WHEREAS: The growing plastic pollution and packaging waste crises pose increasing risks to Hormel Foods. Corporations could face an annual financial risk of approximately $100 billion should governments require them to cover the waste management costs of the packaging they produce.[1] Laws to this effect have significant momentum, having been recently adopted in four U.S. states, with additional introduced at the state and federal level.[2] The European Union has already enacted a $1 per kilogram tax on all non-recycled plastic packaging waste.[3] Additionally, consumer demand for sustainable packaging is increasing.[4]

A circular economy for packaging, whereby packaging is designed for reuse or recycling and kept in the economy and out of the environment, plays an important role in a net-zero emissions world. Hormel states it is committed to emissions reductions,[5] yet lacks commitments to ensure the circularity of its product packaging,[6] even though its sold products and packaging contribute significantly to Scope 3 emissions at their end-of-life (ÒEOLÓ).[7]

More than 100 leading companies have committed to promoting a circular economy for packaging by acknowledging responsibility for the collection, sorting, and recycling of packaging at EOL, a policy known as Extended Producer Responsibility (ÒEPRÓ).[8] Absent legally mandated EPR, companies must make voluntary contributions to improve the collection and recycling of their packaging.

The Recycling Partnership (ÒTRPÓ), the leading recycling organization, finds that $17 billion is needed to modernize and expand recycling infrastructure, and that doing so will save the equivalent of 710 million metric tons of CO2 over ten years.[9] To improve plastic recycling infrastructure, TRP recommends that companies contribute at least $88 for every metric ton of plastic used.[10]

Competitors Kraft Heinz, KelloggÕs, NestlŽ, Procter & Gamble and at least 25 other companies make voluntary contributions to expand recycling infrastructure, a critical step in embracing EPR.[11] Hormel is not known to voluntarily contribute to help ensure its packaging never becomes waste.[12]

Hormel received an ÒFÓ grade on a recent report evaluating corporate packaging sustainability for its failure to financially support recycling infrastructure, endorse EPR, explore reuse opportunities, and make all packaging recyclable.[13]

Our Company could avoid regulatory, environmental, and competitive risks by adopting a circular economy approach to packaging and financially contributing to recycling infrastructure.