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No One-Size-Fits-All Solution for Plastics Industry to Meet Sustainability Goals, Says Delterra CEO

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“We are encouraging governments and stakeholders to create real markets for recyclable materials and reduce system costs on a large scale,” says Delterra CEO Shannon Bouton, a former sustainability guru at McKinsey & Co.

With the word sustainability on everyone’s lips these days, the international environmental nonprofit Delterra has come onto the scene with a burst of energy, a strong pedigree, and a big mission.

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Delterra CEO Shannon Bouton.

Delterra’s founding partner is consulting giant McKinsey & Co., and its flagship initiative, Rethinking Recycling, “works with communities in emerging economies to build rapidly scalable, self-sustaining waste management and recycling ecosystems that redirect waste into productive use while improving the lives of the people it touches,” explained Delterra CEO and President Shannon Bouton.

Productive partnerships between businesses, governments, and other players are essential to solving these complex problems, she urged. Bouton, who also founded McKinsey's sustainability practice, noted that with three years to go to reach the lofty 2025 climate goals set by many countries, there is no one-size-fits-all solution to reaching sustainability.

The debate over single-use plastics highlights the complexity of the plastics challenge, she asserted.

A legislative intersection where industry, governments, and communities work together

“Policy changes alone cannot solve — or even reasonably address — the interconnected issues related to waste management. For that reason, we are encouraging governments and stakeholders to create real markets for recyclable materials and reduce system costs on a large scale. Policy has a role in ensuring those markets can succeed, and this is where legislation can help. The key is finding the legislative intersection where industry, governments, and communities are working together to create good public policy.”

Repurposing post-consumer and post-industrial plastic materials is central to creating the elusive circular economy. But the fact that virgin resins make more economic sense to use when their prices are lower can be a bothersome reality.

“Incorporating higher amounts of post-consumer materials into plastic packaging plays an important role in reducing pollution and stabilizing markets,” she said. “The problem is that the price of virgin plastic is tied to the price of oil so that, historically, when the price of oil was low the price of virgin plastic was low, and the demand for recycled resins collapsed. When that happened for long enough, recycling companies went bankrupt. This boom-bust cycle for recycling has led to low investment in recycling programs and infrastructure. Demand needs to be stable to maintain the recycling industry and allow it to scale so that recycled resin can compete on price, even when oil prices fall. 

“That is why we see increasing acceptance of concepts like product stewardship or EPR [extended producer responsibility] programs, recycled content mandates, taxes, price premiums, and recycled content commitments from producers, where before they may have pushed back. As more of these come into play over time, hopefully, they can act as a bridge to getting the recycling industry to a scale where recycled resin can be reliably economically competitive with virgin resin.”

Retrieving and reusing plastic film has been another sticking point.

“There are some material and packaging types that we struggle to recycle more than others, and films are a good example,” Bouton acknowledged. “Today there is almost no post-consumer market for these plastics. There are niche solutions like plastic furniture or building materials, but very often those cannot be recycled at the end of life because they are composed of mixed plastics. On the horizon are other potential solutions including chemical recycling or compostable materials, but there are complexities in implementing any of these at scale that will need to be overcome.”

Even if technical recycling solutions are found, she continued, “it is expensive and time-intensive to collect and clean films. But that is why it is so important to collect and manage the full waste stream. Higher value, easier to collect materials like PET beverage bottles, can cross-subsidize the cost of collecting and sorting lower value materials like plastic films. At the end of the day, though, if we cannot find a solution for films, they will need to be designed out of the system and replaced with materials that biodegrade or can be recycled.”

A little less conversation and a little more action

Delterra’s mission is “to create a world where human activities protect and restore a healthy planet. We intentionally added ‘restore’ to our vision to highlight the significant amount of damage that has been done to our planet, and why it is essential to reset our impact.”

Yet talk is cheap — and plentiful.

“The problem is that there is so much discussion and so little doing,” she asserted. “Reports and convenings about what the world should look like and high-level pathways to get there are a good start, but they don't help if no one is figuring out the nitty-gritty ‘how.’ Businesses and governments need to do both — set the vision and drive the impact. That also creates a virtuous circle where impact helps us learn and scale what works and further informs the vision and pathway including enablers like regulation. Without doing both, we run a very real risk of talking until we run out of time.”

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