Iranpolymer/Baspar The climate crisis is an unfolding emergency reshaping how businesses operate and how consumers make choices. Despite the efforts to address sustainability issues, many organisations are struggling to make progress in key areas such as tackling plastic pollution, with the complex factors around why the material might be used. Globally, only 9% of plastic waste is recycled, and plastic pollution is expected to double by 2040 if it continues at its current rate.
In response, regulators are introducing stricter environmental policies, while investors and consumers are demanding greater accountability. These emerging regulations are not just compliance hurdles – they are catalysts for innovation and value creation. Forward-looking organisations are leveraging this moment to embed sustainability in their core strategy.
Our recent research revealed that companies are already producing average savings of up to 21% through circularity initiatives targeting waste, energy, and water management. In fact, 82% of businesses report that investing in green initiatives delivers a direct boost to sales, while two-thirds say these efforts have accelerated innovation.
The ESPR is not the only regulatory driver. The EU Circular Economy Act, due in 2026, will further strengthen requirements for recycling, waste minimisation, and resource efficiency. Similarly, the Corporate Sustainability Reporting Directive (CSRD) which came into force last year includes circularity metrics across value chains, while the Packaging and Packaging Waste Regulation (PPWR) introduces new restrictions on single-use packaging and sets ambitious reuse targets. Meanwhile, the UK is introducing Extended Producer Responsibility (EPR) for packaging, shifting the full cost of managing household packaging waste onto producers and requiring more detailed data collection and reporting.
For UK businesses, especially those exporting to the EU or relying on EU suppliers, these rules represent a step change. Compliance will require investment in data management, supply chain collaboration, and new approaches to product stewardship.
From supply chains to value chains
A critical aspect of the circular transition and reducing plastic waste is the move from traditional supply chains to value supply chains, networks that balance profitability with environmental and social impact. However, achieving transparency and traceability at scale remains a challenge. Many businesses grapple with inconsistent regulatory requirements, varying levels of supplier reporting maturity, and the complexities of globalised networks. Emerging regulations such as DPPs can play a key role in tackling this challenge by improving product traceability and enabling the data-driven decision-making necessary for sustainable growth.
New procurement models and supplier incentives are also emerging, encouraging collective action and fostering innovation across sectors. However, the most successful circular models are those that engage and incentivise consumers, making sustainable choices both easy and rewarding. Deposit return schemes, accessible repair services, and digital rewards for recycling are just a few examples of how brands can nudge behaviour in the right direction. Such incentives are particularly important for reducing plastic waste where consumer behaviour is key to making lasting impact.
Choosing the right circularity strategy
To meet the new regulatory requirements and tackle plastics waste, organisations need to develop effective circularity strategies and capabilities for cross-sector collaboration across the value chain. This would require identifying the largest sources of plastic dependency in their value chains to effectively take actions for its reduction. There are different factors to consider when assessing the most effective strategies for reducing plastics waste. These include the specific industry sector, packaging materials, business model, supply chain capabilities and opportunities to achieve a circular ecosystem of plastic. Undertaking an in-depth analysis of the plastic dependency at the material, product, or process level is key to preparing organisations for upcoming regulations and establishing a circularity strategy that effectively reduces plastics waste.
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