Businesses not tackling sustainable packaging issues- BDO study finds

Consumer perception is that businesses are not doing enough when it comes to the issue of sustainability, a new study has found.

According to a study by accountancy and business advisory firm, BDO LLP, almost 60% of consumers surveyed believed that companies needed to do more to address sustainability. 

Particular criticism was levelled at the electronics, home appliance, and fashion & beauty sectors for their use of packaging, with 60% of respondents stating that too much packaging material was used in these sectors. This compares to 40% and 50% in healthcare and groceries, respectively.

Daniel Guttmann, BDO Strategy & Commercial Due Diligence’s lead partner for industrial products, technology and services, commented: “Sustainability continues to be a top issue for consumers and, therefore, has to be a key priority for corporates – packaging, in particular, is an important area which is also very visible to consumers. 

“There is a popular consensus that companies use more packaging than is necessary and that they should take more responsibility for addressing this. That includes absorbing potentially higher costs, which is a real issue for many companies, but critical for their image and improving public perception.”

The UK-wide representative study, which surveyed 500 people between the ages of 16 and 25 and 35+ across all income brackets, showed that over 90% of consumers believe that businesses should carry the cost of improving the sustainability of their packaging. Additionally, more than half (51%) of respondents said they were not prepared to pay higher prices for the use of more sustainable materials. There was however a much higher willingness from younger consumers (<35 years) to shoulder some of the cost – heralding a potential step change in driving the ESG agenda.

Guttmann said: “A large gap remains between consumers’ concern for the environment and their willingness to recycle compared to their understanding of sustainable packaging materials, and crucially their willingness to pay a higher price for more sustainable packaging. 

“For many years, consumers have been demanding more sustainable practices from businesses. Unfortunately, they have, and still are on the whole, unwilling to carry some of the costs associated with achieving these goals.

“What’s clear from our study, is that younger generations are more concerned, more engaged, and more likely to recycle than the general population. Critically, they are increasingly prepared to take on some of the financial burden of making more sustainable packaging a reality.”

The study highlighted that while an overwhelming number of consumers are concerned about the impact of packaging on the environment, with 96% admitting that recycling and reuse is important, more than a quarter of respondents have only limited understanding of which materials are more or less sustainable than others. 

BDO’s recent Packaging Sector Insights report detailed a number of areas driving sustainability in the packaging sector, including Government regulations, taxes and incentives, such as the Plastic Packaging Tax (PPT), the availability of collection and recycling infrastructure, and corporate investment in R&D to reduce waste, maximise the use of recyclates, and develop new materials.

Guttmann concluded: “What is clear is that significant work is already being done by industry professionals to address the issue of sustainability in packaging - whether it’s innovative ways to drive improved usage and processes for existing materials (such as downgauging) or the development of new methods and substrates. However, investment in recycling infrastructure and technologies is absolutely necessary if we are to move to a truly circular economy. Consumer willingness is there and growing and materials are improving, but collection, separation and treatment are not quite where they need to be.”