“Sustainability is not something we do; it is something we are”, says CEO Thomas Körmendi

Q: How does Elopak ensure its high-quality sustainable packaging is done with a growth plan for both the company and the initiative itself?

A: Sustainability is not merely tangential to Elopak’s growth plan, it is at the core of the company’s business strategy. Elopak’s sustainability-driven growth strategy is centred on investment in innovation; the pursuit of new business opportunities in existing and new markets (across both traditional and non-traditional segments); and driving the plastic to carton conversion. This is underpinned by our strong sustainability agenda across both our product offering and operations, as well as our unrelenting commitment to commercial excellence.

By investing in innovation and delivering high-quality sustainable packaging solutions, Elopak is better equipped to achieve these growth goals. We believe consumer demand for sustainable packaging will only rise in more parts of the world and that Elopak is uniquely well positioned to meet and drive this demand. Furthermore, as more companies make the switch from plastic bottles to beverage cartons, demand grows in existing markets and Elopak has shown it can successfully capitalize on this trend. 

Q: What is the one key feature of Elopak’s sustainability vision that distinguishes it from others? How does this accelerate the business prospect of the company as a whole?

A: At Elopak sustainability is not just something we do; it is something we are. Elopak is a UN Global Compact participant with a platinum rating from EcoVadis. Elopak aims to be net zero by 2050, with ambitious company-wide emission reduction and net zero targets verified by the Science Based Targets initiative (SBTi). 

Our commitment to sustainability is reflected in the cartons we offer, which include fully renewable, recyclable, CarbonNeutral® cartons made with FSC™-certified materials (FSC™C081801).

This holistic approach to sustainability accelerates Elopak’s business prospects as it means that when companies partner with us, they can be confident of our determination and expertise to take care of our employees, reduce our impact on the environment, source our raw materials responsibly, and conduct business ethically and responsibly.

Q: Please tell us more about your partnership in Saudi with Obeikan and your customer base.

A: Elopak’s partnership with Obeikan in Saudi Arabia has come to an end, however, in March we were proud to complete our acquisition of Naturepak Beverage – the leading supplier of gable top fresh liquid carton and packaging systems in the Middle East and North Africa (MENA) region. 

This exciting expansion increases Elopak’s access to a strategic customer base in the fresh beverage carton segment in key growth markets. Many of these customers are global blue chip FMCG players and strong regional champions.

As we strengthen our presence in the MENA region, we will continue to bring new products to market that provide a natural and convenient alternative to plastic bottles that fit within a low-carbon circular economy. We are ready to leverage our expertise, market-leading technology and skills to grow our presence in the region across products, segments and markets.

Q: Recently Elopak acquired Naturepak Beverage Packaging, thereby expanding your presence in the MENA region. Could you please tell us about your rationale behind the same and share more about any other significant projects that you are currently invested in within the region? It would be also great to understand your vision for regional growth.

A: The purchase of Naturepak saw Elopak acquire two local production facilities in Saudi Arabia and Morocco to add to our existing global network. It also boosted production capacity by more than 2.5 billion cartons per year and provided a strategic customer base in the fresh beverage carton segment in key growth markets.

The acquisition marked a major milestone in Elopak’s overall growth strategy. Having listed on the Oslo stock exchange in 2021, the company is seeking to capitalize on its strong track record, growing geographical footprint and investment in sustainability-focused innovations to target organic growth of 2-3% per annum; pursuing new business opportunities across both fresh and aseptic segments, across all markets as well as driving the plastic to carton conversion.

Similarly, recently Elopak and GKS announced a Joint Venture ‘GLS Elopak’ in India. The newly formed company, GLS Elopak will leverage the respective expertise, assets and networks of Elopak and GLS to capitalize on the significant consumer demand for sustainable packaging solutions.

Q: What are the key factors/principles that you feel are significant for a packaging company when it comes to the Middle East region? How would you treat it differently from Asia or Europe for example?

A: When operating in any region outside of your home market it is important to be respectful of local customs as well as sensitive to potential differences in the market. Overall, though, customers are largely looking for the same thing when it comes to packaging, which is to keep their product safe and – increasingly –to minimize their impact on the environment.

There are of course regional differences in terms of business models, value chains, and even types of products. For instance, in the Middle East, Elopak provides a lot of packaging for kefir products. Nevertheless, the food security of our packaging remains the same and the environmental benefits of our cartons transcend borders.

Q: What are some of the key challenges when it comes to sustainable packaging, particularly with raw materials such as paper and bio-degradable plastic becoming dearer? When it comes to recycling, the ‘receiving environment’ matters. How does the company influence consumer behaviour on the other end of the spectrum, particularly in the ME region?

