On Leadership: Three Circular Economy Pathways Executives Should Adopt

Jeff Wooster, Global Sustainability Director

August 11, 2021

6 Min Read
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It’s no secret that plastic waste is one of the biggest challenges of a generation. Think with Google found that searches for “zero waste” grew at six times the rate of “sustainability” in 2020 alone. In recognition of this global crisis, circularity has risen to a top C-suite agenda item with leaders launching public commitments to reduce plastic waste—and speaking out on the need for action, now.  


What’s often not discussed, however, is that many executives in the packaging space are hitting daunting roadblocks to solve for waste reduction. Less than one-quarter of executives have adjusted packaging formations to make them more recyclable, according to the recent Path to a Plastics Circular Economy whitepaper and survey from Fortune in partnership with Dow. Here lies a clear gap between ESG targets and implementation. Fortune’s findings – drawn from 300 senior executives at plastics using brands – highlight this disparity between C-suite’s recognition for the need to advance a circular economy, while citing that “impetus and action are not always linked.”

As a leader in sustainability, I intimately understand the steep challenges in redesigning a business’ value chain while meeting the bottom line and stakeholder demands. Yet, great challenges often yield great invention. In this case, we already have the tools to get started: here are three pathways leaders can take to drive measurable impact toward zero-waste commitments.

Pathway One: Overcome Value Chain Challenges through Partnerships

The circular economy is essential for businesses to win current and future markets—where estimated values of future circular supply chains reach up to $120 billion a year. Yet, leaning into circular solutions proves daunting for many leaders: 56% of executives surveyed in the Fortune whitepaper cite difficulty collaborating across the value chain as one of the top three obstacles to the development of a circular economy for plastics.

Kashi’s Bear Naked granola offers one example of a successful collaboration across supply chains to close the loop. In 2019, Kashi introduced the first recyclable, resealable stand-up pouch, a feat given that flexible plastics are notoriously difficult to recycle due to composition of multitude resin types and thin films. This achievement was made possible due to the collaboration of various partners across multiple aspects of production, from Dow’s polymer modifier technologies to Berry Global’s Entour film.  

The circular economy is also a key pathway to driving tangible progress to achieve corporate sustainability goals—where stakeholders are increasingly demanding transparent, continuous reporting of measurable achievements. In fact, a full 88% of institutional investors say their firm monitors ESG indicators to inform investment decisions.

To follow Kashi’s blueprint and to keep in line with ESG targets, leaders must look for partners poised for proof-of-concept partnerships and identify gaps across supply chains where new partners can bring unique capabilities—ranging from scientific expertise, material supply to local community support.

Pathway Two: Invest in Science and Innovation

Investments in emerging technology and innovation are another critical component to overcoming current circular economy challenges. New technologies, like advanced recycling, are primed to meet the demand for 100% recycled products. That is, if brands collectively get behind the necessary investments to mature these solutions.

Already, industries like cosmetics, fashion and food are investing in advanced recycling products to respond to consumer demand and to keep pace with sustainability and ESG goals. In 2020, Estee Lauder’s Origins announced that they will become the first global prestige beauty brand to utilize advanced recycled circular polymer resin to produce the tube packaging for its best-selling Clear Improvement Active Charcoal Mask. Dow, for its role as a polymer supplier, has made investments in new partnerships with Fuenix and Mura to create the platform for brands to meet market demand for 100% recycled products.

For many businesses connected to packaging, deep investments in material science and innovation are a luxury that largely multinational corporations or venture capital-backed enterprises can undertake. That’s why collaboration across the value chain is key.

Dow’s partnership with Circulate Capital and homegrown Indian recycler Lucro is one such example. Prior to the partnership launch in 2020, Lucro was largely producing recycled plastics for use in low-end applications such as shopping and garbage bags from hard-to-recycle plastic films. Dow, with its deep expertise in material science, was able to team up with Lucro to develop and deliver polyethylene film solutions using PCR plastics to enable advanced applications through Dow’s Pack Studios in Mumbai and Shanghai. Through this engagement, Lucro now produces recycled plastics for a wide range of packaging, including for bottles, cans and liquid cartons for a range of local stakeholders. The early commercial success for Lucro is pivotal, as the collaboration acts as a proof-of-concept for circularity models in India and across the globe.

Pathway Three: Deliver Recycling Education

Most concerning, the Fortune whitepaper found that only a handful of companies have made direct moves to address plastic waste. This is often explained on the supply side through the EPA’s finding that recycling infrastructure has not kept pace with today’s diverse waste stream, in conjunction with public confusion around what can be recycled. Without consistent, adequate supply, companies cannot meet demand.

Businesses have the unique opportunity to lean into this problem by leveraging their value chain partners to determine the most optimal solutions for closing the recycling education gap while enhancing local infrastructure. An example of this in action is the investment Dow has made with the Recycling Partnership’s work in Baltimore and other urban communities across the country.

In the Spring of 2021, Dow provided the resin that was used to make recycling carts that were distributed to eligible households in Baltimore. The project, however, did not stop there. The rollout of the new recycling carts meant that citizens needed to be educated on how to use them and served as a window of opportunity to remind people about what types of waste can be recycled. This initiative is expected to increase recycling in Baltimore by an estimated 20,000 tons a year, or nearly 200 pounds per household.

Expanding impact through partnerships between producers, distributors, educators and municipalities – such as this project – will be key to closing the loop.

Leaders are Poised to Meet the Moment—If They Act Now

Next month kicks off a series of consequential fall convenings — from the UN and Climate Week, through to COP26 — where executives are planning to gather alongside world leaders to discuss steps to preserve our planet and enhance our quality of life. Business leaders should plan to meet this visible moment with clear, demonstrated investments in the circular economy or risk leaving future market opportunities on the table—and our planet’s prosperity while the world watches.

About the Author(s)

Jeff Wooster

Global Sustainability Director, Dow Packaging and Specialty Plastics

 Global Sustainability Director for Dow Packaging and Specialty Plastics

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