Former Coca-Cola Veteran Discusses What Circularity Models Work and Why

In his 30 years working with several high-profile brands and corporations, including 19 years with Coca-Cola, Venkatesh Kini has seen firsthand the environmental impact of waste consumer products, mainly packaging. Kini who went on to launch Ubuntoo to help these very types of companies achieve sustainability, spoke to Waste360 about how to transition to a circular economy; what models work and why; and what’s in it for corporations that do it right.

Waste360: What have you seen these past few decades that has you pushing for circular economy models?

Kini: I have observed the huge environmental impact of consumer product brands, especially driven by packaging waste that they produce. While packaging is critical for wide distribution, convenience, and shelf life, it can have terrible consequences if the end of life is mismanaged.

Unfortunately, in most of the developing world, and even in some highly developed markets, too much packaging waste makes its way into the environment, polluting oceans, soil, and even distant arctic ice. My work and travel took me to some of the highest settlements in the world in the Himalayas, and some of the remotest islands in the Maldives. In both places I saw piles of mixed plastic littering the environment with no local solution to recycle them.

When combined with waste that’s landfilled or incinerated, there is a net loss of material worth billions of dollars every year that could be recovered and recycled / reused. In the U.S. alone, the Environmental Protection Agency (EPA) estimated that 27 million tons of plastic was landfilled in 2018 with only 3 million tons recycled. The Ellen MacArthur Foundation reports the value of plastic lost is between $80 and $120 billion per annum.

A well-designed circular economy approach can help reduce or eliminate this waste and provide a competitive advantage to companies that do it right.

Waste360: What circular economy strategies seem to work best?

Kini: The best solutions are designed for the local environment keeping in mind the unique socio-political and economic context. What works in Europe may be inappropriate in Asia, and vice versa.

Secondly, any strategy will only work well if there is a strong economic incentive for all players in the value chain. This requires companies to not only design for recyclability or reuse, but also put thought to how to create value for the return leg of their packaging.

For example, at Coca-Cola, we used to sell billions of bottles of reusable glass, using a “deposit” system that incentivized consumers and retailers to return empty containers to the company in exchange for money. As a result, over 99% of the bottles made their way back to our factories to be reused as many as 30 times each.

Waste360: Any interesting emerging circularity trends?

Kini: We are seeing a lot of interest in returnable and reusable packaging and dispensing solutions. Essentially these are solutions where companies completely eliminate the package or minimize its footprint. For reuse, the most common models are in beverages. Coca-Cola was one of the pioneers in creating a reusable bottle through its iconic contour glass bottle. For decades the only package for Coke was the reusable and returnable bottle, until the invention of cans and plastic bottles.

Another emerging trend is the sale of concentrated products that can be mixed with water at home in a reusable container.

Some are starting to advance circularity by establishing geographically dispersed and small-scale waste recovery and recycling solutions. This is driven by the reality that while manufacturing can be centralized, consumption of most consumer products is highly decentralized, resulting in small quantities of waste being generated in geographically dispersed locations. This makes it uneconomical to process locally using capital-intensive equipment, but it’s also expensive to return to a central location where economies of scale can kick in.

Waste360: What recycling concepts are gaining traction with this push for circularity?

Kini: We are seeing increasing interest in chemical recycling. However, despite high investments in this space, it is yet to take off. Within chemical recycling, pyrolysis seems to hold the most promise, since it can handle mixed plastic waste. There are hundreds of players in this space with solutions ranging from household scale to massive industrial facilities. 

Upcycling of plastics or “open loop” recycling is another example. It’s usually done at scale for construction materials, like plastic lumber, boards, and bricks. Trex outdoor decking is a well-known brand that uses waste polythene bags among other things.

Waste360: Who’s best at advancing circularity models? What’s their “secret sauce?”

Kini: Rather than point to a single company, I want to give examples of industries. The highest recycling and reuse rate happens for corrugated cardboard boxes. According to the U.S. EPA, they are recycled at the whopping rate of 96%.  A distant second is aluminum cans that are recycled at over 60%.

What sets them apart is the ease of recycling, standardization of material that allows any recycler to accept it, consumer education and convenience (everyone seems to know that cardboard boxes can be recycled, and most municipalities accept them), and a value chain that makes money for recyclers.

Waste360: Who’s lagging and why?

Kini: It is no secret that the plastics industry is the least circular. The reason is that plastics come in multiple grades, are extremely cheap to make, lightweight, and difficult to recycle back into the original grade (with the exception of PET).

Waste360: What are unique considerations for individual industries, whether food and beverage or other in advancing a circular economy?

Kini: While principles are common across industries, specific solutions and economic models are often unique.

For example, within the food industry, all waste can be composted into fertilizer to grow the next crop. However, in developed markets most food waste happens in consumer homes and restaurants. It is often intermingled with single-use plastic packaging, and even if people were willing to segregate, there are few composting facilities within easy reach.  Finally, the recovery value of compost is low, so there is little incentive for commercial players to reach out to the last mile to collect food waste.

Waste360: What are common lessons that each industry can learn from and use?

Kini: The most important factors are designing products for ease of recycling or reuse, creating sufficient value for reverse logistics, and making it convenient for consumers or users to participate in the circular economy.

Waste360: What needs to happen along each part of the supply chain to successfully advance a circular economy?

Kini: Circularity begins first and foremost with design. Good design uses whole-system thinking to revisit common assumptions by asking questions like “why do we need packaging?” “How do we reward customers for returning our packages?”, etc.

Another thought on requirements for a successful model: the net cost to the manufacturer of the recovered material should be lower than the cost of the equivalent virgin raw material, while leaving enough margins for the intermediaries on the return leg.

Waste360: How can producers and others called on to advance a circular economy make this transition profitable?

Kini: It takes long-range planning. Technologies change; existing manufacturing facilities need to be replaced or retrofitted; new products need to be designed and find acceptance with customers. At Ubuntoo, we help companies see what is coming down the road so they can pilot, learn, and then scale new models and solutions.

Waste360: What most needs to change for circularity to truly take off?

Kini: The entire ecosystem needs to change. Governments need to pass enabling regulation (rather than diktats or blanket bans) that rewards companies making the transition with preferential tax treatment or other benefits.

Companies need to collaborate across their industry peers and up and down their value chain to enable scale-driven transitions. And investors need to reward companies that make the transition.

Waste360: Can you give a case study that most interests you and say why?

Kini: My favorite case study is Mondelez in India. The company approached Ubuntoo for help finding a solution to recycle waste from their packaging of snacks and chocolates. Unfortunately, it was comprised mainly of multi-layer plastics (MLP), a notoriously difficult material to recycle. We evaluated multiple technologies and business models, and eventually identified a startup in Bengaluru (Bangalore) in India that developed a machine that could convert waste MLP into boards that replace plywood.

The final solution created a unique partnership between a leading NGO, the technology startup, and the brand sponsor Mondelez that profitably converts their waste plastics into reusable and recyclable construction boards.

This solution will eventually divert over 600 tons of MLP waste from landfills or incinerators, replace wood-based boards with more durable and recyclable plastic ones, and create livelihood for marginalized workers. All this was enabled through a small initial amount of seed capital from the brand sponsor.

Waste360: How do corporations gauge effectiveness of their transition to a circular economy?

Kini: The best metric for measuring effectiveness is the percent of virgin materials used in the manufacture of your product. The goal should be zero, but that is not feasible due to inherent waste and inefficiency in the real world. Still, the lower it is, the better.

Editor's Note: This article was edited for length and clarity.