Coming across the newswire last week was this press release from the beverage conglomerate Dr Pepper Snapple Group setting a goal of attaining a U.S. beverage container recycling rate of 60% by 2030. What should be made of this goal? This goal should be compared with those either publicly pledged or made to As You Sow as part of their shareholder advocacy campaigns: Coca-Cola’s commitment of 50% of its own beverage volume by 2015, Pepsi’s commitment of 50% of all beverage container by 2018 and Nestle Waters to 60% of PET by 2018. Then there is the reporting by their trade association, The American Beverage Association.
|Dr Pepper Snapple||60%||2030||All beverage containers|
|Coca-Cola||50%||2015||Own beverage volume|
|Pepsi||50%||2018||All beverage containers|
|American Beverage Association||40%||2013||ABA Packages measured by weight|
Why the range and incomparability of their standards?
One lens through which this can be viewed is that these companies are, first and foremost, competitors. They compete for consumer attention, as their success in that measure will have a direct correlation to sales and profitability. At this time, when savvy consumers are demanding sustainability standards from consumer brands, each company is seeking to position itself. Implicit within this analysis is a race to the bottom when it comes to the corporate estimates as to what the market demands and how to minimize the internalization of costs associated with those decisions.
Additionally, there is significant variation in each company’s supply chain and manufacturing processes, which leads to a responsiveness to different economic factors. Understanding those factors will require comment directly from the companies, which is unlikely to be forthcoming, though a couple of broad assessments are possible.
Nestlé’s public statements have been coupled with an assertion that they are seeking stability in their supply chain when it comes to PET. Greater recycling rates will lead to more domestic processing. That, in turn, will provide for sourcing of more material from domestic suppliers rather than relying on volatile virgin plastic markets. Given that Nestlé’s product lines are primarily packaged in PET bottles strengthening this supply chain would be a priority and their target speaks directly to that purpose.
The varying goals between Dr Pepper Snapple, Coca-Cola and Pepsi paint a more opaque picture, leading generally to supposition and conjecture. Dr Pepper Snapple is sending one clear signal with a 2030 timeline, essentially saying that Coca-Cola and Pepsi are delusional in their belief that these types of rates are achievable in this decade. While these companies are noticeably silent on how to achieve the target rates, they are at a minimum reflective of a desire to rattle the existing system.
That moves this conversation to the core point. What would it take for us to achieve the arguably ambitious rates of beverage container recycling outlined by Pepsi, Coca-Cola and Nestle?
Nestle has been a vocal advocate for Extended Producer Responsibility, which, based upon recent results out of British Columbia, may be a critical step in boosting collection rates and aggregating the quality and quantity of material necessary to meet their goal. Based upon reporting by As You Sow, both Coca-Cola and Pepsi are willing to consider this policy as part of the package of policy and program changes to take place across the United States.
This leaves Dr Pepper Snapple as the outlier. Their goal appears to be a based upon the assumption that there will be no significant changes to the United States’ fractured and stressed recycling system. Without any game-changing policies and efforts, recycling rates will only continue their slow rise, especially as these companies continue to fight against proven programs like extended producer responsibility, including container deposits.
Dr Pepper Snapple needs to look more critically at their operations. Their weak goals reflecting a lack of system change is indicative of a desire to fight against progress. Despite significant support of shareholders, company executives continue to ignore the sustainability demands of investors and consumers alike. Failure to act represents a weakness in the Dr Pepper Snapple brand and will continually have them riding caboose on the sustainability train.
More importantly, it’s time for Coca-Cola, Pepsi Co., Nestle Waters and the American Beverage Association to stop playing games and work with government and public-interest NGOs on a uniquely-American EPR program for packaging. With support from these brands, we can overcome the political juggernaut from other consumer goods trade associations and move packaging sustainability forward in the United States.