The Fourth largest Sector of the Indian Economy VS Our Planet

As any human who spends their life on the planet and leaves behaving a mark, so do businesses and organisations. The way the businesses and organisations perform, take actions and plan their business model, also leaves behind a long lasting impression on the planet.? Without industrialisation any economist would not be able to sustain however the mass production had led to a negative impact on the environment. It is time that we start addressing the long term of the actions and decisions taken by the businesses that would be on the environment.?

The Fast Moving Consumer Goods (FMCG), which includes products like food items, personal care, cleaning products etc,? is regarded as the fourth largest sector of the Indian economy.?

The sector that has high volume of sales while the prices and the durability and the life cycle of the products are low. With a business model that contributes to the growing production and marketing of single use plastics but is evolving rapidly to include sustainable practices in its procedures in the last few years.

The new age consumers are facing the major impacts of climate change which are affecting their purchasing habits and making them more careful about their choices. Hence, sustainability has become the top priority for both the consumer and the brand today.

The industry that heavily depends on the taste and preferences of the consumers has seen to be gradually recognising its social and environmental responsibility which is leading to an increasing embedment of sustainability in its operations.

How is it changing?

In the early years, the concept of sustainability was beginning to be seen as important but there were no actionable strategies in the industry to commit and take it to the next level.

The packaging was using non-recyclable material while recycling was still promoted but there was no restriction or rules to this.

From the late 2010s to the early 2020s, saw a rapid rise in awareness packed by actionable implementations packed by consumer activism which led to a shift in the FMCG priorities.?

There was a global realisation of climatic change and the consequences it has on human life. Stricter rules and regulations were implemented globally which pushed the industries including the FMCG industry towards taking initiatives to address this global issue.

One of the world’s biggest FMCG colonies, committed to ensuring all its plastic packaging would be recyclable, reusable, or compostable by 2025.

How are they impacting the planet?

Packaging: A Double-Edged Sword

The FMCG industry that is alone responsible for one-third of all greenhouse gas emissions has seen taking responsibility for the excessive use of non-recyclable plastics. Companies are transitioning from single use plastic to biodegradable and recyclable packaging materials.

A survey by Nielsen in 2019, states that 73% of the global global consumers said they would definitely or probably change their consumption habits to reduce their environmental impact.

Resource Consumption and Carbon Footprint

The next big shift seen is the use of renewable energy in the manufacturing and distribution processes. Companies have been setting carbon-neutral targets and investing in renewable energy for their operations and focusing on reducing the carbon footprints of their supply chains. Some colonies are also committing to use only zero- carbon electric vehicles.

A trend that is increasing wherein the FMCG manufacturers are replacing traditional incandescent bulbs with LED lights and this is resulting in a cut down of energy consumption up to 40%.?

The FMCG industry is also recognising the importance of conserving water and has started to implement water-saving techniques in the manufacturing processes.?

Nestlé has aimed to reach new zero emissions by the year 2025, and by 2022, they have already made significant strides towards this goal by investing in renewable energy sources and enhancing energy efficiency.

Ethical Sourcing

FMCG companies have begun to take a step forward towards sourcing and procuring raw materials and ingredients that are eco friendly and sustainable. Companies are also taking actions to actively recycle non eco friendly materials present in the supply chain and using it to minimise the waste production.

Waste Management: The Challenge of Scale

Efforts are being taken to minimise the production of waste in the production process. They are also implementing effective waste management strategies, such as recycling and upcycling initiatives.?

In 2019, Procter & Gamble announced that they were working towards reducing their use of virgin petroleum plastic in packaging by 50% by 2030.

In the times when the consumers are showing interest towards the facing consequences of climate change and global warming and pronouncing their interest towards products that are environmentally friendly and sustainable, this has led to a pivotal shift in the mindset of the consumers and also the business however small it seems to be.

The FMCG industry too is trying to incorporate positive changes in the production process and in informing tier consumers about these changes and strategies too.

FMCG giants have the power and resources to lead the sustainability movement. By integrating ESG (Environmental, Social, and Governance) standards into core strategies, these companies can drive meaningful change. It's not just about compliance—it's about setting new industry benchmarks.

Moreover, sustainable shifts are not solely the responsibility of producers. Consumers, too, have a pivotal role. By supporting eco-friendly brands and demanding sustainable practices, consumers can influence market dynamics. After all, every purchase is a vote for the kind of world we want to inhabit.

The FMCG sector, in all its might, holds the key to significant positive change. By recognising the urgency of climate action and corporate sustainability, and by making impactful moves towards sustainability, the industry can ensure a win-win scenario—for businesses, consumers, and, most importantly, our planet.

At Living Pink, our deeper understanding of human psychology ensures that change is not only recommended, but embedded into your business, top to bottom. We enable individuals, businesses, and communities to act upon their awareness of sustainability through tailored solutions across ESG Auditing, Reporting, Sustainability Transformation, Stakeholder Engagement, Workshops & Trainings, and CSR Programmes.