain’
to put the first two categories into perspective but did not calculate the related natural
capital cost.

STEP 3: SCOPE AND BOUNDARY SELECTION
After modelling the plastic intensity of each sector, the next step was to calculate the associatedenvironmental impacts. Trucost set boundaries on both the lifecycle stages and impacts to be
included in order to create an achievable project. Impacts across the lifecycle of plastic wereconsidered including the extraction and processing of raw materials into plastic feedstock and theend-of-life fate of waste plastic. Some lifecycle stages had to be excluded for practical reasons, suchas the plastic product manufacturing, outbound transportation and any impacts during the use ofplastic products.

STEP 4: IMPACT QUANTIFICATION
Trucost quantified the environmental impacts associated with plastic use using lifecycle analysis
techniques. The analysis draws on numerous official sources such as the US Toxic Release
Inventory and Plastics Europe eco-profiles.59,9
Impacts include greenhouse gas emissions, water abstraction, air, water and land pollutants fromthe extraction of natural resources to their conversion into plastic feedstock. However, it excludes
the future cost to society of exploiting non-renewable resources which may not be available to future
generations. It also excludes occupational hazards linked to the use of chemical additives.
Trucost also quantified the environmental impacts associated with plastic at the end of its life
depending on the waste management route used, such as landfill, recycling, littering, andincineration with and without energy recovery. Data came from official sources such as US
Environmental Protection Agency, the World Bank and Eurostat.8,10,11
Impacts include greenhouse gas emissions, water abstraction, air, water and land pollutants fromthe extraction of collecting and treating plastic waste. They also include the end-of-life impact ofchemical additives in plastic leaching into the environment, the loss of amenity caused by litter, theeconomic cost of litter to the marine industries and the ecological cost linked to the loss of species.
Other impacts have been excluded, such as the waste of recyclable resources, the impact of
microplastic and the effect of hazardous chemicals once in a marine environment.
Appendix 3 explains in more detail inclusions and exclusions in the scope and boundary selection
and impact quantification phase.

STEP 5: NATURAL CAPITAL VALUATION
Natural capital comprises stocks of resources, such as water and clean air, and services such as
climate regulation and food provision. Businesses depend on natural capital to be able to operate
and provide goods and services to society. Yet this is rarely accounted for in a company’s financial
accounts. Natural capital valuation provides a way to quantify in monetary terms natural capital risks
and dependencies.
There are many benefits from natural capital valuation. For instance, using a common monetary unit
enables companies to compare the significance of different impacts. It can also be used to measure
the success of programmes to reduce impacts, such as diverting waste from landfill to recycling. It
also enables a company to create an environmental profit and loss account for its business which
can be integrated into its mainstream financial account. By comparing a business’s annual natural
capital cost to its annual revenue, a company’s management can understand the risks it faces iftighter regulation or consumer demand forces it to pay these costs. This knowledge can encouragecompanies to take early action to reduce these risks by cutting environmental impacts.

24Trucost calculated the natural capital cost by converting the physical quantities of different types ofenvironmental impacts, such as tonnes of particulate matter, into a monetary cost and adding them
together. The natural capital intensity is the sum of all the natural capital impacts expressed inmonetary terms per $1m revenue.

STEP 6: APPLICATION
The valuations were applied at both the level of the consumer goods sector and theindividual company.
At the sector level, Trucost calculated the total natural capital cost of plastic use by the consumer
goods sector. The total natural capital cost is the total natural capital intensity for that sector,
multiplied by its aggregate revenue.
For individual companies, Trucost selected the 100 largest stock exchange listed consumer goods
companies and calculated the natural capital cost of plastic for each one. Where these companies
published quantitative data on plastic use and disposal of adequate quality and scope, it was used inplace of modelled data.

LIMITATIONSThere were a number of limitations to the research. One example is in deciding what life cycle
stages to include. While the upstream impacts from manufacturing plastic feedstock (granules orfibres) were included, as were the downstream impacts from end-of-life plastic, the impacts frommanufacturing finished products and packaging, and transporting and using those products andpackaging, were excluded. This is because of the great complexity required by such an analysis. A
single product may comprise hundreds or thousands of components made from different materials
including plastic. This makes the modelling of product manufacturing at a sector level too uncertain.
In addition, some impacts were excluded, such as the end-of-life impact of microplastic. A detailed
discussion of the other limitations can be found in appendices 3 and 4.
Valuing the impacts of plastic on the oceanThis report is the first time that the environmental and societal impacts of plastic in theocean have been assessed using natural capital valuation. Plastic pollution has a range ofimpacts on marine wildlife including small particles of plastic being eaten by fish and seabirds,
or larger plastic items entangling larger creatures such as seals, fish and marine mammals.
Concern over these impacts is growing, but they are difficult to quantify.
To conduct this research, Trucost supplemented its modelling techniques by compiling,
analysing and aggregating academic studies on the impact of plastic on marine ecosystems.
Impacts included the economic losses incurred by fisheries, aquaculture and tourism. The timespent by volunteers cleaning up beaches was also considered. Finally, Trucost valued how
much society would be willing to pay to prevent species loss through plastic ingestionand entanglement.

25

results
This section provides a general overview of the results and is organised along six key questions:•

Which sectors are the most plastic intensive?

•

What is the magnitude of the natural capital cost?

•

What are the most significant impacts?

•

Where do these impacts happen?

•

What is the state of disclosure?

•

What are the potential benefits of good plastic management?

The last section provides a summary of the key findings. The sector-specific results section(appendix 1) disaggregates overall results into sector-specific results.

WHICH SECTORS ARE THE MOST PLASTIC INTENSIVE?
‘Plastic-in-product’ includes the quantity of plastic directly used in the product, as well as
any losses that were incurred during the manufacturing process. An example is the plastic
used in the bumper of a car or a polyester t-shirt. ‘Plastic-in-packaging’ includes thequantity of plastic directly used in the packaging of the product, as well as any losses thatwere incurred during the manufacturing and packaging stage. This covers items such as
plastic bags and films, as well as water and shampoo bottles. ‘Plastic-in-supply-chain’
includes the quantity of plastic used indirectly by consumer goods businesses via their
supply chain but is neither destined to be in the final product nor in packaging.
For example, this includes the plastic containers of fertilisers applied in the agriculture
sector, in the supply chain of the food sector; and the plastic in a toy, and its packaging, inthe supply chain of a retailer where the item was sold. Trucost calculated ‘plastic-in-supplychain’ to put the first two categories into perspective but did not calculate the related natural
capital cost.

Overall, the global weighted average of plastic-in-packaging used in the consumer goods
industry is 2 tonnes per $1m revenue; of plastic-in-product 2 tonnes per $1m revenue; and ofplastic-in-supply-chain 4 tonnes per $1m revenue. This indicates that for every $1m in revenue inthe consumer goods industry, 8 tonnes of plastic are consumed. These figures hide large
sector-specific variations. Figure 7 and table 2 display the estimated tonnage of plastic used per$1m revenue, or plastic intensity, broken down between plastic-in-packaging, plastic-in-product andplastic-in-supply-chain for each of the 16 sectors.
Direct plastic intensity comprises plastic-in-product and plastic-in-packaging, but excludes
plastic-in-supply chain.
The toy sector has the highest total direct plastic intensity, at 40 tonnes per $1m revenue,
while the retail sector has the lowest, at 500 kg per $1m revenue. Plastic-in-packaging
constitutes the main proportion of direct plastic intensity in the soft drinks, personal products, food,medical and pharmaceutical, restaurants and retail sectors. In particular, the soft drinks sector has
the highest plastic-in-packaging intensity, at 15 tonnes per $1m revenue. Plastic-in-product is thelarger proportion of total direct plastic intensity for all other sectors. In particular, the toy sector has
the largest plastic-in-product intensity, at 38 tonnes per $1m revenue, followed by the athletic goods
and durable household goods.

26Sectors with the highest supply-chain-plastic intensity in relation to the total plastic
intensity are the retail (75%), restaurants (72%), tobacco (70%) and food (66%) sectors –meaning that companies operating in these sectors may need to pay attention to plastic usedin their supply chains. The retail and restaurant sectors are located further down the supply chain
compared to others. Their low direct intensity is because it only includes packaging added to the
product in the shop, such as carrier bags. This explains the low intensity of the sector’s direct
operations and proportionately larger plastic-in-supply-chain intensity. The retail, restaurants,
tobacco and food sectors are also significant users of agricultural commodities in their supply chain,
which has been recognized as a plastic intensive sector. As highlighted by Plastics Europe,
agriculture contributed 4.2% to the overall plastic demand in Europe in 2012.1
FIGURE 7: PLASTIC INTENSITY PER SECTOR (TONNES PER $1M REVENUE)

50
PLASTIC-IN-PRODUCT40PLASTIC-IN-PACKAGING

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TONNES OF PLASTICS PER $1m R REVENUE

PLASTIC-IN-SUPPLY-CHAIN

Trucost calculations based on input-output modelling techniques (full methodology available in appendix 3 of this report)

TABLE 2: PLASTIC INTENSITY PER SECTOR (TONNES PER $1m REVENUE)
Plastic-in-packaging

Plastic-in-product

Plastic-in-supply-chain

Toys

Sector

2.9

37.5

7.6

Total

48.0

Soft drinks

14.9

-

19.7

34.6

Furniture

0.8

15.2

10.9

26.9

Durable household goods

1.6

16.2

7.2

25.0

Footwear

3.6

13.8

6.8

24.2

Athletic goods

0.8

16.7

4.0

21.5

Personal products

5.9

not estimated

10.0

15.9

Non-durable household goods

1.0

9.7

3.8

14.4

Automobiles

0.0

4.5

5.3

9.9

Food

3.2

-

6.3

9.5

Consumer electronics

0.4

4.7

3.6

8.7

Clothing and accessories

0.2

3.3

4.7

8.2

Medical and pharmaceutical products

3.1

-

3.5

6.6

Restaurants

1.2

-

3.2

4.4

Tobacco

0.3

0.7

2.5

3.5

Retail

0.5

-

1.5

2.1

27

WHAT IS THE MAGNITUDE OF THE NATURAL CAPITAL COST?
The use of plastic causes environmental and social impacts that can be expressed inmonetary terms to reflect the scale of damage caused – the ‘natural capital cost’. As explainedin the methodology and appendices 3 and 4, natural capital encompasses natural resources suchas clean air and water, and environmental services such as food and climate regulating services.
Economic activity depends on these resources and services; however, they are not often factored
into corporate accounting. By putting a monetary value on environmental resources and services,companies can understand their dependency on natural capital and factor it into business strategy.
For example, the production of plastic produces greenhouse gases, which contribute to climatechange, which may have severe societal and economic repercussions. By calculating the quantity ofgreenhouse gases generated by the production of plastic, and putting a dollar value on each tonneof greenhouse gases in relation to its impact on climate change, these impacts can be factored incorporate decision making.
As part of this report, only the natural capital cost of direct plastic use has been quantified.
This means that the natural capital cost associated with plastic-in-supply-chain has been
excluded, for lack of data. In addition, certain potentially significant impacts have been
excluded, such as the impacts associated with microplastics. Science has yet to catch up forthese impacts to be included these in the analysis.
Figure 8 highlights the total natural capital cost of direct plastic use in 2012 for each sector. Purple
circles display the natural capital intensity, or total natural capital cost per $1m revenue, from plastic
use for each sector. The percentage figures indicate the percentage contribution of the sector to thetotal natural capital cost of the consumer goods industry.
The overall natural capital cost of plastic use by the consumer goods industry is over $75bn.
While the toy sector has the largest natural capital intensity, at 3.9% of revenue, or $39,000 per $1mrevenue, it is one of the smaller contributors to the overall total natural capital cost at just 4%. The
food sector has one of the lowest plastic intensities, at 0.3%, but a total natural capital cost of $18bn
and contributes 23% to the overall consumer goods natural capital cost. The soft drinks sector is thesecond larger contributor (12%), at $9bn, followed by the non-durable household goods sector, atover $7bn (10%).
The sector-specific results section (appendix 1) provides a sector-specific breakdown andcommentaries of these figures.
FIGURE 8: TOTAL NATURAL CAPITAL COST ($) AND REVENUE AT RISK (NATURAL CAPITAL INTENSITY)PER SECTORTOTAL NATURAL CAPITAL COST

23%

18,0004%

14,0003%

12,00010,000

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PERCENTAGE OF REVENUE AT RISK

16,000TO

TOTAL NATURAL CAPITAL COST ($m)

PERCENTAGE OF REVENUE AT RISKCorresponds approximately to over 80 million tonnes of plastic.Trucost calculations derived from, but not limited to, WorldBank [7]; PlasticsEurope [8]; Eurostat [9], and the US EPA [10] datasets (full set of references and methodology available
in appendices 3 and 4 of this report)28

Depending on the type of product manufactured, the service life of plastic will vary. For
example, cars have an average service life of 12.5 years, compared to short-lived products
such as non-durable household goods or packaging. In order to take into account the durabilityof the products and packaging manufactured, Trucost divided the total natural capital cost of eachsector by the average service life of the main product manufactured within that sector. The result is anormalized figure per sector.
The overall total natural capital cost per service year is $35bn. Figure 9 displays the total natural
capital cost and intensity per service year for each sector. The total natural capital cost of the foodsector per service year is $9bn – equivalent to 25% of the total natural capital cost of the consumer
goods industry per service year. The non-durable household goods sector is the second larger
contributor (20%) and has a total natural capital cost per service year of $7bn, followed by the softdrinks (13%) and the retail sector (8%).
FIGURE 9: TOTAL NATURAL CAPITAL COST ($) AND REVENUE AT RISK (NATURAL CAPITAL INTENSITY)PER SECTOR, NORMALIZED BY SERVICE YEARPERCENTAGE OF REVENUE AT RISKTOTAL NATURAL CAPITAL COST PER SERVICE YEAR

1.2%

10,000
25%

1.1%
1.0%

8,000

20%

0.9%

7,000

0.8%

6,000

0.7%

5,000

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13%

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D
O
PR

FU

0.2%

2%

YS

E

TS
U

U

C

IE
R
SO

ES
C

AL
N

SO
R

TH
LO
C

R

S

O

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C
BA

TO

AC
D
AN
G
IN

PE

U
O
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LE
AB
R
U

2%

M

ED

IC

AL

N

O

AN

N

-D

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FO

O

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TW

ET

AI

KS

S
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SO

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G
LD
O
SE

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IN

D
O

FO

O

O

D

0

L

1,000

3%

TO

3%

O

4%

IT

2,000

PERCENTAGE OF REVENUE AT RISKTOTAL NATURAL CAPITAL COST ($m)

9,000Corresponds approximately to over 80 million tonnes of plastic.Trucost calculations derived from, but not limited to, WorldBank [7]; PlasticsEurope [8]; Eurostat [9], and the US EPA [10] datasets (full set of references and methodology available
in appendices 3 and 4 of this report)

TABLE 3: TOTAL NATURAL CAPITAL COST ($) AND NATURAL CAPITAL INTENSITY

SectorTotal Natural

Revenue atTotal Natural

Capital Costrisk (natural

Capital Cost ($m)($m) per Service

capitalYearintensity)

Revenue at risk (natural
capital intensity) normalized
by service year

Food

17,700

8,900

0.3%

0.2%

Non-durable household goods

7,500

7,100

1.0%

1.0%

Soft drinks

9,000

4,500

1.5%

0.7%

Retail

5,800

2,900

0.1%

0.0%

Footwear

4,200

2,700

1.7%

1.0%

Tobacco

900

2,200

0.1%

0.3%

Personal products

2,100

1,000

0.6%

0.3%

Clothing and accessories

4,200

1,500

0.3%

0.1%

Furniture

6,600

1000

1.5%

0.2%

Durable household goods

4,700

800

1.7%

0.3%

Toys

3,300

700

3.9%

0.9%

Consumer electronics

1,400

600

0.5%

0.2%

Restaurants

1,100

500

0.1%

0.1%

Automobiles

6,900

500

0.4%

0.0%

Athletic goods

1,100

200

1.7%

0.4%

400

200

0.3%

0.2%

Medical and pharmaceutical products29

Total and per service year natural capital cost and intensity are both useful to understand thelong term risk of plastic mismanagement. External stakeholders such as governments, pressuregroups and research institutes are more likely to focus their regulatory and advocacy efforts on
sectors which are responsible for the larger proportion of plastic-related impacts, especially when the
products or packaging are short-lived. These efforts could lead to tougher regulation or campaigns
targeting high-profile brands.
Total natural capital intensity represents the percentage of revenue of each sector that is at risk if
the impacts of plastic mismanagement had to be internalized by companies. The larger the natural
capital intensity, the larger the revenue at risk. Hence, while the food sector might be a focus forregulators and other stakeholders, its total natural capital intensity is one of the lowest in the
consumer goods sector, with only 0.3% of its overall revenue at risk.
Natural capital cost as a percentage of economic costs is another useful metric forbusinesses. The economic cost includes the cost of buying plastic, and the cost of treating it afterits disposal, either through recycling, landfilling or incineration with and without energy recovery. On
average, the total natural capital cost of plastic use is 52% of total economic costs. Depending on
the sector and region, end-of-life economic costs are usually not incurred by businesses. When only
considering the upstream natural capital cost as a percentage of plastic prices, the potential cost
increase is 44% on average. This means that if the upstream impacts of plastic were paid for in fullby businesses, the price of plastic would by 44% higher on average.

WHAT ARE THE MOST SIGNIFICANT IMPACTS?
Over 75% of the known and quantifiable impacts associated with plastic use are located in
the upstream portion of the supply chain across all sectors. ‘Upstream’ refers to impacts
generated from the extraction of raw materials to the manufacturing of plastic feedstock.
‘Downstream’ refers to impacts generated once the product has been discarded by the consumer.
While this depends on the sector, type of plastic and application, upstream impacts have beenstudied in a more complete and consistent way than downstream ones, hence leading to data
inconsistency and potential underestimation, especially in the downstream portion of the
supply chain.
Figure 10 illustrates the variation among sectors. The tobacco sector has the largest downstream
impact, at 29% of its total impact. This is mainly due to the impact of plastic used in cigarette filters
which are often littered after use. At the other end of the spectrum, the consumer electronics sector
has the lowest downstream impact as a proportion of total impact (17%), mainly due to recycling
initiatives in North America and Europe.
The sector-specific results section (appendix 1) provides a sector-specific breakdown andcommentaries of these figures.

DOWNSTREAM: PLASTIC-IN-PRODUCTDOWNSTREAM: PLASTIC-IN-PACKAGINGUPSTREAM: PLASTIC-IN-PRODUCTUPSTREAM: PLASTIC-IN-PACKAGING

100%
80%
60%
40%

D
ES
S
SO
R
FO
IE
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S
AB
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TW
LE
AU
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LD

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PR
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N
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AL

LE

C

C

AN
TS

O

0%

D

20%

BA

PERCENTAGE CONTRIBUTION TO TOTAL NATURAL CAPITAL COST

FIGURE 10: UPSTREAM AND DOWNSTREAM IMPACT DISTRIBUTION

Trucost calculations derived from, but not limited to, World Bank [7]; PlasticsEurope [8]; Eurostat [9], and the
US EPA [10] datasets (full set of references and methodology available in appendices 3 and 4 of this report)

30

Measures put in place to better manage plastic often have a consequence on upstream anddownstream impacts at the same time. For example, lightweighting decreases both the upstream
and downstream impact through material reduction, provided that recycling rates can be maintained.
Similarly, increasing the recycling rate at the end-of-life may have a positive impact on the availabilityof recycled content, either to the business itself through closed-loop recycling, or to otherbusinesses. A direct implication is that initiatives and measures could be more focused on the way
plastic is used (in packaging or product) rather than a lifecycle stage in particular.
Table 4 highlights the total natural capital cost of products and packaging as a percentage
of total natural capital cost. This gives an indication of where there is the most potential toreduce plastic intensity. These results are particularly useful for sectors that use both plastic in
product and packaging. For example, 68% of the tobacco sector’s total natural capital cost is
attributable to plastic in product, rising to 91% in the non-durable household goods sector.
Companies in this sector have focused recent improvements on packaging, when higher benefits
could have been be achieved by focusing on products.
TABLE 4: TOTAL NATURAL COST PER SECTOR SPLIT BETWEEN PRODUCT AND PACKAGING, UPSTREAM AND DOWNSTREAM
Product
Sector

Upstream

Downstream

packaging

Total

%

Upstream

Downstream

Total

Total

%

Food

-

-

-

0%

13,0004,700

17,700100%

17,700Soft drinks

-

-

-

0%

6,800

2,100

9,000

100%

9,000

Non-durable
household goods

5,300

1,500

6,800

91%

500

200

700

9%

7,500

Automobiles

5,600

1,100

6,800

99%

100

<100

100

1%

6,900

Furniture

5,200

1,000

6,200

95%

300

100

300

5%

6,600

-

-

-

0%

4,400

1,400

5,800

100%

5,800

Durable household
goods

3,500

700

4,200

89%

400

100

500

11%

4,700

Footwear

2,700

600

3,300

79%

700

200

900

21%

4,200

Clothing andaccessories

3,100

800

3,900

93%

200

100

300

7%

4,200

Toys

2,400

700

3,100

93%

200

100

200

7%

3,300

-

-

-

0%

1,600

500

2,100

100%

2,100

1,100

200

1,300

92%

100

<100

100

8%

1,400

Athletic goods

900

200

1,100

95%

-

<100

100

5%

1,100

Restaurants

-

-

-

0%

800

300

1,100

100%

1,100

400

200

600

68%

200

100

300

32%

900

-

-

-

0%

300

100

400

100%

400

RetailPersonal products
Consumerelectronics

TobaccoMedical andpharmaceuticalproducts

31

Understanding the distribution of the total natural capital cost by impact is useful to identify
which specific initiative or measure may have the most beneficial impact. For example, if themain contributing impact to the total natural capital cost of plastic in a sector is upstream greenhousegases, companies should further investigate this area to find a way to reduce these emissions.
Figure 11 and 12 provide a weighted understanding of the materiality of different impacts.
The model used in this report suggests that the most significant impact of plastic-in-packaging isgreenhouse gas emissions generated during the extraction and processing of raw materials to makeplastic feedstock, followed by land and water pollution. The impact of littered plastic packaging
reaching the ocean at the end-of-life is a significant contributor. As the downstream impacts,
especially littering impacts, of plastic are more studied, the relative order of magnitude is likely
to change.
The model also suggests that upstream emissions of greenhouse gases are also the most significant
impact for plastic-in-product, followed by land and water pollution. The model used in this report
assumes very few plastic products end up in the ocean; hence the ocean impact of plastic products
is significantly less than that of packaging. Additive leachate at the end of the product’s life is also asignificant issue.
The sector-specific results section (appendix 1) provides a sector-specific breakdown andcommentaries of these figures.

PERCENTAGE CONTRIBUTION TO TOTAL NATURAL CAPITAL COST

FIGURE 11: PLASTIC-IN-PACKAGING NATURAL CAPITAL COSTS COMPARED

50%

UPSTREAM45%

DOWNSTREAM

40%
35%
30%
25%
20%
15%
10%
5%
0%

GHGS

WATER

TOTAL
LAND &WATER
POLLUTANTS

TOTAL
AIR
POLLUTANTS

ADDITIVESDISAMENTIY

OCEAN

Trucost calculations derived from, but not limited to, World Bank [7]; PlasticsEurope [8]; Eurostat [9], and the US EPA [10]datasets (full set of references and methodology available in appendices 3 and 4 of this report)

PERCENTAGE CONTRIBUTION TO TOTAL NATURAL CAPITAL COST

FIGURE 12: PLASTIC-IN-PRODUCT NATURAL CAPITAL COSTS COMPARED

50%

UPSTREAM45%

DOWNSTREAM

40%
35%
30%
25%
20%
15%
10%
5%
0%

GHGS

WATER

TOTAL
LAND &WATER
POLLUTANTS

TOTAL
AIR
POLLUTANTS

ADDITIVESDISAMENTIY

OCEAN

Trucost calculations derived from, but not limited to, World Bank [7]; PlasticsEurope [8]; Eurostat [9], and the US EPA [10]datasets (full set of references and methodology available in appendices 3 and 4 of this report)

32

The total weighted natural capital cost of plastic on marine ecosystems is $13bn.
Understanding the natural capital cost of plastic ending up in oceans is an area that has seldom
been included in end-of-life analysis. Nevertheless, it contributes a non-negligible part of the total
end-of-life and total lifecycle impacts. On average, the impact of plastic on marine ecosystems
accounts for 17% of total lifecycle impacts. There are large variations across sectors, from 20% in
the restaurant sector to less than 1% in the automobile sector. This percentage rises to 42% on
average when calculated as a percentage of end-of life impacts only.

OCEAN COSTPERCENTAGE CONTRIBUTION TO TOTAL NATURAL CAPITAL COSTS

25%

TOTAL NATURAL CAPITAL COST ($m)

6,000
5,000

20%

4,000
15%
3,000
10%
2,000
5%

1,000

0%
TO
YS
TW
H
EA
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LD
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ET
A
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IE

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S

0

PERCENTAGE CONTRIBUTION TO TOTAL NATURAL CAPITAL COSTSFIGURE 13: TOTAL NATURAL CAPITAL COST OF PLASTIC IN MARINE ECOSYSTEMS ($)

Total natural capital costs correspond approximately to over 80 million tonnes of plastic.Trucost calculations derived from,but not limited to, World Bank [7]; PlasticsEurope [8]; Eurostat [9], and the US EPA [10] datasets (full set of references andmethodology available in appendices 3 and 4 of this report)

WHERE DO IMPACTS OCCUR?
Impacts vary across regions based on waste management infrastructure, local geographicalconditions and the size of the consumer goods industry. Collection and recycling rates varyacross regions affecting the types and quantity of pollutants emitted and the portion of plastic ending
up as litter or in marine ecosystems. Local conditions influence the magnitude of the impact – forexample, emitting one tonne of pollutants (e.g. to manufacture plastic feedstock) in a populated
region (e.g. Asia) has a higher natural capital impact than emitting the same tonne of air pollutants
in a sparsely populated region. These variables will therefore influence the natural capital intensityof producing and disposing of plastic. Finally, the larger the sector in one particular region, the larger
the total natural capital cost.
Understanding regional variations in natural capital intensity of plastic use and disposal may
be useful for companies to decide where to focus their efforts geographically. For example,
efforts could be focused where local infrastructure is poor and emissions have a larger impact.
Figure 14 highlights upstream and downstream geographical regions. Figure 15 highlights the total
natural capital cost of plastic per sector in different regions. It should be noted that transboundary
trade and shipping of waste has not been taken into account. These figures are based on theassumption that a tonne of plastic bought in North America has been manufactured in North
America. Similarly, plastic waste disposed of or littered in Oceania is assumed to be treated in
Oceania. This may underestimate the impacts of disposing plastic waste in region where it is likely
to be shipped to another region.
Sourcing plastic in Oceania and North America is likely to be the best option in terms of natural
capital, while sourcing in Asia the worst. This is of concern given that plastic production is increasing
rapidly in Asia. Companies that purchase more plastic in Asia are likely to increase their exposure tonatural capital risk. In addition, disposing of and treating plastic-in-packaging and plastic-in-productin Asia has one of the largest natural capital intensities, so increased sales in this region of the world
are likely to increase companies’ exposure to natural capital risk unless companies take steps inimproving local waste collection and recycling infrastructure. In contrast, disposing of and treating
plastic-in-packaging in Europe, Oceania and the United States have lower natural capital cost thandisposing of and treating plastic waste in other regions.

33

FIGURE 14: NATURAL CAPITAL INTENSITY DISTRIBUTION ($ PER TONNE OF PLASTIC)

900
800
700
600
500
400
300
200
100
0

900
800
700
600
500
400
300
200
100
0

NORTH AMERICAEUROPE

900
800
700
600
500
400
300
200
100
0

900
800
700
600
500
400
300
200
100
0

ASIA

900
800
700
600
500
400
300
200
100
0

900
800
700
600
500
400
300
200
100
0

AFRICALATIN & CENTRALAMERICA

UPSTREAM

OCEANIA

PACKAGING DOWNSTREAM (WEIGHTED AVERAGE)

PRODUCT DOWNSTREAM (WEIGHTED AVERAGE)

Trucost calculations derived from, but not limited to, World Bank [7]; PlasticsEurope [8]; Eurostat [9], and the US EPA [10] datasets(full set of references and methodology available in appendices 3 and 4 of this report)

FIGURE 15: DISTRIBUTION OF NATURAL CAPITAL IMPACTS, BY BUSINESS SECTOR

EUROPE[$22bn]NORTHAMERICA[$13bn]ASIA[$27bn]21%

17%
LATIN & CENTRALAMERICA[$8bn]

24%
29%
AFRICA[$3bn]

34%

OCEANIA[$850m]23%

AUTOMOBILESSOFT DRINKS AND ICE

CLOTHING & ACCESSORIESDURABLE HOUSEHOLD GOODS

FOOD

TOBACCONON-DURABLE HOUSEHOLD GOODSFURNITURE

MEDICAL AND PHARMACEUTICAL PRODUCTSPERSONAL PRODUCTSRETAILCONSUMER ELECTRONICS
ATHLETIC GOODSTOYS

FOOTWEARRESTAURANTS

Corresponds approximately to over 80 million tonnes of plastic.Trucost calculations derived from, but not limited to, World Bank [7];PlasticsEurope [8]; Eurostat [9], and the US EPA [10] datasets (full set of references and methodology available in appendices 3 and
4 of this report)

34

WHAT IS THE STATE OF DISCLOSURE?
Measurement is the first step towards good management. What is measured can be managed.
Disclosure is central to good management – whether on the plastic footprint, the targets, andachievements. As outlined in the introduction, reporting ensures transparency, accountability
and collaboration.
Out of the 100 companies analysed, approximately half disclose useable quantitative
information on plastic. Disclosure has been assessed on the following quantitative indicators:
total or partial volume of plastic, percentage of recycled content and bio-based materials, upstream
initiatives that have resulted in materials savings, downstream initiatives and take-back programs.
To be “usable” the data provided needed to be clear as to coverage and granularity of application.
Many companies disclosed both quantitative and qualitative data that could not be integrated within
the calculations.
Disclosure rates vary from 0% in the athletic goods and footwear sector to 88% in the durable
household goods sector. Types of disclosure vary depending on the sector. The durable household
goods, consumer electronics and automobile sectors are more likely to report on take-back schemes,
while the retail sector discloses the quantity of plastic bags saved. Most companies in the sample
disclose qualitative information as well. While these levels of disclosure may appear high at first sight,
disclosure is understood here in a broad way. Any type of quantitative disclosure that could be used toassess the impact of plastic use of each company has been counted as “disclosure”.
Table 5 lists the companies assessed within the framework of this report and the primary sector towhich they were mapped. Information on specific disclosure and sources can be found in Appendix 5.

