Life in plastic isn’t fantastic ??

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On the agenda today, the use of plastic is set to double by 2050 and a Reuters investigation reveals that a recycling program by U.S. petrochemicals giant Dow Inc and the Singapore government to turn old sneakers ?? into playgrounds and running tracks is not working as planned. Speaking of recycling shoes, today’s ESG Spotlight showcases the emergence of "eco-rubber" ?? made from second-hand shoes in Portugal.

Dow, a major producer of chemicals used to make plastics and other synthetic materials, in the past has launched recycling efforts that have fallen short of their stated aims ??.

Reuters wanted to follow a donated shoe from start to finish to see if it did, in fact, end up in new athletic surfaces in Singapore, or at least made it as far as a local recycling facility for shredding.

Reuters put that promise to the test by planting hidden trackers inside 11 pairs of donated shoes. Spoiler alert: None of the 11 pairs of footwear ?? donated by Reuters were turned into exercise paths or kids’ parks in Singapore.

Click here to read more about what really happened to the shoes, or check out the video showing Reuters correspondent Joe Brock following the trackers around the world to unexpected places ??.

Speaking of existing recycling programs ??, plastic use in G20 countries is on course to nearly double by the middle of the century unless a comprehensive and legally binding global treaty to curb consumption is drawn up, according to a report by Back to Blue, a research group run by the Economist Impact think-tank and the Nippon Foundation, a private philanthropic organization.

Existing programs to boost recycling or cut single-use plastic consumption only "scratched the surface" and a more comprehensive global plan ?? is required, according to the research.

The United Nations kicked off negotiations on an agreement to tackle plastic pollution in Uruguay in November, with the aim of drawing up a legally binding treaty by the end of next year. As many as 175 countries have signed up to the talks ??? .

If negotiations fail, annual plastic production in G20 countries could rise to 451 million tons by 2050 according to current rates of growth, Back to Blue said – up nearly three-quarters from 2019 ?.

The treaty called for a more aggressive ban ?? on single-use plastic together with higher production taxes and mandatory schemes to make firms responsible for the entire lifespan of their products, including recycling and disposal.

In Conversation

Diana Radu, CFA , ESG equity analyst at 晨星 , an American financial services firm, shares her thoughts on plastic waste and growing regulations to tackle it:

“Since current policies on plastic waste are on track to deliver only marginal increases in recycling rates, we expect to see a tightening of regulation around the world.?

There are different mechanisms that regulators could use, with various impacts on the circular use of plastics and a corresponding internalization of externalities.

We believe an outright ban on all single-use plastic is highly unlikely given the lack of sustainable alternatives.?

While tightening regulation has the potential to affect profit margins as plastic pollution externalities are reined in, we expect it will lead to industry-wide increases in selling prices, with a limited impact on volumes for staples.”

ESG Lens

The climb in the price of European carbon credits to above 100 euros ($107) per tonne last week sends an ominous signal to Europe-based manufacturers and heavy industry that have so far dragged their feet on cutting emissions.

Two-thirds of Europe's emissions stem from just three sectors: energy supply (24.2%), domestic transport (20.7%) and industry (20.7%), according to European Environment Agency (EEA) data from 2020, the latest available.

ESG Spotlight

We take a trip to Portugal in today’s ESG Spotlight as the nation’s green push has led to the emergence of "eco-rubber" made from second-hand shoes ??.?

A factory worker grabbed a handful of worn-out shoes and fed them into roaring machines that chopped and crushed and transformed them into "eco-rubber" – part of a green push in Portugal's footwear industry ??.

The rubber is then transformed into recycled soles and other products sold by Bolflex – one of 120 Portuguese shoemakers that signed a pact ?? to cut the sector's emissions by half by 2030 – and its clients.

The company also recycles rubber waste from its soles, an operation that it says saves it around ?? 1 million euros ($1.05 million) a year.

?"We were throwing away, burying, sending to landfill about 300 tons" of materials a year, sales head Pedro Saraiva said at the factory in the northern town of Felgueiras.

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