How CDP supply chain members are tackling emissions in their supply chains.
Product innovation, supplier collaboration and consumer engagement to tackle the environmental impact of food packaging
The Japanese food, chemicals and pharmaceuticals corporation, Ajinomoto, operates 118 plants and employs over 30,000 people, selling its products in more than 130 countries worldwide. However, by far the biggest source of environmental impact related to the company’s operations occurs upstream in the supply chain.
Purchased goods and services account for over half of the group’s total Scope 1, 2 and 3 emissions, producing the equivalent of 7.7 million tonnes of carbon dioxide in 2016. Most significant within this category are the purchase of the raw and processed materials that go into manufacturing Ajinomoto’s own products, as well as the packaging materials that are used to contain and protect them.
By working to take action on the impact of these materials, Ajinomoto is therefore able to have a far greater potential positive influence than by focusing just on its own Scope 1 and 2 emissions, which together make up just 17% of the company’s total. This part of the supply chain is also where the majority of water and deforestation issues can arise, giving increased reason for action.
One of the areas where the company has been making good progress on sustainability recently is in packaging. This has upstream impacts from the production of packaging materials – particularly plastic, paper and cardboard – alongside downstream impacts from product logistics and post-consumer waste. In 2016 the manufacture of packaging for Ajinomoto’s products required 235,000 tonnes of raw material input, including 45,000 tonnes of plastic and 139,000 tonnes of paper and cardboard.
The business has taken a collaborative approach to create change, bringing together key stakeholders on a regular basis through events, including the Ajinomoto Group Food Conference and a Packaging Designers’ Liaison Meeting. The company also closely works with government and local authorities, particularly in Japan, to help overcome technical, legal and behavioural barriers to increasing the rate of packaging recycling.
As a company with a strong focus on R&D, one of the biggest areas of success for Ajinomoto has been through packaging innovation and redesign. To ensure a consistent approach is taken across all group companies Ajinomoto launched an updated environmental assessment procedure to be used before releasing any new or revised product. This involves going through two separate exercises: using an environmental assessment checklist , followed by scoring containers and packaging against the company’s own Eco-Index assessment table.
The checklist takes into account product design issues such as: ensuring material use is reduced, and wherever possible compatible with reusing or recycling; the sustainable procurement of materials; designing for loading efficiency in distribution; helping to reduce food loss; and promoting environmental consumer behaviour through labelling.
Packaging is then scored across a variety of points-based assessment criteria, such as whether it extends product shelf life, improves loading efficiency or has lower greenhouse gas emissions. This index is regularly reviewed and updated to ensure that it is driving positive outcomes, with the most recent revision launched in April 2017.
One example of this approach being put into practice is with Ajinomoto’s Blendy bottled coffee products. Ajinomoto AGF worked alongside the company’s packaging supplier, Toyo Seikan Group, to pioneer technologies that take post-consumer plastic bottles and recycle them into heat-resistant PET resin. Thanks to this work Ajinomoto has become the only company worldwide to sell drinks in 100% recycled heat-resistant PET bottles, reducing the use of virgin plastics from fossil fuels by around 2,000 tonnes a year.
A number of other innovations are being adopted, working alongside suppliers such as Acteiive Corporation, Dai Nippon Printing, SATO Green Engineering and Toyo-Morton. These include the use of plant-based bioplastics, which can make up more than a quarter of the packaging for some products, as well as using plastics that are able to absorb and lock away carbon dioxide during incineration.
To demonstrate the environmental credentials of its packaging Ajinomoto has developed the Aji-na Eco and Hotto-suru Eco labels, which are used to communicate to consumers the positive changes made by the company. These are often used to highlight improvements that may not be superficially obvious, such as the switching to certified sustainable timber and recycled paper, reducing the amount of packaging or removing an internal tray. They also encourage more environmentally-friendly behaviours, by making it clear that the product can be easily separated when recycling, or making it clear that containers can be refilled and reused.