TABLE 5: COMPANIES ASSESSEDSectorAthletic goods
Automobiles
Clothing and accessories
Consumer electronics

company

Amer Sports, Anta Sports, Jarden Corporation, Peak Sport
Daimler, Fiat, Ford, General Motors, Nissan, Toyota, Volkswagen
Fast Retailing, Gap, Hanesbrands, Hennes & Mauritz, Inditex, Kering, VF Corp
Apple, Canon, Hewlett Packard, LG Electronics, Ricoh, Samsung, Sony

Durable household goods

Arcelik, Electrolux, Husqvarna, Indesit, Makita, Panasonic, Seb, Whirlpool

Food

Danone, Kellogg, Meiji Holdings, Mondelez International, Nestle, Pepsico

Footwear

Asics, Belle International, Daphne Holdings, Salvatore Ferragamo, Stella Holdings, Tod’s

Furniture

Ekornes, Fortune Brands Home and Security, Interface, Legget & Platt, Mohawk, Samson Holding

Medical and pharmaceutical products
Non-durable household goods
Personal products

Abbott Labs, Johnson & Johnson, Merck, Novartis, Pfizer, Sanofi
Clorox, Colgate Palmolive, Kao Corp, Kimberly Clark, Procter & Gamble, Reckitt Benckiser, Svenska Cellulosa
Avon, Beiersdorf, Estee Lauder, L’Oreal, Natura Cosmeticos, Unilever, Shiseido

Restaurants

Bidvest Group, Compass, McDonalds, Sodexo, Starbucks, Sysco

RetailCarrefour, Costco, CVS Caremark, Kroger, Tesco, Walmart Stores

Soft drinks
TobaccoToys

Britvic, China Huiyuan Juice, Coca Cola Company, Dr Pepper Snapple,
Lotte Chilsung, Uni-President, Tingyi, Want Want China
Altria Group, British American Tobacco, Imperial Tobacco, Japan Tobacco, Philip Morris, Reynolds American
Hasbro, Hornby, Mattel

35

Trucost found no robust correlation between disclosure rates and the natural capital intensityof each sector’s plastic use or its total natural capital cost, suggesting that disclosure is not yet
driven by a clear understanding of risks and opportunities faced by companies. On the other hand,
sectors with higher disclosure rates seem to be exposed to regulatory or reputational pressures. For
instance, the durable household goods and consumer electronics sectors, with disclosure rates of
88% and 71% respectively, are covered by the EU directive on waste electrical and electronicequipment and other equivalents. The retail and food sectors, with rates of 67%, have received
considerable media attention around plastic waste. Reporting pressures thus appear to be driven
mainly by regulatory and reputational considerations. This can change in the future as companies
become aware of the risks and opportunities of plastic use measurement, reporting and management.
Table 6 and figures 16, 17 and 18 show the results of the disclosure analysis. ‘Disclosure on at least
one data point’ is the percentage of companies in each sector that report at least one useable
quantitative figure. ‘Disclosure on quantity’ and ‘disclosure on recycled/bio-based/re-used content’refers to the percentage of companies that report at least usable partial information on the quantity ofplastic used and its recycled/bio-based/re-used content. Average ‘plastic’ occurrences is the average
number of times the word ‘plastic’ appears in reports published by companies in each sector (butdoes not include counts of related terms such as ‘polymer’).
The sector-specific results section (appendix 1) provides a sector-specific breakdown andcommentaries of these figures.
TABLE 6: disclosure analysis

Disclosure on
Sectorat least one

Disclosureuseable dataon quantity

point

Disclosure on

Disclosure on

recycled/

both quantity

bio-based/

and recycled/

re-usedbio-based/

content

re-used content

Averageoccurrences of
the word

Number ofcompanies
included in the‘plastic’ indisclosurecompany’s

analysis

disclosure

Durablehousehold goods

88%

63%

38%

25%

1

8

Non-durable
household goods

71%

29%

43%

14%

1

7

Consumer electronics

71%

29%

43%

14%

2

7

Personal products

71%

14%

29%

0%

1

7

Food

67%

33%

50%

17%

2

6

Retail

67%

0%

0%

0%

2

6

Clothing and accessories

57%

29%

29%

0%

1

7

Soft drinks

50%

13%

13%

0%

1

8

Medical andpharmaceutical products

50%

0%

0%

0%

0

6

Toys

33%

0%

0%

0%

4

3

Restaurants

33%

0%

33%

0%

0

6

Furniture

33%

0%

17%

0%

1

6

Automobiles

29%

0%

14%

0%

2

7

Tobacco

17%

17%

17%

17%

0

6

Athletic goods

0%

0%

0%

0%

0

4

Footwear

0%

0%

0%

0%

0

6

36

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PERCENTAGE OF COMPANIES DISCLOSING ON
RECYCLED/BIO-BASED/RE-USED CONTENTPERCENTAGE OF COMPANIES DISCLOSING ON
PLASTIC USE QUANTITY
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PERCENTAGE OF COMPANIES DISCLOSINGON A LEAST ONE DATA POINT

FIGURE 16: PERCENTAGE OF COMPANIES DISCLOSING ON AT LEAST ONE DATA POINT
100%
90%

80%

70%

60%

50%

40%

30%

20%

10%

Trucost calculations derived from companies public disclosure (full set of references andmethodology available in appendices 3 and 5 of this report)

FIGURE 17: PERCENTAGE OF COMPANIES DISCLOSING ON PLASTIC USE QUANTITY
70%

60%

50%

40%

30%

20%

10%

Trucost calculations derived from companies public disclosure (full set of references and methodology
available in appendices 3 and 5 of this report)

FIGURE 18: PERCENTAGE OF COMPANIES DISCLOSING ON RECYCLED AND BIO-BASED CONTENT

60%

50%

40%

30%

20%

10%

0%

Trucost calculations derived from companies public disclosure (full set of references and methodology
available in appendices 3 and 5 of this report)

37

WHAT ARE THE NATURAL CAPITAL BENEFITS OF GOOD
PLASTIC MANAGEMENT?
Good management practices represent an opportunity for businesses that use plastic and canlead to substantial natural capital cost savings. The baseline figures presented throughout thereport are based on impacts, and do not include the benefits of recycling or incineration with energy
recovery at the end-of-life of products and packaging. Recycling benefits include the avoided impactsof the quantity of plastic that would have been produced if the recycled material had not been
available, as well as the avoided impacts of where the plastic would have ended up (littered,landfilled) if it had not been recycled. Benefits of incineration with energy recovery include the avoided
impacts of grid electricity production. Appendix 3 outlines the methodology used to assess
these benefits.
Taking these benefits into account decreases the total natural capital cost from over $75bn to around$72bn. These waste management practices save $4bn a year. Figure 19 displays how this $4bn issplit across sectors and products. Initiatives in the food and soft drinks sectors contribute 27% and
17% respectively to the total savings.

FIGURE 19: NATURAL CAPITAL COST SAVINGS DUE TO CURRENT RECYCLING AND
INCINERATION WITH ENERGY RECOVERY RATEPACKAGING
PRODUCT

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TOTAL NATURAL CAPITAL COST SAVINGS DUE TO CURRENTRECYCLING AND ENERGY RECOVERY RATES ($m)

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US EPA [10] datasets (full set of references and methodology available in appendices 3 and 4 of this report)

M

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The same analysis can be carried out using company disclosures. Figure 20 shows the total
natural capital cost savings that can be attributed to the use of recycled content in products andpackaging for selected companies in each sector. These vary between zero and $153m in 2012.
This data only takes into account companies that disclosed quantified savings, so is likely to beunderestimated as many companies disclosed their use of recycled content in qualitative terms. The
largest benefit is in the food sector with savings equivalent to $153m, or 8% of the natural capital costof plastic, followed by the soft drink sector ($57m and 4% respectively) and the furniture sector ($16m
and 24% respectively). No company in the toys, athletic goods, retail, and footwear or restaurants
sector disclosed useable data on recycled content.

38

FIGURE 20: NATURAL CAPITAL SAVINGS DUE TO THE USE OF RECYCLED CONTENT
PACKAGING AND PRODUCT NATURAL CAPITAL COST SAVINGS

NATURAL CAPITAL COST SAVINGS ( $m)

180
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20

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Trucost calculations derived from, but not limited to, companies’ public disclosure, World Bank [7]; PlasticsEurope [8]; Eurostat[9], and the US EPA [10] datasets (full set of references and methodology available in appendices 3, 4 and 5 of this report)

SUMMARY
The global weighted average of plastic used by the consumer goods sector in their products andpackaging, but excluding plastic used solely within the supply chain, is 2 tonnes per $1m revenue. Thistranslates into a minimum natural capital cost for the consumer goods sector attributable to its plasticof over $75bn, with the food sector contributing 23% of this figure. When the lifespan of products andpackaging is taken into account, the annualized overall natural capital cost of the consumer goods
sector is $35bn, with the largest contributors being food (25%), non-durable household goods (20%),
soft drinks (13%) and retail (8%).
Companies with the highest total natural capital cost are most likely to experience externalpressures, such as legislation or scrutiny from the general public and non-profit organisation.
Plastic use measurement, management and disclosure are thus particularly relevant forcompanies operating in the food, soft drinks, non-durable household goods, automobiles,
and furniture sectors.
Natural capital intensity expresses the revenue-at-risk if the environmental impacts of plastic use had
to be internalized by companies. The toys sector has the highest natural capital intensity, at 3.9% of its
overall revenue, followed by the durable household goods, footwear and athletic goods sector (1.7%).
Sectors with the lowest natural capital intensities are the retail, restaurants and tobacco sectors.
Companies with the highest natural capital intensity have the highest proportion of theirrevenue at risk if they had to internalize the costs linked to their plastic use. Plastic use,measurement, and disclosure are thus particularly relevant for companies operating in thetoys, durable household goods, footwear and athletic goods sector.
On average, the total natural capital cost of plastic use is 52% of total economic costs. Over 75% of
impacts are located upstream in the supply chain across all sectors and most are due to greenhousegas emissions, followed by land and water pollution. At the end-of-life stage, the impact of plastic
reaching marine ecosystems is the largest contributor – 17% of the total natural capital cost on
average, or $13 bn. The non-durable household goods are the largest contributor to the overall ocean

39

natural capital cost. Upstream impacts are better understood than downstream impacts, which havelikely been underestimated as a result.
When assessing what actions could be taken to better manage their plastic use, companies needto understand how these actions will impact the overall impact. The model developed for this reportsuggests that actions tackling upstream greenhouse gas generation and downstream littering are
likely to have the most effect on the overall natural capital cost and intensity. The ‘Fishing for Litter’
case study in the next section provides insights on how to decrease marine litter impacts.
Impacts will vary across regions based on waste management infrastructure, local geographicalconditions and the size of the consumer goods sector. Regions with the highest natural capitalintensity – both upstream and downstream - are Asia, Latin America and Africa. With both production
and consumption growing in these areas, companies’ exposure to the risks of plastic is likely to grow,unless they take steps to improve production processes, waste collection, and recycling and recovery
practices in these regions. A limitation of this report is that it does not take into account transboundary
waste exchanges in its calculations.
Companies could develop an understanding of where the plastic material is sourced andwhere it is disposed. Actions to decrease the impact of plastic use in these regions of theworld where is it the highest will have the most effect on the overall natural capital costand intensity.
The first step towards good management is measurement, because without measurement, it is
impossible to properly manage. Disclosure of this plastic footprint is considered best practice. Out of
the 100 companies analysed, approximately half disclose useable quantitative information on plastic.
Disclosure rates vary from zero in the athletic goods and footwear sectors to 88% in the durable
household goods sector. While this figure may seem high at first sight, “disclosure” here is understoodin its broad sense and can comprise only one partial data point.
No correlation was found between natural capital cost, natural capital intensity, and rates of disclosure,suggesting that disclosure is not yet driven by a clear understanding of the risks and opportunities
associated with plastic use. Sectors that disclose information on plastic use seem to be those that are
most exposed to regulatory and reputational risks, rather than an understanding of the natural capitalcosts they face. This indicates that plastic is still a nascent issue, compared to others such as carbon.
As companies improve their measurement, management and disclosure, a correlation could develop in
their improved impact on natural capital.
Companies could disclose better, both quantitatively and qualitatively, on their use of plastic. For
example, the Plastic Disclosure Project provides guidance as to how to do this.
Plastic is a useful material with many benefits such as being lightweight and low cost. The main
challenge is to properly manage the negative impacts of plastic and improve the positive aspects.
Good management practices represent an opportunity for businesses that use plastic to achieve
substantial natural capital cost savings. Recycling and incineration with energy recovery save $4bn
in natural capital costs mainly due to initiatives in the soft drinks and food sectors.
Once companies have taken action, they could evaluate and report on the progress achieved.
Appendix 1 provides sector-specific breakdown and analysis, including company-level analysis andcase studies.
The next section details potential solutions and provides a roadmap for better plastic managementand disclosure.

40

Raising awareness through innovation:
Fishing for litter and the latest uses of ocean plastic
A handful of companies are finding new and innovative solutions that increase the use of recycled plastic, clean up plastic
litter from the world’s oceans, and raise public awareness about the impacts of plastic.
Fishing for Litter programs were first developed in the Netherlands in 2000 by the North Sea Directorate of the Dutch
Government and the fisheries association, and were expanded by Kommunenes Internasjonale Miljøorganisasjon (KIMO),
the local authorities’ international environmental organization. Since then, Fishing for Litter has grown in the North Sea
region to include programs in Scotland, south west England and the Baltic Sea. The programs work to reduce marine litterby encouraging fisherman to collect the litter they ‘catch’ while fishing, and bring back to shore. The program works withports and harbours to provide areas to deposit the trash, and with non-profit organizations and businesses to transfer it torecycling and waste recovery facilities.
Participation is voluntary and without financial compensation. Because the adverse impacts of marine litter on the fishingindustry are widely understood, the program is fuelled by a desire to spread good operating practices. A study published in
2002 demonstrated that the UK fishing industry loses over €33m ($31m) a year due to marine debris. Research focusing
on the Scottish Shetland fishing fleet found that marine debris could cost a vessel up to £30,000 ($45,000) a year.7
More than 210 boats in Scotland participate in Fishing for Litter, which operates in all Scottish ports. In south west
England, eight harbours and 111 vessels participate.60 Fishermen are important stakeholders in developing awarenessof marine litter and practical ways to clean it up. Fishing for Litter’s innovative approach to include fishermen along with
non-profit organizations, businesses, government officials and harbours, facilitates and develops participatory multistakeholder awareness of the issue.
In 2011, the success of Fishing for Litter programs in the North Sea inspired EU commissioner for maritime affairs andfisheries Maria Damanakis to announce a similar plan in the Mediterranean. The fishing for plastic plan started in France
and was later extended to Greece. This pilot project was coordinated by EU-level trade association the European Plastics
Converters, in collaboration with the public-private foundation Waste Free Oceans (WFO) and the fishing industry.63
This initiative is the first program of its kind to pay fishermen through the European Fisheries Fund to recover litter,
including plastic, and provides an extra source of income to fishermen while reducing pressure on fish stocks and cleaning
up local fishing grounds. Fishermen who participate in this program use specially designed equipment to recover the litter,some of which is provided by the pilot project. The innovative multi-stakeholder partnership program promotes cooperation
across sectors and raises awareness of the marine litter issue for the EU government and fisheries officials, the plastics
and fishing industries, and non-government organizations like WFO.
GhostNets Australia is an example of a fishing for litter-type organization that specifically targets fishing nets that havebeen abandoned, discarded or lost at sea. They can become entangled with other nets and marine litter, and can continue
to accidently catch marine life at sea or on beaches. The Australian government funded the start of the program in 2004.
The organization is now made up of over 22 indigenous Australian communities in the coastal areas of northern Australia, areas of west Australia, the Northern Territory and Queensland. The communities that recover these nets can either
properly dispose of them, or convert them into artistic products, such as colourful baskets that are woven from the nylon
threads of the fishing nets.62 GhostNets Australia is a successful example of innovation employed by a diversity of
stakeholders to reclaim highly destructive types of marine litter.
Interface is the world’s largest designer and maker of carpet tiles.34 In 2013, Interface introduced its Net-Works program tobuy waste fishing nets from local Philippine fishermen of the Danajon Bank, an environmentally sensitive and ecologicallydiverse reef system that is one of only six double reefs in the world.63 Many modern fishing nets are made of plastic
nylon which will persist in the marine environment for an unknown period of time. With a density greater than water,
discarded nets can sink to the ocean’s floor and cause damage to fragile reefs and the surrounding marine life.
Interface’s Net-Works program sets up community banking systems to pay fishermen and villagers to collect, clean, sortand sell-back discarded fishing nets. These villagers can invest the money earned through the Net-Works program in new
financial opportunities including the creation of savings accounts, loans and micro-insurance. In collaboration with its
business partner Aquafil, Interface converts the nylon from these nets into 100% ECONYL recycled nylon yarn, with thesame quality and performance as virgin nylon yarn, to be used in their Net-Works blue ocean inspired carpet designs. The
recycled nylon yarn is a blend of pre-consumer waste such as scraps from industrial processed nylon, and post-consumer
waste such as the fishing nets.63 With 27,000 kg of nets collected from 24 villages (4,460 people), Interface is planning to
expand the program to other areas of the world.
Other companies are raising awareness about ocean pollution as well as utilising a new source of raw material by using
recovered plastic in their products. Home care and personal products company Method uses ‘ocean plastic’ that has beencollected by cleanup volunteers on the beaches of Hawaii to create post-consumer recycled blend plastic bottles for its

41

2-in-1 dish + hand soap.64 The bottles are grey in colour, with tags attached explaining that the reason is because they are
made with recycled ocean plastic.
UK-based cleaning and personal care company Ecover is using recycled ocean plastic in the production of its new ‘ocean
bottle’. This washing-up liquid bottle eliminates the use of fossil fuels in the supply chain, and replaces them with a
combination of 10% ocean plastic, with the rest a combination of sugarcane and post-consumer recycled plastic.65 They
are the first company to create plastic from the combination of these three materials. Ecover sources ocean plastic throughits partnership with the WFO and the North Sea Fishing for Litter programs.
Recycled plastic is also being used in clothing and fabric, such as by companies Patagonia and Nike. In 2010, Nike put
recycled plastic clothing on the world stage when they produced kits for all of their World Cup teams from recycled plastic
bottles harvested from landfills in Japan and Taiwan. Through the creation of these kits they removed the equivalent ofnearly 13 million plastic bottles from landfills.66
In February 2014, musician and fashion designer Pharrell Williams announced his denim jeans clothing line, RAW for
the Oceans. Williams, along with his company Bionic Yarn and clothing partner G-Star RAW, use recycled ocean plastic
reclaimed from coastlines to produce the fabrics and yarn in the jeans.67 Using fashion and popular culture, Williams isreaching a modern global audience, advancing innovation in the clothing sector, and making informed consumer choice a
fashion statement.

42

ROADMAP FOR PLASTIC
FOOTPRINT MANAGEMENT
Better upstream and downstream management of plastic will require collaboration between
stakeholders. The first step is for companies to measure and report on plastic. This section describes
how companies can report, and the role that other stakeholders can play in creating the conditions to
support disclosure. It goes on to discuss how companies can manage the upstream impacts of theiruse of plastic. Finally, it highlights downstream solutions and challenges.

MEASURING, REPORTING AND MONITORING
Companies’ measurement of plastic use can feed into mainstream reporting standards such as
the Global Reporting Initiative and CDP.54,68 The GRI enables companies to disclose plastic although
the requirement is expressed in general terms. EN1 and EN2 indicators in the latest version of theguideline, GRI-4, require companies to report on the total weight or volume of materials used to
produce and package products and the percentage of recycled input used. EN28 requires thepercentage of reclaimed products and packaging materials for each product category to be disclosed.
Similarly, understanding the carbon impact of its plastic consumption may feed into a company’s
disclosure to CDP on the scope 3 categories ‘material sourcing’ and ‘end-of-life waste’. Additional
reporting opportunities include the Sustainability Accounting Standards Board (SASB) and theInternational Integrated Reporting Council (IIRC).69,70 Finally, the Plastic Disclosure Project provides aframework specifically on plastic reporting.
Integrating information on plastic use and its impact into annual sustainability and corporatesocial responsibility reports can help companies differentiate themselves in the marketplaceand capture first-mover advantage by going beyond traditional issues such as carbon.
Regulation and reputation are currently the main drivers of disclosure. External stakeholders could
create the conditions amenable to greater measurement, disclosure and reporting. The Plastic
Disclosure Project provides a platform for companies to report and demonstrate leadership on the issueof plastic, specifically by inviting them to disclose on the production, use, handling and end-of-life of thismaterial in a standardised way. Companies and investors can then use this data to feed into product,
supply chain and investment strategies.
Aside from commercial confidentiality issues, the main barrier to better disclosure andmanagement appears to be a lack of transparency along the supply chain, all the way from raw
material sourcing to end-of-life. While companies may have an understanding of their own
material use, information on the plastic and chemicals embedded in items purchased from suppliers
may not be readily available. This is particularly true of the use of additives in plastic, for example, inthe clothing sector.71 The Plastic Disclosure Project and other reporting frameworks provide a usefulway to harmonize and compare data. However, this depends on companies taking the lead in engaging
and monitoring their supply chain. One tool to do this is Material IQ, a comprehensive business-tobusiness online registry designed to provide in-depth sustainability information about materials,
including chemical additives, used in a range of products and industrial sectors.94 Another tool is the
Plastic Scorecard, developed by BizNGO and Clean Production Action, which can serve as amechanism to help businesses move to environmentally preferable types of plastic.72
Measurement is the first step towards understanding a company’s use of plastic. With thisinformation companies can identify the economic, environmental and social impacts of plastic
consumption and make decisions on how to improve. Many of the companies in this research
make use of lifecycle analysis, with some disclosing the results. For example, Apple and Interface
make formal environmental product declarations linked to their main product categories, with the exact
material composition and associated impact.34,73 Industry bodies such as PlasticsEurope havepublished environmental profiles (or eco-profiles) for different types of plastics, from the extraction of
raw materials to the manufacturing of plastic feedstock.9 The next step could be to apply natural capitalvaluation in order to produce a single monetary figure which is easy to communicate to stakeholders
and which can facilitate business decision-making by allowing different impacts to be compared.

43Companies could collaborate with governments and research organisations to improve data on
the downstream impacts of plastic related to waste management. The end-of-life fate ofplastic products and packaging varies significantly depending on the geographical location, but minimal
country-specific data for different types of materials exists. Very few countries apart from the US andEU member states disclose detailed data on the amount of plastic going to waste management. In
addition, the amount of waste plastic going to different waste treatment routes such as incineration andlandfill is rarely disaggregated, yet the social and environmental impacts of these two options varysignificantly. This represents a challenge for companies that want to understand and take responsibility
for their downstream impacts, but which operate in many different countries.
Companies could work with research institutions, campaign groups and others to improve theirunderstanding of the environmental impact of littered plastic. At present there is only a limited
understanding of the impact of plastic litter on the environment. While this research gathered the best
available data to assess the end-of-life impacts of plastic, there are significant gaps in the information.
Specifically, there are gaps in the understanding of dispersion routes for plastic litter, and how likely it is
to be collected or enter the ocean. Experts also debate the quantity of plastic entering the ocean eachyear. Large uncertainties remain around degradation, leachate, and the toxicity of additives andde-adsorption rates of persistent bio-accumulative toxic substances. Similarly, the impact of
microplastics is only starting to receive attention. In 2010, the UN’s Joint Group of Experts on the
Scientific Aspects of Marine Environmental Protection (GESAMP) established a working group on thesubject and the UNEP’s 2011 Yearbook identified it as an emerging issues.74,75

DISCLOSING PLASTICS
The Plastic Disclosure Project is an initiative of the Hong Kong and California-based Ocean
Recovery Alliance (ORA). Its supporters include the UN Environment Programme (UNEP)
and the World Bank. The Plastic Disclosure Project participates in both of their related ocean
programmes (UNEP’s Global Partnership on Marine Litter, and the World Bank’s Global
Partnership for Oceans). Its mission is to encourage companies to report their performanceon plastic management through an annual survey, much as the CDP (formerly Carbon
Disclosure Project) has done with carbon.
Cosmetic company Lush was the first to disclose to the Plastic Disclosure Project.
Ecologic Brands, Paragon Communications, AWP Painting, Seventh Generation, Method Home,
PulpWorks, UC Berkeley, and San Francisco International (SFO) Airport are examples ofother companies and institutions that participate in the Plastic Disclosure Project questionnaire.
Companies can disclose either through a questionnaire or in their own sustainability or
integrated reports. The Plastic Disclosure Project is calling for collaboration with main
reporting standards, such as GRI, Earth Check, the Sustainability Consortium and the
Higgs Index in order to facilitate the reporting processes for companies and not
overburden businesses with a plethora of inconsistent requirements.
The Plastic Disclosure Project provides a detailed reporting guideline, with the key
quantitative questions highlighted below. Additional information can be found online atwww.plasticdisclosure.org

What is the estimated use (in tonnes) of plastic in the company’s operations andsupply chain?
Companies may disclose plastic used in operation (or direct plastic use) as a minimum.
Companies may also disclose around the quantity and type of additives used. Additional questions
include: What type and quantity of chemicals and additives have been used during the
manufacturing process? What type and quantity has been released to air, land and water? What
type and quantity remains within the product and packaging, and how likely is it to affect toxicity inthe use and end-of-life phase?
Explain the calculation methodology employed.
Scope and boundary should be clear. If possible, additional information could be provided on theplastic content of parts purchased from external suppliers, for example, batteries, displays
and keyboards.
What are the main types of plastic used in products and packaging, broken down by typeand volume?
If possible, these figures may be disclosed both at the company and the product level, by sourcing
location, as well as split between product categories and packaging (primary, secondary
and tertiary).

44

Additional questions include: What proportion of raw material has been wasted during the manufacturing process and how it is handled? Is it sent to landfill, incineration without energy recovery,
incineration with energy recovery, recycled in-house, recycled externally or re-used? This applies
to both plastic-in-product and plastic-in-packaging. If possible, this information could be provided
for plastic parts bought from external suppliers as well.
If recycled material is used, what percentage of the total material used is recycled or
bio-based content?
If possible, this figure may be disclosed both at company and product level, and split between
product categories and packaging (primary, secondary and tertiary). Information on the type ofrecycled and bio-based content could be provided, such as the type of recycling technology(mechanical or feedstock, for example) and the type of biomass used (corn or sugar-cane,for example).
What percentage of plastic used is biodegradable or recycled at end-of-life?
Is the organization aware of what happens to plastic used in its products and packaging after
its use by customers? What percentage is disposed of in landfills or other disposal locations?
How much is recovered as result of energy conversion (%) or recycling (%)?
Global data to be broken down between unmanaged waste and managed waste, landfilled,incinerated, incinerated with energy recovery, recycling, re-used, composted and other use (suchas fuel conversion). Information on potential take-back programs such as quantity of products andpackaging collected, type of materials recovered, and loss rates during the recovery process.
What percentage of plastic used is for short-user-life products or packaging?
This data point can help partially assess the efficiency of plastic usage.

