Beverage Packaging Sustainability Trends Driven by Regulation and ESG

Introduction

Sustainable packaging is considered a key strategic element for the global beverage industry as the demands from regulators and consumers are becoming more aligned and this pressure is rising. Currently, beverage brands do not consider packaging only from the standpoint of cost efficiency and shelf performance. Indeed, factors such as environmental impact, recyclability, and traceability of materials have become very important and have particularly influenced decision making for bottled water, spritzer, and functional beverage categories.

In 2024, several large beverage companies have publicly set the pace for packaging changes to fulfill sustainability goals. For example, Coca Cola has rolled out 100% recycled PET bottles only in some European markets, attributing to the development of the recycling infrastructure and consumer willingness. Along the same line, PepsiCo has also raised the use of recycled materials in its water and sparkling beverage ranges in North America and parts of Asia Pacific thus packaging changes have been related to company-wide ESG targets.

The packaging industry is meeting this challenge by innovating and extending capacities. For instance, in 2025, Ball Corporation took over Florida Can Manufacturing, thereby a great strengthening of the aluminum beverage can supply network in the United States. As a matter of fact, beverage brands are turning more towards aluminum as they are aiming to achieve higher recycling rates and to follow the principles of the circular economy. Thus, this trend constitutes the next evolution of carbonated water and spritzer product packaging that has been marketed as premium and environmentally friendly.

Carton based and paper integrated packaging solutions are also gaining traction. After obtaining regulatory approvals, Tetra Pak launched in India their packs for beverages that contain certified recycled polymers in late 2024. The pack is an expression of the increasing need for substitutes to regular plastic bottles in the areas where the recycling facilities are still quite limited.

For deeper insights into how packaging formats influence demand and pricing across carbonation based water products, refer to the Spritzer Market Report and its table of contents.

Major Trends, Drivers and Challenges

Environmental regulation has long been the main factor that influences the adoption of sustainable packaging for beverages. Governments in different parts of the world, particularly Europe and Asia are instituting extended producer responsibility schemes and recycled content mandates. Beverage companies, therefore, need to make changes to their packaging lines to be able to continue operating legally, especially in those markets which are highly regulated.

Corporate sustainability commitments are giving more weight to these changes. Large-scale beverage manufacturers are under continuous pressure from their investors and other stakeholders to come up with clear and measurable results not only in cutting down on their carbon footprint but also in managing their waste effectively. One of the simplest ways that packaging redesign can be used to communicate these goals is by making the changes visible and sizable.

Material innovation is helping a lot of the suppliers to be competitive with each other. Aluminum, recycled PET, and paper based composites are now marketed and presented as the real alternatives to virgin plastic. Besides, packaging suppliers that have the capacity to scale up their operations and are in line with the regulations are the ones that are getting long term supply contracts from beverage brands.

Besides that, packaging has become the key point of branding i.e., packaging as a brand differentiator is another noteworthy trend. In case of pristine mineral water and spritzers, where the impact of the customers purchase decisions is greatly derived from environmental credentials, sustainable packaging is used to leverage higher price positioning.

Despite the growth of sustainable packaging in beverages markets, key players in the market still face a lot of issues regarding the cost and infrastructure readiness. Not only do recycled materials tend to be more expensive, but they also usually rely on the local collection systems. It is well known that in emerging markets, recycling facilities are not fully functioning hence limiting the speed at which new solutions can be adopted. Changes in packaging will also require a significant amount of capital and will affect the supply chain.

Despite these challenges, sustainable packaging adoption is accelerating as environmental accountability becomes embedded in beverage procurement strategies.

Table of Contents

1. Introduction
2. Definition and Scope
3. Regulatory Drivers and Compliance Requirements
4. Packaging Material Innovation Trends
5. Supplier Expansion and Capacity Investments
6. Brand Sustainability Commitments
7. Cost and Infrastructure Constraints
8. Competitive Landscape Summary
9. Outlook and Strategic Opportunities

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