Packaging data and specifications: Preparing for new regulations

Are you wondering how new environmental regulations and legislation will affect your organization? Numerous nations and regional unions — and several U.S. states — have passed regulations concerning the environmental impact of your operations. These measures call for transparency into the environmental impact of your products — from how they’re produced to distances traveled and events at the end of the cycle. Various event categories fall under the same umbrella of environmental reporting and climate disclosure that link to extended producer responsibility (EPR).

Depending on where your products are manufactured, where they’re sold and the relevant industrial sector, different regulations may apply. Considering that, how will you improve your packaging specifications and what supporting data will you need to collect to satisfy these regulations?

What’s driving the new environmental legislation?

Why so many changes so quickly?
Many global events have led us to this point, but the most relevant driver is the United Nations Framework Convention on Climate Change (UNFCCC) Paris Agreement. 195 signatories agreed to keep Earth from warming above 2°C from pre-industrial levels (1840–1900).

As global temperatures rise, urgent action is needed as the globe experiences more extreme weather events. The loss of life and damage to infrastructure strain nations across the globe. These events also reduce capital investment, trade and economic activity.

These reporting regulations provide consistent and comparable economic information for markets and investors, but the scope and application may vary between regions and their standards and frameworks.

Why the need for more data?
Emerging regulations will bring adjustments to reporting standards and the environmental, social and governance (ESG) requirements defined by organizations and their respective directives. Depending on your area of operation, these organizations may include the Security and Exchange Commission (SEC) Climate Disclosure Proposal (U.S.); the Corporate Sustainability Reporting Directive (CSRD) (E.U.); and Packaging Waste Regulations for England 2023 (U.K.).

What will these environmental regulations ask of you?

Preparing and aligning your data
Be ready to report according to the standards covering where your products are manufactured or sold. The rules you’ll need to follow will vary according to reporting requirements in these locales, but a few good starting points include consulting the task force on climate-related financial decisions (TCFD) for guidance on SEC-related regulations. The European CSRD also lays out specific guidance. For a guide to corporate standards on greenhouse gas emissions, consult the Greenhouse Gas Protocol.

Complicating matters for multinational organizations is that there are no cohesive global standards for sustainability reporting. A recent effort to combine multiple standards and create a common framework for global reporting can be found in the International Sustainability Standards Board’s (ISSB) International Financial Reporting Standards (IFRS) S1 and S2.

Companies need to define a sustainability strategy to follow forthcoming reporting rules. But their specific data collection and management rules must be followed for those covered by existing regulations — including those U.S. states* adopting the Extended Producer Responsibility (EPR) regulations on packaging or the U.K. Packaging Waste Regulations 2023 for England.

Increasing your data value through proper management

Don’t house packaging data fragments in multiple server locations, email chains, spreadsheets or even with your suppliers. There’s no time like the present to build a systemic process and to house and classify your packaging data.

What packaging data will you need?

Depending on your region and applicable regulations, data requirements can vary drastically. However, a few factors can be generally applied to this type of sustainability/EPR or environmental reporting.

These can include:

• Packaging Activity — How is the packaging supplied?
  • Supplied under your brand (name, trademark or other distinguishing marks)?
  • Unbranded?
  • How’s it sold (online via your website, online marketplace or brick-and-mortar)?
  • Is the packaging owned by your company or hired/loaded out reusable packaging?
  • Is empty packaging being supplied or imported?
  • Annual turnover rate or supply for import?
  • Are any waste management fees paid throughout the supply chain?
  • Any packing waste recycling notes for post-processes that aid in meeting recycling obligations.
• Packaging Type: household or non-household?
• Packaging Class: primary, secondary, tertiary or shipment?
• Material Supplier's country of origin and their associated environmental practices.
  (Any certification about material production or certification chains?)
• Material composition and weight
  • Percent recycled content — feedstock origin information.
  • End-of-life considerations — recyclability, compostability, biodegradability and associated certifications from the manufacturer.
• How should the product/package be handled during transport?
• Quality and compliance with standards from testing to production environment.
  • International Organization for Standardization (ISO), American Society for Testing Materials (ASTM), International Safe Transit Association (ISTA).

Circling back to your own sustainability goals

Packaging data will play an increasing role intrinsically linked to your company’s overarching sustainability goals. It'll also have a significant impact on how your objectives will be tracked.

You’ll need to know the materials used in your packaging and where they are made. Be aware of what production, transport and disposal resources are needed. These details will allow you to accurately quantify a product’s environmental footprint and compile it with your total emission output. (Calculated by scope one, two and three reporting.)

Regulations like the European Union’s CSRD and EPR in the U.S. aim to create clearer reporting structures and understanding of the environmental impacts of a business and the associated environmental and financial risks.

The space is changing quickly. Some regulations already require data collection for potential audits or reviews by 2025 or 2030. It'll require considerable time and resources to align your data to these regulations and create clear go-forward strategies.

Now’s the time. Familiarize yourself with how best to align your brand with today’s standards. But don’t forget to prepare your organization for new sustainability legislation that may be on its way.

Contact us and learn how NTT DATA’s packaging optimization practice will help you comply with environmental packaging regulations and reach your sustainability goals. Our top supply chain talent, enabled by proven, leading-edge digital assets — tools, methods and content — deliver actionable insights and measurable outcomes to some of today’s largest and most complex supply chains 

^{*California, Colorado, Maine and Oregon have passed EPR packaging legislation. Connecticut, Illinois, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Rhode Island, Tennessee and Washington are pending.}