May 24, 2011
CEO pushes extended producer responsibility laws
STAMFORD, CONN. (May 24, 11:55 a.m. ET) -- Kim Jeffery isn’t bashful about speaking his mind or taking the lead on an issue that makes most packaging executives in corporate America uncomfortable. So it comes as no surprise that the CEO and president of Nestlé Waters North America Inc. is vigorously campaigning for — and arguing to enact — some form of extended producer responsibility laws to increase the amount of materials that are recycled in the United States.
“My motivation is just to get more materials back,” said Jeffery, who knows that some people will look at his stance skeptically and wonder if he is just trying to eviscerate bottle bills. “I’m not trying to undo a bottle bill that’s been done. My goal is to increase the recycling of all materials.”
EPR is an approach in which companies are responsible for what happens to their product at the end of its life, usually through an industry-run nonprofit organization, financed by fees per container on producers. The concept is widespread in Europe, and spreading throughout Canada.
Pushing for EPR is not the first time that Jeffery, who has headed the Stamford company for more than 20 years, has taken a leadership role.
Three years ago, he set a goal to achieve a 60 percent nationwide recycling rate for all PET beverage containers by 2018, and he’s led the industry in reducing the weight of water bottles, driving the weight, for example, of the company’s Eco-Shape single-service .5-liter bottle down to 9.3 grams. That’s 25 percent lower than when the Eco-Shape bottle was first introduced in 2007, and 60 percent lower than the weight of the company’s .5-liter bottle when it was first introduced in the mid-1990s.
“Would I be comfortable with an EPR setup in a state without a bottle bill,” said Jeffery in a phone interview May 13. “The answer is ‘yes.’ ”
“I would have no problem going to a non-bottle bill state where my motives would not be suspect and advocating EPR,” Jeffery said. “If you want to do EPR in a non-bottle state and you see that I support it, then my motivation must be to get more material back.”
But very few executives in the U.S. are advocating EPR. “I’m one of the few,” said Jeffery. “There is going to have to be a lot of us.”
Still, some support is building, certainly among non-government organizations and some state recycling officials, most notably Scout Mouw, the recycling director for the state of North Carolina.
“If one were to look at basket of strategies to increase supply, EPR sits out there as a way to address the recycling of all things,” said Mouw. “It is the one piece of legislation I would enact” to improve recycling. “But everyone would have to recognize the serious nature of such a program and the politics involved in enacting it. To move EPR forward will require political will. But that is better than limping along.”
Mouw also said that you have to keep bottle bills in the basket of strategies to enact to increase the amount of recycled materials.
But Jeffery disagrees with that.
“I’m not saying bottle bills aren’t effective. They do work,” said Jeffery. Indeed, the 10 bottle bills states collect more PET bottles than the other 40 states in the U.S. combined, and have recycling rates of 70-95 percent compared to recycling rates of less than 30 percent in non-bottle bill states.
“But I’m looking beyond just beverage bottles at all the streams we need to get back, and bottle bills are not expandable to packaging, paper or compostable waste,” said Jeffery. “They do nothing to build curbside, public space and commercial recycling infrastructure and they do nothing to address the infrastructure for paper recycling,” which he said accounts for 40 percent of landfill waste.
“Bottle bills are not solving the need for broader recycling solutions. They are not a futurist solution,” said Jeffery.
“Even if we collect 100 percent of bottles, there’d still be much more out there in other materials,” he said. “There are so many streams of materials, thousands of things made from plastics. We need to collect all of them to preserve our resources and we can’t do that all through stores. Our food stores do not have the physical space to play this role, nor should our food stores be the place we bring garbage.”
Jeffery doesn’t deny that he holds the view that bottle bills are expensive — for bottlers, distributors and consumers alike — and he said that it bothers him that the unclaimed money from deposits often isn’t used to improve recycling infrastructure, but usually goes into a state’s general fund.
“EPR is what I call a 21st century solution,” he said. “We need to think about the systems we have and when building systems for the future, we need to think about what is it that we want them to do.”
“If we want to collect multiple streams of material and get all reusable packaging back, we need to think further out into the continuum and envision a system that does that,” said Jeffery. “It requires us to think more broadly about a lot of options. We have to rethink the recycling challenge.”
“We need a system that gets back all containers,’” said Jeffery. “If we are really concerned about recycling and doing something good, rather than just looking good, we need to have comprehensive recycling of all containers of value — bottles, containers for health and beauty aids, laundry bottles and foods such as mayonnaise, mustard and ketchup.”
He said if someone has a better option that EPR, he’s willing to listen.
“There are lots of solutions for better recycling,” he said. “Some are more expensive than others. But EPR seems to be the logical answer and I think this will be the cost-effective for collecting a lot of materials.”
Jeffery points to the EPR program in the Canadian province of Manitoba that is working to improve curbside, commercial and away-from-home recycling.
Under that program, the year-old Canadian Beverage Container Recycling Association will spend several million dollars during the next two years — funded by a 2-cent container recycling fee paid by CBCRA members — to place thousands of bins in Winnipeg city parks, arenas, recreation centers, public buildings and other high-traffic areas.
“We like the system that is set up there,” and which Nestlé participates in, Jeffery said. “Industry pays 80 percent of the cost and manages the funds.”
Mouw agreed. “That’s illustrative of what’s possible when a responsible party steps up.”
“The nature of taxpayer-funded collection systems doesn’t promise a great leap forward in supply,” Mouw added. “If we just keep the current model and just keep doing what we’ve been doing, we’re just going to get incremental progress in recycling rates and recycling.”
That’s a view that Jeffery also shares.
“We don’t have a good recycling system in the United States. States don’t have the money needed to improve recycling, and government fiscal crises jeopardize the viability of programs,” said Jeffery. “The industry is going to have to take responsibility for the end of life of its products.”
“We have it in Canada. We have it in Europe and we’ll probably have it in the U.S,” he said.
But both Mouw and Jeffery thinks EPR laws in the United States are still a good distance down-the-road.
“I wish it was going faster. But I don’t think it’s going to happen overnight,” said Jeffery. “I think we’re in the early stages of forming opinions on EPR in the U.S. I think that there will be more discussion before action because there is a lack of awareness in the United States on how these things work.”
“But we have got to get to the doing stage — and sooner than later — because if all we ever do is talk about it, we are not going to get anything done,” Jeffery said. “We need to find a reason to do something — not a reason not to do it.”
Jeffery said he doesn’t believe that the federal government has “the ability to do this.”
I think it is a state issue,” he said. “But I’m willing to do this one state at a time. We need to be successful in one state because if it’s a successful implementation, it will be a model for people to look at.
Equally as important, all parties to start talking about how to resolve supply problems.
“How to increase supply is a conversation the recycling industry needs to have” with brand owners, waste haulers and governments, said Mouw. “We need industry to come to the table with real money.”
“We have to get all parties at the table,” Jeffery agreed. “We have to have a large number of people seriously thinking about how we improve recycling and improve the amount of material we get back from a variety of sources. You have got to get a lot of stakeholders in the same boat with you.”
“We need a coalition of people to make comprehensive recycling come together in America,” said Jeffery. “We all have skin in this game. We need all companies, municipal governments and citizens to be committed to getting these materials back. We are not getting enough of them. That is bad for business, bad for the environment and wasteful.
“Recycling is good for the environment, it is good for the conservation of natural resources, it reduces greenhouse gases, it saves energy, and it is good for jobs,” said Jeffery. “Why would we want to waste these materials and landfill them?”
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