current volume and persistence of plastic pollution is unprecedented tics.pdf. 13 Market Research Future (2020). Global. Flexible Plastic Packaging Market, By.
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portfolio.earth is a new initiative born out of rising human-induced sixth mass extinction seriously and is actively providing capital to sectors that gov -ernments and scientists agree is deemed harmful to biodiversity. -tion of nature. We aim to bring together diverse voices to amplify the we need to see.For more information please contact info@portfolio.earth or visit our website Contents About us Executive summary pg 4 The largest lenders to the industry pg 8 The role of banks in reducing plastic waste and fostering a circular economy pg 14 The problem with plastic pg 20 The plastic packaging industry pg 28 Corporate and government initiatives pg 34 Global corporate commitments pg 35 National and international government initiatives pg 38 Plastic manufacturer commitments pg 39 Appendix: Methodology pg 40 3
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Executive summary Summary Every minute a truck-full of plastic ends up in our oceans. Governments and scientists agree that the current volume and persistence of plastic pollution is unprecedented in human history. Plastic packaging is the main culprit. With growing public outcry around the world, companies and governments are slowly waking up. The banks which lend to these companies, and with -out whom the plastic packaging industry would not function, are co-responsible for creating persistent, harmful pollution. Out of step with reality, and the wishes and concerns of their customers, these banks and persistent product. FindingsFor the first time, this report analyses the January 2015 and September 2019, banks provided loans and underwriting of more than USD 1.7 trillion (equivalent to Russia™s GDP) to forty key plastic chain actors. This includes all lending to those companies The total is equivalent to USD 790 million per global plastics supply chain. While many banks have shown some awareness of the issue, none of the 20 banks which provide the lion™s share of funding have developed any due diligence systems, contingent to the plastics packaging industry. The report ˜nds that between January 2015 and September 2019, banks provided loans and underwriting of more than USD 1.7 trillion to forty key plastic supply chain actors. This means banks are not acknowledging their responsibility nor taking action to understand, meas -ure, and reduce the impacts of their loans within the plastics value chain. included in the report are headquartered in the USA Demands To address plastic pollution, a fundamental shift away from business models that depend on sin -gle-use packaging towards those that prioritise reuse and more localized supply chains and services is needed.Banks should make funding of corporate actors within the plastic packaging supply chain contingent on companies implement-ing best practice.Governments should stop protecting banks banks liable for the damage caused by their lending. Companies must adopt international best practice to reduce the production and use of virgin plastic and increase the reusability of plastic packaging products. 54
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Why this matters Plastic pollution is out of control Plastics, and the chemicals they are made from, permeate our daily lives. Persistent harmful pollution from plastic packaging has now reached every corner of the planet from the deepest oceans to the top of Mount Everest. The largest contributor of plastic waste is packaging. Scientists and governments agree that pollution from plastics is ‚escalating and accumulating at an ‚alarming rate™, and the future level of pollution in terms of volume and persistence has ‚no previous analogue in human history™. Worldwide, about 2 million plastic bags are used every minute. Each bag is used on average for 12 minutes, but can take hundreds or thousands of years ingestion of plastic kills an estimated 1 million marine Business and government are waking up slowly This global public outcry led to a set of govern -ment and business responses. As of June 2020, it was reported that 69 countries had passed a full or partial ban on plastic bags. Some companies have made comparatively strong commitments to reduce plastic packaging. Future plastic growth trends are at odd with public opinionThe delivery of companies™ commitments have been called into question by environmentalists. What™s more, according to the World Economic Forum, the world™s leading plastic manufacturers are planning to increase production by almost one-third plastics, with policies and legislation being stalled. Disposable masks and gloves are clogging up our rivers and oceans, alongside additional plastic pack -aging from our food and beverages. Meanwhile, the plastics industry in some countries has used this pandemic to scale up its lobbying, arguing