The Case of Fast Moving Consumer Goods

This is the fifth piece of a collection of articles written for Bare Necessities- Zero Waste India dedicated to discussing plastic bans in India, all relating to the plastic announcement that was expected to be made on October 2nd 2019. The collection aims to discuss the enforcement of policies, design and innovation of new ideas and important steps that have already taken place that will assist in transitioning the country toward a new, more sustainable system along with other areas that will be expanded upon on a weekly basis.

The United Nations Environment Programme suggests that “bans will be effective only if there’s a concerted effort by the policy makers and the public at large” (source). Significantly this effect at changing a systemic culture of using Fast Moving Consumer Goods (FMCG) that contains or is wrapped, stored, housed etc. in plastic, will be one of the toughest changes to make due to the reach of FMCG and the size of the companies that benefit from the sale of these products. Without concerted efforts from policy makers and consumers at large, there is a potential that continual Greenwashing- a term to convey a false impression that a company or its products are more environmentally friendly than they actually are (source)- may continue.

The FMCG sector is the “4th largest sector in the Indian economy with Household and Personal Care accounting for 50 percent of FMCG sales in India” (source). Although it could be suspected that the largest contributor to FMCG would be found in the growing urban sectors, particularly those cities that produce almost half the waste in India, Delhi, Mumbai, Kolkata, Chennai and Bangalore (source), the rural sector of India accounts for a larger revenue country wide of 55% (source). However, this also highlights that with only mid 30% of India’s population living in urban sectors that the reliance and popularity of FMCG is growing considering it accounts for 45% of the market. This growth in popularity has mirrored the growth in production, consumption and waste in Indian society.

The increase has notably been “led by a combination of increasing incomes and higher aspirational levels (with an) increased demand for branded products” (source). In addition, research has found that the unorganised FMCG market share is also falling replaced with organised sector growth due to brand consciousness, in part promoted by growth in retail chains promoting less diversified range of brands (source). 

This narrowing of brands presents both an opportunity and a warning to the move away from plastic. If, for example, the large brands accept the changes and commit to reducing plastics in their overall operations, a large part of the market will change. This is especially true if it includes packaging by e- commerce giants such as Amazon. Yet, it also holds the potential of large brands greenwashing to achieve goals if they are not held accountable by policy makers and consumers.

Currently there are no “specific globally applicable standards for preventing and curbing greenwashing practices… In the absence of any such regulations, the practice of greenwashing is growing exponentially and this trend if continued will gradually undermine the trust of consumers” (source). This situation illustrates that if the large FMCG retailers do not choose to follow more sustainable practices relating to plastic use and environmental behaviours a move away from plastic can still be dictated by consumers. Such an important point could have been leveraged off the October 2nd announcement by the Indian government (that did not occur in any formal capacity). By this, simply put, consumers and policy makers are able to keep large FMCG companies to standard providing that there is a country wide- both rural and urban- transition away from a desire to use FMCG that contain damaging materials.

With areas such as the “online FMCG market (forecast) to reach US$ 45 billion in 2020 from US$ 20 billion in 2017” (source) there is a pressing need to move toward a transparent situation where consumers and policy makers hold businesses into account by knowing how they are operating and what materials they are using. Without this there will be room for larger companies who have a monopoly on the market to work around an implemented system. Yet, with it there is opportunity and that, at this time in history, is what consumers and policy makers need.