PRODUCT AND PACKAGING DESIGNThe first and preferred upstream management option that is available to companies is reducing
the weight of plastic products. There has been a trend, most apparent in the packaging industry,
towards size reduction leading to a decrease in overall material intensity and operational cost
reductions. For example, Dr Pepper Snapple Group has decreased its use of polyethylene
terephthalate by 14m pounds (6m tonnes) in 2011 – or 31m (14m tonnes) pounds since 2007, saving
the company $25m in costs.76 Similarly, LG Electronics has reduced its use of packaging materials by
4.6% for new TV products and 20.1% for mobile phones in 2013, resulting in cost savings higher than
$13m.77 While laudable, these efforts are often offset by sales growth; how material use is decoupledfrom economic growth is unclear. Many other companies have set up goals for material reduction.
Yet, apart from the EU packaging directive, very few regulations exist on material use reduction in mostcountries. Beyond anecdotal examples, it is often hard to evaluate the extent to which these voluntary
goals are met.78
Another key trend is the continued growth in the market share of bioplastics, mainly inpackaging and car components, forecast to be 20% per year globally.79 Key drivers forbiodegradable polymers include decreasing landfill capacity, pressure from retailers, consumer
demand, and regulatory pressures on greenhouse gases, fossil fuel dependence and waste control.
Challenges to the adoption of bioplastic include limited applicability until its functionality matches thatof oil-based plastic, poor compatibility with existing equipment and end-of-life management systems,
higher production costs, and a lack of detailed information on its environmental and social impacts.
There are different types of bioplastic comprising materials that can either be bio-based, biodegradable
or both, and each presents different social, environmental and business risks and opportunities.
Bio-based plastic is made from natural resources, such as starch or sugar, but may notnecessarily be biodegradable. Examples of non-biodegradable bio-based plastics include bio-basedpolyethylene and polyester terephthalate. The bulk of market growth is projected to come from thisfamily of products, from 12% in 2007 to 38% in 2011.79 Debate exists around the environmental
superiority of this material, and it is essential to draw adequate assessment boundaries to include
potential impacts such as biodiversity loss, water consumption and fertiliser use. According to one
review, most lifecycle analyses show that bio-based plastic is better than oil-based equivalents on
aspects such as greenhouse gas emissions and fossil fuel consumption, but not necessarily for otherimpacts, such as eutrophication, manifested by algae blooms.79 In addition, some bio-based plastics
require land for production, which raises concerns over competition for land needed for foodproduction. However, second generation plastic production from sources that do not compete with
agricultural production, such as agricultural by-products including corn straw and waste sugar cane, ison the rise.80

45

Biodegradable plastic can be bio-based or oil-based and meet standards for biodegradability
and compostability. Degradable or oxo-degradable plastics are usually oil-based plastics to which
additives have been added to enhance the degradation, but do not meet biodegradability andcompostability standards.80 An example of bio-based and bio-degradable plastic is polylactic acid
(PLA), which dominates the market. Confusion often stems from inadequate labelling and lack ofconsumer knowledge, leading to recycling stream contamination. Furthermore, these plastics havedifferent degradation times and infrastructure needs, often requiring an industrial composter, rare in
most of the world, to biodegrade as advertised. If they were littered by the public based on theassumption that they will soon biodegrade by themselves, they would have the same end-of-life
environmental impacts as oil-based plastics. Stronger labelling requirements, educational programsand end-of-life sorting and monitoring are thus required to capture the benefits of this option. For
example, NatureWorks proposes its own buy-back scheme to manage the recycling
process themselves.81
Recycled plastic is gaining considerable attention across all industries. Treatment options include
mechanical and feedstock recycling among others, and suitability differs across plastic types. Sorting
remains a key issue. Due to the variety of plastic entering this waste stream, contamination may occur
resulting in lower-grade, down-cycled materials, the price of which is approximately half that of new
plastic.82 In contrast, food-grade recycled PET (rPET) plastic, which is frequently used in packaging, issold at a premium in most markets reflecting increased demand across multiple industries. The higher
price also reflects problems with current processing technology which makes it difficult to remove
contaminants, limiting supply.83
Reliability of supply has also been highlighted by several companies in the sample analysed.
Solutions include closed-loop recycling of in-house waste or investment in end-of-life take-backprograms. However, uptake remains limited. Similarly, environmental and human impacts havereceived recent attention when the process takes place in countries with less stringent regulations.
China, for example, dominates the supply of recycled plastics. Attention has grown recently on therecycling practices of products with additives, such as consumer electronics, due to their potential
health impacts when dismantled.
Chemical use in plastic has received regulatory attention due to the potential human health andenvironmental hazards across the lifecycle. While these substances play an essential role in
improving the functionality of plastic, they can potentially be dangerous to workers during
manufacturing and recycling processes, and to the general public through possible product leachate
under certain circumstances. Several substances are covered and regulated by legislation, such as
REACH in the European Union, while others have been banned such as PCBs in the US.84,85 Manycompanies are taking steps to phase out toxic substances such as phthalates, brominated flame
retardants and polyvinyl chloride.
Process innovation may help to tackle some of the issues associated with recycled plastic andbio-plastic, and lead to cost reduction while potentially generating additional revenue streams.
Several companies are implementing internal guidelines and commodity purchasing plans fordesigners, product managers and buyers to help them develop more sustainable products andpackaging, while making sense of all the information available. For example, Natura issued aguidebook in 2011 for the development of new products that includes increasing the use of
post-consumption recycled materials and the choice of finishing to increase recyclability.86 Similarly,
Hasbro’s sustainable packaging guidelines include information and an internal check list for designers
and engineers to compare packaging options on criteria such as number of packaging layers and typeof materials.87
Some companies are developing their own materials better suited to their specific requirements
in terms of functionality, cost and supply availability. For example, in 2012 Ricoh and Shizuoka
University developed a new type of PLA, polymerized at low temperatures, without the use of metalor organic solvents catalysts. According to Ricoh, this means the material can be produced in a safer
and cheaper way without compromising on quality.88 Another example is Sony’s SoRPlas developed in2011, which has 99% recycled content, the highest recycled material rate in the world according to thecompany’s sustainability report. This was made possible by the development of a proprietary flameretardant that reduces the proportion of additives to 1% of total content, thus allowing for a 99%
recycled content rate compared with 60% in typical electronics devices made of recycled plastic.89
Some companies have put in place innovative processes, for example, to improve recycling
technology. Interface’s ReEntry process, launched in 2007, is an example of companies taking thelead to overcome traditional recycling barriers. This process has the lowest embodied energy of allrecycling processes in the carpet industry while maximising the quantity of material recovered andminimising contamination.34 Another example is Panasonic’s resin-sorting system using near-infrared
rays to overcome the issue of plastic mixture, enabling a purity of over 99% of sorted materials.
This, along with optimizing the use of additives, has allowed extending the strength and quality of
appearances of recycled plastics.90

46

END-OF-LIFE MANAGEMENT
The value of packaging sent to landfill in the US in 2010 was more than $11bn, with plastic
accounting for more than 70% of this figure.78 Plastic packaging has the highest recycling rate
among plastic products, yet it is one the largest waste streams in US landfills and the most common
material that ends up in oceans. Downstream waste management thus poses risks and opportunities
from social, environmental and economic perspectives. Companies are taking voluntary steps tomanage their end-of-life impacts, but these are often the low-hanging fruit and not necessarily the mostsignificant from a social and environmental perspective. Regulations promoting extended producer
responsibility are also being passed in key areas such as packaging and electronic waste. However,these mainly focus on increasing the overall recycling rate and may have a perverse effect on the
management of plastic. As plastic is lighter than metal and glass, companies prioritize the recycling ofthese materials rather than plastic to meet the percentage required to be recycled. In addition,
regulations are weaker in regions where consumption is growing.
Collection rates are inadequate in many countries. For example, this research estimates that
57% of plastic in Africa, 40% in Asia, and 32% in Latin America is not collected. These materials
are either littered or burnt in the open, and eventually part of them make their way to the ocean. A 2013
research brief by Pritzer reviewed international instruments relevant to plastic marine litter and foundthat they have limited jurisdiction over major sources of plastic pollution, in particular land-based, andhave limited enforcement standards and mechanisms.37 The brief provides several recommendations
on the key steps to tackle this problem through new conventions, amendments of actual law and thecreation of an ‘Ocean Friendly’ certification program. One of the solutions appears to lie in creating avalue for the most common types of plastic as an incentive for recovery and implementation ofadequate collection and waste management structures to avoid plastic litter entering the environment in
the first place.
After reduction, reuse is often seen as the next most preferable option. Avon, for example, has
introduced refillable containers in its Mark Brand, which according to the company saves 0.15 pounds(0.07 kg) of materials at each refill.91 More broadly, retailers are promoting the replacement of
single-use plastic bags with reusable bags. These initiatives necessitate a change in consumer
behaviour that is not always straightforward to achieve. In addition, they represent a change in thebusiness model of companies, from product to solution thinking. In some instances, it is not clear
whether the overall environmental and social benefit is positive or negative when taking into accountthe full lifecycle. Pouches are not easily recyclable and companies are investigating viable businessmodels to manage the new types of waste generated, such as recovering some of the material andenergy contained through incineration.
Despite all technological advances in the reclamation of plastic, an important proportion of theplastic waste stream cannot be mechanically recycled due to contamination, lack of markets, orinability to separate plastics. MBA polymers is an example of company that can recycle mixed
plastics, however this is not yet common practice.92 A new generation of conversion technology
designed to manage non-recycled plastic using pyrolysis to convert plastic into oil and other fuels is
becoming increasingly established in Europe and Asia.93 One prominent player in the plastic to fuel field– British company Cynar – converts almost any kind of waste plastic by feeding it into a system where
it undergoes liquefaction, pyrolysis and distillation at a 95% conversion rate.94
Pyrolysis is being investigated by several companies in the peer group. For example, in an effort
to offer a practical solution to the problem of single-use sachet litter, Unilever investigated options
to recover as much of the energy used in the manufacturing process. Through an assessment ofwaste-to-energy options it concluded that pyrolysis was the most promising, proving that turning
sachets, pouches and other flexible plastic waste into fuel oil could be achieved at a viable cost.95
Despite the greenhouse gas emissions associated with fossil fuels, it could be argued that the process
is a possible alternative in that it offers a solution for difficult to recycle plastic such as bottle caps,
appliance plastic and food packaging. The process is not suitable for polyvinyl chloride
and polystyrene.94
Most companies have committed to operational waste reduction and recycling. Few companies,
depending on their sector, have also implemented take-back programs for their own or different
products. Regulations exist on overall recycling rates of certain products, such as the EU directives
on end-of-life vehicles and waste electrical and electronic equipment. However, as discussed
previously in this report, the focus on setting recycling rates using weight has often been to thedetriment of plastic recycling because its lighter weight makes it a low priority compared with othermaterials such as metals. Further improving the recycling rate for plastic, as well as improving
recycling processes and quality of plastic, could thus be a primary focus for companies andpolicymakers, particularly in a context where the supply of quality-recycled material does notmeet demand.

47

RECOMMENDATIONSGiven the implications of plastic use for companies in the consumer goods industry, this research
makes the following recommendations:
1. Raise awareness at the Board Level – Taking action to reduce the risks of plastic while
benefiting from the opportunities first involves raising the awareness of a company’s executive
board. The findings of this research provide the information needed to build a business case for theboard to sanction action.
2. Measure your plastic footprint. This research recommends that companies measure how muchplastic they use in their direct operations, and ideally in their supply chain, as the first step towards
understanding the implications of their plastic dependency. For companies in the consumer goods
industry, the findings in this report could provide a useful initial assessment tool.
3. Assess the risks and opportunities. Once the plastic footprint is calculated, the next step is to
identify the potential risks it poses in terms of emerging regulation, reputational damage and otherfactors. Companies will also benefit from assessing opportunities from improved plastic
management such as cutting costs through efficiency gains, generating new revenue streams
through ‘closed loop’ business models that recover useful resources locked up in plastic; andwinning customers by demonstrating more sustainable products.
4. Plan and implement a management strategy. Once companies understand the implications ofplastic for their business, they can set about developing a plan to address them. Companies canuse the plastic footprint results to identify product lines, types of plastic, sourcing and end-of-life
locations, as well as relevant environmental impacts that deserve further attention. To ensure thestrategy is robust and effective, companies could include quantitative performance targets.
Companies could use the disclosure to compare its performance with targets set in the strategy.
5. Take action. The management plan could include some or all of the following measures:a. Prepare your business for future regulation. Recognize, commit publicly and push forward
the agenda of extended producer responsibility policies and standards. This could help
companies to achieve first mover advantage on future bans, taxes and regulations.
b. Design products with the end in mind. Consider the overall environmental and reputational
impacts of products and packaging across the lifecycle and minimise the likelihood thatmaterials will be littered or escape into the environment. This includes prioritizing
environmentally preferable materials and chemicals, making use of tools such as Plastic
Scorecard, Material IQ, lifecycle analysis and natural capital valuation. It also includes
designing products and packaging to maximise recycled content, enable easy disassembly
and recycling, and ideally, ‘close the loop’ on waste so that valuable materials avoid landfill
and incineration without energy recovery and come back to industry as feedstock.
c. Evaluate carefully any alternatives such as bio-based plastics or biodegradable
additives. Confirm, or disprove, their environmental and social superiority by conducting
lifecycle assessments, natural capital valuation and other analyses.
d. Label plastic clearly for tracking, public information and recovery purposes. Proactively
collaborate with industry and government to agree pragmatic labelling schemes. Particular careshould be given to the labeling of biodegradable plastic that necessitates industrial composting
facilities. In particular, the use of ‘bio-based’ and ‘bio-degradable’ claims could be regulated anda standard developed to identify plastic that biodegrade fully under natural conditions and inmarine environments within an acceptable time frame.
e. Participate in community reuse, recovery and recycling programmes. Both economic andreputational opportunities exist in implementing and funding initiatives ranging from collection,
recycling, take-back and used swap schemes. For instance, by supporting higher recycling
rates, companies can develop new supply sources. When non-recyclable and non-reusable
materials are still being used, companies may investigate other end-of-life routes such as
incineration with energy recovery and waste-to-fuel options.

48

6. Publicly disclose. Companies would benefit from disclosing their plastic footprint, management
plans and progress on an annual basis. The disclosure could be part of an existing sustainability/
CSR report, following the Plastic Disclosure Project guidelines, or could be a separate Plastic
Disclosure Project disclosure if preferred.
7. Form collaborative partnerships with stakeholders, including suppliers, industry
associations, academic bodies, governments and environmental protection organisations
to promote industry-wide change and positive action.

COLLABORATION
SUPPLIERS
Companies can engage with their suppliers to support them in measuring and managing
their plastic footprint. This can promote a greater understanding of plastic use throughout
the whole supply chain, sensitise suppliers to issues around plastic, and generatemutual benefits.

REPORTING INSTITUTIONS
Companies can engage with reporting institutions to ensure that the issues around plastic
are recognised and included in reporting standards. Pushing for the harmonization ofreporting requirements is particularly important in a context where companies are being
asked to disclose on different platforms and issues.

RESEARCH INSTITUTIONS
Companies can partner with research institutions to derive valuable insights on plastic
management in particular, at the plastic type and product level. In addition, there is a
critical information gap on waste management routes and infrastructure at country level.
Companies could fund research and educational efforts to better understand the impact ofplastic. Areas of particular interest include: consistent lifecycle analyses of bio-based,biodegradable and degradable polymers, including criteria such as food supply and wateruse; landfill and littered plastic leachate; quantity of plastic entering the environment per
year and current concentration of plastic and additives; dispersion routes of plastic;
deterioration rate of plastic in different environments and conditions; microplastic impact
through ingestion and chemical effects; damage-oriented statistics on the impact of plastic
to evaluate the extent of its impact; understand the toxicity impact of additives through theestablishment of dose-response function curves, the probability of being released indifferent media and building up the food chain.

GOVERNMENTS
Companies can collaborate with governments, industry bodies and other institutions toencourage the extended producer responsibility agenda. Features of successful extended
producer responsibility programs include: “Financed and managed by producers; aggressive
recovery targets with enforceable penalties set by government for failure to meet goals;
participation by all industries that produce waste streams with each producer contributing
an equitable share to the program; transparent cost allocation; transparency in EPR collection
and recycling data, including data from commercial service providers; applies to commercial,industrial, and residential packaging; industry-funded away from home collection, as well as
curbside programs; sophisticated educational/promotional programs to ensure consumer
participation; mechanisms to work synergistically with existing container deposit programs;
levies and other market-based instruments; a focus on materials management and market
development for all recyclables; provisions to reduce and phase out use of non-recyclable
packaging and single-use items; no incineration – burning recyclable materials sends thewrong message to consumers and markets on materials conservation and efficiency.”78
Companies can collaborate with industry associations (ACC, PlasticsEurope), institutions(UNEP) and governments to identify practical solutions to plastic issues. This particularly
applies to international conventions covering marine litter. Companies and other stakeholders
could support the development of new enforceable standards to reach the Rio+20 goalof “achieving significant reduction in marine debris to prevent harm to coastal andmarine environments”.

49Companies can promote and support government, industry bodies and other institutions’focus on significant sectors and products by proactively looking for alternative material
and/or design. This particularly applies to sectors that manufacture short-lived andplastic-intensive products, and a potential restriction on the use of hard-to-manage
plastic, including microplastics.
INVESTORS
Companies can engage with the investor community to make the business case forgood plastic management. Investors would benefit from considering effective managementof plastic in their investment decisions through the use of natural capital valuation andinitiatives such as the Plastic Disclosure Project.

50

glossary
Term, acronym or abbreviation

Meaning

Additives

Chemical substances added to plastic materials in order to enhance its
properties, for example its resistance to heat or durability.

Benefit transfer

Technique by which an environmental value is transferred from one
location to another.

BurdenNegative environmental impacts.

CreditPositive environmental impacts.

Direct environmental impacts

Impacts from a company’s own operations.

Downstream

Life cycle state once the product is discarded by the consumer.

Disamenity

Nuisance caused by noise, odour, presence of vermin, etc.

Environmentally extended input-output model

A model that maps the flow of inputs and environmental impacts throughan economy.

Feedstock

Plastic granules or fibre before it is transformed into a finished productand packaging through different manufacturing processes, such as blow
moulding or film extrusion.

Incineration without energy recovery

End-of-life treatment route which consists of burning plastic waste.
Efficiency and environmental impact of incineration facilities vary
globally. A global average has been used in this report and the wordrefers to a family of technologies rather than a specific one.

Incineration with energy recovery

End-of-life treatment route which consists of burning plastic waste to
generate energy. Efficiency and environmental impact of incineration
facilities vary globally. A global average has been used in this report andthe word refers to a family of technologies rather than a specific one.

Indirect environmental impacts

Impacts from a company’s supply chain.

Industry

Refers to the overall consumer goods industry.

Marine litter

Marine litter comprises items that have been deliberately discarded orunintentionally lost, and has reached oceans and beaches.

Microplastics

Microplastics refer to smaller pieces, less than 5mm in size.

Natural capital

The finite stock of natural assets (air, water, and land) from which goods
and services flow to benefit society and the economy. It is made up of
ecosystems (providing renewable resources and services), andnon-renewable deposits of fossil fuels and minerals.

Natural capital cost

Expresses the impact to natural capital of processes and activities.
Derived by multiplying the natural capital intensity by revenue.

Natural capital intensity and revenue-at-riskExpresses the natural capital cost of all environmental impacts per
million US$ revenue. This can be understood as a measure of risk – if allenvironmental and social impacts generated by plastic were to be paid
for by businesses, this percentage of their total revenue would be at risk.

Natural capital valuation

The value to people from environmental goods and services. When no
market price exists, it can be estimated in monetary terms by using
environmental valuation methods. It is often a cost borne by third parties
not taking part in the economic activity which generated it.

Normalised natural capital cost

Expresses the total natural capital cost weighted by the average service
life of a typical product within the sector of interest.

51

Plastic

Synthetic material derived from petrochemicals. Can be classified infamilies depending on properties (see Appendix 2). When the word
plastic is used in this report, it excludes bioplastic.

Plastic-in-packaging

Includes the quantity of plastic directly used in the packaging of the
product, as well as any losses that were incurred during the
manufacturing and packaging stage.

Plastic-in-productIncludes the quantity of plastic directly used in the product, as well as
any losses that were incurred during the manufacturing process.

Plastic-in-supply-chain

Includes the quantity of plastic used indirectly by consumer goods
businesses via their supply chain but is not destined to be neither in the
final product nor in packaging.

Sector

Refers to individual sectors (soft drink, food, etc...) within the consumer
goods industry.

UpstreamLife cycle stage spanning from the extraction of raw materials to plastic
granule manufacturing.

52

ACRONYMS
acronym

Meaning

ACC

American Chemistry Council

Bn

Billion

CDP

Formerly the Carbon Disclosure Project

EP&L

Environmental Profit and Loss Account

EPR

Extended Producer Responsibility

EU

European Union

GPML

Global Partnership on Marine Litter

GRI

Global Reporting Initiative

IIRC

International Integrated Reporting Council

M

MillionNAICS

North American Industry Classification System

PDP

Plastic Disclosure Project

SASB

Sustainability Accounting Standards Board

T

Tonne

TEEB

The Economics of Ecosystems and Biodiversity

Tr

Trillion

UNEP

United Nations Environment Programme

UNEP FI

UNEP Finance Initiative

UN PRI

United Nations Principles for Responsible Investment

US

United States

WEEE Directive

Waste Electrical and Electronic Equipment Directive

WBCSD

World Business Council for Sustainable Development$

US dollar

53

APPENDIX 1:
SECTOR-SPECIFICRESULTS54

athletic goods
Plastic has permeated every domain of sports, from tracks, through clothing and shoes, to safety equipment such as helmets. The benefits of synthetic
wear in sports are long established, as natural materials such as cotton consist of fibres that maintain moisture easily.96 Polyester is the mostwidely used manufactured fibre in US apparel. Recent trends include apparel made of fibres from recycled plastic bottles (e.g. Coke, Nike, Patagonia).97
Beyond this, plastic plays an important role in sports shoe designs, for example, the mid-sole can be made from ethyl vinyl acetate, providing lightweightcushioning, and polyester foam padding, providing extra flexibility to the insoles. Plastic materials are also used in most ballgames; tennis racquet
manufacturers use plastics for the frame and strings because of their light weight and strength. Water vessels use advanced carbon plastics compounds
for their greater flexibility, superior performance and faster production speed.98

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

TOTAL NATURAL CAPITAL COST ($m)

INDUSTRY AVERAGE INTENSITYINTENSITY

1,200

20,0001,100

18,0001,000

16,000900

14,000800
700

12,000600

10,000

500

8,000

400

6,000

300

4,000

200

2,000

100
0

PACKAGING

0

PRODUCTPRODUCT

UPSTREAM

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

DOWNSTREAM

UPSTREAM

The total natural capital cost of plastic use by the athletic goods
sector is over $1bn per year, or 1% of the total natural capital cost of
the consumer goods industry. The athletic goods sector has a modelledplastic-in-product and plastic-in-packaging intensity of 1 and 17 tonnes
per $1m revenue respectively. Plastic-in-packaging accounts for 5% of
the overall natural capital cost, while plastic-in-product accounts for 95%,
mainly in the upstream stage. This amounts to a total natural capitalintensity of $17,000 per $1m revenue, or 1.7% of total revenue. The risk
related to plastic-in-packaging, expressed by the natural capitalintensity, is lower than that of the overall industry. However, the risk related
to plastic-in-product is higher, meaning that on average the athletic goods
industry is more at risk from plastic than other sectors

DOWNSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-product. 79% of impacts are located upstream (or$870m) and 21% downstream (or $230m). The most significant
upstream impact is greenhouse gas emissions ($450m), followed byland and water pollutants ($330m). Downstream, the impact of
unmanaged waste from chemical additives, land disamenity andmarine litter is $120m. Of these, the impact of littered products ending
up in marine environments is the most significant. The impact ofmanaged waste is lower, at $114m, with the emission of greenhousegases the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

100

200

300

400

500

600

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

$23m

$6m

ANTA
SPORTS

PEAK SPORTPRODUCTS

21,000NATURAL CAPITAL INTENSITY ($ per $1m revenue)

20,00019,00018,000$106m

17,00016,000$26m

15,00014,000The figure on the left displays the estimated natural capital cost andintensity of selected companies. None disclosed useable quantitative
data. All of the variation is thus attributed to type of products
manufactured and sales location. Jarden has the highest natural capital
cost of the peer group due to the type of product manufactured andhigher revenue. As well as outdoor and sports goods, Jarden sells
non-durable goods such as cutlery which have a higher intensity than
the athletic goods sector. Amer Sports has the lowest intensity due to its
sales being located mostly in Europe and the US.

13,00012,000AMER
SPORTSJARDENCORPORATION

55

AUTOMOBILEs
Plastic is increasingly used in the automotive industry, from approximately 60 kilograms per car in the 1970s to around 150 kg at present. This isequivalent to around 10% to 15% of the total weight of a car, found in more than 2,000 parts.99,100 Plastic presents numerous advantages such as
improved durability, corrosion resistance, design flexibility and high performance at low cost. Several types of plastic are used in automotive
manufacturing, ranging from polypropylene (28.6% by weight) to polyvinyl chloride (3.8%), mostly in the interior of the cars (52.5%), but also in theexterior and electric system.100

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

DOWNSTREAMINTENSITY

INDUSTRY AVERAGE INTENSITY

5,000

TOTAL NATURAL CAPITAL COST ($m)

7,000
6,000

4,000

5,000
3,000

4,000
3,000

2,000

2,000
1,000

1,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

00

PACKAGING

PRODUCTPRODUCT

UPSTREAM

The total natural capital cost of plastic use by the automobile
sector is $7bn per year, or 9% of the total natural capital costof the consumer goods industry. The automobile sector has amodelled plastic-in-product and plastic-in-packaging intensity ofover 4 and less than 1 tonnes per $1m revenue respectively.
Plastic-in-packaging accounts for 1% of the overall natural capitalcost, while plastic-in-product accounts for 99%, mainly in the
upstream stage (82%). This amounts to a total natural capitalintensity higher than $4,000 per $1m revenue, or 0.4% of total
revenue. The risk related to plastic-in-packaging, expressed by
the natural capital intensity, is significantly lower than that of theoverall industry. However, the risk related to plastic-in-product ishigher, meaning that on average the automobile industry is more
at risk from plastic than other sectors.

DOWNSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-product. 83% of impacts are located upstream (or$5.5bn) and 17% downstream (or $1bn). The most significant
upstream impact is greenhouse gas emissions ($3bn), followed
by land and water pollutants ($2bn). Downstream, the impact of
unmanaged waste from chemical additives, land disamenity andmarine litter is $760m. Of these, the impact of chemical additives
is the most significant ($660m). The impact of managed waste islower, at $380m, with greenhouse gases the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

500

1,000

1,500

2,000

2,500

3,000

3,500

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

4,500

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

4,400
4,300
$899m

4,200

$468m

4,100
4,000

$323m
$503m

$400m

$603m

FIAT

GENERAL
MOTORS

$881m

3,900
3,800
3,700
3,600

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Three companies
in the peer group disclosed useable data; all the rest is modelled.
As such, any comparisons should be taken with care. Ford has
the lowest overall intensity and Toyota the highest due to theirgeographical sales, as Ford sells more in the US and Europe,
while Toyota’s primary market is Asia. Toyota and Volkswagen
have the higher total natural capital cost due to their high revenue.
Nissan and Ford disclosed data points on use of recycled content
that have been used to model their total natural capital cost. Allother companies mentioned qualitative information that could not
be integrated and are thus modelled.

3,500
FORD

VOLKSWAGENDAIMLERNISSANTOYOTA

56

CLOTHING AND ACCESSORIES
Synthetic fibres make up over 60% of all fibres used in the clothing and accessories industry, as they are cheaper, more resistant and less prone
to price volatility than natural fibers.101 Acrylic, polyolefin and polyester account for approximately 98% by volume of total synthetic production, with
polyester accounting for 60%.102 Chemical additives have received considerable attention recently. For example, Greenpeace recently publisheda report highlighting the hazards related to the use of additives such as phthalates, organotins and antinomy in several large consumer brands.71
These additives can also contaminate sewage water, along with fibres that easily break down into microplastics. One study estimates that over
1,900 fibres can be produced by a single garment, per wash.103 Trucost was able to include the impact of additives in its natural cost model, but thewash out of fibres was excluded due to lack of adequate data.

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

DOWNSTREAM

INDUSTRY AVERAGE INTENSITYINTENSITY

4,000

3,500

3,500

3,000

3,000

2,500

2,500

2,000

2,000
1,500

1,500

1,000

1,000

500

500

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

TOTAL NATURAL CAPITAL COST ($m)

UPSTREAM

00

PACKAGING

PRODUCTPRODUCT

The total natural capital cost of plastic use by the clothing
and accessories sector is around $4bn per year, or 5% of thetotal natural capital cost of the consumer goods industry. The
clothing and accessories sector has a modelled plastic-in-productand plastic-in-packaging intensity of 200 kg and 3 tonnes per $1mrevenue respectively. Plastic-in-packaging accounts for 7% of theoverall natural capital cost, while plastic-in-product accounts for
93%, mainly in the upstream stage (79%). This amounts to a total
natural capital intensity higher than $3,000 per $1m revenue, or
0.3% of total revenue. The risk related to plastic-in-packaging,
expressed by the natural capital intensity, is lower than that of theoverall industry. However, the risk related to plastic-in-productis higher, meaning that on average the clothing and accessories
industry is more at risk from plastic than other sectors.