against plastic bans in the name of public health despite push-back from the health sector. birds and 100,000 marine animals every year. More to have plastic particles in their stomach. What™s more, the average person eats about 100 particles of microplastics in every meal and on average 70,000 particles a year. Public concern is mounting A South-East Asian survey commissioned by the in the region were concerned about plastic waste. In Europe, over 53 per cent of consumers name plastic waste as a major environmental concern. Studies show that nearly half of all consumers worldwide – are increasingly successful. Banks are silent and out of touch with reality Despite public outcry over the serious impacts within the plastic value chain to reduce their impacts, none of the banks analysed have developed due – means banks are currently not taking responsibility to understand, measure, and reduce the impacts of their loans within the plastics value chain. supply chain, banks have failed to acknowledge their role in enabling global plastic pollution. They have fallen far behind the crowd of other actors that contribute to the plastic pollution crisis.Despite public outcry over the serious impacts of plastic pollution, and e˚orts by some companies within the plastic value chain to reduce their impacts, none of the banks analysed have developed due diligence systems, contingent loan criteria or ˜nancing exclusions when it comes to this industry. This means banks are currently not taking responsibility to understand, measure, and reduce the impacts of their loans within the plastics value chain. Worldwide, about 2 million plastic bags are used every minute. Each bag is used on average for 12 minutes, but can take hundreds or thousands of years to decompose. 76EXECUTIVE SUMMARY
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The movement to end plastic pollution and to ban single-use plastic packaging has become one of the most visible campaigns globally. The largest lenders to the industry A South-East Asian survey commissioned by the region were concerned about plastic waste issues. 1 In Europe, more than 53 per cent of consumers named plastic waste as one of their three major environmental concerns, followed by climate change at 44 per cent. 2Despite this, the role of the banking sector in enabling the plastic industry has not been investigated until now. industry sectors contributing to biodiversity loss, pollution, or climate change, enabling a clear picture report), plastic packaging is not one of them. This means that in order to assess the amount – companies within it. This report analyses loans to forty companies which operate within industry sectors linked to the plastic value chain. These companies were chosen from sectors including producers of polymers that are largely used for plastic packaging, plastic packaging manufactures, Fast Moving Con -sumer Goods (FMCG) companies, and some of the world largest retailers. Together, the ten companies percentage of their respective markets. Table 1: Key Actors along the Plastic Packaging Value Chains Included in the Research Role of banks in plastic packaging PLASTIC RAW MATERIAL PRODUCERS ˜ ˚ ˛ ˝ ˙ ˆ ˇ ˘ PLASTIC PACKAGING MANUFACTURERS ˘˘ ˘˜ ˘˚ ˘˛ FMCG COMPANIES ˘˝ ˘˙ ˘ˆ RETAILERS ˘ˇ BASF Amcor/Bemis Anheuser -Busch Ahold Delhaize Chevron Philips AptarGroup Coca-Cola Amazon.com Dow Chemicals Berry Global Danone Costco Corporation DuPont Coveris JBSCVS Health Corporation Exxon Mobil Huhtamaki MarsSchwarz Group Formosa Reynolds Group Nestle Tesco PLC INEOS Sealed AirPepsiCo The Home Depot Inc LyondellBasell SilganProcter & Gamble The Kroger Co. SABIC SonocoTyson Foods Walgreens Boots Alliance SinopecZhuhai ZhongfuUnilever Walmart 9898
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A number of the companies in Table 1 have made pledges of various strength and detail to address the amount of plastic they produce, use, or sell. A very small subset of companies have made commitments considered more ambitious and impactful. Unilever for instance has promised it will have cut in half its use of virgin plastic 20 to reduce its use of virgin plastics by one third in the same period.21 Despite public outcry over the serious impacts within the plastic value chain to reduce their impacts, none of the banks analysed have made funding con-tingent on such pledges.22 supply chain, banks have failed to acknowledge their role in enabling global plastic pollution. They have fallen far behind other actors that contribute to the plastic pollution crisis.Key ˜ndings banks provided loans and underwriting of more than USD 1.7 trillion to these 40 key value chain actors. More than eighty percent of this funding (USD 1.4 trillion) came from just 20 banks, out of a total of -mental harm caused by plastic pollution.Of note also is that the three largest lenders Œ Œ are all headquartered in the United States. contributed by banks from the United States, followed by the United Kingdom (15.5 per