We’re all used to throwing away our packages and the labels attached to them. But there’s a growing movement for #circularization that will see packages become part of a cyclical economy that reduces waste and greenhouse gas emissions.
In this video, Neil Cameron—head of our new sustainable packaging fund—speaks to Shruti George of Avery Dennison. How does the labels giant contribute to this growing trend?
✳️ It adapts its designs to markets that don’t yet have the culture, regulation or norms that promote recycling—making its labels circular by design.
✳️ It applies a “global coordination, regional execution” approach—particularly crucial given its footprint across widely divergent ecosystems.
✳️ It helps build circularity infrastructure in places that lack it, including by investing in startups and running pilot programs.
Transcript:
Neil Cameron (00:00):
Welcome to this conversation hosted by Emerald Technology Ventures. In this episode, we’re going to explore the circularization of packaging and labels.
Neil Cameron (00:10):
Joining me today to discuss this topic is Shruti George, one of the sustainability and innovation leaders at Avery Dennison.
Neil Cameron (00:18):
So let’s dive right in. Avery Dennison began in 1935 with Mr. Avery who thought, “What a great idea. We need a self-adhesive label.” You’ve come a long way since 1935. And circularization is a major theme. You could argue that circularization as a theme, was born in 1990, there was a paper written on the topic and everyone thought, “Oh, God. This seems like a good idea.” And the idea started to grow, in the same way that a sneeze kind of starts to grow, and it’s sort of tickling your nose, and it gets worse and worse and worse, until finally at some point, the sneeze erupts. At some point, Avery Dennison went through that paradigm shift from just being a label producer, to being a global leader in circularization. What was the sneeze?
Shruti George (01:12):
So, Neil, I like of us being defined as the sticky-
Neil Cameron (01:18):
A sneeze? Sorry.
Shruti George (01:21):
… A sticky plan, right? Because we did start in 1935, but we’ve always been defined by our spirit of innovation. We were always ahead of the curve. So part of this for us was also to look at what is happening in the industry and the sneeze in this case, was legislation. And I think there were two specific instances. The first one was China, banning import of plastic waste into the country. And the second one, which is still happening across the board is, single-use plastics and what governments are doing with that. So I would call that the sneezing moment, and this is absolutely part of our strategic imperative, really looking at circularity and do we invest in it, and really drive this change for a value chain.
Neil Cameron (02:11):
But how you react to it is the critical thing, right? I mean, on the one hand, you have all of this imperative that comes down from on high, thou shalt not export waste to China, thou shalt not use single-waste plastics, but somehow, you have to put this innovative engine that’s behind you at Avery Dennison to work. And not only do you have to put all of this innovation to work based on the strengths of the company that you have, but also, you have to react to the requirements around the world, right?
Neil Cameron (02:39):
We talk about the, certainly, the China impact on everybody around the world was huge, but how the Chinese react to labels and packaging is different than how the Japanese react to labels and packaging, and is different than how Europeans react to labels and packaging. And you guys have $5 billion of top line revenue selling labels around the world. So you are particularly informed about these differences. How do you put your innovation team to work, solving different problems all around the world like that?
Shruti George (03:09):
In general, our company’s quite regional. So we really work with our regional teams on this. The mantra that we talk about always global coordination, regional execution. It always happens in the regions. And I like the example that you bring about China versus Japan. We’ve really embraced eco design as a concept for our products. And part of that is actually talking about infrastructure and how nations react to what the infrastructure is.
Shruti George (03:41):
I grew up in India where we do not have a formalized recycling system, but recycling happened. We would have what we call Kabadiwala, so a person that would come home, pick up the waste papers. So we would’ve stacked months worth of newspapers and magazines, and they would pick it up and go almost for five rupees or whatever. So it was almost a pittance for us, but they were making money off of it, which I found very powerful as a concept, because this was not happening in the 90s. It was even happening in the 80s.
Shruti George (04:15):
That is an informal recycling system that works. The Japanese actually know how to recycle plastic. They will take a bottle, take the shrink sleeve off, drop the bottle somewhere, the cap somewhere, and the label somewhere else. We need to know how to design for those ecosystems. And we need to drive that from the regions. And that’s essentially what the company is really doing and doing well, in my opinion.
Neil Cameron (04:42):
So if I understand that correctly, in some markets, you can depend on a highly educated, very informed, extremely compliant customer base, who will follow instructions and do proper separation of all the various waste streams. And in those cases, you have perhaps more designed freedom about the very various ways in which you can put together a package and a label.
