Reference no: EM133315484

Learning Outcomes

Students should apply learning in sustainability and strategic management to discuss the imminent plastic treaty and its impact on business and corporate sustainability strategy.

Note: A thirty-foot monument themed "turn off the plastics tap" by Canadian activist and artist Benjamin von Wong, using plastic waste retrieved from Nairobi's largest slum, Kibera, stands outside the venue of the Fifth Session of the United Nations Environment Assembly (UNEA-5) in Nairobi.

The Issue

On March 2, 2022 in Nairobi, Kenya, an environmental assembly of 175 international representatives agreed on a roadmap toward a treaty to end plastics pollution. The United Nations Environmental Assembly determined that over the next two years, guidelines will be established for all aspects of the plastics industry, from production to distribution to waste to reuse. The approval of this plastics plan is being touted as the most crucial climate deal since the Paris Agreement.

Details of the plan are aimed at curbing major companies from generating pollution in oceans, landfills, and in the air we breathe. While the Paris Agreement reduced greenhouse emissions, helping establish regulations on climate change issues, the new environmental treaty will tackle plastic waste and disposal across several industries, driving the issue of pollution and climate change peril into open discussions across major economic sectors for creative solutions that can be quickly implemented.

"Plastic pollution is a planetary crisis, a threat that affects all of us," Jeanne d'Arc Mujawamariya, the Rwandan environment minister, stated at the summit. "The real work now begins."

Why Is It News?

The staggering percentages of plastic waste have led to estimates of 1.3 billion tons of global environmental damage by 2040. Consumer single-use items such as plastic bags and kitchen utensils are in the billions, and 20 million sea animals die annually due to plastic waste. Half the plastic in production is single-use, and only 14% of all plastics globally is recycled.

Evolving business values that emphasize building prosperous economies through mindful environmental resolve remained a key tenet of the conversations in Nairobi. However, one point of contention in the agreement is determining the boundaries of liability between plastics producers and governments. It is unclear who will ultimately bear the cost of recycling, particularly for plastics exported to developing countries without the technical or financial infrastructure for recycling. Even in developed countries, including the United States, the costs of waste management are often passed to municipal governments that may already be financially spread thin. The process of discerning finer points of delineation in cost and obligation will advance throughout the treaty discussions.

The considerations in the agreement target not just plastic waste but plastic production, particularly that of single-use plastics, a primary driver of pollution. The draft resolution recommends the sustainable redesign of plastic packaging so that it could be reused and recycled-a point that may have a drastic impact on consumer goods and retail companies that rely on plastic packaging or shipping materials.

The issue of labor is also a critical point in the agreement. Plastic waste management is largely done by underpaid labor who risk injury and toxic vapors while collecting, sorting, and recycling plastic waste. This is the first time that pickers and recycling laborers have been formally recognized in a major sustainability initiative.

The necessity for urgent change will undoubtedly impact businesses across multiple industries, particularly considering the projected $100 billion risk if governments determine that businesses will be financially responsible for waste management. The redesign and re-evaluation of properties, production, recycling ability, and import/export issues will be part of the process in determining the most equitable and healthy plan for the world. Ultimately the success of the agreement will depend on the creative input of industry leadership in conjunction with the legally binding nature of the final treaty, which will potentially enforce punitive measures against nations or companies that violate the treaty.

"We all know that an agreement will only count if it is legally binding," said Inger Andersen, executive director of the United Nations Environment Programme. "I have complete faith that once endorsed by this assembly we will have something truly historic on our hands."

Question: What changes do you think businesses will have to make in order to be in compliance?