cent), Japan (7.7 per cent), France (6.2 per cent), Germany (5.5 per cent), Switzerland (3.5 per cent), Canada (3.3 per cent), and -quartered in European countries accounted for 38 per cent of the total investment value. BANKHQLOANS & UNDERWRITING OF TOTAL United States 171,737 10.31% Citigroup United States 145,816 8.76% JPMorgan Chase United States 143,766 8.63% Barclays United Kingdom 117,923 7.08% Goldman SachsUnited States 97,042 5.83%HSBC United Kingdom 96,201 5.78% Deutsche Bank Germany 77,398 4.65% Wells Fargo United States 74,121 4.45% BNP Paribas France 55,8523.35% Morgan Stanley United States 54,2113.26%Mizuho FinancialJapan50,602 3.04% Mitsubishi UFJ Financial Japan43,587 2.62% Credit Suisse Switzerland 40,218 2.42% Société Générale France 35,775 2.15% Santander Spain33,960 2.04% SMBC Group Japan33,189 1.99% ING Group Netherlands 31,084 1.87% Toronto-Dominion Bank Canada23,574 1.42% NatWest United Kingdom 22,207 1.33%Royal Bank of Canada Canada21,760 1.31%Other295,191 17.73% Table 2: Top Twenty Lenders to 40 actors in the Plastic Packaging Value Chain (Jan 2015 – Sept 2020; million USD)Figure 1. Just over 90 per cent of the funding for the 40 key supply chain actors came from banks headquartered in just eight countries. By indiscriminately funding actors in the plastic supply chain, banks have failed to acknowledge their role in enabling global plastic pollution. They have fallen far behind other actors that contribute to the plastic pollution crisis. This concentration of ˜nance from banks Headquarted in a few jurisdictions indicates that legislative measures, such as introducing lender liability which holds ˜nanciers and investors responsible for the impacts their ˜nancing has on biodiversity, could be highly impactful even when initially implemented in a small number of geographic regions. UNITED STATES UNITED KINGDOM FRANCEJAPAN GERMANYSWITZERLAND 46.4% 15.5% 6.2% 7.7% 5.5% 3.5% CANADA 3.3%NETHERLANDS3.1% 111010THE LARGEST LENDERS TO THE INDUSTRY
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While plastics have played an important role in society over the last 70 years and will continue to do so, any plastics which are not recycled end up in the environment, either as uncontrolled pollution or in waste repositories. At the present rate of growth, plastics production is estimated to double within the next 20 years. 23The role of banks in reducing plastic waste and fostering a circular economy chain in an unsustainable manner contributes to environmental pollution. In order to reduce the impacts of plastic on biodi -versity and to eliminate plastics from the natural envi – that the way we produce, process, and use plastic, and plastic packaging in particular, changes radically. One proposed solution is the wide implementation of a ficircular economyfl. In contrast to the current economic model which relies on making, using, and disposing of products, a circular economy promotes a produc -tion and consumption model that is restorative and regenerative. It aims to ensure that the value of products, materials, and resources is maintained in the economy at the highest utility and value for as long as possible, while minimising waste generation by designing out waste and hazardous materials. 24 A study of seven European nations found that a shift to a circular economy could reduce greenhouse-gas emissions by up to 70 per cent and grow the work -force by about 4 per cent. 25 Pollution from plastic packaging has been at the forefront of the debate about the circular economy but there has been little progress to date. Even though numerous companies have made high-level commit – and use of plastic packaging. To achieve this, a much sector will be required. A limited number of banks have started to adopt policies that allow them to limit investments for other high biodiversity impacting sectors such as fossil fuels, forest products, and some agricultural commod -ities. However, this has not yet occurred for plastics. Even though many have demonstrated aware -ness of the issue,26 27 and are planning to reduce banks that provide the lion™s share of funding within the plastic packaging value chain have developed any due diligence systems, contingent loan criteria, industry. 28 This means banks are currently not taking responsibility to understand, measure, and reduce the impacts of their loans within the plastics value chain. The circular economy is a nothing less than a blue print for a fundamental transformation of our economic system Š a transformation that is urgently needed, that is entirely possible, and that is indeed desirable.fl Naoko Ishii Š CEO and Chairperson, Global Environment Facility 29fi1514
