Understanding Fast Moving Consumer Goods (FMCG) Litter

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Understanding Fast Moving Consumer Goods (FMCG)
Litter

• Dr Brett Carroll, Environment Manager, Nestle
• Peter Shmigel, Director, Nolan-ITU
• Leading on Litter Conference
• May 2004
• Melbourne, Victoria

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Todays Presentation

• Explain Nestles reasons for involvement in
  littering issue
• Outline path that Nestle is following
• Overview research outcomes by Nolan-ITU for
  Nestle
• Introduce a model for prioritisation of FMCG
  litter
• Comments on improving littering management

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Nestlé - Background

• Founded in 1866 in Switzerland - largest Food and
  Beverage company in the world
• Factories or operations in almost every country
  on earth
• Set up business in Australia in 1908 and now 2nd
  or 3rd largest FB company in Australia
• DID YOU KNOW? - MILO was a uniquely Australian
  invention in 1934, now sold in over 30 countries
  worldwide

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Nestlé in Australia
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Market Background

• Fast moving consumer goods (FMCG)
• purchased from retail for immediate consumption
• consumer low cost, low commitment, frequent
  purchases
• industry high volume, low margin
• Nestle FMCGs confectionery, yoghurt, ice cream,
  and beverages
• Changing demographics
• smaller households
• more away-from-home consumption
• smaller, convenience oriented packs

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Nestle Reasons for Involvement

• Social / market factors leading to higher
  probability of littering of FMCGs
• Corporate citizenship and environmental
  management goals
• National Packaging Covenant participation
• Broadening of Nestles environmental management
  program from internal operations focus to product
  life cycle
• Risk management public policy, reputation, brand

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Nestle Pathway

• 1. Better understanding of scope and nature of
  littering of FMCGs
• Whats the size and scale of the problem?
• What currently works in managing it?
• 2. Open dialogue and co-operation
• Australian Food Grocery Council Enviro
  Committee
• anti-littering stakeholders, including VLAA
• 3. Implementation actions
• - some still being identified
• - Eco-Design Guidelines (in Covenant Action Plan)

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Scoping the Problem

• Nestle engaged Nolan-ITU
• conduct desktop review of existing litter data
• generate preliminary estimate of Nestlé products
  in litter stream
• examine quality of existing litter data on food
  and grocery products
• prioritise litter items
• outline current anti-littering initiatives

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Process

• Determine value of FMCGs (industry data)
• Determine value of consumed away-from-home (AFGC
  estimate)
• Assign 2 per item (Nolan-ITU assumption)
• Determine potential litter items (CCC/BIEC data)
• Estimate of FMCG litter items (KABC data)
• Estimate of Nestle litter items (industry data)
• Prioritise Nestle litter items by significance
  (Nolan-ITU methodology)

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FMCG in Australian litter stream
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Nestle products as proportion / in litter stream
NESTLE
3
50 million littered units
FMCG
33
496 million littered
units
REMAINING 64
963 million littered
units
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Data Characteristics

• No national count since 1996
• Previous to today, no public estimate of total
  size of litter stream or actual of FMCGs in
  litter stream
• Brand names generally unrecorded
• Inconsistent recording of packaging types
• Geographical dispersion not well established

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Process - another way of thinking

• Determine potential litter items (2003 KESAB)
• Extrapolate number of equivalent litter
  collection sites across Australia
• Multiply by average number of items collected per
  site
• Multiply from a quarterly to a yearly equivalent
• Est. size of total litter stream 622 m. items
• Apply estimated 23 of FMCG litter items (2003
  KESAB)
• account for differences in beverages due to CDL
• Est. size of FMCG litter stream 141 m. items

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FMCG Litter How Significant?

• Major advances in understanding factors that
  contribute to littering
• Less understanding of actual impact of litter
  (with exception of some work on direct financial
  cost of management)
• Critical to estimate impacts in order to guide
  program priorities

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Direct Litter Indicator (DLI)

• Indicates the immediate, objective and
  quantifiable aspects associated with litter from
  a packaging type
• Area (m2) Maximum area of ground covered by
  FMCGs littered items
• Persistence (years) Estimated amount of time
  litter remains in the environment

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Direct Litter Indicator (DLI)

• Results for key Nestle items
• Confectionery wrappers 7.86
• Ice cream wrappers 2.89
• Yogurt containers 0.17
• Other beverage bottles 0.06
• Ice cream sticks 0.02
• Bottle tops 0.0036

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Cumulative Litter Indicator (CLI)

• Adds the dimensions of
• Environmental impact - in terms of ecosystem
  impact (primarily impacts on wildlife) and human
  toxicology (through emissions to water, air and
  soil)
• Risk Level in terms of the likelihood and
  severity of regulatory intervention and brand
  reputation damage.

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CLI Example -Confectionery Wrapper

• DLI 7.86
• Environmental impact 2
• ecosystem impact 1 and human toxicity 1
• Risk level 2
• Regulation 1 and reputation 1
• CLI 7.86 x 2 x 2
• CLI 31.44

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Cumulative Litter Indicator (CLI) (cont)

• Results for key Nestle items
• Confectionery wrappers 31.44
• Ice cream wrappers 8.67
• Yogurt containers 0.17
• Other beverage bottles 0.18
• Ice cream sticks 0.02
• Bottle tops 0.01

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Comparative example

• Confectionery wrappers
• Amount 28 million
• Area 0.23m
• Persistence 1y
• DLI 6.44
• Enviro impact 2
• Ecosystem impact 1
• Human impact 1
• Risk impact 2
• Regulation 1
• Reputation 1
• CLI 25.76

• Beverage containers
• Amount 28 million
• Area 0.13m
• Persistence 5y
• DLI 17.90
• Enviro impact 2
• Ecosystem impact1
• Human impact 1
• Risk impact 3
• Regulation 1.5
• Reputation 1.5
• CLI 107.4

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Insights

• Attempting to quantify problem creates impetus
  for action by company, industry stakeholders
• Prioritisation of items enables better targeting
  of efforts
• Strong need for broadly accepted, consistent and
  official litter measurement methodologies
• Collaborative approaches - on VLAA model -
  necessary