A: Multiple scientific studies have shown that beverage cartons are a natural fit within a low carbon, circular economy and have a smaller carbon footprint than alternative packaging options. For instance, a May 2021 Life Cycle Assessment conducted in North America on packaging for fresh milk and juices demonstrated that the carbon footprint of American whiteboard beverage cartons is 32% lower than HDPE and 60% lower than PET bottles. These figures increase to 54%and 73% for European brown board cartons[1].  

Nevertheless, it can be difficult to source raw materials that meet Elopak’s strict sustainability standards. We mitigate this issue by having all suppliers sign our Supplier Code of Conduct, which sets forth our requirements and expectations in business ethics, human rights, labour practices, health and safety and the environment. 73% of our suppliers by spend have also been independently assessed for their environmental and social impact. Additionally, we source all the paperboard for our cartons from responsibly managed forests. In 2021, 64% of Elopak’s sales volume was FSC™-certified (FSC™C081801).

Recycling is another area in which it can be challenging to deliver on consumers’ sustainability expectations. While Elopak’s cartons are recyclable, this is dependent on having relevant collection and recycling facilities in place locally. To help improve this, Elopak works with industry associations and local markets to facilitate increased beverage carton collection and recycling. In recent years there has been a steady upward trend in beverage carton recycling in Europe, with the average recycling rate standing at 51% in 2019. Elopak is committed to working with governments and relevant institutions in all our relevant markets to ensure there are systems in place to facilitate the recycling of all our products.

Q: Where are your raw materials sourced? Do they need to be freighted long distances? If yes, what are the steps Elopak has implemented or is considering reducing its carbon footprint? If not, what steps have you taken in your supply chain to ensure that Elopak maintains a low carbon footprint?

A: Our supply chains are global, and we have 11 manufacturing units around the world, producing some 14 billion cartons annually that are sold in 70 different markets. Key raw materials are mainly sourced from Sweden, Finland, Germany, the Netherlands, Switzerland, Luxembourg, France, Belgium, China and USA. Closures are sourced from third-party suppliers based in Germany, Luxembourg, Hungary, Spain, and the UK. Equipment is produced or sourced via a German-based Elopak company, ultimately from Japan, China or Italy. 

When possible, we aim to source materials as close to our operations as possible, while making sure that we work with responsible and sustainable suppliers to reduce risk and avoid negative impact throughout our supply chain on people, the environment, and society. 

In 2022 Elopak updated its emission reduction targets in line with the Science Based Targets initiative’s new Net Zero Standard, setting near-term targets with the overall goal of reaching net zero by 2050. This includes reducing scope 3 emissions such as transport, business travel and raw materials by 25% by the year 2030. Overall, in order to reach net zero, Elopak has pledged to reduce absolute scope 1, 2, and 3 greenhouse gas emissions by 90% from a 2020 base year. Scope 3 reductions include value chain emissions, such as from transport. We are continuously investigating the optimal transport solutions for our raw materials, keeping in mind the above criteria for raw materials and suppliers.

Q: Circular products require material health, re-utilisation and a host of other important elements in place for packaging to be termed as sustainable. How does Elopak define ‘sustainable packaging?

A: Elopak defines sustainable packaging as packaging that is designed and produced to have minimal impact on the product itself, on the planet and its people, from the cradle to the grave. Elopak cartons are responsibly sourced, naturally renewable and recyclable, and fit well with low carbon, circular economy.

At Elopak we are constantly innovating and creating new products that push the boundaries of sustainable packaging. In June we rolled out the Pure-Pak® eSense: a more environmentally friendly aseptic carton made without an aluminium layer. This innovation was developed using technology from Elopak’s fresh portfolio and results in a 30% reduction of the carton’s carbon footprint.

Q: Please tell us about your journey in the packaging industry, and your association with the ME region. Who is your inspiration for climate-forward and sustainable living? And why?

A: Elopak already has a long track record and an established sustainability profile. It is our ambition to leverage these strengths, to provide the best carton consumer experience possible while systematically supporting our customers in realizing the transition to a low carbon, circular economy.

Prior to joining Elopak, I was CEO of product traceability technology company Kezzler. Before that, I worked at Tetra Pak for 18 years, latterly as Managing Director of Tetra Pak Bulgaria, Turkey, Caucasus and Hungary. 

I very much enjoy working in the Middle East and North Africa region and was delighted when I had the opportunity to visit Casablanca in May to welcome team members from the newly acquired Naturepak sites in Morocco and Saudi Arabia. I look forward to working closely with the teams at both these locations in the years to come.