This report details the financing of companies in the global plastic-packaging value chain.

With the annual production of virgin plastics estimated at 400 million metric tonnes, the plastic waste stream is steadily becoming a major environmental concern. In particular, plastic-packaging accounted for 36% of all plastic produced in 2015 and contributed to 47% of total plastic waste.

The public concern with plastic is tied to its high persistence and heavy leakage into the environment. It is estimated that 12.7 million tonnes of plastic enter the ocean every year, a figure that is expected to increase to 29 million tonnes in the next twenty years. More than 90% of all birds and fish are believed to have ingested plastic particles and the average person is estimated to eat 100 particles of microplastics in every meal.

The scientific evidence of the environmental and social impact of plastic waste has been tangible enough for manufacturers and regulators to take note. According to the report:

• as of June 2020, 69 countries had a full or partial ban on plastic carrier bags.
• at least 20% of all global producers of plastic are signatories to the New Plastics Economy Global Commitment launched in 2018 by the Ellen MacArthur Foundation and the United Nations Environment Programme (UNEP).

Despite this rising concern, the report identifies a lack of due diligence reports, contingent loan criteria, or financing exclusions by the top banks that provide funding to the global plastics value chain. Such an omission is unusual, especially as the financial industry has existing risk identification protocols for industries that contribute to biodiversity loss, pollution or climate change. A lack of due diligence is cited as a risk for the banks. The concentration of lending banks headquartered in a few jurisdictions could have implications for future introductions of lender liabilities.

The authors suggest how banks, governments and corporate companies should address the problem of plastic pollution, with particular actions and commitments.

• Banks are urged to align lending portfolios with plastic reduction, reusability and recycling public policies and report historic and ongoing impact of activities relevant to plastic waste.
• Governments are urged to extend investor liability for future environmental or health related legal challenges to those responsible for plastic pollution and introduce a mandatory tax on virgin plastics and invest in a new generation of recycled plastics markets.
• Corporate companies are urged to adopt international best practice and increasing reusability of plastic packaging products.

The report emphasises that banks will need to play a more active role and lay the groundwork for a circular economy and significant reduction in the production and use of single-use plastic packaging. This report aims to prevent extinction of species, reduce negative health impacts to humans and reduce biodiversity loss through encouraging reusable plastics, and urging banks to stop funding single-use plastic products and packaging in the supply chain.

1. Between January 2015 and September 2019, banks provided loans and underwriting of more than USD 1.7 trillion to 40 key actors in the plastics value chain. The total funding was equivalent to USD 790 million per day.
2. According to the report, 80% of funding for actors in the plastics value chain came from 20 banks. Nearly half (46.4%) of the financing was from banks headquartered in the United States with the Bank of America topping the list at 10.31% of total financing.
3. The bulk of plastic funding went to 40 companies that are spread across four key sectors in plastic packaging i.e. Fast moving consumer goods (FMCG) companies (42% of total funds), followed by the retail sectors (29%), polymer producers (24%) and plastic packaging manufacturers (6%).
4. Although some companies in the plastics value chain (like Unilever) have made public pledges to address the amount of plastic they produce, use or sell, none of the banks have made funding contingent on such pledges.
5. Plastic waste is so prevalent and persistent it has been predicted that by 2050 the weight of all plastic in the ocean will exceed the weight of all fish in the world's oceans (World Economic Forum).
6. The largest contributor to global plastic waste is packaging, which is responsible for around 47% of all plastic waste generated. Coca Cola company alone produces around 3 million tonnes of plastic packaging a year, the equivalent of 200,000 bottles a minute.
7. A study of 7 European nations found that a shift to a circular economy could reduce greenhouse-gas emissions by up to 70% and grow the workforce by about 4% (2016).
8. In 2018, the Ellen MacArthur Foundation, in collaboration with the UN Environment Programme launched the New Plastics Economy Global Commitment. The Global Commitment calls for a circular economy for plastics that is based on eliminating problematic or unnecessary plastic packaging and moving from single-use to reuse packaging models.
9. ING was the only bank amongst the top 20 investors in the Bankrolling Plastics research report that endorsed the New Plastics Economy Global Commitment, but the bank does not make its lending contingent on companies having strong policies to address plastic pollution.
10. Since the Global Commitment was launched, a progress report across the corporate signatories shows an increase in commitments made and establishes a baseline for compostable, recyclable, and reusable plastics. However, only 3 % of plastics used are reusable, while 97% are still single-use. Reusability underpins a circular economy since recyclability alone does not ensure a reduction in the production of virgin plastic, in particular taking into account that only 9% of all plastics have been recycled.