Investors are concerned that a failure to account for the negative impacts of plastic has resulted in numerous interlinked challenges – from acute environmental pollution and potential human health impacts, to substantial greenhouse gas emissions across plastics value chains. We believe that the linear, take-make-waste model for plastics has become unacceptable and companies reliant on this model will face substantial new commercial risks in coming years.
We expect companies to move from treating plastic as an externalised risk, to developing strategies that consider it as a resource requiring responsible management and value preservation – in partnership with suppliers, customers, processors and regulators.
Our engagement activity focuses on businesses engaged in the manufacturing of chemicals for plastics, and the design, marketing and retailing of consumer goods. In 2020 and beyond, we are amplifying our engagement in the chemicals, consumer goods and retail sectors by setting objectives for high-risk companies and targeting outcomes that address opportunities and risks.
We take a bespoke approach to each company exposed to plastics value chains, which takes the maturity of the company into account. Our approach considers all the elements relating to a sustainable plastics strategy, including the management, governance and disclosure.
For each sector in this report, we believe companies should be on a journey of change. This report concludes with a series of questions that investors can ask companies at each point on this journey. Without a cogent, disclosed journey on the sustainability of plastics and packaging, we believe many companies will face significant scrutiny from investors and stakeholders.