Aviva Investors: COVID's dirty plastic secret

As the world continues to grapple with the health implications of COVID-19, unintended consequences were inevitable. In this data-led story, we look at the effect the pandemic has had on global plastic wastage and what policymakers can do to tackle the issue.  

The coronavirus pandemic has not helped plastic wastage

Demand for biomedical plastics has surged during the pandemic.¹ Syringes, surgical gowns, COVID-19 test kits, latex gloves, shoe covers, sanitizer containers, visors, disposable blades and scalpels, disposable masks; the list goes on. If we had a plastic wastage problem before, the coronavirus pandemic has not helped.

The facts are startling and the size and scale eye-watering. Here are few highlights:

• 1.6 million tonnes of medical waste generated daily², adding to 8.3 billion tonnes of plastic made since the 1950s;³
• 129 billion single-use face masks have been thrown away every month;⁴
• 65 billion gloves with a carbon cost of 13 million auto miles must be disposed of monthly;⁵
• COVID-19 testing is also waste generating; 1000 Polymerase chain reaction tests = 22 kilogrammes of plastic.⁶

Even more worryingly, surgical items include resilient materials like polypropylene, polyurethane, polyacrylonitrile and polyethylene that can remain in the environment for up to 450 years.⁷

450 years

Time for a surgical mask to fully decompose

Does it matter?

Substantial volumes of plastic waste are not being collected, sorted, recycled or safely disposed of.

Plastics accumulating in terrestrial and aquatic ecosystems can be harmful

On some parts of the earth, more than 1 million pieces of microplastic have been identified per square mile⁸, and millions of tonnes are being washed into the sea. But we know plastics accumulating in terrestrial and aquatic ecosystems can be harmful.

• Long-lasting plastics can block the digestive tracts of animals, diminishing their urge to eat and, in a worst-case scenario, prove fatal;
• Microplastics have been found in more than 100 aquatic species, many of which are commonly on the menu. Experiments in the US show fish that ingest plastic may experience liver damage;⁹
• In humans, there is growing concern that some materials used to improve the malleability of plastics may impact fertility; this is an ongoing area of study.¹⁰

Plastics in Earth systems: What business-as-usual means¹¹

With no change to the way we use and manage plastic (see Figure 1, Business as usual), around 30 million tonnes of plastic pollution will be entering aquatic ecosystems each year by 2040, with another 55 million tonnes entering terrestrial ecosytems.

Biomass- and algae-based polymers could replace some petroleum-based materials, reflected in the reduce and substitute and system change scenarios shown in Figure 1.  

Figure 1: The future of plastics - potential pathways from multiple Monte Carlo simulations (Mt/y)

Managing the mountain of plastic waste

Figure 2: Impacting the plastic waste chain

Source: Aviva Investors, June 2021; Heliyon 7, February 2021

"China banned imports of plastic waste in 2017 and Turkey has followed this year, with new restrictions due to come into effect in July. This is a significant change, because Turkey received almost half of all global packaging waste exports in early 2021. We need to work much harder to reduce and manage our own waste"

Sora Utzinger, Senior ESG Analyst

"Companies we invest in warn of a recycling crisis. We want to see companies do more to reduce virgin plastic use, increase recycled content, design for reusability, and report quantitively on their progress in these areas"

Eugenie Mathieu, Senior ESG Analyst

"There are useful new applications developed during the pandemic that could deliver compound growth and reduce waste. They include double-chamber, pre-filled syringes for freeze-dried vaccines, which should help distribution issues and increase the shelf life of the drugs. We are also interested in the multiple uses for UV as a disinfectant. Light within specific wavelengths, known as UV-C, can disinfect airflows and surfaces. This is being used in light fittings, reducing the risk of infection from airborne bacteria and viruses, as well as to clean re-usable masks"

Matt Kirby, Portfolio Manager

What can we do about it?

The negative impact that long-lived plastics have on the environment is evident everywhere.

Steps can be taken immediately to address the problem

Steps can be taken immediately by various stakeholders to address the problem:

• Individuals can reduce how many single-use products they buy and ask for re-usable products e.g. washable masks.
• Companies can rethink resource management, design for re-use, substitute, actively target waste reduction and avoid unnecessary ‘hygiene theatre’.
• Public health bodies can focus their purchasing power on reusable equipment and new cleaning technologies.    
• Governments have a higher bar to reach now that the Basel Convention has been amended to enhance control of international movements of plastic waste, reducing the ability of countries to export their waste problem. There is scope to use tax incentives more extensively to nudge behaviour.
• Investors and asset managers have a key role to play, using their voice to accelerate change by engaging with companies on resource management, either bilaterally or as part of investor coalitions, and investing in alternative solutions that are better from an ESG perspective but also deliver positive returns.

As Steve Waygood, chief responsible investment officer at Aviva Investors, puts it: “Humankind has made around 8,300 million metric tons of virgin plastic, and the compounds take centuries to degrade. Our enthusiasm for the product has made a stamp on the planet that will be visible for millennia. Our water, soil and oceans are all affected: we need action.”