Through its efforts to improve the sustainability of its packaging Ajinomoto has already made substantial strides in reducing upstream material use, helping to reduce supply chain greenhouse emissions, water use and deforestation. It is also having a positive impact in tackling downstream consumer food waste and packaging waste. The business intends to continue these efforts over the coming year, as part of its ongoing commitment to the environment.
Addressing environmental challenges from an increasingly diverse supply chain to support business growth in more sustainable product lines
Braskem is the largest petrochemical company in the Americas and the world’s fifth largest producer of basic petrochemicals and thermoplastic resins, operating in 70 countries around the world. It is also one of the few major petrochemical companies to integrate operations across both basic petrochemicals and thermoplastic resins, providing the company with a competitive advantage from increased scale and operational efficiency.
Given the nature of Braskem’s business, it is essential that the company has a secure and competitively priced supply of feedstock for making its core products. It is therefore a key part of the company’s strategy to continue to expand and diversify its feedstock profile, while working on the development of more sustainable technologies and solutions for the plastics supply chain.
In recent years the company has invested significantly into developing alternative feedstock sources that do not involve using virgin fossil fuels. These efforts have focused on two areas: on the one hand scaling up 100% renewable sources of plant-based feedstock; and at the same time building up a supply chain of plastic waste that can then be recycled into new material.
This strategy has been driven in part by Braskem’s recognition of the importance of taking action on sustainability issues, but it also reflects a growing customer demand for more sustainable products. For example, a number of large consumer goods companies have expressed ambitions to adopt more sustainable packaging that contains bioplastic or recycled plastic.
Thanks to the company’s research and development efforts, in 2010 Braskem was able invest in building a US$290 million facility that would make the company a world leader in biopolymers. The plant has an annual production capacity of 200,000 tonnes of polyethylene produced entirely from renewable resources.
This green polyethylene is sold around the world under the company’s I’m green™ brand. The product has also been certified as having a negative carbon footprint, as during its lifecycle the net effect is to sequester greenhouse gases from the atmosphere.
The procurement of agricultural inputs – which currently account for 3% of Braskem’s raw material feedstock – has brought the company a different set of supply chain sustainability challenges, including deforestation and biodiversity issues. As a result of this Braskem has needed to develop and enforce a Responsible Ethanol Sourcing Framework for its ethanol suppliers, to cover a range of sustainable development principles and ensuring good environmental practices.
In November 2017 the company also announced that, working in partnership with Denmark’s Haldor Topsoe, it will build a demonstration plant in Denmark. This facility will produce monoethylene glycol, a key component of PET plastic, without needing to first convert sugar into ethanol. Although process this will initially use cane sugar, it opens up the possibility of having a more diverse supply chain that can use beet sugar, or potentially even second generation sugars made from biomass.
The other major initiative from Braskem, to help meet the growing customer demand for greener plastics, has been a focus on boosting initiatives to produce recycled plastics from post-consumer plastic waste, particularly within Brazil. This has had the additional benefit of helping to promote a more circular economy, growing the amount of recycled input available for future manufacturing.
As well as needing to develop the recycling chain to secure a regular and sufficient source of plastic waste for use as feedstock, avoiding excessive contamination is a key concern as this is one of the main technical problems that affects the quality of recycled products. To address this Braskem created the Wecycle platform, looking to increase the value of post-consumer plastic waste by building partnerships with Braskem clients, recyclers and brands to find better solutions for them that promote the use of recycled plastics.
Wecycle provides audit processes and quality assurance for recycled plastic materials, providing manufacturers with confidence to make greater use of it. It also works with businesses including Brazil’s largest retail chain, GPA Group, to support greater levels of consumer recycling.
Alongside this, Braskem has created the Ser + Realizador programme to support key waste management cooperatives in Brazil’s recycling supply chain, at the same time as helping to strengthen its own supply of recycled raw material input. This provides training and environmental education to waste pickers, as well as management consultancy support to waste-sorting cooperatives.
