The commercial case for sustainable packaging

In brief...

The consensus in the discussion was clear: packaging sustainability is a systems challenge, and the technology, standards, and logistics needed to support it call for organisations to pool expertise and resources. Collaboration is essential, both to build the infrastructure and to share the data that sits fragmented across the value chain. Where those pieces are coming together, real progress is being made.
Regulations are creating urgency and timelines that focus efforts. Regulatory pressure isn’t necessarily driving innovation, it’s more that innovation creates value from compliance. The best solutions are those that solve multiple challenges at once, as seen in the move towards mono-material structures that are compliant with recyclability criteria, process-efficient, and commercially competitive.
The companies navigating packaging challenges well are those looping in the right expertise internally, collaborating upstream and downstream in the value chain, and treating the switch to more sustainable packaging as a strategic opportunity to stay ahead in a changing market. Putting the full weight of uncertainty on consumers isn’t the answer, and engaging in building better systems from the inside out is where the real opportunity lies.

For organisations across industries, regulatory pressures on packaging and waste are driving questions around design, best practice for data collection, and clear consumer communication to back sustainability and compliance efforts. To explore the commercial case behind the transition to more sustainable packaging, we organised a webinar in collaboration with the Sustainable Packaging Coalition, the knowledge partner for the Sustainable Packaging Innovation Forum 2026 (Chicago, Oct. 27-28).

Our panel brought together experts from Mondelēz International, Lush, Korozo Group, and the Sustainable Packaging Coalition. Below are the key takeaways from our discussion on how packaging innovation drives business value amid compliance challenges.

Changing packaging for a changing market

The Sustainable Packaging Coalition’s third annual trends report identifies several converging shifts in the sustainable packaging space.

As a key trend in 2026 we see recyclability, with regional bodies starting to land on more harmonised design-for-recycling criteria and explaining more clearly what materials and formats are considered ‘widely recyclable’ – distinctions that carry fee implications for organisations under Extended Producer Responsibility (EPR) schemes. This scrutiny is also prompting re-evaluation of formats long assumed to be recyclable, with cartons and paper cups being notable examples where industry in the US has had to gather and share data to substantiate recyclability claims. Canada’s five PROs recently came together on shared definitions around eco-modulation best practices. A similar convergence in definitions and guidelines is hoped for across the seven US states with EPR laws and in Europe under the Packaging and Packaging Waste Regulation (PPWR), to offer brands more clarity for their compliance strategies.

Other trends to keep an eye on:

On-pack labelling: California, amongst other jurisdictions, is requiring to display substantiated recyclability information. For a start, this implies gathering the (right) data. Then, figuring out what and how to communicate on pack in a way that educates consumers and tells them clearly what to do with the package after use.
Refill: We see continued innovation and brand adoption of such solutions across spirits, personal care and beauty. In spirits, innovation is mainly happening on the B2B side, with the hospitality sector partnering with providers on refillable formats. In beauty and personal care, creating refillable solutions that are genuinely appealing to consumers is more of a design challenge.
Reuse: As brands look to meet EPR source reduction goals, it’s becoming increasingly relevant, particularly for those trying to eliminate certain formats altogether. Pilots are scaling in stadiums, universities, and cities, generating real data. Retail remains harder to crack, but progress is being made and worth keeping an eye on.
Material innovation: Appetite for alternative materials is there, but brands are navigating it carefully. A switch to paper makes sense and is easy to communicate, keeping the paperisation trend going. Many of the early performance concerns have been overcome, meaning paper packaging now works for product categories it didn’t before like chocolate and candy wrappers. Beyond that, much of the focus is on recycled content integration, particularly food-grade applications, and feedstock diversification. Brands are testing closely alongside suppliers and regulators to unlock viable solutions.

The practical questions behind packaging innovation are consistent: how difficult is it to implement on existing lines, and does it maintain product safety and quality? For some, material innovation also has to clear an ethical bar: new materials that rely on virgin inputs or conflict with regenerative sourcing commitments or internal product standards create tension. The overall message isn’t that innovation isn’t welcome: the willingness to test and learn is there, but so is the awareness that solutions are context-specific and need to work on multiple levels.

Zooming in: How are brands and manufacturers navigating this?

The brand owner-manufacturer relationship has been shifting with the market conditions. The conversation used to be centred on replicating or incrementally improving existing packaging. Today, manufacturers such as Korozo Group, are fielding questions on PPWR compliance, recycled content targets, EPR fee implications, traceability, and long-term commercial viability of formats. Brand owners are thinking five to ten years ahead, not just to the next product cycle, and the expertise in the room has changed too. Procurement, regulatory affairs, R&D, marketing, finance and sustainability teams are all involved. The relationship is increasingly a shared strategic exercise, with converters and brands aligning on regulatory strategy and portfolio planning together, because ultimately the targets and laws apply to everyone.

For a company like Mondelēz International that markets a variety of food products such as chocolate, biscuits, and candy, there is no single solution that works across the whole portfolio. Food safety and quality are non-negotiable, which also limits the options. Key challenges include the limited flexibility of existing packaging lines, the higher cost and sometimes limited supply of innovative materials, and regulatory fragmentation. On the consumer side, awareness and expectations are rising, but so is the say-do gap. The business case increasingly hinges on finding solutions that work for the planet, the brand, and the consumer simultaneously, which has pushed sustainable packaging from an R&D-led agenda to a cross-functional one.

Meanwhile, Lush’s challenges are somewhat unique. Many of their products are intentionally sold without packaging, but a warming climate means some formulations now need protection they didn’t before. Since 2009, they have run an integrated take-back scheme. They collect, wash, and reprocess their polypropylene pots into new containers, with the longer-term goal of replacing this programme with more localised closed-loop solutions. On materials, they are avoiding a wholesale switch to paper, and are instead exploring future fibres. On the consumer side, their data on sustainable packaging is compelling. In survey of 5,000 customers, 85% said sustainable packaging mattered to them, 70% preferred packaging they could return or reuse, and over half said a brand’s sustainability commitment would increase their likelihood of becoming a repeat customer. Their newly launched Lush Wallet, allowing customers to save return credits in-app, has already driven increase in store footfall in the UK. Lush sees this data as something the wider industry can learn from, making the case that consumer appetite for reuse and take-back is real and commercially viable.