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Bank, government and corporate actions and commitments on plastic How companies should act To mitigate their direct role in enabling plastic pollution, companies should adopt international best practise to reduce the production and use of virgin plastic and increased the reusability of plastic of corporate actors within the plastic packaging supply chain contingent on companies implementing best practise.How banks should respond chain causes and contributes to pollution of the environment by harmful, persistent plastics. Any plastics which are not recycled, end up in the envi -ronment, either as uncontrolled pollution or in waste repositories. To mitigate their role in enabling plastic pollution, banks should: Align their lending portfolios with public policy on plastic reduction, reusability, recycling and net plastic released to the environment; Publicly report their historic and ongoing impact through their lending contribution to activities which create plastics waste in the environment. virgin feedstock for the production of sin -gle-use plastic packaging for consumer products. How governments should change the ˜nancial rulesTo address the problem of plastics pollution, that end up in the environment, in particular the marine environment, endanger the health of biodi -versity and the public welfare of current and future should both recognise that investment in the plastics plastics value recovery chain (reduction, recovery, re-use and recycling), causes and contributes to this harm. To remedy the problem, governments should: Extend investor liability for any future envi -ronmental or health related legal challenges to those responsible for plastic pollution, chain.Introduce a mandatory tax on virgin plastic at the point of importation to or production within a country, in order to raise its price relative to recycled plastics, achieving equivalence by channeling the receipts from the tax into incentives to recover and reuse plastics waste streams. This would require trade related controls to ensure equivalence in imported packaging.Invest in a new generation of recycled plastics markets by establishing forward contracting arrangements akin to renew -able energy feed in tariffs to incentivise investment in modern recycled plastics value chains.Table 3: Examples of How Bank Funding can be Contingent on Corporate Best Practice for Plastic Packaging Commitments and Action PlansPOLICIES polymers by 2025 feedstock economically preferred plastic packaging or polymers for plastic packaging polymers by 2025 feedstock economically preferred plastic packaging or polymers for plastic packaging 1617BANKROLLING PLASTICS THE ROLE OF BANKS IN REDUCING PLASTIC WASTE AND FOSTERING A CIRCULAR ECONOMY
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Finance accountability framework for ˜nance to protect biodiversity In addition to the recommendations, the Finance Finance Accountability Framework to reduce the -versity crisis. The Framework states: -zens™ individual and collective biodiversity-related associated risks liable for biodiversity impacts – -lated policies, goals, and commitments -ities are consistent with biodiversity-related public policies, goals, and commitments accountability for impacts on biodiversity. In addition, in order to address global plastic pollution, banks will need to play a much more active role and lay the groundwork for a circular economy and significant reduction in the production and use of single-use plastic packaging. 1918THE ROLE OF BANKS IN REDUCING PLASTIC WASTE AND FOSTERING A CIRCULAR ECONOMY
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The problem with plastic The word plastic comes from the Greek plassein which means to mould. Plastic is a comparatively cheap, easily formable, hydrophobic, bio-inert material. After World War II, plastics entered and transformed the daily lives of expanding consumer societies around the world. The ability to cheaply produce a material that can be shaped freely allowed people with limited incomes to become prolific consumers. shelf life of some perishable foods and protected food from contamination. Today, packaging accounts for 42 per cent of global plastic resin (the base of all plastics such as polyethylene) production and 31 single-use plastic has become the embodiment of a throw-away consumer society. The properties that make plastic desirable however, also make it one of the most hotly-debated environmental problems. While plant cellulose was the raw material for early plastics, today it is nearly Up to 12.7 million tons of plastic enter the ocean every year, 32 equal to a truckload of plastic being dumped into the ocean every minute. 33 Without major transformation in how plastic is produced and used, This is the equivalent of 50 kilograms of plastic on every metre of coastline around the world. 34 Concern -ingly, scientists recently discovered there is ten times more plastic in the Atlantic than previously thought. 35 Production and waste Plastics freed us from the con˜nes of the natural world, from the material constraints and limited supplies that had long bounded human activityfl Susan Freinkel, the author of Plastic: A Toxic Love Story 36fi2120
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