Through the programme Braskem also provides new equipment for waste pickers and investment for cooperatives to upgrade infrastructure. To date this has benefitted 1,300 waste pickers and 35 cooperatives. Braskem is currently working towards a 2020 target of providing development support for waste pickers in order to help them raise their incomes by 70%. In addition, the company aims to benefit 4,000 workers through training and better work conditions.
These combined efforts are allowing Braskem to expand its sustainable product lines and drive future business growth. As result of these efforts the company has recently been able to launch 100% recycled polypropylene and polyethylene resins produced entirely from recycled big bags and sacks.
Pioneering a circular economy model by using sustainable product design and reverse logistics to create a closed loop system
Sky is one of Europe’s leading entertainment and telecommunications companies, providing television, phone and internet services to 22.5 million customers across the UK, Ireland, Germany, Austria and Italy.
The company has put in place robust internal procedures to address the environmental and social impacts of its supply chain, actively engaging with all new and existing suppliers which fall within the top 80% of Sky’s total annual supplier spend. As a result Sky is now able to report that 40 of its top 50 suppliers have integrated climate change initiatives into their corporate strategies.
In addition, Sky became one of the first broadcasters to make it mandatory for production companies to measure and reduce their impacts using the UK film and television industry’s albert+ sustainable production certification as part of commissions for Sky.
Sky understands that its main focus for its supply chain sustainability efforts should be on its most material impacts. As a way to help monitor and evaluate these impacts, Sky has been conducting life cycle assessments on its products for a number of years, which are used to drive ongoing improvements in their sustainable design.
This process has revealed that the use of set-top boxes, provided to customers so they can access Sky broadcasting, are one of the most significant sources of greenhouse gas emissions across the company’s full value chain.
Indeed, customers’ use of Sky’s products – which includes broadband routers as well as set-top boxes – accounts for over half of the company’s total scope 3 emissions. And a further 20% of those scope 3 emissions come from purchased goods and services, which includes the manufacturing of that hardware by Sky’s suppliers. Continuously looking at ways to reduce the impact of the set-top box is therefore a priority focus.
The electricity consumption in the use-phase of a set-top box represents the majority of emissions across its life cycle. Sky has therefore been continuously working with suppliers to address the energy efficiency in product design. This is an area where good progress is being made. Coupled with detailed insight into how customers use its products, Sky has further developed three power modes which take advantage of energy efficiencies based on usage patterns.
But looking beyond energy performance, Sky has put a particular emphasis on reducing the embedded emissions related to the production of its set-top boxes. Product life cycle assessments have helped to identify hotspots of emissions, highlighting areas where improvements can be made.
This has led to a reduction in the amount of materials that go into the box itself, as well as helping to remove metal components where lower impact alternatives can be found. Building smaller, lighter boxes has also reduced the amount of packaging they require, at the same time as cutting transport emissions.
Making proactive efforts to engage with manufacturing partners has helped Sky to overcome barriers, where those partners may previously have been concerned that improved sustainability would cost time and money. The company has gone beyond merely auditing its suppliers by providing consultancy support to improve performance and jointly develop strategies to reduce emissions. For example one manufacturer, Zinwell, has invested in a large-scale solar installation for its facility in China, which now provides half of the electricity needed to manufacture Sky’s products.
However, despite all this progress, Sky has now gone one step beyond just looking to reduce impacts. The company is aiming to close the loop with its new Sky Q set-top boxes, which have been designed with the circular economy in mind.
Design improvements have been made to allow boxes to be refurbished more effectively, including the ability to replace parts without dismantling the box. Sky is working with key partners for reverse logistics and distribution, enabling them to carry out product repair and recycling.
These partnerships operate with a zero landfill policy, ensuring that all material inputs are processed in the most effective way possible to retain their economic value. This supports Sky’s commitment to reuse or recycle all products returned to them.
Over the coming years, Sky will continue to take action on its supply chain, as well as helping to perfect its closed loop system. In order to strengthen its efforts, the company is currently focusing on increasing the accuracy of its scope 3 emissions data which will help inform subsequent reduction targets.