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Plastic packaging tax doesn’t need to be taxing

Whilst the nations at Cop26 failed to agree on far-reaching measures which might have halted the climate breakdown, some pledges have been made to reduce the impact on the environment. What is more, it is very likely that further measures will be agreed in the not too distant future. The onus of implementing suitable measures, now and later, will be on the private sector. Partly driven by consumer demand, but mainly driven by government legislation, enterprises will need to show evidence of real changes.

 

 

At corporate level, there will be a need to introduce, standardize and/or expand on the reporting of Environmental KPIs. Defining the KPIs is the easy part. National governments provide guidelines (see for example the guidelines for UK businesses here).  It is just a matter of time until global enterprises are required to use an international framework for environmental reporting. Standardized environmental reporting will be as commonplace as the International Financial Reporting Standards (IFRS) are today.

 

 

The challenge for organizations will be to gather the data required for the reporting in an effortless way. Financial data is usually well organized in a corporate financial system. To get a full picture of emission and resource usage across the entire enterprise, data needs to be gathered from a wide variety of resources. The key to doing this in a cost effective way is by having a strong data management capability. This data management capability includes a cloud data platform providing cheap storage for large quantities of data. It also includes an Extract, Transform and Load (ETL) tool which can effortlessly connect to a wide variety of data sources and handle data even if it is not structured in the traditional, relational, way. Finally you need the Business Analytics tools for automating the reporting and (AI assisted) analytics.

 

 

The introduction of the plastic packaging tax in the UK has kicked many organizations into gear to organize their environmental reporting. For those not familiar with the plastic packaging tax, On 1st April 2022, the UK introduces a £200 tax for every metric tonne of plastic packaging used (if less than 30% recycled). More details on the HMRC website.

 

 

The plastic packaging tax is a good incentive to improve the data infrastructure of your company for years to come. Instead of just implementing a point solution for plastic packaging reporting, enterprises would be wise to take the bigger picture into consideration and build an infrastructure which can easily fulfil the future needs for environmental reporting. This will save money – and a big headache – later on. Increasing carbon emission prices will result in a demand for better reporting on the sources of emissions in a company.  Consumers will want to see evidence of the claims on packaging and across the supply chain (‘sustainable’, ‘plastic free’, ‘100% recycled materials’). Dealing with all these requirements on an ad-hoc basis will result in an unmanageable data mess, which will ultimately be more expensive.

 

 

Snap Analytics is helping a large UK FMCG enterprise with getting their data infrastructure up to date. This company has made a strategic decision to become information driven and needed a cloud data platform to achieve this. Plastic packaging tax reporting was one of the first use cases for this new platform and confirmed that the rationale behind the platform was sound. Plastics tax reporting required information from corporate ERP systems, recipe management systems, claims databases and other sources. By having the right tools in place, this could be done with a minimum effort, freeing up business resources to act on the data, rather than spending time getting the data.

 

 

We would love to help other organisations with their data infrastructure and environmental KPI reporting.

Our templates will help you hit the ground running and to keep the cost at a minimum we will give any organization a 15% discount on our standard rates for any work directly linked to making a positive change to the environment!

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