DOWNSTREAM

UPSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-product. 80% of impacts are located upstream (or$3bn) and 20% downstream (or $800m). The most significant
upstream impact is greenhouse gas emissions ($1.6bn), followed
by land and water pollutants ($1.1bn). Downstream, the impactof unmanaged waste from chemical additives, land disamenity
and marine litter is around $390m. Of these, the impact of litteredproducts ending up in marine environment is the most significant.
The impact of managed waste is marginally higher, at $400m, withthe emission of greenhouse gases the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

250

500

750

1,000

1,250

1,500

1,750

2,000

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

4,500
4,000
3,500
3,000

$33m

$43m

$61m

$42m

$68m

HENNES& MAURITZFASTRETAILING CO

INDITEX

$43m

$11m

2,500
2,000
1,500
1,000
500
HANESBRANDSINC.

V F CORPKERINGSA

GAP
INC

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. More than half of thecompanies disclose useable quantitative data – however,disclosure may be better at the brand level for most of the biggroups such as VF, Kering and Fast Retailing. Fast Retailing has
one of the highest intensities due to the larger proportion of its
sales done in Asia. Hennes and Mauritz (H&M), Hanesbrands and
Kering have low intensity due to the larger proportion of its sales
done in Europe and its disclosed use of post-consumer
polyethylene terephthalate in products and packaging. The natural
capital valuation and intensity of luxury brands that use more
cotton and leather may be overestimated. Most data points aremodelled and as such any comparison should be taken with care.

57

CONSUMER ELECTRONICS
The consumer electronics sector accounts for a large and varied part of total plastic demand from polyethylene to polyurethane – in Europe in 2012,
5.5% of total plastic demand came from the electrical and electronics sector.1 Environmental and social issues pertaining to this sector are diverse andhave received attention from stakeholders and policymakers in recent years, through the waste electrical and electronic equipment (WEEE) directivein the EU for example. Notwithstanding the upstream impacts of manufacturing plastic, the use of toxic additives such as flame-retardants have beenhighlighted, especially its related occupational hazards and downstream toxicity when recycled, incinerated, landfilled or littered. The following casestudy details specific issues and regulations, while highlighting examples of initiatives and disclosure from Hewlett-Packard, Apple and Dell.

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

DOWNSTREAMINTENSITY

INDUSTRY AVERAGE INTENSITY

5,000

TOTAL NATURAL CAPITAL COST ($m)

1,500
1,250

4,000

1,000
3,000
750
2,000
500
1,000

250

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

00

PACKAGING

PRODUCTPRODUCT

UPSTREAM

The total natural capital cost of plastic use by the consumer
electronics sector is over $1.4bn per year, or 2% of the total
natural capital cost of the consumer goods industry. The
consumer electronics sector has a modelled plastic-in-product andplastic-in-packaging intensity of 400 kg and 5 tonnes per $1m revenue
respectively. Plastic-in-packaging accounts for 8% of the overall
natural capital cost, while plastic-in-product accounts for 92%, mainlyin the upstream stage (84%). This amounts to a total natural capitalintensity higher than $4,000 per $1m revenue, or 0.4% of total
revenue. The risk related to plastic-in-packaging, expressed by thenatural capital intensity, is significantly lower than that of the overall
industry. However, the risk related to plastic-in-product is higher,
meaning that on average the consumer electronics industry is more at
risk from plastic than other sectors.

DOWNSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-product. 84% of impacts are located upstream (or$1bn) and 16% downstream (or $200m). The most significant
upstream impact is greenhouse gas emissions ($550m), followed
by land and water pollutants ($400m). Downstream, the impact of
unmanaged waste from chemical additives, land disamenity andmarine litter is $65m. Of these, the impact of chemical additives is
the most significant ($52m). The impact of managed waste ishigher, at $140m, with greenhouse gas impacts the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

100

200

300

400

500

600

700

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

14,000$273m

12,00010,000

$368m

8,000

$290m

6,000
$201m

4,000
2,000

$490m

$310m

$198m

0
APPLE

SAMSUNG
ELECTRONICHEWLETT
PACKARD

SONY

CANON

LG
ELECTRONICS

RICOH

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Variations are mainly
due to differences in the type of product manufactured, countriesof sale and disclosed data. Five out of seven companies disclosed
usable quantitative data, and all disclosed qualitative information
on plastic usage and disposal. Ricoh for example is active indeveloping new materials and processes and incorporating
recycled content in their product – however, no quantitative data
could be integrated within the model. The company’s high intensity
is mostly due to the type of product manufactured and its large
proportion of sales in Asia. LG used 4,980 tonnes of recycledplastic in 2012, phased out PVC, brominated flame retardants andother additives from new products, put in place Green Packaging
Design Guidelines in 2012 and is active in implementing take-backprograms which collected 174,482 tonnes of e-waste.

58

CASE STUDY: CONSUMER ELECTRONICS
The use of electronics is soaring across the world and for most manufacturers, environmental accountability is easier said
than done. One common challenge facing the sector is the lack of visibility up the supply chain due many of thecomponents they source being pre-manufactured. Firms also have difficulty sourcing recycled plastic due to the additives
they contain. In contrast, manufacturers have much more control over packaging.
The increasing ubiquity of electronics coupled with the decreasing lifetime of devices means that e-waste is thefastest growing global waste stream.104 According to the UN, the world’s e-waste is expected to grow by 33% over 2012
to 2017.105 Illegal exports of electronic waste to developing countries amplify the problem. For example, China is theworld’s primary dumping ground for global e-waste receiving shipments from the US, Europe and neighbouring Asian
countries due to illegal loopholes in transboundary imports.106 The situation is aggravated by the fact that many
developing countries now produce large amounts of e-waste with some, like Indonesia, becoming net exporters of it.107
The way e-waste is managed has a crucial influence on the environmental impacts of used and discarded electronics.
Certain toxic and hazardous materials contained in IT equipment are not only released from equipment during manualdisassembly but during other recycling processes, for example when plastics are heated for recycling.108 Consequently,
e-waste recycling is associated with significant health hazards, which are exacerbated under the uncontrolled conditions
prevalent in developing countries.
The 1992 Basel Convention is the best known initiative to attempt to impose restrictions on shipping e-waste todeveloping countries, with mixed results. In the EU, regardless of the fact that the Waste Electrical and Electronic
Equipment (WEEE) directive banning the export of hazardous electronic waste to third-world countries has been in placesince 2003, circumventing EU legislation remains a serious problem.109 The revised 2012 WEEE directive aims to give
EU Member States the tools to fight this more effectively. Other jurisdictions such as China have promulgated WEEE
regulations too.
The United States presents a problematic compliance landscape. It tops the list of countries for total volume of e-waste
generated each year, more than 80% of which ends up in landfills.110 The lack of comprehensive federal regulation
governing waste electronic equipment, partly due to corporate resistance to the NEPSI Initiative back in 2001, has
prompted states to enact their own WEEE legislation resulting in an inconsistent patchwork of state requirements covering two thirds of US population. In this context it is very important that electronics manufacturers become more responsible and accountable for their own footprint.
The following provides an overview of the attempts at e-waste plastic management of three of the world’s largest
technology companies. Three companies have been selected to showcase a particular plastic management innovation in
one of three areas – design, packaging and recycling - although the selection is not exhaustive and a morecomprehensive review would acknowledge the efforts of many other electronics manufacturers.

APPLE
Electronics company Apple’s compact products and packaging designs with highly recyclable aluminium enclosures leadthe sector in material efficiency manufacturing innovations such as unibody construction which allows MacBooks andiPads to become thinner while being more resilient.73 As an additional benefit the extensive use of aluminium materialmeans that plastic use is greatly reduced in comparison to competitor brands.
Since 1995 when it phased out polyvinyl chloride in packaging materials, Apple has been working to improve theenvironmental performance of its products.73 By 2002, it had phased polyvinyl chloride out of cables and other parts, aswell as removing hazardous substances such as brominated flame retardants and heavy metals. The 2012 iMac has
been redesigned to use two thirds less material than previous models. Apple’s AirPort Express has an enclosure that
contains bio-based polymers derived from rapeseed and recycled acrylonitrile butadiene styrene.
At the same time Apple sparks debate among the proponents of sustainable electronics for the fact that its productdesigns involve sticking its lithium polymer battery cells directly onto the aluminium unibody shell. There is somedisagreement over the extent to which this inhibits recycling. Construction with screws could be more efficient forrecycling processing, but this could compromise the slenderness of the products.111
Apple is one of the companies in the sector that publishes an environmental footprint for each of its products, including
data on energy use, restricted substances and material use. Apple’s 15-inch MacBook Pro with retina display contains
59g of plastic, compared with 738g of aluminium and 175g of glass. Apple also discloses the packaging materials used
for the MacBook.112 These include 23g of plastic and 241g of polystyrene in the retail box and shipping boxes, comparedwith 822g of cardboard and 296g of moulded fibre. Unfortunately, this could not be integrated within the calculations inthis report due to the lack of aggregation in the data. Critics have raised concerns over the fact that Apple does not
publish details over its methodology or aggregated material use.

59

DELL
In 2012, Dell achieved its long-term recycling goal to collect 1bn pounds of e-waste a full year ahead of schedule. Moreambitious yet, as part of its 2020 Legacy for Good Plan, Dell has set the goal of recovering 2bn pounds of electronics andreusing more than 50m pounds of recycled-content plastics in its products by 2020. In 2009, against the background ofa patchy regulatory framework, Dell became the first information technology company to prohibit the practice of shipping
non-working parts or end-of-life equipment into certain developing countries.113 It has also created the first of its kinde-waste recycling hub in East Africa by building a regional e-waste handling facility in collaboration with partners in
Kenya. In addition to the environmental benefits generated by the hub’s operation, the model has created important
employment opportunities at the facility and across supporting logistics and collection networks, in part by converting
informal e-waste ‘pickers’ into compensated and trained employees.114,115
Dell uses Ecovative’s packaging grown from agricultural wastes and mushroom fungus into solid moulded packaging
materials without the use of petrochemicals.116 This mycelium-based molding is an alternative to polystyrene andpolyethylene-based cushioning for its heavier product packaging, and has the added benefit of breaking down naturally
and ability to act as compost. Dell is the first technology company to use this material for shipping. This is not the firstenvironmentally sustainable material in Dell’s track record however – in 2009 the company began using bamboo forelectronics packaging and still uses it for some of its lighter products.

HEWLETT-PACKARD
Since 1992, computer and printer manufacturer HP’s Design for Environment programme has been helping the company
incorporate sustainability considerations into the design of its products, including the impacts of plastic.117 The
programme has led HP to introduce ways to make its products more recyclable by making it easier for them to be
dismantled at end of life. Improvements include using common fasteners and snap-on features to avoid using glue or
welds. Most HP products are 90% recyclable by weight.
HP is also working to close the loop on plastic waste from toner cartridges by taking back used cartridges for recycling.
HP operates a free take-back scheme for used cartridges in 56 countries, and over the past two years, it has made 600m
inkjet cartridges using recycled plastic. HP also uses recycled plastic to make new computers and printers. A quarterof the plastic used to make one of its new 2012 desk jet printers is from recycled sources. One of its new desktop PCs
contains one third recycled plastic. In 2013, HP took this a step further by using recycled plastic from its own hardware
recycling facilities to make acrylonitrile butadiene styrene. Recycled ABS makes up 5% of the plastic used to make the
new HP Office jet Pro X printer.
For packaging, HP is shifting from plastic to paper and moulded pulp alternatives, which contain recycled content and arefrom certified sustainable forests. In some cases plastic has a lower carbon footprint, so HP uses expanded polystyrene
or polyethylene which contains recycled plastic. HP also operates a programme called Green Screen to phase out use ofhazardous substances in its products such as phthalates, as well as halogens, including brominated flame retardants and
PVC. For instance, 96% of HP’s Compaq notebooks are classified as low-halogen. Since 2007, more than 160
assessments have been conducted.
In 2012, HP published for first time data on the weight of materials it uses in PC and printer manufacturing, including
plastic, normalised by revenue (tonnes per $1m) so it can measure performance.
Despite these initiatives, Greenpeace gives the company a low score with regards to its e-waste program and use ofrecycled plastic in products, because the company does not disclose the use of post-recycled plastic in its products nor
has specific goals with this respect.118

60

DURABLE HOUSEHOLD GOODS
The household durables sector includes products such as large and small household appliances, from toasters to refrigerators. Relevant environmental
and social impacts are similar to the consumer electronics sector, as well as industry and policy initiatives. In particular, household appliances are also
covered by the WEEE directive in the EU, stipulating that 80% and 70% of the weight of the collected large and small appliances should be recovered,with at least 75% and 50% recycled and the rest used as an energy source. The occupational hazards and downstream impact of additives has also
received attention in the past year, and industry initiatives focus on phasing out and finding alternatives to these substances.

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

DOWNSTREAM

INDUSTRY AVERAGE INTENSITYINTENSITY

5,000

15,0004,000

12,000

3,000

9,000

2,000

6,000

1,000

3,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

TOTAL NATURAL CAPITAL COST ($m)

UPSTREAM

00

PACKAGING

PRODUCTPRODUCT

UPSTREAM

The total natural capital cost of plastic use by the durable
household goods sector is over $4.5bn per year, or 6% of the total
natural capital cost of the consumer goods industry. The durable
household goods sector has a modelled plastic-in-product andplastic-in-packaging intensity of 2 tonnes and 16 tonnes per $1mrevenue respectively. Plastic-in-packaging accounts for 11% of theoverall natural capital cost, while plastic-in-product accounts for 89%,
mainly in the upstream stage (83%). This amounts to a total natural
capital intensity higher than $16,000 per $1m revenue, or 1.7% of total
revenue. The risk related to plastic-in-packaging, expressed by thenatural capital intensity, is lower than that of the overall industry.
However, the risk related to plastic-in-product is significantly higher,
meaning that on average the durable household goods industry is more
at risk from plastic than other sectors.

DOWNSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-product. 83% of impacts are located upstream (or$3.5bn) and 17% downstream (or $710m). The most significant
upstream impact is greenhouse gas emissions ($1.8bn), followed
by land and water pollutants ($1.3bn). Downstream, the impact of
unmanaged waste from chemical additives, land disamenity andmarine litter is $290m. Of these, the impact of chemical additives
is the most significant ($235m). The impact of managed waste ishigher, at $410m, with greenhouse gas impacts the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2,200

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

40,00035,000$119m

30,00025,000

$276m

$126m

$305m

20,00015,00010,000$27m$56m

MAKITASEB$692m

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Most companies
disclose quantitative information that could be used and allcompanies disclosed qualitative information. Indesit is one of thebest disclosers, disclosing quantity of plastic use, percentage ofrecycled content and tonnes of packaging collected in Europe.
Electrolux discloses quantity of plastic used and recycled content;
Arcelik, Husqvarna and Seb information on plastic use; Panasonicpercentage of recycled content; and Whirlpool packaging waste
collection in Brazil. All the rest is modelled – as such, any
comparisons should be taken with care.

$17m

5,000
HUSQVARNA

PANASONIC WHIRLPOOL ELECTROLUXARCELIKINDESIT

61

food
Packaging in the food sector serves a number of functions, including physical protection during storage and transportation, convenience, labellingand branding. Increased use at the detriment of other materials such as glass is driven by higher demands for packaged fresh food and ready-mademeals.119 From an environmental and social perspective specifically, the use of plastic packaging yields significant benefits such as reducing waste andextending the shelf-life of items. On the other hand, impacts include upstream and downstream pollution. In particular, food wrappers andcontainers are among one of the main items collected during coastal clean ups.120

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INTENSITYDOWNSTREAM

INDUSTRY AVERAGE INTENSITY

3,500

TOTAL NATURAL CAPITAL COST ($m)

18,0003,000

16,0002,500

14,00012,0002,000

10,000
1,500

8,000
6,000

1,000

4,000

500

2,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

20,000

The total natural capital cost of plastic use by the food sector isaround $18bn per year, or 23% of the total natural capital cost of
the consumer goods industry. The food sector has a modelledplastic-in-packaging intensity of 3 tonnes per $1m revenue. This
amounts to a total natural capital intensity higher than $3,000 per $1mrevenue, or 0.3% of total revenue. The risk related to plastic-in-packaging, expressed by the natural capital intensity, is higher than that of theoverall industry, meaning that on average the food industry is more at
risk from plastic than other sectors.

00

PACKAGING

PRODUCT

PACKAGING

UPSTREAMDOWNSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-packaging. 73% of impacts are located upstream(or $13bn) and 27% downstream (or $5bn). The most significant
upstream impact is greenhouse gas emissions ($6.5bn), followed
by land and water pollutants ($5bn). Downstream, the impact of
unmanaged waste from chemical additives, land disamenity andmarine litter is around $3bn. Of these, the impact of littered products
ending up in marine environment is the most significant. The impact
of managed waste is lower, at $1.3m, with greenhouse gas impacts
the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

14,000$1,385m
NATURAL CAPITAL INTENSITY ($ per $1m revenue)

12,75011,500$670m

10,250
9,000
7,750
6,500

$146m

5,250

$62m
$115m

4,000
2,750

$39m

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Four out of the six
companies in the peer group disclose useable quantitative data.
Nestlé has the highest intensity of the peer group and the best
disclosure, reporting on both the quantity of packaging used andthe quantity of recycled content. Nestlé and PepsiCo also operate
in the soft drink sector, which has a higher plastic-in-packaging
intensity than the food sector, hence their higher overall intensity.
Meiji reports on the quantity of packaging used and has the lower
intensity of the peer group, mainly due to its activities in thepharmaceutical sector. In addition to sectoral activities, variation
can be explained by the geographical location of sales.

1,500
MEIJI
HOLDINGS CO

MONDELEZINTL INC

KELLOGG CODANONEPEPSICO INCNESTLE SA

62

footwear
Global footwear sales have increased from 2.5bn pairs per year in 1950 to more than 20bn pairs of shoes currently.121 The use of synthetic materials,
plastic, rubber and adhesives has underpinned the proliferation of shoes that differ from traditional crafting techniques and biodegradable materials.
Because less than 5% of shoes are currently recycled, this leads to significant material loss and landfill space, as some estimates suggest the averagepair of shoes takes 1,000 years to degrade in landfill.122 The main use of downcycled plastic shoes is in other applications such as rubber playgroundsurfacing, insulation materials, and underlay products. In recent year’s biodegradability or recyclability is a growing trend in shoe manufacturing, with
bio-plastic, recycled plastic and organic or eco-friendly materials becoming a popular choice, with for example the PUMA Incycle shoe.122,123

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INDUSTRY AVERAGE INTENSITYINTENSITYDOWNSTREAM

3,500

14,0003,000

12,0002,500

10,000

2,000

8,000

1,500

6,000

1,000

4,000

500

2,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

TOTAL NATURAL CAPITAL COST ($m)

UPSTREAM

00

PACKAGING

The total natural capital cost of plastic use by the footwear sector
is over $4bn per year, or 6% of the total natural capital cost of theconsumer goods industry. The footwear sector has a modelledplastic-in-product and plastic-in-packaging intensity of 4 and 14 tonnes
per $1m revenue respectively. Plastic-in-packaging accounts for 21%of the overall natural capital cost, while plastic-in-product accounts
for 79%, mainly in the upstream stage (81%). This amounts to a total
natural capital intensity higher than $16,500 per $1m revenue, or 1.7%of total revenue. Both the risk related to plastic-in-packaging, expressedby the natural capital intensity, and the risk related to plastic-in-productare higher than industry averages, meaning that on average thefootwear sector is more at risk from plastic than other sectors.

PRODUCTPRODUCTDOWNSTREAM

UPSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-product. 81% of impacts are located upstream (or$2.7bn) and 19% downstream (or $645m). The most significant
upstream impact is greenhouse gas emissions ($1.4bn), followed
by land and water pollutants ($1bn). Downstream, the impact of
unmanaged waste from chemical additives, land disamenity andmarine litter is $300m. Of these, the impact of littered products
ending up in marine environment is the most significant. The impact
of managed waste is higher, at $350m, with the emission ofgreenhouse gases the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

250

500

750

1,000

1,250

1,500

1,750

2,000

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

19,00018,000$54m

17,000$21m$22m

16,000$25m

15,00014,00013,00012000
11,000$58m$12m

10,0009,000
BELLE
INTERNATIONASALVATOREFERRAGAMOSTELLA
INTERNATIONALHOLDINGS
LIMITEDDAPHNEINTL HOLDS

TOD'S
SPA

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. No company
disclosed useable quantitative data points to include in theanalysis. Variations can thus be fully explained by sector ofoperation and downstream sales location. For example, Belle andSalvatore Ferragamo also operate in the clothing sector, which
has a lower intensity than the footwear sector. Asics has thehighest natural capital intensity due to its large proportion of sales
made in Asia – this figure may however be overestimated. Asics
reports making use of recycled polyester and strives to design
products in a way that allows repair and replacement of wornout parts.

ASICS
CORP

63

furniture
Although wood has been a building material of choice for centuries, its deficiencies in terms of durability and deforestation have meant that over thelast century plastic alternatives have gained increasing popularity, as well as recent movements towards reclaimed wood products. Plastic furniture iscost-efficient and needs less maintenance. Composites of wood and plastic make the product difficult to recycle. In the past, PVC has been widely usedas alternative to wood. However, it has been proven to be one of the most toxic materials.124 Beyond this, polyester is the most widely used
manufactured fibre in the US in apparel and home furnishings, such as bed sheets, mattresses and curtains.125 Many carpets are made up of nylon
fibres with plastic backing. The contamination of different materials makes recycling a difficult option. Some innovative business models that minimise
plastic use include Econyl, which produces nylon 6 polymers from 100% regenerated materials, and Interface, a leading producer of carpet tiles madefrom discarded fishing nets.126
Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INTENSITYDOWNSTREAM

INDUSTRY AVERAGE INTENSITY

7,000

14,000

6,000

12,0005,000

10,000

4,000

8,000

3,000

6,000

2,000

4,000

1,000

2,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

TOTAL NATURAL CAPITAL COST ($m)

UPSTREAM

00

PACKAGING

PRODUCTPRODUCT

The total natural capital cost of plastic use by the furniture sector
is over $6bn per year, or 9% of the total natural capital cost of theconsumer goods industry. The sector has a modelled plastic-inproduct and plastic-in-packaging intensity of 1 tonnes and 15 tonnes
per $1m revenue respectively. Plastic-in-packaging accounts for 5%of the overall natural capital cost, while plastic-in-product accounts
for 95%, mainly in the upstream stage (83%). This amounts to a total
natural capital intensity higher than $14,500 per $1m revenue, or 1.5%of total revenue. The risk related to plastic-in-packaging, expressed by
the natural capital intensity, is lower than that of the overall industry.
However, the risk related to plastic-in-product is significantly higher,
meaning that on average the furniture sector is more at risk from plastic
than other sectors.

DOWNSTREAM

UPSTREAM

The figure on the left highlights the distribution of impacts
for plastic-in-product. 83% of impacts are located upstream(or $5bn) and 17% downstream (or $1bn). The most significant
upstream impact is greenhouse gas emissions ($2.7bn), followed
by land and water pollutants ($2bn). Downstream, the impact of
unmanaged waste from chemical additives, land disamenity andmarine litter is $295m. Of these, the impact of chemical additives
is the most significant ($230m). The impact of managed waste ishigher, at $730m, with greenhouse gas impacts the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

500

1,000

1,500

2,000

2,500

3,000

3,500

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

16,000NATURAL CAPITAL INTENSITY ($ per $1m revenue)$43m

14,000$13m

12,00010,000
8,000
6,000

$3m

$3m
$14m

$6m

4,000
2,000
FORTUNE
BRANDS HOME
& SECURITY, INC.

EKORNESASASAMSONHOLDING LTD.

LEGGETT& PLATT INC

INTERFACE
INC.

The figure on the left displays the estimated natural capital costand intensity of selected companies. Two companies in the peergroup disclosed useable quantitative data, both operating in the
carpet and rug mill sub-sector, which is more intensive than otherfurniture sub-sectors. Interface discloses a 49% rate of recycledcontent and bio-based material use that could be integrated in thecalculations. This company also makes public the results of lifecycle
analysis conducted on its products; however, for lack of sales data,
this could not be included. Interface is also known for its take-backprograms, but no data was found on quantity of products collected.
Mohawk discloses quantitative data on specific measures, for example, the diversion of more than 1bn pounds foam trim from landfill
since 2006 to be used in their product range.

MOHAWK
INDS INC

64

MEDICAL AND PHARMACEUTICAL PRODUCTS
This sector only includes medicine preparation and excludes medical appliances. Plastic packaging plays an important role in the preservation of medicine
due to its exceptional barrier properties, light weight, low cost, durability, transparency and compatibility with other materials.127 Plastic pill capsules release
the active ingredients over a longer period of time. The most important impacts associated with medical packaging are related to upstream production anddownstream disposal as some make their way into the ocean. Measures taken by the industry include material use optimization and reduction. For example,
Merck has a goal of having 50% of its products with sustainable packaging features such as size reduction, use of renewable, recyclable or recycled content
and implementation of take-back programs by 2020.128 Similarly, Johnson and Johnson has environmental, health and safety standards which require allbusiness units to evaluate all new products and product packaging for sustainable packaging improvements.129

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INDUSTRY AVERAGE INTENSITYINTENSITYDOWNSTREAM

3,500

TOTAL NATURAL CAPITAL COST ($m)

500

3,000

400

2,500
300

2,000
1,500

200

1,000
100

500

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

The total natural capital cost of plastic use by the medical andpharmaceutical products sector is higher than $400m per year, or
1% of the total natural capital cost of the consumer goods
industry. The medical sector has a modelled plastic-in-packaging
intensity of 3 tonnes per $1m revenue. This amounts to a total natural
capital intensity higher than $3,000 per $1m revenue, or 0.3% of total
revenue. The risk related to plastic-in-packaging, expressed by natural
capital intensity, is higher than that of the overall industry, meaning thaton average the medical sector is more at risk from plastic thanother sectors.

00

PACKAGING

PRODUCT

PACKAGINGDOWNSTREAM

UPSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-packaging. 75% of the impacts are located upstream(or $310m) and 25% downstream (or $100m). The mostsignificant upstream impact is greenhouse gas emissions ($161m),
followed by terrestrial pollutants to land ($118m) and water use($25m). Downstream, the impacts from unmanaged waste fromchemical additives, land disamenity and marine litter are $70m.
Of these, the impact of littered products ending up in the marine
environment is the most significant. The impact of managed waste
is lower, at $35m, with greenhouse gas impacts the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

25

50

75

100

125

150

175

200

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

4,000
3,800
3,600

$133m

3,400
3,200
3,000
2,800

$165m

$117m

$131m

$96m

NOVARTISAGABBOTT
LABS

$114m

2,600
2,400

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. No company in thesample disclosed quantity of plastic packaging or recycled content
percentage. Abbott Labs reported a 3.9% reduction in packaging
used from 2007 to 2011, Novartis the amount of plastic film saved
by a facility in Brazil, and Sanofi a 24 tonne reduction in PVC froman initiative in Hungary. Johnson and Johnson has the highest
natural capital intensity due to its activities in the non-durable
goods and personal product sector.

2,200
2,000
PFIZER
INC

MERCK& CO INC

SANOFIJOHNSON& JOHNSON

65

NON-DURABLE HOUSEHOLD GOODS
The non-durable household goods sector includes products such as cleaning products, razor blades and bin liners. Personal hygiene products areincluded in the personal product sector. This sector has one of the highest natural capital cost per service year, due to the short life span of products
sold. Plastic used in non-durable household goods are not widely recycled – for example, while the average recycling rates of plastic in the United States
is more than 8%, plastic in non-durable household goods are only recycled at 1.7%.130 Companies are taking steps to address the lack of infrastructure.
For example, Procter and Gamble assesses the recyclability of its packaging design prior to market launch in partnership with the Association of
Postconsumer Plastic Recyclers.131 Other key sectoral initiatives include lightweighting, incorporation of recycled and bio-based materials, and refills,
which may help mitigate their environmental impact. For example, Colgate Palmolive provides eco refills for spray cleaners in Europe.132

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INTENSITYDOWNSTREAM

INDUSTRY AVERAGE INTENSITY

10,000TOTAL NATURAL CAPITAL COST ($m)

7,000
6,000

8,000

5,000
6,000

4,000
3,000

4,000

2,000
2,000

1,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

00

PACKAGING

PRODUCTPRODUCT

UPSTREAMDOWNSTREAM

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

500

1,000

1,500

The total natural capital cost of plastic use by the non-durable
household goods sector is over $7bn per year, or 10% of the total
natural capital cost of the consumer goods industry. The
non-durable household goods sector has a modelled plastic-in-productand plastic-in-packaging intensity of 10 and 1 tonnes per $1m revenue
respectively. Plastic-in-packaging accounts for 9% of the overall natural
capital cost, while plastic-in-product accounts for 91%, mainly in the
upstream stage (77%). This amounts to a total natural capital intensity
higher than $10,000 per $1m revenue, or 1% of total revenue. The risk
related to plastic-in-packaging, expressed by natural capital intensity,
is lower than that of the overall industry. However, the risk related toplastic-in-product is higher, meaning that on average the non-durable
household goods sector is more at risk from plastic than other sectors.

