With the tightening of packaging regulations like the EU's Packaging and Packaging Waste Regulation (PPWR), turning a blind eye to sustainability communication is no longer an option. Now, more than ever, it's crucial to engage in clear, evidence-based communication due to regulatory efforts to prevent greenwashing, such as the EU's Green Claims Directive, set to come into force in 2027.
Packaging offers potential beyond mere product protection which, combined with detailed product descriptions on retailers’ websites, also plays a key role in validating a brand's sustainability narrative. Companies face not just regulatory fines and tax penalties for non-compliance, but also reputational damage if they fail to openly share their sustainability initiatives.
47% of global companies were investing in sustainable packaging in 2024 or had plans to do so in the near future
Source: Euromonitor’s Voice of the Industry Survey, fielded in February 2024 (n=579)
Euromonitor’s Sustainable Packaging Opportunities: Meeting Demand, Ensuring Compliance report explores how regulatory measures are driving packaging transformation, emphasising recyclability, waste reduction and reuse/refill initiatives. Here are some insights from it.
Closing the loop on recyclability
Recycling regulations, including the EU's PPWR, EPR, and Australia's National Packaging Targets, are driving a transition to a circular economy mandating higher recycling rates and use of recycled materials. Circularity is increasingly central to companies' decarbonisation strategies. As highlighted at the ESG & Sustainable Packaging Summit in Germany in March 2025, which Euromonitor attended, corporations are opting for targeted materiality-driven strategies, including logistics redesign, engagement with high-carbon suppliers, and use of low-impact materials on high-impact areas where they have data and operational control.
Regulatory pressure is motivating businesses to rethink packaging design, especially regarding plastic waste, which accounts for 66% of global packaging. Leveraging the existing recycling infrastructure, companies are prioritising plastic packaging recyclability as the path with least resistance, focusing on reducing single-use plastics, eliminating harmful substances like PFAs, and promoting highly recyclable materials like mono-materials to ensure high-quality recycled content.
Despite a noticeable improvement in the use of recycled materials, the pace and geographical spread are still not ideal, highlighting the significant challenge in achieving a closed-loop system. Products made from recycled materials are only a quarter of those labelled as recyclable, underlining a substantial opportunity for firms to enhance their recycling processes, infrastructure, and communication about their use of recycled packaging.
Embracing alternatives to reduce waste
With the growing emphasis on waste management and efficient materials use, companies must embrace innovative solutions beyond the path of least resistance. For instance, providing transparent, traceable information is crucial to comply with stringent regulations aimed at reducing waste and enhancing recycling systems' efficiency, like the EU's Digital Product Passport and India's QR code enforcement.
Regulations such as PPWR and Australia's Packaging Targets are encouraging packaging optimisation. Efficiently redesigning packaging can have a triple impact: fewer materials required, waste reduced, and transportation costs cut, ultimately lowering a company's emissions.
Belgian retailer Delhaize shared how design optimisation can significantly reduce waste without compromising functionality. Over five years, it reduced plastic use by 30% across private label products. Simple changes, like removing yoghurt container caps, eliminating the plastic handle on milk multipacks and switching from plastic cups to trays for blueberries, resulted in 53.4 tonnes of plastic saved.
Approaching circularity through reuse
The shift towards reuseable/refillable packaging is gradually gaining traction, driven by regulations such as single-use plastic bans and the EU's PPWR. However, the lack of incentives and collaboration is limiting scalability.
Reuse/refill solutions can lower consumers’ sustainable purchase barriers, where clear communication around the benefits, particularly economic ones, is essential for adoption. They can reduce costs, offer convenience and accessibility, and provide an improved consumer experience when implemented well. For example, EcoCarga's refill options in Chile are 40-45% cheaper than single-use plastic alternatives.
Policy shifts like Deposit Return Schemes and EPR are stimulating consumer participation and enforcing producer accountability, bolstering the viability and scalability of reuseable models. These policies also encourage industry collaboration to share infrastructure, thus reducing costs and improving efficiency. As these policies become more prevalent, reuseable/refillable systems grow more appealing. Thus, choosing the right reuse/refill model is crucial to boost consumer engagement and system efficiency, enabling brands to maximise affordability, convenience, and customer loyalty while fostering a sustainable economy.
Learn more about our data-driven solutions on our Sustainability page.
Read our latest reports, Sustainable Packaging Opportunities: Meeting Demand, Ensuring Compliance and Innovation in Sustainability, for more actionable insights.