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September 25, 2013
As You Sow Engages with Food Companies on Packaging
    by Robert Kropp

The advocacy group succeeds in convincing McDonald's to end the use of environmentally destructive polystyrene foam cups, but decides to resubmit a shareowner resolution with General Mills after engagement over post-consumer packaging fails to lead to agreement.

In much the same way as a tax on carbon would be, the philosophy behind extended producer responsibility (EPR) highlights a basic tenet of corporate social responsibility. In the case of a carbon tax, those that pollute pay for it; in EPR, responsibility for post-consumer packaging waste is shifted from taxpayers and governments to the corporations themselves.

“At least 43 million tons of plastic, glass, metal, and paper packaging—much of it with market value—is landfilled or burned in the US each year,” according to As You Sow, an advocacy organization promoting environmental and social corporate responsibility. “The commodity market value of this wasted glass, plastic, paper, and metal packaging is estimated at $11.4 billion.”

Furthermore, products and packaging are responsible for 44% of greenhouse gas (GHG) emissions in the US, more than the electrical utilities industry sector.

As You Sow scored a noteworthy triumph this week when McDonald’s announced that it will replace environmentally destructive polystyrene foam coffee cups with paper cups at the company’s 14,000 locations in the US. A shareowner resolution filed by As You Sow in 2011 requested that the fast-food giant report on its progress toward ensuring “more environmentally beneficial beverage containers;” after the resolution gained 30% of shareowners’ votes, McDonald’s embarked on a pilot program in which polystyrene cups were replaced with paper at 2,000 stores.

“The company has confirmed that the pilots were successful and that it will phase out foam cups at all locations in the coming months,” As You Sow stated this week. While congratulating McDonald’s on its initiative, however, As You Sow also observed, “There is more work to do for the company to have a comprehensive packaging recycling policy.”

"McDonald’s has made a great start by phasing out foam," Conrad MacKerron, Senior Vice President for As You Sow, said. “We hope they will also incorporate recycled fiber in the cups and develop on-site systems to collect and recycle food service packaging.”

Corporate engagement with McDonald’s by As You Sow took a route well-traveled by shareowner advocates to a satisfactory end result: filing a resolution leads to engagement leads to agreement. As You Sow’s engagement with General Mills, on the other hand, has had its share of frustrating detours.

In 2011, As You Sow filed a shareowner resolution with General Mills, requesting that the company keep up with some of its industry peers and adopt an EPR policy. After the company agreed to meet regularly with stakeholders concerned over package waste, the resolution was withdrawn.

However, “In spite of constructive dialogue,” As You Sow stated, “the company was not willing to articulate a policy on post-consumer recycling of packaging in the US or to initiate new efforts to increase recovery of its packaging or recycled content.”

As a result of the company’s inaction, As You Sow and Clean Yield Asset Management refiled the resolution this year.

“After two years of dialogue, General Mills continues to avoid the basic question of what responsibility it should bear for recycling packaging waste in the US,” MacKerron said. “The company currently contributes to mandated producer responsibility systems in nearly all of the European Union and several Canadian provinces, yet it has not agreed to support similar responsibility for its packaging in the US.”

General Mills held its annual general meeting was held this week. The results of the vote on the resolution have not been distributed, but the company stated that the resolution did not receive a majority vote.


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