2,000

2,500

3,000

3,500

The figure on the left highlights the distribution of impacts forplastic-in-product. 77% of the impacts are located upstream(or $5.3bn) and 23% downstream (or $1.5bn). The mostsignificant upstream impact is greenhouse gas emissions ($2.7bn),
followed by terrestrial pollutants to land ($2bn) and water use($416m). Downstream, the impacts from unmanaged waste fromchemical additives, land disamenity and marine litter are $860m.
Of these, the impact of littered products ending up in the marine
environment is the most significant. The impact of managed waste
is lower, at $670m, with the emission of greenhouse gases themost significant.

TOTAL NATURAL CAPITAL COST ($m)

DISCLOSURE

AVERAGE SECTOR INTENSITY

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

45,00040,000$734m

35,00030,00025,000$94m

20,000$158m

15,000$157m

10,000$139m

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Most companies
in the peer group disclose useable quantitative data to different
extents – as such, any comparison should be taken with care.
Kimberly Clark has the best disclosure of the sector, on both theamount of packaging and recycled content used; Kao discloses
quantity of packaging; Procter and Gamble recycled content andother disclosing companies’ quantitative savings throughoptimisation measures. Variations are mostly due to countries ofsales and sector of activities.

$650m
$126m

5,000
PROCTER& GAMBLE

RECKITTBENCKISER

COLGATEPALMOLIVEKAOSVENSKACELLULOSA

CLOROXKIMBERLY
CLARK

66

PERSONAL PRODUCTS
Packaging is an important part of cosmetics as it must protect and preserve the product, be durable, enable efficient application, be distinctive andattractive, and simultaneously be designed to allow recycling or recovery.133 Much of it ends up in landfill however, either due to contamination,
unavailability of local recycling facilities, or to non-recyclability of the packaging. Some initiatives to deal with this include Aveda, which also recycles
polypropylene caps through its ‘Recycle Caps with Aveda’ initiative, and Origins ‘Return to Origins’ recycling programme inviting customers to return
packaging in exchange for a sample.134 However, some of the barriers to wider adoption of refillable packaging include time constraints, shelf availability,
extra staffing and logistical costs. Microplastics used in products are of particular concern as sewage treatment facilities are not designed to remove or
break them down. They then find their way into the marine environment, resulting in concentrations of microplastics sometimes higher than that ofplankton, and accumulate in the food chain. However, the impact of microplastic could not be included in the analysis for lack of data.

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INDUSTRY AVERAGE INTENSITYINTENSITYDOWNSTREAM

7,000

TOTAL NATURAL CAPITAL COST ($m)

2,500

6,000

2,000

5,000
1,500

4,000
3,000

1,000

2,000
500

1,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

The total natural capital cost of plastic use by the personal
products sector is over $2bn per year, or 3% of the total natural
capital cost of the consumer goods industry. The personal products
sector has a modelled plastic-in-packaging intensity of 6 tonnes per$1m revenue. This amounts to a total natural capital intensity higher
than $6,000 per $1m revenue, or 0.6% of total revenue. The risk related
to plastic-in-packaging, expressed by natural capital intensity, is higher
than that of the overall industry, meaning that on average the personal
products sector is more at risk from plastic than other sectors.

00

PACKAGING

PRODUCT

PACKAGINGDOWNSTREAM

UPSTREAM

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

100

200

300

400

500

600

700

800

900

1,000

The figure on the left highlights the distribution of impacts forplastic-in-packaging. 74% of the impacts are located upstream(or $1.5bn) and 26% downstream (or $530m). The mostsignificant upstream impact is greenhouse gas emissions ($805m),
followed by terrestrial pollutants to land ($590m) and water use($120m). Downstream, the impacts from unmanaged waste fromchemical additives, land disamenity and marine litter are $370m.
Of these, the impact of littered products ending up in the marine
environment is the most significant. The impact of managed waste
is lower, at $170m, with the emission of greenhouse gases themost significant.

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

7,000
NATURAL CAPITAL INTENSITY ($ per $1m revenue)

$21m
$58m

6,000

$171m
$39m

$57m

$345m

5,000

4,000

3,000
$20m

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Five companies inthe sample disclosed useable quantitative data on materials
savings due to light weighting initiatives, recycled content andquantity of packaging used. Shisheido is the only company that
disclosed useable data on packaging usage; Natura and Unilever disclose it at a product level and this could not be integrated
for lack of consolidated figure. Natura has the highest modelledintensity due to its high sales in Latin America; however, this figure
is likely to be overestimated given the large sustainability efforts
undertaken by this company.

2,000
SHISEIDO
CO LTD

UNILEVERPLC

BEIERSDORF
AG

L'OREALLAUDERESTEE INC

AVON
PRODS INC

NATURACOSMETICOS

67

CASE STUDY: lush
Cosmetics company Lush was the first to disclose its plastic footprint and management strategy with the Plastic
Disclosure Project in 2011, with its 2014 disclosure currently underway. The company stands out as having taken many
positive steps towards minimising plastic use in all stages of its value chain, famously designing its products to eliminate
or minimise the need for packaging. For example it has redesigned many traditionally liquid products into solid form,
resulting in about 70% (62% in 2010/11) of its product range to require no packaging, hence the slogan “We
prefer naked”.135
One such innovation – a solid-bar shampoo – removes the need for a plastic bottle. Lush says one shampoo bar provides
up to 100 hair washes, the equivalent of three 200ml bottles of liquid shampoo. The company sells 1.9m shampoo bars
per year, preventing the need for 5.7m plastic bottles. Lush has developed solid bar massage oil, bath bombs, deodorant,
conditioner, toothpaste and henna hair dye. Shifting from liquid to solid-bar shampoo removes water from the product,
cutting its weight and reducing transport emissions.136,137
Another example is Lush’s use of knot wraps to replace wrapping paper. Almost two thirds of the wraps are vintage
scarves from the second hand clothes market, while the remainder are made from recycled plastic bottles or organic
cotton. Lush sold almost 90,000 wraps in 2011, recycling 44,000 plastic bottles in the process.138,139
Where packaging is needed Lush favors using recycled material. Some 90% of its packaging is from recycled sources
including all of its bottles, pots and carrier bags. In total, some 90 tonnes of plastics is saved per year, the equivalent of
800 barrels of oil. Lush is also developing closed loop systems for its waste. Facial toner bottles are made fromhigh-density polyethylene recycled from containers used within the firm’s operations to transport fragrances. Pots, or
small plastic containers for cosmetics such as cream and shampoos, are made from recycled polypropylene. Lushencourages customers to bring back empty pots to its stores by offering a free face mask if they return five pots. In 2011,
some 250,000 pots have been brought back as a result. Lush is aiming to recycle these back into new pots. Bottle tops
can also be brought back.
Trucost applied natural capital valuation to estimate the savings from Lush’s plastic reduction initiatives using its Plastic
Disclosure Project disclosure in 2010/11. The total natural capital savings from plastic reduction amount to $263,273. The
most important of these savings, over $160,000, relates to the fact that 62% of products are sold packaging free. $86,041
of these savings are associated with the sales of its solid bar shampoo. In 2010/11 Lush also redesigned its bottles,
shaving 14% of the weight of a bottle, gave out 51,250 facemasks for the return of black pots, and sold 88,609 knot
wraps 40% of which were made from recycled PET. These initiatives resulted in combined savings of $9,140.

FIGURE 21: NATURAL CAPITAL SAVINGS FROM SELECTED LUSH INITIATIVESSHAMPOO BAR(1 SHAMPOO BAR
62% OFREPLACES 3
PRODUCTS
200ML BOTTLES PACKAGING
OF SHAMPOO)FREEREDESIGNEDBLACK POTS
BOTTLES
RETURNED(14% WEIGHT(IN EXCHANGE
REDUCTION) FOR FACEMASKS)

GLITTERREMOVEDFROMPRODUCTSKNOT WRAPS(SCARVESREPLACING
PACKAGING)

0

NATURAL CAPITAL SAVINGS ($)-20,000-40,000-60,000-80,000-100,000-120,,000-140000-160,000-180,00068

One important issue on Lush’s agenda has been its use of microplastic glitter in ten products. Starting with the Christmas
line in 2012, Lush decided to replace these with alternatives including rice paper confetti, coloured mica, agar-based
sparkles and popping candy, without losing any of the product functionality. This is a forward thinking decisionconsidering the associated costs, both economic and to natural capital. The Plastic Disclosure Project was partiallyinstrumental in Lush’s move away from plastic beads and glitter, as it was through conducting its Plastic Disclosure
Project disclosure that Lush recognised the magnitude of the issue and opportunity.139
Prominent Dutch non-profit organization the Plastic Soup Foundation is also working to bring a halt to microplastic pollution in marine environments with their smartphone app for shoppers called ‘Beat the Bead’.50 Microplastics are plastic
pieces less than 5mm long and an important type of marine litter. When used in products such as cosmetic scrubs, they
can make their way into the sea where they have a detrimental effect. Research suggests that very small particles canbe retained in the tissues of marine invertebrates and mussels, as well as having an elevated ability to absorb chemicals
in the water due to the petroleum in the plastic and subsequently bioaccumulate in the food chain.140 The small size of
microplastic makes it difficult to study and model its environmental impacts but research in this field is growing quickly.
One campaign led by the Plastic Soup Foundation and other organizations contributed to Unilever’s commitment in late2012 to phase out the use of microplastic in all its personal care products by 2015. The company is currently investigating
alternatives. Some other mainstream companies which have pledged to phase out microplastic by or before 2017 include
L’Oreal, Johnson & Johnson and Procter & Gamble.141 Increasingly suppliers have also started responding to the trend bylaunching biodegradable alternatives to plastic beads. For example, Koster Keunen offers sunflower and rice bran waxes
in bead form as an alternative to plastic beads.141 With their wide colour and size availability, they are suitable for a wide
range of exfoliation applications. Other natural alternatives include ground almonds, oatmeal and pumice.
Overall, the combination of these market trends with increasingly evident scientific research and emerging legislative
pressure – most recently through the California “Microplastic Nuisance Prevention Law” banning the sale andmanufacture of products containing microplastics – implies a regulatory risk that companies might not have anticipated.44

69

restaurants
Disposable food packaging prevalent in fast food and takeaway restaurants is typically made from plastic, paper, and other bio materials. The uniqueproperties of plastic including insulation, light weight, hygiene, malleability, and cost-effectiveness compared to reusable packaging, make it aparticularly popular choice for the foodservice industry. The main barriers to recycling plastic packaging are that it is considered contaminated and unfit
for recycling unless cleaned and sorted, individuals eating fast food on the move rarely encounter dedicated waste collection services, as well as thechallenge of raw material, collection and scrap costs.142 Paper takeaway cups are least expensive and most widely used; however in the UK alone, anestimated 2.5bn disposable cups go to landfill every year because the plastic coating makes them difficult to recycle or compost.143

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INDUSTRY AVERAGE INTENSITYINTENSITYDOWNSTREAM

2,000

TOTAL NATURAL CAPITAL COST ($m)

1,200
1,000

1,500
800
1,000

600
400

500
200
0

0

PACKAGING

PACKAGING

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

PRODUCTDOWNSTREAM

UPSTREAM

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

50

100

The total natural capital cost of plastic use by the restaurants
sector is over $1bn per year, or 1% of the total natural capital
cost of the consumer goods industry. The restaurants sector hasa modelled plastic-in-packaging intensity of 1 tonne per $1m revenue.
This amounts to a total natural capital intensity around $1,300 per $1mrevenue, or 0.1% of total revenue. The risk related to plastic-in-packaging, expressed by natural capital intensity, is slightly lower than that of
the overall industry. Plastic-in-packaging only include’shop-added’ packaging.

150

200

250

300

350

400

450

500

The figure on the left highlights the distribution of impacts forplastic-in-packaging. 71% of the impacts are located upstream(or $770m) and 29% downstream (or $310m). The mostsignificant upstream impact is greenhouse gas emissions ($400m),
followed by terrestrial pollutants to land ($295m) and water use($60m). Downstream, the impacts from unmanaged waste fromchemical additives, land disamenity and marine litter are $230m.
Of these, the impact of littered products ending up in the marine
environment is the most significant. The impact of managed waste
is lower, at $80m, with the emission of greenhouse gases themost significant.

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

2,500
NATURAL CAPITAL INTENSITY ($ per $1m revenue)

$23m

2,000

1,500

1,000

$43m

$13m

$25m

$32m

$17m

500
MCDONALDS
CORP

SYSCO
CORP

STARBUCKS
CORP

SODEXOCOMPASSGROUPBIDVEST
GROUP

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Bidvest has thehighest intensity among the peer group due to its operations in thehousehold goods sector, which has a higher plastic use than therestaurants sector. McDonalds has the lowest intensity, primarily
due to its use of recycled content (28%). However, it should be
noted that its natural capital intensity and cost is likely to beunderestimated, as McDonalds is the world’s largest distributor oftoys. Starbucks has the second lowest intensity, due to its
emphasis on reusable cups. In 2012, 1.5% or 35.8m beverages
were served in personal tumblers. No useable quantitative
disclosure was found on the other companies, which are allmodelled. As such, all comparison should be taken with care.

70retail
Between 100 and 380bn plastic bags are used in the US every year, or 1,200 per resident. In 2010, 95.5bn plastic bags were placed on the EU market, 92%of them being single use. Plastic bags are the second most collected items during coastal clean-ups and can thus have significant environmental impacts.120
As a result, several cities and countries have passed laws against the use of plastic bags. Bangladesh became the first country to ban thinner plastic bags in2002 after they were found to have choked the drainage system during floods, soon followed but not limited to South Africa, Rwanda, China, India, cities in
the US and Australia. The main focus of industry-led initiatives is twofold: reducing the use of plastic bags by suggesting alternatives and organising
campaigns, helping suppliers reduce their own packaging and organising takeback programs for products such as batteries. For example, Walmart has
already achieved a 35% reduction in plastic bags distributed since 2007, or 3.1bn bags.144 Similarly, Carrefour saved 1,400m bags since 2009 and Kroger
1bn bags since 2008 through the selling of 4.8m reusable bags.145,146 Furthermore, while this is not captured by the analysis, companies are implementing
measures to reduce the consumption of plastic throughout their supply chain. Walmart for example has the ambition to be ‘packaging neutral’ through theuse of recyclable, reusable, recycled and sustainably sourced packaging by 2025.144

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INDUSTRY AVERAGE INTENSITYINTENSITYDOWNSTREAM

2,000

TOTAL NATURAL CAPITAL COST ($m)

6,000
5,000

1,500
4,000
1,000

3,000
2,000

500
1,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

The total natural capital cost of plastic use by the retail sector
is around $5.8bn per year, or 8% of the total natural capital costof the consumer goods industry. The retail sector has a modelled
shop-added plastic-in-packaging intensity of 500kg per $1m revenue.
This amounts to a total natural capital intensity around $530 per $1mrevenue, or 0.05% of total revenue. The risk related to plastic-in-packaging, expressed by natural capital intensity, is lower than that of theoverall industry.

00

PACKAGING

PACKAGING

PRODUCTDOWNSTREAM

UPSTREAM

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

500

1,000

1,500

2,000

2,500

3,000

The figure on the left highlights the distribution of impacts forplastic-in-packaging. 75% of the impacts are located upstream (or $4.4bn) and 25% downstream (or $1.4bn). The mostsignificant upstream impact is greenhouse gas emissions ($2.3bn),
followed by terrestrial pollutants to land ($1.7bn) and water use($345m). Downstream, the impacts from unmanaged waste fromchemical additives, land disamenity and marine litter are $960m.
Of these, the impact of littered products ending up in the marine
environment is the most significant. The impact of managed waste
is lower, at $470m, with the emission of greenhouse gases themost significant.

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

550

525

500

$49m
$48m

475

450

$44m
$53m

$194m

425

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Kroger, Carrefour
and Walmart Stores all disclosed useable quantitative data onplastic bags decrease. CVS Caremark and Kroger also disclosed
some data on plastic recycled through in-house initiatives andvoluntary takeback programs. Particularly interesting is Kroger’s
in-store Bag2Bag program, which consists of providing recycling
bins to its customers for plastic dry-cleaning bags and plastic
shrink-wrap, which collected 28m pounds of plastic in 2012.

$37m

400
KROGER
COCVS
CAREMARK

WAL-MARTSTORES INC

COSTCOCARREFOUR

TESCO

71

soft drinks
Soft drinks bottles are widely made of polyethylene terephthalate and polyethylene. There has been continual progress at lightweighting, improving recycledcontent (PET bottles are one of the most recycled items), and more recently, advances aimed at integrating bio-based content into the material make-up
which could, depending on circumstances, reduce upstream impacts. However, bio-based content is not without debate, with some fearing it could be athreat to food production, concerns whether bio-based packaging can be treated in mainstream recycling streams, and activists raising concerns that having
bio-based content could seduce consumers into believing the greater problem is solved. Because of its light weight, packaging easily makes its way tomarine environments where it can cause harm through ingestion, especially when it breaks down into microplastic. According to Greenpeace, “a single one
litre bottle could break down into enough small fragments to put one on every mile of beach in the entire world”.147

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

DOWNSTREAMINTENSITY

INDUSTRY AVERAGE INTENSITY

15,000TOTAL NATURAL CAPITAL COST ($m)

10,0009,000

12,000

8,000
7,000

9,000

6,000
5,000

6,000

4,000
3,000

3,000

2,000
1,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

UPSTREAM

The total natural capital cost of plastic use by the soft drinks
sector is around $9bn per year, or 12% of the total natural capital
cost of the consumer goods industry. The soft drinks sector has amodelled plastic-in-packaging intensity of 15 tonnes per $1m revenue.
This amounts to a total natural capital intensity around $15,000 per $1mrevenue, or 1.5% of total revenue. The risk related to plastic-inpackaging, expressed by natural capital intensity, is higher than that of
the overall industry, meaning that on average the soft drinks sector ismore at risk from plastic than other sectors.

00

PACKAGING

PRODUCT

PACKAGING

UPSTREAMDOWNSTREAM

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

The figure on the left highlights the distribution of impacts forplastic-in-packaging. 76% of the impacts are locatedsupstream (or $6.8bn) and 24% downstream (or $2.1bn). The
most significant upstream impact is greenhouse gas emissions($3.6bn), followed by terrestrial pollutants to land ($2.6bn) andwater use ($540m). Downstream, the impacts from unmanaged
waste from chemical additives, land disamenity and marine litter are$1.5bn. Of these, the impact of littered products ending up in themarine environment is the most significant. The impact of managed
waste is lower, at $6.7m, with the emission of greenhouse gases themost significant.

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

20,000$12m

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

18,50017,00015,500$710m

14,000$28m$70m

12,500$21m

11,000
9,500

$37m

$34m
$79m

8,000
6,500
5,000
TINGYI

WANT
WANT CHINA

BRITVICUNIPRESIDENT

DR PEPPER
SNAPPLEGROUP INCLOTTE
CHILSUNG

COCA
COLA

CHINA
HUIYUANJUICE

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Coca-Cola has thelargest total natural capital cost due to its high revenue; China
Huiyuan Juice has the highest intensity due to its geographic
sales in Asia (100%). Tingyi, Uni President and Want Want1 also
operate in Asia; however, a little less than half of their revenue isgenerated within the food sector, which has a lower plastic
intensity than the drinks sector, hence the lower overall intensity.
Britvic, Coca-Cola and Dr Pepper all have end of life programs
and partly operate in regions with packaging regulations, and thus
have lower downstream intensity. Lotte Chilsung operates in Asia,
but achieves the lowest downstream intensity thanks to its
take-back program (91% of all sales).

72

CASE STUDY: COCA-COLA COMPANY
As the world’s largest beverage company, Coca-Cola is aware of the reputational and regulatory pressures it faces overplastic waste. Its iconic brand is one of its greatest strengths, but also a vulnerability that campaigners such asGreenpeace can exploit, as its recent YouTube video on seabird deaths caused by plastic bottles showed.148 The original
source of the row was a court case that Coca-Cola won to stop a container deposit scheme in Australia’s Northern
Territory – a programme that according to Greenpeace doubled recycling rates and ran successfully in South Australia forover 30 years. Yet according to Coca-Cola, it is one of the least efficient methods to increase recycling rates, with othermethods being around 28 times more cost-effective.149
Ultimately, container deposits are linked to Extended Producer Responsibility (EPR), an increasingly prominent public
policy and regulation, which promotes shifting financial responsibility for collecting and recycling used packaging from
taxpayers to producers, leading to an internalization of end-of-life costs, creating an economic incentive for producers toadapt packaging and promote higher recyclability, and providing revenue to improve current recycling systems. In the US,
EPR is successfully established for products such as batteries, carpet, electronics and paint. In the past, US companies
generating a lot of packaging waste have shown little leadership in EPR. Corporate responsibility group As You Sow,
which works with consumer brands to accept responsibility for recycling their packaging, says Nestlé Waters’ advocacy of
EPR for packaging in the US was the most important action taken by a company in the last decade on plastic because an
optimized EPR system would reduce plastic loadings on land and in the ocean, and significantly increase recycling.78
Coca-Cola’s sustainability programme features a range of targets to boost performance on sustainable packaging.150
This includes a 2015 global target to recover the equivalent of half the plastic and metal it uses to make its products froma 2008 baseline, to source a quarter of its PET plastic from recycled or renewable sources by 2015, and to cut plastic use
by reducing the weight of its bottles by 7% per litre of product by 2015 from a 2008 baseline. Investor pressure played an
important role in securing these commitments: for example, As You Sow’s shareholder dialogue and filing of proposals
to encourage beverage and food retailers to assume responsibility for the collection and recycling of their containers. In
2009, Coca-Cola built the US’s largest bottle-to-bottle recycling plant following several years of discussions with As You
Sow on beverage container recycling.151
Progress on the 2015 goal has been hampered by a lack of available data as many emerging markets do not collectrecovery data, although 2013 estimates suggest a current rate of 39%, increasing to 75% by 2020 for developed
countries which already have well-developed waste management infrastructures. Coca-Cola is working with governments
and industries in developing countries to help create waste collection and recycling systems so these targets can beachieved. It supports numerous litter prevention programs through The Coca-Cola Foundation.
To encourage recycling by motivating behaviour change, Coca-Cola has been working to invent creative ways to engage
with consumers. EKOCYCLE, launched in July 2012 in collaboration with musical artist and producer will.i.am and otherconsumer brands, is an initiative dedicated to educating consumers that waste can be turned into recycled content for
fashionable lifestyle products, such as Levi’s 501 jeans, Beats by Dr. Dre headphones, New Era caps, Case-Mate iPhonecases, RVCA board shorts.152 At the same time, the campaign has been criticized in that it does not educate
consumers that the most efficient reuse of PET plastic is to make it into new Coke bottles. In addition it is notable that
Coke has stalled on its binding recycled content goals for PET bottles, whilst some competitors have set binding targets.
Other notable campaigns include Happiness Recycled in collaboration with Zero Waste Sector, recycling at the London
2012 Olympic Games and during the Torch Relay, and addressing marine debris through collaboration with Ocean
Conservancy with whom they launched the Trash Free Seas Alliance, a group of stakeholders seeking to end ocean
trash. Coca-Cola also sponsors Ocean Conservancy’s annual International Coastal Clean-up, the world’s largest
volunteer effort for ocean health, in which 500,000 volunteers remove plastic and other waste from beaches aroundthe world.
In 2009, Coca-Cola launched PlantBottle, a PET plastic bottle made from 30% renewable material. By the end of 2012, it
had distributed some 14bn PlantBottles in two dozen countries, eliminating the need for 300,000 barrels of oil and cutting
carbon dioxide emissions by 130,000 tonnes. In 2011, Coca-Cola licensed this technology to Heinz for ketchup bottles,
and is also working with the Ford Motor Company where PlantBottle material will be used in the fabric interior of a Ford
Fusion Energi.153 The companies also work together with Nike and Procter and Gamble with the goal of creating acommercially scalable 100% plant-based plastic. To ensure that sustainably sourced feedstock is used to make thePlantBottle, the company has engaged with partners such as the World Wildlife Fund. However, although it has been
designed to be compatible with recycling systems, the concern remains that PlantBottle may placate stakeholders, while
Coke needs to continue to push forward a higher percentage of recycled and bio-based content. Moreover, Coca-Cola’s
target of sourcing a quarter of its PET plastic from recycled or renewable sources by 2015 has been criticised for
amalgamating two distinctly different material sources into its goal and thus not fully committing to either one.

73

By 2012, 5% of Coca-Cola’s packaging came from renewable sources. One challenge is scaling up sufficient suppliesof recycled polyethylene terephtalate (rPET) to meet increasing demand. Currently, US PET reclaimers operate at lessthan 60% capacity, and according to As You Sow, lack of sufficient rPET supply is one of the reasons Coca-Cola could
not meet its 10% rPET in bottles target by 2011.151 To address this, Coca-Cola Enterprises in the United Kingdom hasinvested in a PET recycling facility through a joint venture with waste reprocessor ECO Plastics. The £15m investment
more than doubled the amount of rPET available in the United Kingdom and enabled Coca-Cola to commit to recycling all
PET bottles from the London 2012 Olympics venues and turn them back into new bottles within six weeks.
Coca-Cola’s third key target to cut plastic use by reducing the weight of its bottles by 7% per litre of product by 2015 froma 2008 baseline was achieved for 85% of its packaging materials, including the lightest ever bottle for DASANI water
developed by their bottling partner in Puerto Rico, which weighs 9.8 grams. Coca-Cola has joined the Ellen MacArthur
Foundation in launching the Circular Economy 100, a three-year program aimed at facilitating projects promoting a global‘circular economy’. By 2015, participating companies are expected to identify and commit to new circular initiatives.154

74tobacco
Cigarette filters are made of a natural plastic called cellulose acetate and were introduced in the 1950s in order to decrease the toxic chemicals inhaledby smokers. Filters take between 1 month and 15 years to biodegrade depending on the receiving environment.155,156,157 Studies estimate that more than
800,000 tonnes of butts litter the natural environment each year and are the single most collected items in coastal clean-ups. Main impacts include collection
costs, disamenity, leachate of toxic chemicals and ingestion by local fauna.158 Tobacco companies are taking steps against littering. For example, Imperial
Tobacco supports several local initiatives to change consumer behaviour towards littering, such as the ’Keep Australia Beautiful’ campaign.159 Japan
Tobacco rolled out a citizen participation clean-up campaign (’Pick up and you will love your city’) initiative in 47 prefectures.160 Reynolds Americancollected 2m cigarette butts in 6 months in partnership with Terra Cycle.161

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INDUSTRY AVERAGE INTENSITYINTENSITY

2,000

TOTAL NATURAL CAPITAL COST ($m)

700
600

1,500

500
400

1,000
300
200

500

100

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

DOWNSTREAM

UPSTREAM

The total natural capital cost of plastic use by the tobacco sector
is around $890m per year, or 1% of the total natural capital cost of
the consumer goods industry. The tobacco sector has a modelledplastic-in-product and plastic-in-packaging intensity of 700kg and 300kg
per $1m revenue respectively. Plastic-in-packaging accounts for 32%
of the overall natural capital cost, while plastic-in-product accounts for
69%, mainly in the upstream stage (66%). This amounts to a total
natural capital intensity higher than $1,000 per $1m revenue, or 0.1%
of total revenue. The risk related to both plastic-in-packaging andplastic-in-product, expressed by natural capital intensity, is lower thanthat of the overall industry.

300

The figure on the left highlights the distribution of impacts forplastic-in-product. 70% of the impacts are located upstream(or $426m) and 30% downstream (or $180m). The mostsignificant upstream impact is greenhouse gas emissions ($220m),
followed by terrestrial pollutants to land ($160m) and water use($34m). Downstream, the impacts from unmanaged waste fromchemical additives, land disamenity and marine litter are $120m.
Of these, the impact of littered products ending up in the marine
environment is the most significant. The impact of managed waste
is lower, at $60m, with the emission of greenhouse gases themost significant.

00

PACKAGING

PRODUCTPRODUCTDOWNSTREAM

UPSTREAM

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

25

50

75

100

125

150

175

200

225

250

275

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

1,500

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

1,400
1,300
$32m

1,200
1,100
$33m

1,000
900

$25m

$81m

BRITISHAMERICANTOBACCOPHILIP
MORRIS
INTL

$7m
$20m

800
700
600

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. One company inthe peer group disclosed data; all the rest is modelled. As such,any comparisons should be taken with care. Japan Tobacco hasa higher total plastic intensity due to its activities in the soft drink
sector. Imperial Tobacco, Reynolds American, and Altria Group
have lower downstream littering impacts due to the larger
proportion of their sales made in Europe and North America,
where filters are more likely to enter waste treatment routes,
leading to a lower overall intensity. Philip Morris has the highest
total natural capital cost due to its higher total sales

500
REYNOLDSAMERICANALTRIAGROUPIMPERIAL
TOBACCOJAPANTOBACCO
INC

75

toys
The proliferation of plastic material in toy manufacturing took place in the 1950s, facilitated by its durability and malleability. In 1958 Lego patented its blocks
produced from cellulose acetate, later replaced by acrylonitrile butadiene styrene polymer which was glossier, tougher and more ductile.162 Pure plastic
typically has low solubility in water and a low level of toxicity, although some plastic found in toys contains chemical additives and softeners which can beparticularly toxic. For instance, brittle plastic such as polyvinyl chloride contains plasticizers to make them pliable enough for toys such as phthalates andBisphenol A (BPA).163 Traditional plastic toys are not widely recycled, and in the UK alone 8.5m new and usable toys are landfilled every year.164

Results based on a combination of modelled and publicly disclosed data (third graph). Refer to Appendices 3 and 4 for the complete
methodology. The study is NOT intended to compare companies performance due to limitations in methodology and scope.