Shruti George (05:03):
Which is what you see in Japan, by the way. They have the best labels in the world, I would say, but, yes.
Neil Cameron (05:09):
And in environments where you have a less compliant and perhaps-
Shruti George (05:18):
You have to design to it.
Neil Cameron (05:19):
… You have to design to it. So that you’re no longer working to the legislation, but you’re instead, you’re just making it impossible for it not to be circular.
Shruti George (05:26):
Correct. And in places where we feel like we can actually make a substantial dent in the infrastructure, we are actually investing in infrastructure changes as well. So I think we’d invested in a company called RoadRunner Recycling earlier in the year. And we’re walking the talk, so to speak. So really, recycling our own internal products, going to our customers, picking up the products and then bringing it back to recycling. And these are pilots that we are running. We are very excited about actually making a change in how we see circularity for our own business. And that’s important for us.
Neil Cameron (06:04):
Do you see major differences between Europe and North America?
Shruti George (06:08):
Well, in maturity of the legislation and infrastructure, obviously, consumer behavior and demand in the US is actually pretty strong, and that’s driving the US system much more effectively than anywhere else. And I would say legislation is slow, but not much slower, because you see what California is doing in terms of regulation. It’s quite close to what Europe is doing. And we think that the whole country will also not be far behind that.
Neil Cameron (06:41):
So Europe is more progressive than the US, but what about the more than, for labels and packaging? I would argue that packaging has three major purposes. It should contain whatever it’s supposed to contain. It should protect whatever it’s supposed to protect, and it should inform the customer of what’s inside. So those are the requirements, but it’s a missed opportunity if that’s the only thing it does.
Neil Cameron (07:08):
So what about the data piece? What about the digitalization piece? And can we draw any conclusions about how Americans are adopting the digitalization piece of circularization against how Europeans are adopting the circularization and digitalization nexus, and Asians?
Shruti George (07:28):
I think Asians are much ahead of the curve, right? We’ve seen this time and time again.
Neil Cameron (07:32):
This is the Vanguard.
Shruti George (07:33):
This is the Vanguard. China, where QR codes are a fact of life. Europe just started adopting QR codes much more effectively once COVID hit. But that’s just a slice of the question you’ve asked. The way we think about labels is, because I’m going to pick the third one, which is the communication aspect. The way we think about labels is, there’s a brand identification. So the brand shows what it is for. There is absolutely an information. What is the calorifical content? What’s the expiry date, all of that is important. And it’s on the label.
Shruti George (08:10):
The third one, the one that we’re really focusing on right now is around the sustainability aspect. How do you track and trace? How do you make sure that the end of life is happening effectively? And this is something that we’re driving through our value chain. We’re really investing in bringing the physical side of our business and the physical side of what we’re talking about in terms of labels with the data that we have, because we are everywhere. We are ubiquitous. And this is part of that enablement of our physical label that the company is really driving. We are really excited about that for the future. And that’s part of our circularity journey as well.
Neil Cameron (08:51):
And so, if we look ahead, so let’s say 10 years, let’s look ahead to 2030. What does digital and labels and circular look like for Avery Dennison? What’s the missing innovation that we’re going to plug in to solve big problems, to make 2030 look different for you?
Shruti George (09:11):
Before I go to 2030, I will take a step back 10 years, right?
Neil Cameron (09:15):
Sure.
Shruti George (09:16):
If 10 years ago, we were to look out and say, “Let’s talk about solar and electric cars.” They were quite a glimmer in most people’s eyes, because the efficiencies you were talking about solar was so much lower than what we achieved, not less than four years later. And that was actually something that you saw the whole industry callers around, and the supply really created the demand almost, in a way. And then you see the same thing with electric cars, where it happened faster than what you think.
Shruti George (09:51):
The one thing I will say about us 10 years down the line, is I think the change will happen faster than what you and I can talk about. I think part of what is missing is the integration of the backend. And it’s both in terms of systems and the data part of it. So who is the trusted person to hold the data. This is an important question everyone is grappling with, but I’m hopeful that it’ll happen faster than we think it will.
Neil Cameron (10:22):
So I don’t want to overuse the analogy, but it sounds like you’re saying, “We’re right in the middle of an enormous sneeze.”
Shruti George (10:28):
Probably. No, you have killed that analogy.
Neil Cameron (10:33):
I’m so sorry. I’m so sorry. Shruti, I have to thank you so much for sharing your perspective from Avery Dennison on the circularization of packaging and labels. Thank you so very much.
Shruti George (10:46):
You’re welcome. It was a pleasure.