Sustainable Initiatives in the FMCG Space

Click here to explore the page

Awareness of social and environmental issues are growing, and corporations can no longer hide behind empty promises. Social media platforms have enabled consumers to readily share and access information regarding which companies are genuinely committed to sustainable innovation. The conscious consumer is motivated by more than just convenience and cost – they are adopting environmentally friendly shopping habits and prioritising concrete sustainability commitments from the companies they choose to engage with.

Shoppers are paying close attention to the environmental impact of the products and services they use. Environmental responsibility is no longer a value-add, but instead, a standard for the fast-moving consumer goods (FMCG) industry. Many companies are working towards full sustainability and are developing innovative strategies to avoid the severe implications of environmental degradation. In the FMCG sector, key players in the march to sustainability are realigning their business practices to address issues with packaging, sourcing, and production processes.

Responsible Packaging

The regulatory and public concerns about single-use plastic waste are driving significant changes in the industry. Responsible packaging is in the limelight, which is pressing retailers to fundamentally rethink their systems. In the past, many companies were preoccupied with quick victories, such as reducing the weight of packages and consolidating materials used. Although these minor reforms help to lower packaging costs from end-to-end, what consumers want is a brazen commitment from companies outlining how they will reduce waste.

Companies are taking an aggressive approach to achieve complete sustainability and are embracing the use of recyclable and reusable materials at every opportunity. Businesses are opting for ecologically friendly options to minimise their environmental footprints. Companies are taking different routes to achieve sustainability. The approaches vary from using recycled materials to create packaging, extending use through reusability, and altering production processes to minimise supply chains and carbon footprint.

Sustainable Sourcing/Production

To create a future-proof business, companies should strive for transparent supply chains. It will mean something different for every company depending on their industry – it may include investing in sustainable farming, forestry, fishing, or overall sourcing of products. The business case for supply chain sustainability is very strong; it is critical for companies that desire long-term profitability.

To build sustainable sourcing and production practices into the heart of their business, company leaders must take an objective view of their current processes. From there, they can identify pertinent issues across their entire supply chain and develop a plan of action that addresses these core concerns. For most companies, the aim is to shorten supply chains, minimise transportation, and reduce emissions. It will be a challenge for late adopters to build sustainability into the core of their business model.

The Conscious Consumer

A study conducted by Kantar found that one in every five shoppers reports that they have acquired more environmentally friendly shopping habits since the start of the pandemic. Investment in sustainable innovation is at the forefront of everyone’s minds – from consumers to retailers to manufacturers. The main goal for environmentally friendly consumers and companies is to minimise any negative impact on the environment. Some of the steps consumers are taking are:

  • Reducing carbon footprint through buying local produce
  • Paying close attention to the seasonal availability of food
  • Purchasing sustainable products (biodegradable, reusable, recyclable)
  • Engaging with companies who have progressive models, such as “we will plant a tree for every product sold”
  • Researching which products are ethically sourced
  • Assuring zero-waste manufacturing processes
  • Using energy-efficient products

Shifting consumer preferences and the need for industry-wide change have contributed to the trends we are currently seeing in the FMCG space. All industries can contribute to a greener future and integrate sustainable practices into the core of their business models. Sustainability involves much more than simply protecting the environment; the overarching goal is to meet the needs of today without compromising the future generation’s ability to meet their needs.


Consultant, Finance

Rahela Begum