INDUSTRY AVERAGE INTENSITYINTENSITYDOWNSTREAM

3,500

40,0003,000

35,00030,0002,500

25,0002,000

20,0001,500

15,0001,000

10,000500

5,000

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

TOTAL NATURAL CAPITAL COST ($m)

UPSTREAM

00

PACKAGING

PRODUCT

The total natural capital cost of plastic use by the toy sector isover $3.3bn per year, or 4% of the total natural capital cost of theconsumer goods industry. The toy sector has a modelledplastic-in-product and plastic-in-packaging intensity of 38 and 3 tonnes
per $1m revenue respectively. Plastic-in-packaging accounts for 7%of the overall natural capital cost, while plastic-in-product accounts for
93%, mainly in the upstream stage (77%). This amounts to a total
natural capital intensity higher than $39,000 per $1m revenue, or 4%of total revenue. The risk related to plastic-in-packaging and plastic-in-product expressed by natural capital intensity, is higher than thatof the overall industry, meaning that on average the toy sector is more
at risk from plastic than other sectors.

PRODUCTDOWNSTREAM

UPSTREAM

The figure on the left highlights the distribution of impacts forplastic-in-product. 78% of the impacts are located upstream (orUS2.4bn) and 22% downstream (or $670m). The most significant
upstream impact is greenhouse gas emissions ($1.3bn), followedby terrestrial pollutants to land ($920m) and water use ($190m).
Downstream, the impacts from unmanaged waste from chemical
additives, land disamenity and marine litter are $360m. Of these,
the impact of littered products ending up in the marine environmentis the most significant. The impact of managed waste is lower, at$300m, with the emission of greenhouse gases the most significant.

GREENHOUSE GASESTERRESTRIAL POLLUTANTSTO LAND AND WATER
WATER USE

AIR POLLUTANTS

ADDITIVESLAND DISAMENITY

MARINE IMPACTS

0

250

500

750

1,000

1,250

1,500

TOTAL NATURAL CAPITAL COST ($m)

AVERAGE SECTOR INTENSITYDISCLOSURE

NON-DISCLOSURE

NATURAL CAPITAL INTENSITY ($ per $1m revenue)

40,00039,00038,000$4m

37,00036,000$213m

The figure on the left displays the estimated natural capital
cost and intensity of selected companies. Only Hasbro
disclosed a useable quantitative data point on plastic savings
associated with the elimination of the use of plastic bags in whichgame instructions were wrapped. All other aspects have beenmodelled and variations can be explained by location of sale.

$148m

35,000
MATTEL INC

HASBRO INC

HORNBY PLC

76

APPENDIX 2: TYPES OF PLASTIC
This table highlights the differences between several types of plastic.

TABLE 7: TYPES OF PLASTIC
Symbol / RIC Code

Plastic name

Properties

Common Uses

Polyethylene

Clear, tough, solvent resistant, barrier togas and moisture, softens at 80°C•

Soft drink and water bottles•

Salad trays and other food containers•

Synthetic fibres

Hard to semi-flexible, resistant to chemicals and moisture, waxy surface, opaque,softens at 75°C, easily coloured, processed
and formed•

Milk jugs and other containers•

Laundry detergents and other householdcleaning products•

Shampoo bottles

PVC-U: Strong, tough, can be clear, can besolvent weld, softens at 80°C
PVC-P: Flexible, clear, elastic, can besolvent weld•

Plumbing - pipes, fittings, window and door
frames•Electric cables•

Thermal insulation (PVC foam) andautomotive parts

Soft, flexible, waxy surface, translucent,softens at 70°C, scratches easily•

Bread bags, frozen food and grocery bags•

Most plastic film wraps•

Some bottles

Hard but still flexible, waxy surface, softens
at 140°C, translucent, withstands solvents,
versatile•

Margarine containers•

Microwaveable meal trays, lunch boxes•

Garden furniture and outdoor carpets

Can be clear, glassy, rigid, opaque, andsemi-tough, softens at 95°C•

Rigid in disposable cutlery, CD cases•

Foamed (Styrofoam) in food containers, egg
cartons, protective packaging for electronic
goods and toys, and building insulation

Includes all other resins andmulti-materials. Properties dependent onplastic or combination of plastics.

•

Lids, medical storage containers,
most baby plastic bottles•

Electronics

Terephthalate

High Density
Polyethylene

Polyvinyl
ChlorideLow Density
Polyethylene

Polypropylene

Polystyrene / Expanded Polystyrene

Other (e.g. polycarbonate
and polylactide)

77

APPENDIX 3: METHODOLOGYThis report has six steps:
1.

Sector selection and mapping - Sixteen consumer goods and services sectors were selected.

2.

Plastic use quantification – The plastic used in each sector was modelled using input-output modelling.

3.

Scope and boundary selection – Scope and boundaries for impact quantification of plastic use were determined.

4.

Impact quantification – Upstream and downstream impacts were quantified using input-output modelling and lifecycle
analysis techniques.

5.

Natural capital valuation - Natural capital valuations were applied to all impacts.

The output of the first five steps is an intensity figure – or impact per US$ million revenue.
6.

Sector-level and company-level application – The intensity figure derived through the first five steps was applied at a sector
level and company level to calculate total impact. At the company level, 100 companies were selected based on their modelledplastic use in their respective sectors. Further data was retrieved from public reports where available to produce an estimatedplastic use figure for each company.

STEP 1: SECTOR SELECTION AND MAPPING
Input-output models map the flows of inputs through an economy and associated environmental impacts. Trucost’s input-output
model comprises 464 sectors spanning primary to service industries. Consumer-facing sub-sectors were selected as part of thescope of this study. All non-consumer facing sectors, such as agriculture, were excluded and may form part of future analysis. Out
of Trucost 464 sectors, 75 consumer goods sectors were selected and aggregated into sixteen higher-level sectors based on two
main criteria:•

Type of product manufactured – certain sub-sectors were excluded based on the product manufactured. For example, thebreweries, wineries and distilleries sectors were not considered as they are likely to use more glass and less plastic than thesoft drink sector.

•

Position within the supply chain – certain sub-sectors were excluded based on their upstream position in the supply chain.
This is the case of the fibre, yarn and thread mills sector which is upstream of the apparel manufacturing sector.

•

No distinction was made at this stage between products and packaging.

Table 8 lists the chosen sectors, their description, and the corresponding NAICS sub-sectors.165

TABLE 8: SELECTED SECTORS FOR ANALYSIS
Sectors included

Explanation

Sub-sectors

Athletic goods

Sports goods andequipment manufacturers.

Sporting and athletic goods manufacturing.

Automobiles

Car manufacturers. Does notinclude car parts manufacturers
located further upstream..

Automobile manufacturing.

Clothing andaccessories

Clothes and accessories
manufacturers. Does include retailers.

Men’s and boys’ cut and sew apparel manufacturing;
women’s and girls’ cut and sew apparel manufacturing;other cut and sew manufacturing; apparel accessories
and other apparel manufacturing; other leather andallied product manufacturing; clothing and clothing
accessories stores.

Consumer electronics

Includes computers, TV sets andtelephone manufacturing.

Photographic and photocopying equipment
manufacturing; electronic computer manufacturing;
computer storage device manufacturing; computer
terminals and other computer peripheral equipment
manufacturing; telephone apparatus manufacturing;broadcast and wireless communications equipment;
other communications equipment manufacturing; audio
and video equipment manufacturing.

78

Sectors included

Explanation

Sub-sectors

Durable household
goodsIncludes utensil, small electricalappliances and large household
appliances manufacturing.

Cutlery, utensil, pot and pan manufacturing; hand tool
manufacturing; power-driven hand tool manufacturing;small electrical appliance manufacturing; householdcooking appliance manufacturing; household
refrigerator and home freezer manufacturing;household laundry equipment manufacturing; othermajor household appliance manufacturing.

Food

Processed food producers andmanufacturers. Does not include
agricultural sectors.

Dog and cat food manufacturing; other animal food
manufacturing; flour milling and malt manufacturing; wetcorn milling; soybean and other oilseed
processing; breakfast cereal manufacturing; sugar canemills and refining; beat sugar manufacturing; chocolate
and confectionery manufacturing from cacao beans;confectionery manufacturing from purchased chocolate;non-chocolate confectionery manufacturing; frozen food
manufacturing; fruit and vegetable canning, pickling,
and drying; fluid milk and butter
manufacturing; cheese manufacturing; dry, condensed
and evaporated dairy product manufacturing; ice
cream and frozen desert manufacturing; animal (except
poultry) slaughtering, rendering and processing; poultry
processing; seafood product preparation andpackaging; bread and bakery productmanufacturing; cookie, cracker and pasta
manufacturing; tortilla manufacturing; snack food
manufacturing; coffee and tea manufacturing;flavouring syrup and concentrate manufacturing;seasoning and dressing manufacturing; all other food
manufacturing.

Footwear

Clothes and accessories
manufacturers. Does include retailers.

Footwear manufacturing.

Furniture

Furniture manufacturers. Examples
include mattresses, carpet and blind
manufacturing.

Carpet and rug mills; curtain and linen mills; wood
kitchen cabinet and countertop manufacturing;
upholstered household furniture manufacturing; metaland other household furniture manufacturing; mattressmanufacturing; blind and shades manufacturing.

Medical andpharmaceuticalproducts

Medicine manufacturers. Does notinclude medical appliances.

Pharmaceutical preparation manufacturing.

Non-durable
household goods

Includes stationary product, soap andcleaning compounds and equipment
manufacturing.

Stationary product manufacturing; sanitary paper
manufacturing; all other converted paper productmanufacturing; soap and cleaning compounds
manufacturing; all other miscellaneous manufacturing;broom, brush, and mop manufacturing.

Personal products

Personal hygiene productmanufacturing, such as shampoos
and make-up.

Toilet preparation manufacturing.

Restaurants and bars

Includes food and drinking places.

Food services and drinking places.

RetailIncludes general, food andclothing retailers. Does not include
online retailers.

Food, beverage, health and personal care stores;
general merchandise stores; miscellaneous
store retailers.

Soft drinks

Soft drinks bottlers and manufacturers.
Does not include wineries, distilleries
and breweries.

Soft drinks and ice manufacturing.

79Sectors included

Explanation

Sub-sectors

TobaccoTobacco producers. Does not include
agricultural sectors.

Tobacco product manufacturing.

Toys

Includes toys, dolls andgames manufacturers..

Doll, toy and game manufacturing.

STEP 2: PLASTIC USE QUANTIFICATION
Plastic use per sector was then modelled using input-output modelling. The input-output model calculates inter-industry
spend patterns through each tier of the supply chain for each sector using government census data. Thirteen sectors relate toplastic and plastic product manufacturing. The amount spent by the selected consumer goods sectors in these 13 plastic
manufacturing sectors was modelled and converted from a financial figure (US$ million spent) to a quantity (tonnage) using aweighted average plastic price based on global production in order to derive an average plastic intensity (tonnes per US$ million
revenue) per sector and industry.166
Total plastic consumption was disaggregated into ‘plastic-in-product’, ‘plastic-in-packaging’, and ‘plastic-in-supply-chain’.
1.

‘Plastic-in-product’ includes the quantity of plastic directly used in the product, as well as any losses that were incurred
during the manufacturing process. An example is the plastic used in the bumper of a car or a polyester t-shirt.

2.

‘Plastic-in-packaging’ includes the quantity of plastic directly used in the packaging of the product, as well as any losses thatwere incurred during the manufacturing and packaging stage. This covers items such as plastic bags and films, as well aswater and shampoo bottles.

3.

‘Plastic-in-supply-chain’ includes the quantity of plastic used indirectly by consumer goods businesses via their supply chain
but is destined to be neither in the final product nor in packaging. It includes all relevant activities, even where not in the
consumer goods industry. For example, this includes the plastic containers of fertilisers applied in the agriculture sector, further
down the supply chain of the food sector. Trucost calculated the volume of ‘plastic-in-supply-chain’ to put the first two
categories into perspective but did not calculate the related natural capital cost.

Trucost triangulated the results with product-level data on plastic use. For example, the model yields 135kg of plastic for a car
costing US$30,000, which falls within the 100-150kg range disclosed in industry reports.99
Several limitations should be noted. First, the input-output model is based on average transactions in the economy and may not
be representative of particular activities or sectors. Second, the amount of plastic that Trucost has assigned to the categories ofplastic-in-product, plastic-in-packaging and plastic-in-supply chain is based on modelled data and should be considered
as estimates.

STEP 3: SCOPE AND BOUNDARY SELECTION
Once plastic use in tonnes is calculated for each sector, the next step is to set up the boundaries that will be used to calculate theimpact of plastic. Lifecycle boundaries must first be set, i.e., what lifecycle stages are included in the analysis. Then, impacts to bequantified at each lifecycle stage must be determined.
Figure 22 highlights the lifecycle stages that are included in the analysis. Upstream lifecycle stages quantified in the analysis
include raw material extraction and processing into plastic feedstock. Plastic product manufacturing has been excluded due to alack of detailed data. Different processes exist such as blow moulding and film extrusion. Data is available on these processes,
from lifecycle analysis databases like Ecoinvent. However, the multiplicity of products and processes used in each sector does notallow a sector-specific profile for this stage to be built. Exclusion of this stage underestimates upstream impacts, as transforming
plastic feedstock into finished products can be energy intensive.
The transportation and use phases have been excluded due to the lack of data and for the sake of simplicity. The transportation
stage can generate significant amount of greenhouse gases, and leachate of additives during the use phase has recently comeunder scrutiny. These stages may also be significant in terms of benefits. For example, switching from heavier materials to plastics
may decrease transportation emissions.
Downstream stages include the disposal of plastic after its use. Five end-of-life routes are included in this study, namely littering,
landfilling, incineration with and without energy recovery and recycling. Other routes such as conversion to fuel and composting
have not been included for lack of country-specific statistics on the quantity of plastic diverted to these routes. The benefits ofrecycling and incineration with energy recovery have been excluded as part of the baseline calculations and are explained in thequantification section of this methodology. When plastic is littered, it may reach different environments. Freshwater and terrestrial
environments have only partly been included due to a lack of data.

80

FIGURE 22: SCOPE AND BOUNDARYINCLUSION IN THE ANALYSIS:INCLUDED

PARTIALLY INCLUDEDNOT INCLUDEDRAW MATERIALEXTRACTION
PLASTICFEEDSTOCKMANUFACTURING

PLASTICMANUFACTURING

UPSTREAM

PLASTIC
TRANSPORTATION

PLASTICUSE

RECYCLING

INCINERATIONFRESHWATERECOSYSTEMSLITTEREDTERRESTRIALECOSYSTEMSLANDFILL

IN-USEINCINERATIONWITH ENERGYRECOVERYOTHER
ROUTESMARINEECOSYSTEMSDOWNSTREAM

81

The second step is to determine which impact can be quantified at each lifecycle stage selected within the scope of the analysis.
Table 9 highlights included and excluded impacts.

TABLE 9: IMPACT INCLUSION AND EXCLUSION
Lifecycle stage

StatusComment

Non-renewable
resource consumption

ExcludedNatural gas and crude petroleum are
non-renewable resources which if
over-exploited may not be available
for future generations. The opportunity
cost of using non-renewable resources
has not been included as part of thisanalysis. The impact of extracting andprocessing these resources, on theother hand, is included via the threefollowing elements.

Greenhouse gases

Included

Impact of extracting and processing
raw materials into plastic feedstock.

Air/land/water pollutants

Included

Water consumption

IncludedOccupational hazards ofchemicals use

ExcludedLack of consistent and global data

Greenhouse gases, air/land/waterpollutants, water consumption ofplastic product manufacturing (blowmoulding, film extrusion, etc…)

ExcludedThis lifecycle stage (and associatedimpacts) has been excluded. Different
processes exist such as blow moulding
and film extrusion. Data is available onthese processes, from lifecycle
analysis databases like Ecoinvent.
However, the multiplicity of products
and processes used in each sector
does not allow to build a sectorspecific profile for this stage, hence
the exclusion.

Transportation

Excluded

The in-use stage has been excluded
for lack of data.

Additives leachate

Excluded

Upstream

In-useDownstream - Landfilling
Waste of recyclable resources

Excluded

Greenhouse gases

Included

Air/land/water pollutants

Included

Water consumption

IncludedDownstream – Incineration without energy recovery
Waste of recyclable resources

Excluded

Greenhouse gases

Included

Air/land/water pollutants

Included82

Water consumption

Included

Ash disposal

IncludedDownstream – Incineration with energy recovery
Waste of recyclable resources

Excluded

Greenhouse gases

Included

Air/land/water pollutants

Included

Water consumption

Included

Ash disposal

Included

Energy production

Excluded

The benefits of energy production
have been excluded from the main
analysis. An alternative scenario is
explained p86.

Greenhouse gases

Included

Air/land/water pollutants

Included

A conservative value of 0 has beenused. An alternative scenario is
explained p86.

Water consumption

IncludedPrimary material displacement

IncludedDownstream - Recycling

Downstream – Littered
Waste of recyclable resources

ExcludedNuisance (disamenity) related
to littering

Included

Terrestrial and freshwater pollutionof littered plastic

Partially included

Please refer to Appendix 4
for inclusions and exclusions inthis category.

Marine pollution of littered plastic

Partially included

Please refer to Appendix 4
for inclusions and exclusions inthis category.

STEP 4: QUANTIFICATION OF PLASTIC USE IMPACTS
The quantification stage comprises two separate stages, upstream and downstream impact modelling and quantification.
UPSTREAM MODELLING AND IMPACT QUANTIFICATION
The term ‘upstream’ refers to impacts generated from ‘cradle-to-gate’, i.e., the extraction of raw materials such as crude
oil and natural gas to the manufacturing of plastic feedstock. Processing into the final product, such as fibres, shapes orpackaging film is not included, as explained in the scope and boundary section.
Upstream impacts considered include greenhouse gases, water abstraction, air pollutants, land and water pollutants, andcover the cradle-to-gate manufacturing of amorphous plastic feedstock. Trucost used its environmentally-extended inputoutput model to calculate the global environmental impact of producing the plastic used in each sector. The environmentallyextended input-output model goes one step further than the input-output model by overlaying environmental impacts data withfinancial flow data. Each sector has a global environmental profile per unit of output which is derived from numerous sources,
including the US Toxic Release Inventory, UK Environmental Accounts, Japanese Pollution Release and Transfer Register andAustralia’s National Pollution Inventory. The economic magnitude of a sector’s input from another sector defines its environmental
impact, and so on through the supply chain, until all economic flows to produce a unit of output at the top of the supply chain havebeenaccounted for. The model is adjusted on an annual basis to take into account changes in the environmental impact of a unit ofoutput for each sector.

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ILLUSTRATION OF PLASTIC TYPES
Many different types of plastic are used by industry depending on the characteristics of the material and its application. For
example, plastic bottles are commonly made of polyethylene terephthalate (PET) whereas low-density polyethylene is typicallyused for multi-use grocery bags and polyurethane for car seats.1,99 Different types of plastic have different environmental impacts.
Trucost’s calculations are based on an average of the most commonly used plastics across all sectors.
Figure 23 compares the environmental impacts of four plastic types as an example of impact variability during the upstream stage.
When considering the impacts of plastic, companies should assess these differences and identify opportunities to switch between
plastic types.

KG OF GREENHOUSE GASES PER KG OF PLASTIC GRANULE

FIGURE 23: FOCUS ON THE ENVIRONMENTAL IMPACT OF DIFFERENT PLASTIC TYPES
3.5
3.0
2.5
2.0
1.5
1.0

YL

AS
D

ET

H

PL

PY
O

R

SE

D

EC

PO

YC

LY

LE

PR
LY
PO

EN

C

N
LE

LA
TA
H
EP
R
TE
E

C
AR
G
SU

PO

LY

AN

ET

E-

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BA

YL

EN

TI

E

TE

0.0

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0.5

The results displayed in figure 23 are based on secondary lifecycle analysis studies.9,167 One should note that there is noconsensus on the upstream impact of plastics, especially on bio-based plastics, and companies are encouraged to conduct theirown assessments. The use of input-output modelling in this study results in higher estimates – for example 3.48 kg of greenhousegases for the production of 1 kg of average plastic. Input-output modelling implies larger boundaries, hence the higher estimate.

DOWNSTREAM MODELLING AND QUANTIFICATION
The term ’downstream’ refers to impacts occurring when the product is discarded by the consumer. The outbound transportationand in-use phase have been excluded, as explained in the scope and boundary section. The first step is to estimate end-of-life
treatment route percentages. The second step is to understand the impact of each treatment route.
In this report, the impact of plastic is weighted differently depending on how it is handled at its end-of-life. Region-specific end-of-life
statistics for plastic-in-packaging and plastic-in-product across five different routes were derived: littering, landfilling, incineration
with and without energy recovery and recycling/re-use. Other end-of-life routes exist for plastic, such as conversion-to-fuel andcomposting, but represent a small proportion overall and were not included in the analysis. Due to the lack of national andinternational standards for waste treatment data collection, compilation and disclosure, Trucost combined several sources, such as
the US Environmental Protection Agency, Eurostat, the United Nations, the World Bank and academic articles. The following tabledetails specific assumptions.

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TABLE 10: TREATMENT ROUTES SOURCES AND ASSUMPTIONS
Item

End-of-life route

Reference

Packaging

Littering: Percentage of the population served by collection system used asa proxy.

8, 10, 168,
169, 170

All other routes:

Automobiles•

Europe: Eurostat data on plastic packaging waste.

•

United States: US EPA data on plastic packaging waste.

•

Australia and New Zealand: Australian Bureau of Statistics data on plastic
packaging waste.

•

Other: Domestic municipal waste used as a proxy, scaled up using US EPA
ratio between recycled domestic waste and recycled plastic packaging waste.

Littering: a minimum of 6% of cars are littered, scaled up by country’s specificlittering rates for overall waste.
All other routes: Managed is either recycled or incinerated with energy recovery.
The remaining is landfilled.

Electronics andhousehold durables•

Europe, US, Singapore, Japan: Eurostat data on the proportion of plastics
recycled (8%) and incinerated with energy recovery (12%).

•Australia, New Zealand: Europe recycling rate as a proxy (8%), noenergy recovery.

•

Other: 3% recycled/reused, remaining is landfilled or littered.

Littering: percentage of the population served by collection system used asa proxy.
All other routes: Managed is either recycled or incinerated with energy recovery.
The remaining is landfilled.

Tobacco•Europe, US, Singapore, Japan: Eurostat data on the proportion of plastics
recycled (8%) and incinerated with energy recovery (36%).

•

Australia, New Zealand: Europe recycling rate as a proxy (8%), noenergy recovery.

•

Other: 3% recycled, no energy recovery

Littering: Percentage of the population served by collection system used asa proxy for littering.

8, 10, 168,
169, 170, 80,
172, 1718, 10, 168,
169, 170,
80, 1718, 10,
168, 169

All other routes: Domestic waste treatment routes used as a proxy,excluding recycling.
All other products

Littering: Percentage of the population served by collection system used as aproxy for littering.

8, 10,
168, 169

All routes: Domestic waste treatment routes used as a proxy.
Recycling: Recycling figure scaled down using the US EPA ratio between
recycled domestic waste and recycled non-durable consumer plastic goods.

The international data on the waste treatment routes used for plastic packaging and plastic products is often lacking and/orinconsistent. Trucost used several datasets to compile end-of-life statistics, as listed in table 10. As a consequence, allassumptions used in constructing these datasets apply to this report. In particular, recycling data from many countries does notinclude industry closed-loop systems, waste recycled outside the country, and waste-picking activities, which may all increase theproportion of waste recycled. In addition, there may be some differences within each category – for example, recycling rates of film
packaging, bags and trays (all under ’packaging’) may differ.169
As a second step, quantified environmental impacts for each end-of-life route have been calculated, and include
greenhouse gases, air pollutants, water abstraction and land and water pollutants. Additional impacts have been included forplastics that are littered. Table 11 provides information on how these impacts have been calculated.
•

Trucost used lifecycle analysis databases such as Ecoinvent for most end-of-life routes. For littered plastic waste, further
impacts have been calculated based on an extensive academic literature review.

85•

As part of the baseline analysis, no benefits have been attributed to recycling and incineration with energy recovery. For
recycling, a conservative value of 0 has been used. The next section discusses this further and explains how the “benefits” ofrecycling and incineration with energy recovery have been calculated.

TABLE 11: impacts FOR EACH END-OF-LIFE ROUTE
Itemburdens

comments

Incineration without
energy recovery

Lifecycle analysis data on average
plastic mixes for the incinerationroute.171

Burdens include all raw material inputs needed toincinerate as well as the disposal of ash slag.

Landfilling

Lifecycle analysis data on
average plastic mixes for thelandfilling route.171

Burdens include all raw material inputs needed to landfill
as well as landfill leachate.

Incineration withenergy recovery

Lifecycle analysis data on average
plastic mixes for the incinerationroutes.171

Burdens include all raw material inputs needed toincinerate as well as the disposal of ash slag. Refer tothe next section for a discussion of incineration withenergy recovery benefits.

RecyclingConservative value of 0

Recycling has both impacts and benefits. However, theirrelative proportion varies according to several factors
such as recycling techniques, what is the recycledmaterial used for, transboundary waste exchanges.
Due to a lack of global data on recycling burdens andbenefits, Trucost used a conservative value of 0. Refer tothe next section for a further discussion.

Littering

Lifecycle analysis data on average
plastic mixes for the landfilling route.171
In addition, Trucost included region
and end-of-life specific disamenity
impacts relating to the noise, dust,
litter, odour, presence of vermin, visual
intrusion and enhanced perception ofrisk, additive leachate in the terrestrial
and marine environment, and plastic
impacts in the ocean.

Each product and packaging has been assigned aprobability of reaching marine ecosystems, based on
their weight. All packaging items have a probability of 1,
light-weighted products 0.5, and other heavy products
0. While these probabilities can be refined, no global orcountry-specific data exist on the dispersion of plastics.
The analysis excludes terrestrial and freshwater impactsof plastic litter, such as freshwater economic impacts tofishing, tourism, and agriculture, and ecological impact tofreshwater and terrestrial species. Refer to Appendix 4
for a detailed discussion of this end-of-life route.

As for upstream impacts, downstream impact calculations refer to an average plastic mix for simplicity purposes, but in reality mayvary depending on the type of plastic.
Plastic recycling and incineration with energy recovery
As part of the baseline analysis, Trucost only included the impacts of incineration with energy recovery, and used a conservativevalue of 0 for recycling. End-of-life impact quantification is one of the most contentious areas in lifecycle analysis and several
techniques are available. As part of the alternative analysis, Trucost calculated what the total natural capital cost of the consumer
goods industry would be if the benefits of recycling and incineration with energy recovery were taken into account. The
methodology is the same apart from the two following points:•

For plastic that is recycled or incinerated with energy recovery, both positive and negative effects have been allocated.
Positive effects, or credits, include displacing primary plastic production through recycling and energy grid production throughincineration with energy recovery. Negative effects, or burdens, include the impacts generated by the recycling process andincineration with energy processes, such as the emission of greenhouse gases and other air pollutants.

•

Credit for positive effects and burdens for negative effects were allocated using the 50/50 method – meaning that 50% has
been allocated to the “new” user (or upstream impact of a company using recycled plastic in their products and packaging forexample) and 50% to the emitter (or downstream impact of a company where the product or packaging is sent for recycling
for example).

86

TABLE 12: CREDITS AND BURDEN ALLOCATION FOR EACH END-OF-LIFE ROUTE
End-of-liferoutesBurdens

Credits

Comments

Incineration withenergy recovery

Lifecycle analysis dataon average plastic
mixes for the incineration routes.171

Lifecycle analysis data on
impacts that would havebeen generated by thedisplaced grid electricity.171

Burdens include all raw
material inputs needed toincinerate as well as the disposalof ash slag; benefits assume thedisplacement of grid electricity,
taking into account conversion
efficiency. Whether the burdens
outweigh the benefits will dependon the efficiency of theincineration process, as well as
the type of gridelectricity displaced and local
waste infrastructure. In theabsence of global datasets on
incineration with energy recovery
burdens and benefits, Trucost
has used global averages, whereburdens outweigh benefits.

Recycling

Lifecycle analysis dataon the negative impactof recycling processes
and average plastic
mixes.173

Lifecycle analysis data on
impacts that would havebeen generated by thecradle-to-gate production
and disposal of primaryfeedstock, including
conversion losses.171

Burdens include air, land andwater emissions as well as water
consumption of the recycling
process and the extraction andmanufacturing of secondary
raw materials used. Mechanicalrecycling (in opposition to otherrecycling techniques such as
chemical recycling) is taken asa proxy across all sectors, andmay underestimate oroverestimate the environmental
profile depending on the
sector/recycling techniqueconsidered. Transportation
impacts of transboundary waste
exchanges are not included andmay thus overestimate thebenefit attributed to recycling.

