Demystifying CSR: The Race for Improved Packaging

I was speaking with one of my friends in the cosmetics industry the other day and was struck by a comment he made about CSR within a brand he manages.   On one hand, he explained, market research indicates his customers won't pay more for a more "sustainable" product, but on the other, paradoxically, his company is investing in a new product line with more environmentally-friendly packaging.

I questioned my friend's perception that it is paradoxical for a cost-conscious company to invest in sustainable packaging, and looked to a document from the Sustainable Packaging Coalition (SPC), an industry group led by the nonprofit sustainability institute GreenBlue, which is known for its pioneering work supporting companies in identifying safer materials (GreenBlue was founded by the authors of Cradle to Cradle, a must-read for anybody interested in environmentally-sound design).  The Sustainable Packaging Coalition's website offers access to a publication called Sustainable Packaging and Metrics Framework, which identifies the following eight elements of sustainable packaging:

Material use, including reductions in the amount of materials used and waste produced

Energy use, including total energy consumption and proportion of renewable energy used

Water use, including total water consumed and water from scarce sources

Material health, including the concentration of toxics in materials used

Clean production and transport, including toxic, greenhouse gas, water, and air emissions

Cost and performance, including costs of packaging and waste

Community impact, including product safety, landfilling/recycling/reuse of packaging

Worker impact, including records for child labor, forced labor, remuneration, discrimination, and excessive working hours

For each of these elements (core indicators for which are detailed in the chart below), the SPC proposes a variety of benefits, some to society and some to the corporation itself.  On the latter front, explained the document, more efficient use of inputs can "lower overall operating costs and reduce the total costs of packaging", protect a company from losing its "license to operate" in locations where natural resources are scarce, and "reduce operating risks and associated liabilities including insurance costs."

What the SPC doesn't discuss in any detail is that there is now an additional layer to the CSR game.  Say that a retailer (Walmart, for example) is able to help one of its suppliers identify cost savings through improvements in packaging.   And say that the retailer and manufacturer not only split the cost savings, but also pass along some to the consumer in the form of lower prices.  What we now have, in effect, is a win-win-win situation.

So is all this to suggest that my friend's boasts about his company's CSR were without merit?  Hardly.  But in this economic environment, making packaging more sustainable is a necessity rather than an expectation for a company interested in getting credit for its CSR.