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Understanding FMCG Litter
Understanding Fast Moving Consumer Goods (FMCG) Litter
Dr Brett Carroll, Environment Manager, NestlePeter Shmigel, Director, Nolan-ITU
Leading on Litter ConferenceMay 2004
Melbourne, Victoria
Understanding FMCG Litter
Today’s Presentation
• Explain Nestle’s 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
Understanding FMCG Litter
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 F&B company in Australia
• DID YOU KNOW? - MILO was a uniquely Australian invention in 1934, now sold in over 30 countries worldwide
Understanding FMCG Litter
Nestlé in Australia
Understanding FMCG Litter
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
Understanding FMCG Litter
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 Nestle’s environmental
management program from internal operations focus to product life cycle
• Risk management: public policy, reputation, brand
Understanding FMCG Litter
Nestle Pathway
1. Better understanding of scope and nature of littering of FMCGs– What’s 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)
Understanding FMCG Litter
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
Understanding FMCG Litter
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)
Packaged food andgrocery productssold in the awayfrom home sector
$6.5 billion perannum
Consumedoutdoors
$3.25 billion p.a
(50% of total)
Consumed in acommercialsetting
$3.25 billion p.a
(50% of total)
Binned products
$2.16 billion +$3.25 billion
Littered products
$1.083 billion p.a
= 541 million units
(30% littered)
PRODUCTION CONSUMPTION DESTINATION
Plastics (82.8%)
= 448 million units
= 41.5 million units
LPB (6.5%)
= 35 million units
Metals (5%)
= 27 million units
Wood (5.5%)
= 30 million units
= 8 million units
Glass (0.2%)
= 1.5 million unitsLandfill
6%
7%
2%
12%
0%
2%
1%
2%
0%
2%
2%
0%
64%
straws
Bottle/can tops
ice cream wrappers
confectionery wrappers
plastic containers (assumed yoghurtcontainers)
PET bottles
other beverage bottles
cartons (milk, fruit and milk flavoured)
Soft/juice - steel
Soft drink - aluminium
Ice cream sticks
soft drink - Glass
REMAINING LITTER STREAM
FMCG in Australian litter stream
REMAINING 64% 963 million littered
units
FMCG33%
496 million littered units
NESTLE 3%
50 million littered units
Nestle products as proportion / # in litter stream
Understanding FMCG Litter
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
Understanding FMCG Litter
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
Understanding FMCG Litter
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
Understanding FMCG Litter
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
NUMBER OF NUMBER OF LITTERED ITEMS X LITTERED ITEMS X
AREA X AREA X PERSISTENCEPERSISTENCE
== DIRECT DIRECT LITTER LITTER
INDICATORINDICATOR
Understanding FMCG Litter
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
Understanding FMCG Litter
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.
DIRECT LITTER DIRECT LITTER INDICATOR X INDICATOR X
ENVIRONMENTAL ENVIRONMENTAL IMPACT X RISK IMPACT X RISK
LEVELLEVEL
==CUMULATIVE CUMULATIVE
LITTER LITTER INDICATORINDICATOR
Understanding FMCG Litter
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
Understanding FMCG Litter
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
Understanding FMCG Litter
Comparative example• Beverage containers
– Amount = 28 million – Area = 0.13m– Persistence = 5y
• DLI = 17.90– Enviro impact = 2
• Ecosystem impact=1• Human impact = 1
– Risk impact = 3• Regulation = 1.5• Reputation = 1.5
• CLI = 107.4
• 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
Understanding FMCG Litter
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