STEP 5: NATURAL CAPITAL VALUATIONS
The final step of the calculation involved transforming physical quantities of plastic into monetary values using environmental or
natural capital valuation techniques. These techniques estimate the value of environmental goods or services in the absence of amarket price and aggregate them into a single figure.
Trucost applied region-specific valuations for water abstraction and air pollutants, and global averages for land and water pollutants
and plastic ending up in the ocean. Toxicity information on land and water pollutants contains many methodological uncertainties,
hence the use of a global average. The impacts of greenhouse gases are global, regardless of the location of emission. Finally,
little information exists on the dispersion of plastic, hence the use of a global valuation for plastic ending up in the ocean. Other
environmental impacts are region-specific. In order to evaluate the global natural capital intensity and cost, Trucost weighted
regional averages by market share.174
Appendix 4 details the valuation methodology used for each impact. The following table provides an overview of Trucost’s natural
capital valuation methodology.

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TABLE 13: VALUATION METHODOLOGY SUMMARY
Valuation scope

Methodology summary

Geographical scope

GHGs

Uses the social cost of carbon (in preference to themarket price or abatement cost of carbon) as it bestreflects the total damage engendered by the emission of one tonne of CO2e. The valuation is basedon the present value of each metric tonne of CO2eemitted now, taking account of the full global costof the damage that it imposes during its time in theatmosphere.

A social cost of 113 US$ 2012 per metric tonne of CO2e was used to value GHG emissions,which is the value identified in the UK Government’s Stern report as the central,business-as-usual scenario, adjusted for inflation to 2012 prices using a global weighted
average consumer price index (CPI).

Global average

Air pollution

Valuation methodology for 5 air pollutants: ammonia(NH3), sulphur dioxide (SO2), Nitrogen oxide (NOx),
volatile organic compounds (VOCs), and particulatematter (PM10). Each pollutant is associated withdifferent but overlapping damage costs. Studies
into the damage costs of air pollution use Impact
Pathway Analysis (IPA) to follow the analysis fromidentification of burdens (e.g. emissions) through to
impact assessment and then valuation inmonetary terms.

Literature reviews were carried out for each air pollutant. The impact pathway approach wasused to assess air pollution impacts. Data on the number of effect end points per tonne werecompiled to derive an average number of each type of effect per tonne. The general approachtaken when performing function transfer for air pollution is to scale the number of effect end
points from the literature based on the receptor density. Therefore the number of effect end
points per tonne is adjusted based on relevant factors.

Region-specificDisamenity

The localized impacts of landfill and littering activity
that generate negative reactions from those locatedin the immediate vicinity of a site.

The most common valuation method used in literature for disamenity is to use the hedonic
pricing method. This method is based on the idea that the utility that individuals obtain froma particular good, and therefore the ‘value’ that they place on that good, is a function of thecharacteristics such as house size, house age, number of rooms, proximity to amenities suchas schools, etc.

Region-specificWaterconsumption

The environmental services of water, which canbe assimilated to the instream services of water(services provided by water in its naturalenvironment).

Trucost has developed a methodology linking the environmental services of water to its scarcity
in the region where it is abstracted. As defined by the Food and Agriculture Organization, water
scarcity is the freshwater withdrawal as a percentage of total renewable resources.

Region specificLand andWater pollution/
Additives

Health and ecosystem damages of pollutantsreleased in different media. The valuation isregion-specific but due to high uncertainty in toxicity
calculations, Trucost chose to use a global average.

Trucost used life cycle analysis models that quantify the health and ecosystem damage ofdifferent pollutants released to land and water. Health impacts are calculated in Disability
Adjusted Life Years (DALYs) and ecosystem damages in Ecosystem Damage Potential (EDP).
Based on secondary literature and benefit transfer, Trucost derived a value for DALYs and EDP
based on societal willingness-to-pay.

Global average

Plastic in marine
environments

Economic impact on fisheries and aquaculture,
tourism, and the opportunity cost of volunteer time;
and the entanglement and ingestion impacts on
marine species.

Trucost used secondary literature on the economic impact of plastic and on the quantity ofmarine species impacted by plastic entanglement and ingestion. Willingness-to-pay studies
were used to assess the value that society puts on marine species.

Global average

88

STEP 6: SECTOR-LEVEL AND COMPANY-LEVEL APPLICATIONThe output of steps 1 to 5 is a sector and region-specific natural capital intensity figure. Natural capital intensity
expresses the natural capital cost of all environmental impacts per US$ million revenue. This can be understood as ameasure of risk. If all the environmental and social impacts generated by plastic were to be paid by business, this percentage of
their total revenue would be forfeit.
The natural capital intensity figure can then be multiplied by total revenue to derive a total natural capital cost for plastic
use, either at a sector or company-level.
Total natural capital cost can also be normalized by service life.175 Service life is the period of time over which product andpackaging are used. The period varies depending on the item. Natural capital cost normalized by service life is useful to partially
understand how efficiently plastic is used by dividing the total natural capital cost by the average service life of a typical product/
packaging item manufactured by each sector. Total natural capital cost should thus be considered along with normalized total
natural capital cost to have an overall understanding of the impact of plastic use.
OUTPUT 1: SECTOR LEVEL ANALYSISAt the sector level, Trucost calculated the total natural capital cost of plastic use by each consumer goods sector. The total natural
capital cost is the total natural capital intensity for that sector, multiplied by its aggregate revenue.174
OUTPUT 2: COMPANY ANALYSIS
Trucost collects financial and environmental data on more than 4,500 stock exchange listed companies from publicly
available sources such as annual and corporate social responsibility reports. Each company is mapped to one or more of
464 sectors based on its business activities and revenue. At the end of the data collection process, Trucost engages with eachcompany for quality control purposes.
For this particular study, the average plastic consumption was first modelled for each consumer-facing company in Trucost’s
database based on its respective sector mapping and revenue. One hundred companies were then selected on the basis of theirmodelled materiality in their respective sectors. When one company operates across different sectors, such as soft drinks and food,
it was mapped to its primary sector for reporting purposes.
When the input-output modelling methodology is applied at a company level, plastic consumption and impact may be over orunder-estimated depending on a company’s business model, product mix, or whether it discloses data on plastic use. This isbecause the level of impact is modelled on its expenditure in certain sectors – in this case plastic manufacturing sectors. For
example, luxury goods companies are likely to have their plastic consumption overestimated, as they have a higher
revenue-to-quantity-sold ratio than most other companies.
Publicly available data on plastic use for the financial year 2011/12 were then incorporated to refine results based on sector
averages. Specific data points collected include plastic consumption, recycled content, bio-based content, quantitative information
on upstream initiatives such as quantity of plastic saved through lightweighting, quantitative information on downstream initiatives
such as takeback programs. Trucost also gathered revenue data at a regional level to estimate the quantity of products andpackaging ending their lives in different regions. To be “usable” the data provided needed to be clear as to coverage and granularityof application. Many companies disclosed both quantitative and qualitative data that could not be integrated within the calculations.
Scope and boundaries are not always clear from companies’ reports, so data can lack comparability. When assessing reports,
Trucost had to make some assumptions to overcome this issue. An example is the percentage of recycled content: somecompanies report a rate which covers all materials, in which case Trucost made the assumption that this rate would be the same forplastic. Globally, plastic recycling rates are lower than for traditional materials such as metals, pulp, and glass. As a result, recycling
rates for these companies have been overestimated.
The following example illustrates how the calculations were performed for a mock company.
COMPANY-LEVEL CALCULATIONS
Company A is a publicly listed company which operates in the ‘soft drink and ice manufacturing’, ‘chocolate and confectionery
manufacturing from cacao beans’, and ‘Air conditioning, refrigeration, and warm air heating equipment manufacturing’ sectors.
Each sector generated US$8m, $6m, and $2 million revenue respectively in 2012, as reported in its income statement.
Company A’s plastic use is modelled as follows:
Plastic use in the ‘air conditioning, refrigeration, and warm air heating equipment manufacturing’ is excluded as this sector is not in
scope for this report.
The ‘soft drink and ice manufacturing’ sector has an average plastic in packaging intensity of 15 tonnes per US$ million revenue(and zero for plastic-in-product). Thus, Company A’s activities in this sector is modelled as 8x15 tonnes of plastic, or 120 tonnes
in total.

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The ‘chocolate and confectionery manufacturing from cacao beans’ sector has an average plastic-in-packaging intensity of 4
tonnes per US$ million revenue (and zero for plastic-in-product). Thus, Company A’s activities in this sector are modelled as using
4x6 tonnes of plastic, or 24 tonnes in total.
The total modelled plastic use of Company A is 120 + 24 = 144 tonnes, and the total plastic intensity of company A is 10 tonnes per
US$ million revenue.
To create a more refined estimate, Company A’s Disclosure is integrated as follows:
Company A does not report on total plastic use, which would have been used to override the modelled data.
Company A reports on an estimated reduction in weight per consumer use of 20% over a two-year time period, the total plastic
consumption is 144x(1 – 20%) = 115 tonnes.
Company A also reports on 1 tonne of plastic saved due to lightweighting initiatives, its total plastic consumption is 115 – 1 = 114
tonnes.
Company A also report a 5% recycled content rate, thus total primary plastic consumption is 114x(1-5%) = 107 tonnes and total
recycled plastic use is 114x5% or 7 tonnes. This methodology also applies for bio-based content.
The average upstream natural capital cost of one tonne of plastic is US$760 per tonne of virgin plastic, and 0 for recycled plastic.
Thus the modelled upstream natural capital cost of Company A plastic use is thus 107 tonnes of virgin plastic x US$760 + 7 tonnesof recycled plastic x US$0= US$ 81,320.
Company A generates 60% of its revenue in North America and 40% in Asia. As a result, this report assumes 60% x 114 tonnes,
or 68 tonnes, are discarded in North America and 46 tonnes in Asia. The downstream plastic-in-packaging natural capital valuationin the soft drinks sector is US$480 per tonne in Asia and US$60 per tonne in North America. The downstream plastic-in-packaging
natural capital valuation in the food sector is US$480 per tonne in Asia and US$70 per tonne in North America.
The downstream natural capital cost of Company A’s plastic use is calculated as follow:
Soft drinks sales in North America: 95.5 tonnes used in the soft drink sector x 60 % of sales in North America x US$60 = US$ 3,438
Soft drinks sales in Asia: 95.5 tonnes used in the soft drink sector x 40 % of sales in Asia x US$480 = US$18,336
Food sales in North America: 18.7 tonnes used in the food sector x 60 % of sales in North America x US$70 = US$785
Food sales in Asia: 18.7 tonnes used in the food sector x 40 % of sales in Asia x US$480 = US$3,590
The total downstream natural capital cost of Company A’s plastic use is thus 3,438 + 18,336 + 785 + 3,590 = US$26,149.
Company A does not report quantitative data on take-back schemes and therefore we assume country average recycling rates.
The total upstream and downstream natural capital cost of Company A’s plastic use is 81,320 + 26,149 = US$107,469 andits natural capital intensity is 107,469 / (8 + 6) is US$7,676 per million dollar revenue or 0.7% of its overall revenue.

90

APPENDIX 4: NATURAL
CAPITAL VALUATIONThis appendix explains in detail how natural capital valuations were derived for greenhouse gases, air pollutants, water use, land
and water pollutants, managed waste and littered waste. For an explanation of how they were integrated in the analysis, refer toAppendix 3.

GREENHOUSE GAS EMISSIONS
A greenhouse gas is a gas in the atmosphere that absorbs and emits radiation within the thermal infrared range. The primary
greenhouse gases are water vapour, carbon dioxide, methane, nitrous oxide and ozone. Greenhouse gas emissions can be valued
using a marginal abatement cost, a market price or the social cost of carbon. This section defines these three methods and justifies
why the social cost of carbon is the preferred valuation method. It then describes the valuation study used to derive the natural
capital valuation applied in this study.
STEP 1: SELECTING AN APPROACH FOR VALUing GREENHOUSE GAS EMISSIONS
Three approaches for valuing the marginal or incremental cost of an additional tonne of GHG emitted are summarised below.
Marginal abatement cost (MAC)
Definition: Valuing carbon using the known costs to reduce carbon to achieve an emissions reduction target, for example throughenergy efficiency improvements, renewable energy, materials substitution and/or carbon capture and storage technology.
Advantages: Based on the known actual costs of existing reduction efforts.
Disadvantages: Costs of reduction will fluctuate over time, by sector and by geography. Different reduction targets will translate
into different MACs for each country. Estimates of the costs or benefits of increasing energy efficiency or switching to renewableenergy are influenced by fossil fuel prices, carbon prices and other policy measures. The policies and technologies used to support
carbon abatement will therefore influence pricing.
Market priceDefinition: The value of traded carbon emissions rights under policies which constrain the supply of emissions permits, credits orallowances. The market price should be equal to the MAC for a given target, if the carbon market covers all emissions sources andis competitive. In the absence of a comprehensive international emissions trading scheme, a cap consistent with the optimal
stabilization goal would result in a market price of carbon equal to both the MAC and social cost of carbon.
Advantage: Market prices are easily accessible.
Disadvantages: Market-based mechanisms have been slow and fragmented so companies are unlikely to pay market prices foremissions across global operations. Traded market prices do not reflect non-traded carbon costs, nor the impact of othermarket-based mechanisms such as carbon/fuel taxes, subsidies for removal of fossil fuels, or support for low carbon technologies(i.e. feed-in-tariffs for renewable energy supplies). Current market prices are too low to induce the level of emissions reductions
required and are not representative of future abatement costs of the expected costs of damages from climate change impacts.
Social cost of carbon (SCC)
Definition: The global cost of damages resulting from GHG emission-induced climate change. The value is based on the present
value of each metric tonne of carbon dioxide equivalent (CO2e) emitted now, taking into account the full global cost of the damage
that it imposes during its time in the atmosphere.
Advantages: The SCC signals what society should be willing to pay now to avoid the future damage caused by carbon emissions
and therefore best reflects the total damage caused by emitting one tonne of CO2e. In theory, climate policy would set emissions
reduction targets that result in a MAC equal to the SCC and, in perfect markets the price of carbon should equal the SCC. SCC istherefore the most complete measure of the damage generated by the emission of GHGs and is the method used by Trucost.
Disadvantages: SCC valuations are highly contingent on assumptions, in particular the discount rate chosen, emission scenariosand equity weighting. Please see the next section for a discussion of each.
Trucost uses the Social Cost of Carbon method as it best reflects the total damage by the emission of one tonne of CO2e. In
theory, optimal climate policies would set emissions reduction targets that result in a MAC equal to the SCC. Further, in perfectmarkets, the price of carbon should be equal to its damage cost (i.e. to the SCC). Therefore, the SCC is the most complete
measure of the damage generated by GHG emissions.

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STEP 2: CALCULATING THE SOCIAL COST OF CARBON
Over 300 studies attempt to put a price on carbon, valuing the impacts of climate change on agriculture, forestry, water resources,
coastal zones, energy consumption, air quality, tropical and extratropical storms, and human health. Estimates across studies varyfrom below-zero to four-figure estimates, mainly due to four factors:
Emissions scenarios: In order to derive the social cost of carbon, assumptions need to be made on future emissions, the extent
and pattern of warming, and other possible impacts of climate change, so as to translate climate change to economic
consequences. Tol identified three methodological approaches undertaken by the literature – expert review, enumerative method,and statistical method – and conducted a meta-analysis of the results.176 Studies are in broad agreements on the fact that thenegative effects of climate change outweigh the short-run benefits of inaction.
Discount rate: The discount rate used to calculate the present value of future economic damages resulting from carbon emitted
today can be the most significant source of variation in estimates of the social cost of carbon. Higher discount rates result in lower
present day values for the future damage costs of climate change. Variations in discount rates can be due to differences inassumptions about factors such as the rate of pure time preference, the growth rate of per capita consumption and the elasticity of
marginal utility of consumption.
Equity weighting: A global SCC can take into account variations in the timings and locations at which the costs of climate change
impacts will be internalized, which may differ from the locations where the GHGs are emitted. Some studies including Stern andTol take account of equity weightings – corrected for differences in the valuations of impacts in poor countries.176,177
Uncertainties: Variations in valuations are influenced by uncertainties surrounding estimates of climate change damages andrelated costs. However climate change studies since 1995 tend to take account of net gains as well as losses due to climatechange.The mean estimate of the social cost of carbon, as well as the standard deviation, have declined since 2001, suggesting
decreasing uncertainty in the understanding of climate change impacts. Further, GDP loss estimates in relation to climate change
have declined over time, as later studies focus on the positive and negative effects of climate change and take adaptation
into account.
A social cost of 113 US$ 2012 per metric tonne of CO2e was used to value GHG emissions, which is the value identified in the UK
Government’s Stern report as the central, business-as-usual scenario value, adjusted for inflation to 2012 prices using a global
weighted average consumer price index (CPI).177

AIR POLLUTANTS EMISSIONS
The main air pollutants include sulphur dioxide (SO2), nitrogen oxides (NOx), particulate matter (PM), ammonia (NH3), carbon
monoxide (CO) and volatile organic compounds (VOCs). Each pollutant impacts human health and/or crop and forest yields in aunique way. The economic damage caused per unit of pollutant depends on the specific location, and is driven by population andcrop and forest density.
Each pollutant is associated with different but overlapping types of external costs. Some effects are caused directly by the primarypollutant emitted (e.g. health impacts of particulates) and some are caused by secondary pollutants formed in the atmosphere from
pollutants that acts as precursors (e.g. sulphur dioxide forming sulphuric acid as well as sulphate compounds which contribute tosmog). As each pollutant has a unique set of effects, each pollutant is valued using an individual methodology (although there isoverlap between methodologies).

92

FIGURE 24: AIR POLLUTION VALUATION

VOCs

CO

NOx

NH3

HEALTH

PM10

CROPS

IMPACTSVALUATION

TIMBER

SO2

CORROSION

WATER ACIDIFICATIONCOSTS PERTON$

Studies of the costs of damages from air pollution use the Impact Pathway Approach (IPA) to identify burdens (e.g. emissions),
assess their impacts and value them in monetary terms.178 In this approach, emissions are translated into physical impacts usingdose–response functions (DRFs) which use peer-reviewed scientific data to measure the relationship between a concentration of apollutant (the dose) and its impact on human health, building materials, crops, etc (the receptor). A financial value is then assigned
to each impact.

FIGURE 25: IMPACT PATHWAY APPROACH

EMISSION
Specification of
relevant pollutants

PHYSICALIMPACTSDISPERSION
Increase inconcentration at
receptor sites

Damage to health,infrastructure, crops,
etc. established by
the DRFsMONETARYVALUATION
Cost of reversing thephysical impacts

STEP 1: IDENTIFYING THE MAIN IMPACTS FOR EACH AIR POLLUTANT
Trucost identified which environmental impacts to consider for each air pollutant using the Impact Pathway Approach. Where
impacts are excluded, such as the impact of particulate matter on crops and forestry, it was due to immateriality relative othereffects. The table below summarizes which impacts are included for each air pollutant.

TABLE 14: ENVIRONMENTAL IMPACTS CONSIDERED
Air Pollutant

Environmental Impacts

Particulate Matter (PM10)

HealthAmmonia (NH3)

Health and forestry

Nitrous Oxides (NOx)

Health, crops and forestry

Volatile Organic Compounds (VOCs)

Health, crops and forestry

Sulphur dioxide (SO2)

Health, freshwater, forestry and materials

93

STEP 2: BUILDING COUNTRY SPECIFIC VALUATIONS
Air pollutant impacts on health
The health costs developed by Trucost include the cost mortality; chronic bronchitis; hospital admission; asthma attacks;
restricted activity days; respiratory symptom days; congestive heart failure; chronic cough; cough and wheeze; and bronchodilator
use. These costs were calculated as follow:
Calculation of number of end points
Trucost compiled data on the number of end points (number of health impacts) generated by the emission of one tonne of each air
pollutant. In the context of health impacts, the number of end points is driven by population density, which is country specific.
Development of global average health costs
Trucost conducted a literature review to identify country specific studies calculating the willingness to pay to avoid the different
health impacts listed above. Using these studies, Trucost built a country specific model and calculated a global average costweighted by population for each health impact. A global average was chosen to avoid the ethical considerations of applying
different values to health and life across countries.
Application of global average costs
Natural capital valuation coefficients for each air pollutant are obtained by multiplying the number of end points by the global
health costs.
Environmental impacts of other air pollutants impacts
Natural capital valuations of air pollutant impacts on crops, timber, water and building materials are country specific and were
calculated as follow:
Literature compilation
Trucost compiled data from IPA studies on the cost of air pollutants’ damages on crops, timber, water and building materials.
Adjustment of the cost based on receptor densities factors
Trucost adjusted the country-specific data obtained from the literature based on receptor densities such as percentage of crop orforest cover in a country. Impacts on building materials use maintenance costs which have been adjusted using purchasing power
parity. Impacts on water acidification, included in the valuation of SO2 is a global average.

WATER CONSUMPTION
Pressures are growing on water resources, with risks from climate change impacts increasing the unpredictability and security ofsupplies. Information on the benefits of water and the costs of damages from depleting resources are usually not recognised inmarket prices or in risk analysis.
According to the Total Economic Value (TEV) framework, the value of water can be broken down into “use” values and “non-use”
values (Figure 26). Use values can be further broken down into direct use, indirect use, and option values. Within direct use, thevalues can apply to “consumptive” or “non-consumptive” uses.179

FIGURE 26: COMPONENTS OF THE TOTAL ECONOMIC VALUE OF WATERTOTAL ECONOMIC VALUEUSE VALUENON-USE VALUEDIRECT

INDIRECTOPTIONALTRUISTIC

EXISTENCEBEQUEST

CONSUMPTIVEECOSYSTEMFUNCTIONSFUTURE DIRECT
AND INDIRECT USE
VALUESKNOWLEDGE OFUSE OF THE
RESOURCE BY
OTHERSKNOWLEDGE OF
EXISTENCE OF THE
RESOURCEKNOWLEDGE OFPASSING THE
RESOURCE TO
OTHER
GENERATIONSNON-CONSUMPTIVE

94

However, in this report, only values shaded in green have been included in Trucost’s water valuation model. The valuation of wateris based on the opportunity cost of water or the value generated by water when it is not abstracted. Consumptive uses (foragriculture or industry) of water have therefore been excluded. Option and non-use values have also been excluded given the
difficulty inherent in their valuation. Values for direct non-consumptive uses (including hydro-electric power, recreation, navigationand cultural activities) and indirect uses (including ecosystem services such as flood control, regulation of water flows and supplies,
carbon sequestration, nutrient retention and climate regulation) were identified in academic literature in different geographicallocations.180,181
A function of water value (in $ per m3) relative to water scarcity (% of internal renewable water resources abstracted) was
developed based on the values estimated in the academic literature.179,180,181 This function was then used to estimate theopportunity cost of water in any geographic location where water scarcity is known, by adjusting the function for purchasing power
parity at that location.

LAND AND WATER POLLUTANTS
STEP 1: QUANTIFICATION OF IMPACTS
Life cycle analysis characterization models, such as Recipe, calculate the human, terrestrial, freshwater and marine toxicity of
thousands of substances when released in different media. Trucost used a global adaption of Recipe by EUSES-LCA to model land
and water pollutants. Human toxicity impacts are expressed in Disability Adjusted Life Years (DALYs) and terrestrial, freshwaterand marine toxicity are expressed in Ecosystem Damage Potential (EDP).182,183,184,185,186 While it is hard to state an order ofmagnitude, toxicity data are among the most uncertain in lifecycle analysis characterization models. Trucost based its analysis on
the best available data, but recognizes this weakness in the underlying data.
STEP 2: VALUATION OF ENVIRONMENTAL TOXICITYThe NEEDS Project approach developed a formula to estimate the monetary cost per kilogram of toxic substances deposited innatural ecosystems.187 Within the NEEDS project, a regression analysis between willingness-to-pay and several variables were
performed. The EDP valuation is known to have a positive correlation with population – as more people live close to an area withhigh biodiversity there will be more people that value biodiversity. The EPD value is known to have a negative correlation withthe ecosystem size – if an ecosystem covers a larger area, the value per unit area will be less. Similarly, as biodiversity change
increases, the value per unit of biodiversity diminishes. Using these variables, the formula below calculates the value of EDP in
different regions.

The value of ecosystem damage is a function of the change in biodiversity due to the emission of the toxic substance and thewillingness to pay for biodiversity (adjusted for purchasing power parity).
STEP 3: VALUATION OF human TOXICITY
In order to put a value on the years of life lost, Trucost used the NEEDS project approach. The results of this approach are basedon a contingent valuation questionnaire applied in nine European countries: France, Spain, UK, Denmark, Germany, Switzerland,
Czech Republic, Hungary and Poland. The value was adapted to other countries based on country-specific income levels. To avoid
ethical criticisms on the value of life and disease incidence in different countries, Trucost applied the global median value to value
DALYs in different countries.

MANAGED PLASTIC
As explained in appendix 3, plastic can be collected and treated through different routes. Treatment routes considered here arelandfill, incineration with and without energy recovery and recycling. One should note that even if impacts are generated by thetreatment of waste, treatment is a necessity and its impact is small compared to those of littered plastic.
In order to apply natural capital valuations on these treatment routes, Trucost calculated the quantity of greenhouse gas and otherair, land and water pollutants emitted, and water used in these processes as per Appendix 3 and Tables 9 and 10, and applied therelevant valuations as described above.

LITTERED PLASTIC
When littered in an unregulated manner, Trucost assumed two possible pathways depending on the sector under consideration,
namely reaching or not reaching marine environments. The following table summarises the pathway of each product.
It is understood that a significant amount will be transported over time by the winds, streams, waterways, and eventuallypartially end up in the ocean. While there are estimates of the total volume of plastic from land reaching the ocean per year, there95

is insufficient data to model this accurately. For the purpose of this report, conservative assumptions have been taken so as to not
overstate the problem. For example, the report assumes, that in the fullness of time, all tobacco filters and packaging materials thatwere littered eventually reach the ocean due to their lightweight, while heavier plastic such as car parts are assumed to remain on
terrestrial environments (see table 15).

TABLE 15: PERCENTAGE OF LITTERED PRODUCT AND PACKAGING REACHING THE OCEAN
sectors included% of littered packaging
reaching the ocean% of littered productreaching the ocean

Automobiles

0%Soft drinks and ice

NR

Clothing and accessories

50%

Consumer electronics

0%

Durable household goods

0%

Food

NR

Personal products

NA

Athletic goods

50%
100%

Toys

50%

Tobacco100%

Furniture0%

Non-durable household goods

50%

Footwear50%

Medical and pharmaceutical products

NR

RetailNR

Restaurants and bars

NR

No consensus and very little data exist on the percentage of plastic reaching the marine environment, let alone on different types ofplastic/products made of plastic in different countries. Trucost thus had to make assumptions and use best-guess estimates.
The valuation for waste ending up in the ocean includes the disamenity caused to society, and the ocean valuation (explained ingreater detail in the following part). The valuation for waste not reaching the ocean include the air, land, and water emissions
generated in the open-dump and the leachate of additives, as well as the disamenity caused to society. Other ecological, economic
and society impacts of litter on freshwater and terrestrial ecosystems are not included for lack of data.

DISAMENITY
Disamenity does not have one agreed upon definition in the literature, however, it generally refers to the localised impacts oflandfill activity that generate negative reactions from those located in the immediate vicinity.188 The European Commission specifies
disamenity impact as referring to the ‘nuisance’ caused locally as a result of the presence of landfill – noise, dust, litter, odour, thepresence of vermin, visual intrusion and enhanced perceptions of risk. The magnitude of the effects will depend on distance fromthe site, type of waste (non-hazardous or hazardous), status of the site (existing, new, or proposed), management practices,
topography and prevailing wind directions.
Only a limited number of valuation studies of disamenity have been undertaken for the waste sector.189,190 A number of studies wereconducted in the US in the 1980s and early 1990s (especially for landfills). Only two European studies have been identified.
Disamenity impacts were excluded completely from the Exiopol study in 2009 because it said that disamenity impacts were site
specific. The study only indicates an order of magnitude based on a study from 2006 by Walton (1 Euro per tonne).191
Hedonic pricing studies require information on house prices near to a landfill site and specific information on sales of houses in thisradius. Conducting a primary hedonic pricing study is not appropriate for this study as the location of the landfill sites is unknown
and the number of sites is very large, making this technique beyond the scope of this valuation.

96

It is likely that disamenity effects would be higher in countries where waste is managed poorly (as the disamenity effects such as
noise, nuisance, vermin, etc are likely to be higher). Most studies have been carried out in countries with high quality waste
management. A recent study is the only study found from a country with a lower collection rate (South Africa, where approximately
60% of waste is formally collected).192 When disamenity (adjusted for PPP to adjust for differences in house prices) was plottedagainst formal waste collection rates, it indicated a negative relationship between percentage of waste formally collected anddisamenity cost (see Figure 27 below).

FIGURE 27: DISAMENITY COSTS (PPP ADJUSTED) VERSUS PERCENTAGE OF WASTE COLLECTED

Due to the large number of regions included in this analysis, and the fact that the specific locations are unknown, a disamenity
scale was derived from the figures provided in the literature, plotted against formal waste collection rates in each region. The
disamenity cost for a tonne of waste in a particular region is then estimated based on the collection rate in the region in question.
The resulting figure for each region is then adjusted for PPP to take account of differences in house prices. Adjusting for PPP is a
widely used technique, especially for transfers between countries or regions189

ADDITIVES
Additives are chemicals added to plastic during the manufacturing process to enhance its properties, such as heat resistance andflexibility. Recently, there has been growing concerns on the leaching of these substances and their impacts on human health andthe environment. The impacts additives leachate follows the following framework.

