I get it. If the industry causes so much of the plastic problem, how can we expect them – or even trust them – to be part of the solution? But I think if we finally want to achieve a global agreement on plastic pollution that actually eliminates plastic pollution, we have to give companies and investors a seat at the table because public policy is most effective when designed with all stakeholders.
To be honest, thoughts like this used to make me laugh out of the business school classroom. One side of the class might say that “the role of business is to make money, not to improve society,” while the other side of the class might say “Once the government makes a law, business will have to go along, so why bother?” The idea that Business has not only made a positive contribution, but it has also been an important player that has not won me any friends on either side of the room.
But what if the industry believed that policies designed to reverse decades of externalities were actually good for their business in the long run? What if they were induced to maintain those policies that were enacted to equal opportunity?
This is the opportunity before us with the global plastics treaty. For the first time, more than 150 countries are negotiating a global treaty to end plastic pollution. We can’t waste the moment. To maximize the effectiveness of any treaty, we need private sector involvement in the solution. why? We’ve seen time and time again that we can’t rely on government regulation alone to get us there.
Case in point – attempts in the United States to regulate clean air are fraught with complications and frustrated ambitions. In 1970, the US government enacted the Clean Air Act (CAA), a landmark legislation that enabled the US Environmental Protection Agency (EPA) to regulate air pollution, especially things like acid rain and toxic emissions from coal-fired power plants. Fast forward for more than 30 years to 2003, and the Bush administration enacted the Clear Skies Initiative, which changed almost overnight how civil aviation law was implemented and reduced the EPA’s ability to enforce the law. It was such a shock and contrary to the spirit of the Civil Aviation Authority that the EPA’s chief law enforcement officer (the person in charge of law enforcement) resigned in protest. (Full disclosure: Eric Schaeffer, EPA chief cop at the time, became one of my first clients as well as an inspiration and mentor to me.) More recently, last year, the US Supreme Court imposed more control over the EPA’s ability to reduce air pollution by deciding that it could not regulate carbon emissions.
So, it took more than a generation, but what was once seen as a colossal victory for environmental policy has now been reduced to a shadow of its potential. We’ve seen the same happen with other supposedly stable political battles, such as abortion and gun control.
This is the Government instability. It is a disturbing fact for policy advocates in the United States and around the world. My career started in Washington DC because I thought politics was like that The The path to the main solution to the problems I was interested in. However, I left Washington years later and moved to the private sector because I realized that politics in and of itself was not enough. If the industry is dragged into kicks and yells by regulation, regulations will ultimately not achieve the desired result. Industry will always act in its own interest, and when policies are seen to be in opposition to that interest, they will not give up until they prevail in the end, as we have seen in many such cases. We can’t afford to have that happen when it comes to plastic pollution.
Why do we need a more accurate view of the industry
We clearly need a more holistic approach to solving these complex problems, and part of the solution is engaging the industry to help identify, find and fund scalable solutions. But getting to this point means we have to take a more accurate view of the industry. In fact, plastic pollution is perhaps the only environmental area in which we have an almost universal, vested interest and built-in compromise to solve the problem - think consumer packaged goods companies, chemical companies, beverage companies, NGOs, government agencies, banks, multilateral institutions, and on and on. Nobody wants plastic in the environment.
We need industry players involved for many reasons - not just for their financial investment. My company's work in Asia has proven that you can find investable companies that innovate new ways and expand the proven methods of tackling the problem of plastic waste. Investors and companies can provide valuable investment dollars, but just as importantly help integrate the operations of these startups into the global supply chain; advising on product design; Helping ensure greater transparency in the system - all with the goal of building a circular economy for plastics. These are the key insights and facts on the ground that can guide effective policy.
Earlier this week, more than 80 organizations including companies from across the plastics value chain, financial institutions and NGOs joined a coalition convened by the Ellen MacArthur Foundation and the World Wide Fund for Nature to call for and support an ambitious, effective and legally binding UN treaty to end plastic pollution ( *Circulate Capital is part of this alliance). Many companies are already showing that they are driving government and regulatory action on some of the most critical climate issues, so it is not an exaggeration to see the value they can bring to developing a global treaty on plastic pollution with tangible and meaningful results. We have already seen in the face of a US Supreme Court ruling that fills the spirit and legal influence of the Environmental Protection Agency that many companies, from leading global automakers to multinational corporations such as Amazon, Danone, Meta, Microsoft, Netflix, PayPal, Tesla, A Other hosts, will continue to pursue their climate goals.
The bottom line is that a piecemeal or short-sighted approach to our climate challenges will not work, and this also applies to the global plastics treaty. No single silver bullet or magic wand will miraculously solve such a major global crisis. We need corporations, governments, NGOs, entrepreneurs, and yes, corporations, working together in tandem with institutional capital—which is critical to scaling climate solutions—if we are to have any hope of turning the tide quickly. I urge negotiators to ensure that companies as well as investors have a seat at the table to develop a global treaty on plastic pollution - not as a party to negotiate against - but as an ally in ensuring the treaty's success.