Replenishing the world through sustainable packaging

Amcor's sustainable procurement drives ESG strategy, circularity and industry-wide change towards greater sustainability

Amcor designs smart, sustainable packaging that weighs and contributes less to greenhouse gases with readily recyclable, in addition to 100%-recycled products that are designed with end-of-life usage and circularity in mind.

Here, procurement plays a very strategic, integrated role in driving corporate ESG strategy through important activities like raw material and strategic vendor selection, creating strategic partnerships across the value chain, driving grassroots recycling efforts, and capacity and supply protection.

Ranga Mulabagula is Global Vice President of Procurement at Amcor Rigid Packaging. He is responsible for US$2.5bn global spend spread across 50-plus manufacturing facilities in over 15 countries.

His 27-year global career – of which he has dedicated 10 years to Amcor on top of a previous 17 spent at General Motors – spans the areas of procurement, supply chain, product development, and international operations, helping him to develop into a highly-skilled and well-rounded operations executive in the manufacturing and service industries.

Amcor’s procurement activities tackle everything from supporting Scope 1 endeavours, carbon footprint reduction efforts with Kaizen workshops, and supporting scope 2 renewable energy footprint sourcing and expansion, all the way through to Scope 3 greenhouse emissions reduction.

Mulabagula says, “we recognise the principle that ESGs shouldn’t be a later addition to circularity efforts, but are far more effective when baked into the process from the very outset.”

It is worth noting that Amcor's focus on ESG aligns with broader trends in the corporate world. Many companies are increasingly recognising the importance of addressing ESG concerns not only for ethical reasons, but also because of the potential financial benefits. 

Now, it’s widely recognised that addressing ESG concerns can help companies reduce costs, mitigate risks, and improve their reputations – among other benefits.

Amcor's approach of addressing ESG concerns across all three scopes is also notable. Scope 3 emissions, in particular, are often overlooked by companies but can be a significant source of emissions and environmental impact. By addressing greenhouse gas emissions in its value chain, Amcor is taking a more holistic approach to ESG, which should help the company achieve its sustainability goals more effectively.

ESG efforts are, of course, not a solitary endeavour, and the importance of partnerships and supplier relationships is an incontestable part of the enterprise. Such gigantic projects require cooperation, and Amcor has set its sights on significant collaborations to achieve a far-reaching, positive environmental impact.

Amcor has a robust supplier onboarding and management programme, the parameters of which are informed by the code of conduct verification process, coupled with a balanced supplier scorecard and governance process for all of its suppliers.

“Data and transparency play a key part in ESG efforts,” says Mulabagula. In-keeping with this, the systemisation of supplier data and relationships is emphasised throughout its operations. For example, Amcor uses EcoVadis’ third-party measures to verify and validate its sustainable procurement processes. The company was the recipient of EcoVadis’ prestigious ‘gold’ ranking in 2022.

By working with strategic supplier partners and customers in Columbia, Amcor’s procurement function has established a sustainable circular model for the region, driving grassroot waste collection, recycling, post-consumer resin (PCR) processing, and container manufacturing, which yields significant greenhouse gas emission reductions and ESG improvements across the entire value chain. 

Collaboration & driving sustainable practice

Mulabagula points out that Amcor plays an active leadership role in many packaging industry NGOs via activities such as promoting recycling, the use of sustainable materials such as PET, and – perhaps most importantly – in raising consumer awareness about environmentalism and ESG efforts.

This has the potential to create positive ripple effects throughout the supply chain. By promoting the use of sustainable materials and raising consumer awareness about environmentalism and ESG efforts, Amcor is helping to create a more sustainable market demand for packaging.

This increased demand for sustainable packaging options can incentivise other players in the packaging industry to invest in sustainable practices and materials. As a result, Amcor's sustainability leadership could help drive industry-wide change towards greater sustainability and reduce the environmental impact of the packaging industry as a whole.

Amcor's involvement in industry NGOs demonstrates the company's willingness to collaborate with other stakeholders towards a shared goal of sustainability. Through the sharing of knowledge, resources, and best practices with other organisations, Amcor can help drive collective action towards greater sustainability in the packaging industry.

“As part of this leadership” says Mulabagula, “we’re a leading participant and board member of the Plastics Industry Association (PIA), the American Beverage Association (ABA), and The National Association for PET Container Resources (NAPCOR), and we work with numerous reputable organisations across North America to achieve appreciable ESG outcomes.”

Challenges and opportunities of the future

When asked what he sees as the greatest challenges and opportunities for Amcor in terms of sustainable procurement, Mulabagula says: “Post pandemic rebalancing of supply chains, macroeconomic slowdown, high inflationary raw material markets and the growing importance of ESG objectives present a complex and exciting challenge for Amcor and its procurement function. These will consist of balancing business objectives with customer, end-consumer and supplier expectations.”

Mulabagula also thinks that deep engagement and alignment with business, customers and communities is critical to support and serve the growing, complex business needs of the present and future.

“Our procurement function is proactively addressing these challenges by revamping the supplier scorecard process, third-party auditing and validation, and robust processes and systems to drive continuous monitoring, reinforcement, transparency, and reporting alongside the development of its strategic suppliers.”

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