FIGURE 28: quantification of the PLASTIC CHEMICAL IMPACTS FRAMEWORKQUANTIFICATIONOF TOXICCONSTITUENTSLEACHING

QUANTIFICATIONOF TOXICIMPACTSVALUATION OF
TOXIC IMPACTS

97

Trucost calculated the quantity of additives per type of plastic based on an Organisation for Economic Co-operation andDevelopment report focusing on plastic additives.175

LEACHING
Data regarding the leaching of additives from plastic into its environment is nascent and the results are highly uncertain.
Furthermore, few data points exist on the leaching rate of plastics’ constituents into a marine environment. Hence, Trucost used theleaching rate calculated by Organisation for Economic Co-operation and Development for plastics “outdoor, leaching toenvironment”.175 The annual leaching rate is 0.16% per year. At this rate, it would take 625 years for 100% of the additives to bereleased from the plastics. Trucost discounted the total natural capital cost using this timeframe, thereby producing what is believed
to be a conservative estimate of the impact. Future studies may reveal more accurate leaching rates, including in the marine
environment, which would likely revise upwards the impacts calculated in this report.

VALUATION OF TOXIC IMPACTS
Depending on whether plastic is likely to reach marine environments or not (see table 5), Trucost either quantified marine, landor freshwater toxicity impacts. Lifecycle analysis characterization models calculate the human, terrestrial, freshwater and marine
toxicity of thousands of substances when released in different media. Trucost used a global adaption of Recipe by EUSES-LCA
to model the marine and human impacts additives.182,183,184,185,186 Human toxicity impacts are expressed in Disability Adjusted Life
Years (DALYs) and terrestrial, freshwater and marine toxicity are expressed in Ecosystem Damage Potential (EDP). These toxicity
impacts were then valued using same methodology as for land and water pollutants (described earlier).

MARINE LITTER
Important quantities of plastic reach the ocean every year. Media’s attention has been particularly focused on entanglements fromfishing nets or ingestion of plastic bags. More and more reports and scientific literature assess these impacts which are diverse,
economic as well as ecological, and come from plastics as well as microplastics. The objective of this methodology is to obtain avalue in monetary terms per kilo of plastics reaching the ocean.

STEP 1: IDENTIFYING THE IMPACTS OF PLASTICS IN THE OCEAN
The impacts of plastics into the ocean are complex for various reasons:•

Plastics degrade very slowly over time, and this degradation depends on the type, shape and location of the plastics. As aconsequence, plastics accumulate and it is difficult to quantify the amount of plastic which is today in the ocean.

•Macroplastics and microplastics have some overlapping and some distinct impacts.

•

Water flows makes it challenging to track plastic geographically. For this reason, Trucost built a global average valuation ofplastic rather than a location specific one.

Due to the complexity of plastics impacts, Trucost built a valuation model based on a simplified interpretation of these impacts.
The figure below presents these impacts. Light arrows represent potential impacts which have been excluded from the valuation.
For example, the valuation excludes primary microplastics impact for lack of adequate data, even though this area of research has
been receiving more attention recently.

Where do microplastics come from?
There are primary and secondary forms of microplastics. Primary forms of microplastics are found in personal careproducts such as toothpaste and skin care products, synthetic textiles such as blankets, fleeces or shirts, and industrial
sources such as plastic resin pellets used in industrial feedstocks. These primary microplastics are problematic as they
are not filtered during sewage treatment and can be released directly into the ocean or other water bodies (e.g. personalcare products and textiles) or lost through poor management operations and during transport (e.g. pre-production plastic
resin pellets). Secondary microplastics are formed when plastic items fragment and disintegrate; the rate at whichfragmentation occurs is highly dependent on the environmental setting.193 In the marine environment larger plastic items
can break into secondary microplastics through combined effects of wave action and photo-degradation from sunlight.
The key to stemming flows of plastic debris to the ocean is to prevent this debris entering the environment. Larger items
are much easier to identify and potentially to control than small ones.

98

FIGURE 29: IMPACTS OF MACRO AND MICRO PLASTICFISHERIES AND AQUACULTURE

MARINE TOURISM
ECONOMIC IMPACTS
SHIPPING

MACROPLASTICS

PLASTICSIN THE OCEANSECONDARYMICROPLASTICS

CLEAN UP COSTENTANGLEMENTINGESTION: DIGESTIVESYSTEM IMPACTS

PRIMARYMICROPLASTICS

PHYSICAL IMPACTS

TRANSPORTATION OF
INVASIVE SPECIESPBTs SUBSTANCES DESORPTIONINCLUDED IN THE
VALUATION MODEL
MATERIAL BUT NOT INCLUDEDIN THE VALUATION MODEL

ADDITIVES LEACHATE

CHEMICAL IMPACTS

MONOMER LEACHATEECOLOGICAL IMPACTS
Plastics in the ocean generate economic impacts which are often paid by those affected rather than plastic producers or
consumers. Economic impacts relate to the loss of revenue caused by marine plastics. Industries concerned by this issue arefisheries and aquaculture, marine tourism and shipping. Additionally, plastics litter on beaches will imply clean-up costs.5
ECOLOGICAL IMPACTS
Ecological impacts refer to the morbid or lethal effects endured by marine biodiversity. These impacts can be broken down into
physical impacts, referring to the impacts coming from the shape of plastics objects, and into chemical impacts, referring to theimpacts coming from the toxic substances present in the plastic.
PHYSICAL IMPACTS
Entanglement: marine biodiversity such as marine mammals can be entangled, which can lead to suffocation, starvation, drowning
or increased vulnerability to predators.
Ingestion: marine species can ingest plastic by mistaking it for food. This can lead to starvation, malnutrition or internal injury.6
Transportation of invasive species: floating plastic can act as vector of invasive species which would alter community structure.6
This impact has not been included in the valuation model due its complexity and for lack of quantitative data.
CHEMICAL IMPACTS
Persistent Bioaccumulative Toxic substances (PBTs) desorption: plastics can act as a carrier for the ingestion of PBTs.25 PBTs are
chemicals that degrade slowly in the environment and accumulate in organism tissues. Due to industrial activity, the oceans now
have varying concentrations of PBTs to which marine life is already exposed. However, due to its chemical characteristics, plastic
in the ocean absorb these PBTs increasingly over time. If the plastic is then ingested by marine wildlife, PBTs can be transferred tothe animal and potentially bio-accumulate further through the food chain. While PBTs absorption and desorption impacts are likely
to be more material that additives leachate, the data available was specific to certain situations, and did not lend itself tobroad-based application through the valuation model. Research in this field is constantly evolving.
Additives leachate: additives are chemicals added to plastic feedstock in order to enhance their properties including but not limited
to heat and corrosion resistance, hardness and colours. The quantity of additives varies based on the type of plastic and its usage– for example plasticisers are often used in PVC products to improve flexibility and flame retardants in electronics and automobiles
for safety reasons.

99

Monomers leachate: the molecules bonded together to form plastics are called monomers. When plastic degrades, thesemonomers can leach and be ingested by biodiversity. Some of the monomers are hazardous, such as styrene which is themonomer of polystyrene. This impact has not been included in the valuation model due to its complexity and for lack ofquantitative data.

STEP 2: BUILDING THE VALUATION MODELECONOMIC IMPACTS
The main approach to value economic impacts generated by marine plastics is based on calculating the yearly revenue loss
attributable to plastic litter.
Fisheries and aquaculture
According to Mouat et al., marine fisheries and aquaculture lose every year respectively 2% and 0.03% of their revenue.28
Trucost assumed that the same percentage of revenue loss was applicable at a global level. It was estimated that marine
fisheries and aquaculture generated in 2009 revenue of approximately 52 and 1 billion 2012 US$.194 Considering that plastics
comprise between 50% and 80% of marine waste, Trucost calculated that plastics were responsible for a yearly revenue loss of
794 and 7 million 2012 US$ for fisheries and aquaculture activities.
Marine tourism
Marine tourism includes seawater and freshwater angling, sailing and boating, water sports, and inland cruises. Studies estimatedthat beach litter in Sweden was responsible for a tourism decrease between 1 and 5%. Based on these numbers, Trucost assumed
that 3% of global marine tourism revenue was lost because of marine litter. As result, Trucost calculated that plastic litter was
responsible for a yearly revenue loss of 4 million US$.
Clean-up costTo calculate the clean-up cost imposed by plastics litter on beaches, Trucost based its model on the number of volunteers
estimated globally by the Ocean Conservancy.120 In 2012, more than 5 million volunteers helped clean beaches around the world.
To put a value on the time spent by these volunteers on cleaning beaches, Trucost calculated the opportunity cost of their time,
based on the global average income per capita per year and on the assumption that each volunteers dedicates half a day per year.
As a result, the global opportunity cost of volunteers is 74 billion 2012 US$. While there could be a benefit to collection –volunteers becoming more aware of the environment for example – this has not been included in the analysis.
To obtain the economic values per kilo, the annual values calculated must be divided by the quantity of plastics reaching the ocean
every year. UNEP estimates that 6.4 million tonnes of litter enter the ocean every year – this figure is likely to be an underestimate,as it is based on research published in 1975.5 In 2013, a European Commission Green Paper suggested 10 million tonnes per
year.16 No consensus exists today on this quantity which is highly complex to estimate. Trucost decided to use the figure which
would give the more conservative result and based its calculation on a study done by Raveender Vannela in 2012, according towhich 20 million tonnes of plastics reach the ocean every year.17
ECOLOGICAL IMPACTS
Physical impacts: entanglement and ingestion
According to the Secretariat of the Convention on Biological Diversity and the Scientifc and Technical Advisory Panel—GEF, thenumber of species with entanglement and ingestion records is 45% and 26% for marine mammals, 0.39% and 0.24% for fish and
21% and 28% for seabirds.6 To value these impacts, Trucost based its analysis on a contingent valuation, a survey-based
economic technique where people are asked directly their willingness to pay for the preservation of an ecosystem good or service.
This technique is often applied to capture non-use values such as the existence of species. Trucost applied a benefit transfer
technique to a study done by Ressurreição A. et al., which assessed how much people would be willing to pay to avoid a loss of
10% and 25% of different categories of marine species.195 This study ignores the actual ecosystem services provided by eachindividual species. Yet, contingent valuations indirectly include the perceived services that these animals render to society.
Chemical impacts
As the only chemical impact considered, additive leachate is handled as per the valuation methodology described earlier inthis appendix.

100APPENDIX 5:
company analysis
This appendix provides more information on the companies for which plastic natural capital cost and intensity were calculated.
The first column highlights which sectors of activity of the company were included in the analysis. The second column identifies theregions where sales occur, which is used for downstream modelling. The third column displays quantitative data points that Trucost
was able to include in the analysis. Most companies disclose some data around plastic use and disposal; however, data could be
integrated in the model only in half of cases due to insufficient coverage and details. Finally, the last column provides the source forthis information. Refer to Appendix 3 for a more detailed explanation of how total natural capital cost and intensity were modelled at
a company level.
TABLE 16: COMPANIES’ SECTOR, COUNTRIES OF SALES, DISCLOSURE AND SOURCE
Sectors included

main Regionsof salesDisclosure used

SourceImperial
TobaccoTobacco (100%)

Europe, Asia

NA

Imperial Tobacco. 2013. Focused on
Sustainable Growth. Annual Reportand Accounts 2013. [report].

Japan
TobaccoTobacco (80%),
Soft drinks (18%),
Medical andpharmaceuticalproducts (2%)

Asia, Europe

Quantity used,
Recycled content

Japan Tobacco. 2012. CSR Report
2012. [report].

Philip MorrisInternational

Tobacco (100%)

Europe, Asia

NA

Philip Morris International. 2014.
Environmental Performance. [online]
Available at: http://www.pmi.com/
eng/sustainability/pages/environmental_performance.aspx [Accessed: 31
Jan 2014].

Altria Group

Tobacco (100%)

North America

NA

Altria. 2012. Corporate
Responsibility Progress Report.
[report].

Reynolds
AmericanTobacco (100%)

North America

NA

Reynolds American. 2014. Reynolds
American Inc.. [online] Available at:
http://www.reynoldsamerican.com/[Accessed: 31 Jan 2014].

BritishAmericanTobaccoTobacco (100%)

Europe, Asia

NA

British American Tobacco. 2012.
Annual Report 2012. [report].

Daimler

Automobile (100%)

Europe, Asia

NA

Daimler. 2012. Sustainability Report
2012. [report].

Fiat

Automobile (100%)

North America,
EuropeNA

Fiat. 2012. Sustainability Report
2012. [report].

Ford Motor

Automobile (100%)

North America,
EuropeQuantitative
measures

Ford Motor. 2013. Sustainability
2012/13. [report].

GeneralMotorsAutomobile (100%)

North America,
EuropeNA

General Motors. 2012. 2012
Sustainability Report. [report].

NissanMotorsAutomobile (100%)

Asia,
North America

Quantitative
measuresNissan Motors. 2012. Sustainability
Report 2012. [report].

ToyotaMotorsAutomobile (100%)

Asia, North
AmericaNA

Toyota Motor Corporation. 2012.
Sustainability Report 2012. [report].

101Sectors included

main Regionsof salesDisclosure used

SourceVolkswagen

Automobile (100%)

Europe, Asia

NA

Volkswagen. 2012. Sustainability
2012. [report].

Britvic

Soft drinks (100%)

EuropeQuantitative
measures

Britvic. 2012. Sustainable Business
Report 2012. [report].

China
HuiyuanSoft drinks (100%)

Asia

NA

China Huiyuan. 2014. China Huiyuan
Juice Group Ltd.. [online] Available
at: http://www.huiyuan.com.cn[Accessed: 31 Jan 2014].

Coca-Cola

Soft drinks (100%)

Asia,
Latin America,
North America

Recycled content,
Bio-plastic content

Coca-Cola. 2012. 2011/2012 GRI
Report. [report].

Dr Pepper
SnappleSoft drinks (100%)

North America

Quantitative
measures

Dr Pepper Snapple Group. 2012.
Sustainability Report 2012. [report].

Lotte
Chilsung

Soft drinks (100%)

Asia

Quantitative
measures

Lotte Chilsung Bev. 2012.
Sustainability Report 2012. [report].

Tingyi

Soft drinks (100%)

Asia

NA

Tingyi (Cayman Islands) Hold Group.
2012. 2012 Annual Report. [report].

Uni-President

Soft drinks (54%),
Food (46%)

Asia

NA

Uni-President. 2014. [online]
Available at: http://www.uni-president.com [Accessed: 31 Jan 2014].

Want Want
China
Holdings

Soft drinks (66%),
Food (34%)

Asia

NA

Want Want China Ho. 2012.
Annual Report 2012. [report].

Apple

Consumerelectronics (100%)

North America,
Asia

Quantity used

Apple. 2014. Apple and theEnvironment. [online] Available at:
http://www.apple.com/uk/environment/ [Accessed: 31 Jan 2014].

Canon

Consumerelectronics (100%)

Asia, Europe

NA

Canon. 2012. Canon Sustainability
Report 2012. [report].

Hewlett
PackardConsumerelectronics (100%)

North America,
Asia

Quantity used

HP. 2012. HP 2012 Global
Citizenship Report. [report].

LG
Electronics

Consumerelectronics (75%),
Durable household
goods (25%)

Asia,
North America

Recycled content

LG Electronics. 2012. 2012 - 2013
LG Electronics Sustainability Report.
[report].

Ricoh

Consumerelectronics (100%)

Asia,
North America

NA

Ricoh. 2013. Ricoh Group
Sustainability Report 2013. [report].

Samsung
Electronics

Consumerelectronics (69%),
Durable household
goods (31%)

Asia, Europe

Quantity used,recycled content

Samsung Electronics. 2012. Global
Harmony with People , Society andEnvironment. [report].

Sony

Consumerelectronics (100%)

Asia,
North America

Recycled content,
Quantitative
measuresSony. 2012. CSR Reporting 2012.
[report].

Arcelik

Durable household
goods (100%)

Africa, Europe

Quantity used

Arcelik A.S. 2012. Sustainability
Report 2012. [report].

Electrolux

Durable household
goods (100%)

North America,
EuropeQuantity used,recycled content

Electrolux. 2014. [online] Available
at: http://www.electrolux.com/ [Accessed: 31 Jan 2014].

102

Sectors included

main Regionsof salesDisclosure used

SourceHusqvarna

Durable household
goods (100%)

North America,
EuropeQuantity used

Husqvarna Group. 2012.
Sustainability Report 2012. [report].

Indesit

Durable household
goods (100%)

EuropeQuantity used,recycled content,
quantitative
measuresIndesit. 2014. Indesit – efficient,reliable and functional household
appliances for modern living. [online]
Available at: http://www.indesit.com[Accessed: 31 Jan 2014].

MakitaDurable household
goods (100%)

Europe, Asia

NA

Makita. 2012. Company Profile/Sustainability Report. [report].

Panasonic

Durable household
goods (55%),
consumer electronics
(45%)

Asia,
North America

Recycled content

Panasonic Corporation. 2012.
Sustainability Report 2012. [report].

Seb

Durable household
goods (100%)

Europe, Asia

Quantity used

Groupe SEB. 2012. Business andSustainable Development Report
2012. [report].

Whirlpool

Durable household
goods (100%)

North America,
Latin America

Quantitative
measures

Whirlpool Corporation. 2012. 2012
Sustainability Report. [report].

CloroxNon-durable
household goods(100%)

North America

Quantitative
measures

The Clorox Company. 2013. 2013
Integrated Annual Report. [report].

ColgatePalmolive

Non-durable
household goods(87%), Food (13%)

Latin America,
EuropeQuantitative
measuresColgate-Palmolive. 2012.
Sustainability Report 2012. [report].

Kao Corp

Non-durable
household goods(72%), Personal
products (28%)

Asia

Quantity used

Kao. 2012. Sustainability Report
2012. [report].

Kimberly
Clark

Non-durable
household goods(100%)

North America,
Asia

Quantity used,
Recycled content

Kimberly-Clark. 2012. 2012
Sustainability Report. [report].

Procterand Gamble

Non-durable
household goods(52%), Personal
products (24%),
Medical andpharmaceuticalproducts (15%),
Durable household
goods (10%)

North America,
EuropeRecycled content,
Quantitative
measures

P&G. 2012. 2012 Sustainability
Report. [report].

Reckitt
Beckinser

Non-durable
household goods(66%), Personal
products (22%),
Medical andpharmaceuticalproducts (9%),
Food (3%)

Europe, North
AmericaNA

Reckitt Benckiser. 2012.
Sustainability Report 2012. [report].

Svenska
CellulosaNon-durable
household goods(100%)

Europe, North
AmericaNA

Svenska Cellulosa Aktiebolaget.
2012. Sustainability Report 2012.
[report].

103Sectors included

main Regionsof salesDisclosure used

SourceFast
Retailing

Clothing andaccessories (100%)

Asia, Europe

Quantity used,
Quantitative
measures

Fast Retailing. 2012. CSR Report
2012. [report].

Gap

Clothing andaccessories (100%)

North America

NA

Gap Inc. 2012. 2011-2012 Social &Environmental Responsibility Report.
[report].

Hanesbrands

Clothing andaccessories (100%)

North America

Recycled content,
Quantitative
measures

Hanes. 2014. [online] Available at:
http://www.hanes.com/corporate[Accessed: 31 Jan 2014].

Hennesand Mauritz

Clothing andaccessories (100%)

EuropeRecycled content

H&M. 2012. Sustainability Report
2012. [report].

Inditex

Clothing andaccessories (100%)

EuropeNA

Inditex. 2012. Annual Report 2012.
[report].

KeringClothing andaccessories (100%)

Asia, Europe

Quantity used,bio-based content,
quantitative
measures

Kering. 2012. Reference Document
2012 - Annual Report. [report].

VF Corp

Clothing andaccessories (100%)

North America,
EuropeNA

VF Corporation. 2012. 2012 Annual Review & Performance Update.
[report].

DanoneFood (83%), Softdrinks (17%)

Europe,North America

Recycled content,
Quantitative
measures

Danone. 2012. Sustainability Report
2012. [report].

Kellogg

Food (100%)

North America,
EuropeNA

Kellogg Company. 2012. Corporate
Responsibility Report. [report].

Meiji
Holdings

Food (89%), Medical
and pharmaceuticalproducts (11%)

Europe, Asia

Quantity used

Meiji. 2014. Meiji Holdings Co., Ltd..
[online] Available at: http://www.
meiji.com/english/ [Accessed: 31 Jan
2014].

Mondelez

Food (100%)

North America,
EuropeNA

Mondelez International. 2014.
Mondelez International, Inc. [online]
Available at: http://www.mondelezinternational.com/ [Accessed: 31 Jan
2014].

Nestlé

Food (100%)

North America,
EuropeQuantity used,recycled content

Nestlé. 2012. Nestlé in society.
Creating Shared Value and meeting
our commitments 2012. [report].

PepsiCo

Food (67%), Drinks(33%)

North America,
EuropeRecycled content,
Quantitative
measures

PepsiCo. 2012. Sustainability Report
2011/2012. [report].

Carrefour

Retail (100%)

EuropeQuantitative
measures

Carrefour. 2012. Registration
Document Annual Financial Report.
[report].

CostcoRetail (100%)

North America

NA

Costco Wholesale. 2012. Annual
Report 2012. [report].

CVS

Retail (100%)

North America

Quantitative
measures

CVS Caremark. 2012. 2012
Corporate Social Responsibility
Report. [report].

KrogerRetail (100%)

North America

Quantitative
measures

Kroger. 2013. 2013 Sustainability
Report. [report].

104Sectors included

main Regionsof salesDisclosure used

SourceTesco

Retail (100%)

Europe, Asia

NA

Tesco. 2012. Corporate
Responsibility Review 2012. [report].

WalmartRetail (100%)

North America,
Latin America

Quantitative
measures

Walmart. 2012. 2012 Global
Responsibility Report. [report].

BidvestRestaurants andbars (92%), Durable
household goods(8%)

Europe, Asia

NA

Bidvest Group. 2012. Annual
Integrated Report. [report].

Compass

Restaurants and bars
(100%)

North America,
Asia

NA

Compass Group. 2013. Our formulafor growth. Annual Report 2013.
[report].

McDonald’s

Restaurants and bars
(100%)

North America,
Europe, Asia

Recycled content

McDonald’s. 2012. 2012 Global Sustainability Highlights. [report].

SodexoRestaurants and bars
(100%)

Europe,North America

NA

Sodexo. 2013. Better Tomorrow Plan
Progress Review. [report].

Starbucks

Restaurants and bars
(100%)

North America,
Asia

Reusable content

Starbucks. 2012. 2012 Global
Responsibility Report. [report].

Sysco

Restaurants and bars
(100%)

North America

NA

Sysco Corporation. 2012. 2012 Sustainability Summary Report. [report].

AbbottMedical andpharmaceuticalproducts (80%), Food
(20%)

North America,
EuropeQuantitative
measures

Abbott. 2012. 2011 Abbott Global
Citizenship Report. [report].

JohnsonandJohnson

Medical andpharmaceuticalproducts (80%), Personal products (15%),
Non-durable household goods (5%)

North America,
EuropeNA

Johnson & Johnson. 2012. 2012
Citizenship & Sustainability Report.
[report].

Merck

Medical andpharmaceuticalproducts (100%)

North America,
EuropeNA

Merck. 2012. Corporate
Responsibility Report 2012. [report].

Novartis

Medical andpharmaceuticalproducts (100%)

Europe,North America

Quantitative
measures

Novartis. 2012. Annual Report 2012.
[report].

PfizerMedical andpharmaceuticalproducts (100%)

North America,
EuropeNA

Pfizer. 2012. Annual Review 2012.
[report].

Sanofi

Medical andpharmaceuticalproducts (100%)

North America,
EuropeQuantitative
measures

Sanofi. 2012. Corporate Social
Responsibility 2012. [report].

Asics

Footwear (100%)Asia,
EuropeNA

Asics. 2012. CSR Report 2012.
[report].

Belle
International

Footwear (64%),
Clothing andAccessories (26%)

Asia

NA

Belle International. 2014. [online]
Available at: http://www.belleintl.com/[Accessed: 31 Jan 2014].

DaphneHoldings

Footwear (100%)

Europe,North America

NA

Daphne Holdings. 2014. [online]
Available at: http://www.daphneholdings.com/ [Accessed: 31 Jan 2014].

105

Sectors included

main Regionsof salesDisclosure used

SourceSalvattore
Ferragamo

Footwear (65%),
Clothing andAccessories (35%)

Asia, Europe

NA

Salvatore Ferragamo. 2014.
Salvatore Ferragamo. [online]
Available at: http://www.ferragamo.
com [Accessed: 31 Jan 2014].

StellaInternational

Footwear (100%)

North America,
EuropeNA

Stella.com.hk, (2014). Stella International. [online] Available at: http://
www.stella.com.hk/index.html [Accessed 4 Apr. 2014].

Tod’s

Footwear (100%)

Europe, Asia

NA

Tod’s. 2012. Annual Report 2012.
[report].

HasbroToys (100%)

North America,
EuropeQuantitative
measures

Hasbro. 2014. Products and theEnvironment. [online] Available at:
http://csr.hasbro.com/sus12-product-life-cycle.php [Accessed: 31 Jan
2014].

HornbyToys (100%)

EuropeNA

Hornby. 2014. [online] Available at:
http://www.hornby.com/ [Accessed:
31 Jan 2014].

MattelToys (100%)

North America,
EuropeNA

Mattel. 2012. Global Citizenship
Report. [report].

Avon

Personal products(100%)

Latin America,
EuropeQuantitative
measuresAvon. 2014. Corporate Responsibility
Report. [online] Available at: http://
www.avoncompany.com/pdfreportbuilder/default.aspx [Accessed: 31
Jan 2014].

Beierdorf

Personal products(100%)

Europe, Asia

NA

Beiersdorf, (2014). Sustainability.
[online] Available at: http://www.beiersdorf.com/sustainability/overview[Accessed 31 Jan. 2014].

Estée
Lauder

Personal products(100%)

Europe,North America

NA

Estée Lauder. 2012. Corporate
Responsibility Report 2012. [report].

L'OréalPersonal products(100%)

Europe,North America

Quantitative
measures

L’Oréal. 2012. RAPPORT DÉVELOPPEMENT DURABLE. [report].

NaturaCosmeticos

Personal products(100%)

Latin America

Recycled content,
Quantitative
measuresNatura. 2012. Report 2012 Full GRI
Version. [report].

Shiseido

Personal products(99%), Medical andpharmaceuticalproducts (1%)

Asia,
North America

Packaging used,
Quantitative
measures

Shiseido. 2014. Environmental Activity Results Data | Social Responsibility | Shiseido group website. [online]
Available at: http://group.shiseido.
com/csr/performance/env/index.html[Accessed: 31 Jan 2014].

Unilever

Personal products(35%), Food (47%),
Non-durable household goods (18%)

Europe,North America

Recycled content,
Quantitative
measures

Unilever. 2012. Sustainable Living
Plan. [report].

Ekornes

Furniture (100%)

Europe,North America

NA

Ekornes Asa. 2012. Annual Report
2012. [report].

FortuneBrandsFurniture (100%)

North America

NA

FBHS. 2014. Fortune Brands Home
& Security. [online] Available at:
http://www.fbhs.com/ [Accessed: 31
Jan 2014].

106Sectors included

main Regionsof salesDisclosure used

SourceInterface

Furniture (100%)

North America,
EuropeRecycled content,
Biobased content

Interface Global. 2014. Interface- Sustainability. [online] Available
at: http://www.interfaceglobal.com/
sustainability.aspx [Accessed: 31 Jan
2014].

Leggettand PlattFurniture (100%)

North America,
Asia

NA

Leggett & Platt. 2012. Annual Report
2012. [report].

MohawkFurniture (100%)

North America,
EuropeQuantitative
measures

Mohawk. 2012. Corporate Responsibility and Sustainability Report.
[online] Available at: http://www.mohawksustainability.com/ [Accessed:
31 Jan 2014].

SamsonHoldings

Furniture (100%)

North America

NA

Samson Holding. 2014. Samson
Holding LTD. [online] Available at:
http://www.samsonholding.com/[Accessed: 31 Jan 2014].

Amer Sports

Athletic Goods(100%)

Europe,North America

NAAmer Sports. 2014. Amer Sports Product. [online] Available at: http://
www.amersports.com/responsibility/
environmental/product [Accessed: 31
Jan 2014].

Anta Sports

Athletic Goods(100%)

Asia

NA

Anta. 2014. [online] Available at:
http://www.anta.com.cn [Accessed:
31 Jan 2014].

Jarden Corp

Athletic Goods (42%),
Non-durable household goods (58%)

North America,
Asia

NA

Jarden. 2014. [online] Available at:
http://www.jarden.com/ [Accessed:
31 Jan 2014].

Peak Sport

Athletic Goods(100%)Asia

NA

Peak Sport. 2012. 2012 Annual
Report. [report].

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