Identifying policy-level instruments required for a more sustainable plastic future

Authors: Katri Valkokari , Peter Ylen (VTT) & Rosa Ballardini and Juha Vesala (University of Lapland)

A transition towards renewable and circular plastic ecosystems is a systemic challenge. In this regard, there is an obvious need to find the appropriate bundle of policy measures, incentives and regulation instruments to enhance the transition to a sustainable and circular economy (CE) for plastics, as also pointed out in several EU policies packages, like the EU Green Deal and the European Strategy for Plastics in a Circular Economy.

In October 2020, the ValueBioMat project organised an interactive, exploratory workshop[1] with key stakeholders in order to shed light over the various possible incentives that could be helpful in driving stakeholders’ behaviour towards a more sustainable plastic future.  The challenge of determining the right bundle of instruments was approached especially from the meso level, that is, how to enhance sustainable innovations in ecosystems consisting of a variety of actors. Furthermore, in defining the purpose and structure of the workshop, it was acknowledged that a comprehensive perspective that considers the entire lifecycle of plastics from the raw materials, their use in production all the way up to consumption, repair and recycling is essential in order to ‘close the loop’ of plastics. From this perspective, the stages of financing, regulating and transferring the innovations were considered and discussed in the workshop by the presenters and participants.

Financing of innovations as means pf composing novel ecosystems

With their investment decisions, both public and private investors can direct research and development resources, as well as innovation activities, towards a more sustainable direction. As there are multiple categories of innovation relevant to the plastics innovation ecosystem (e.g., material development, production processes, business models, social innovations) it is important to identify the differences between these types of innovations when developing the funding instruments. Within innovation ecosystems, it was noted that the funding rules for public-private partnerships may include IPR management challenges related to who obtains the rights to developed innovations. This can hinder the commercialisation of bio-based plastic material inventions since industry partners are less willing to collaborate when they know that they will not receive exclusive rights to the inventions. Furthermore, since the development of pathways of systemic innovations in ecosystems are long, costly and capital intensive, in addition to pure funding, the attractiveness of strategic development agendas is also important.

Regulation of innovations as a tool to guide ecosystems’ impact paths

There are several different paths to reach a target impact – and when the vision and impact are not jointly agreed upon, there are numerous alternative futures as well. Via incentives provided through legal and policy instruments, innovation ecosystems can be guided towards certain, more desirable paths. For instance, in the context of more renewable and circular plastics innovations, these kinds of legal and policy incentives are needed to promote the use of bio-based raw materials and feedstocks. In this regard, a holistic and solid regulatory framework for what standards or criteria shall be considered while assessing the sustainability of products and materials (i.e., establishing clear and accountable thresholds), would help to select suitable raw materials as well as in planning the right production processes and end-of-life solutions for these bio-based plastic products. The challenge, however, lies in having to define the desired sustainability targets for plastics, and laying down incentive systems like taxes or subsidies for specific materials can lead to mismatches between the incentives provided and the actual environmental impacts. There is the need to increase transparency of the actual environmental impacts of bio-based plastic applications and their use.

Technology transfer and open innovation practices enable ecosystems to create new markets

The systemic sustainability transition in plastics involves multiple public and private organisations and actors across innovation ecosystems. Thus, transparent licensing and technology transfer practices are important for the diffusion and adoption of key technologies and innovations in the market. Regulation and policy can remove obstacles, create incentives and markets for transferring sustainable technologies. For example, novel licensing schemes may create business opportunities for actors in other value networks to use innovations developed in another value network. Furthermore, open innovation practices that enable sharing the results of co-innovation can enhance the dissemination and enable market shaping together.

Need for science-based information

Transition towards more sustainable plastics future emerge only through interactions among multiple actors, including businesses, users, scientific communities, policy makers, social movements and different interest groups. Understanding the key elements and mechanisms is a crucial starting point. Science-based evidence on different interdependencies can support the transition.

When developing the policies to promote the transfer of innovations, regulatory reviews, roadmaps, and impact assessment are useful in order to create a big picture of obstacles and drivers. Guidance is needed for both companies and authorities since the new technologies raise new regulatory issues and can result in inconsistent and uncertain outcomes when regulation is applied to them by different authorities (e.g., in different regions). Regulatory sandboxes and help desks could help companies to adopt new solutions by reducing regulatory uncertainty, whereas authorities would benefit from coordination and sharing of information in the application of regulation of new technologies.


[1] Interactive workshops are either exploratory (finding new systemic dependencies) or focused (testing, validating and disseminating focused hypotheses).  The ValueBioMat workshop was exploratory, so only a very abstract hypothesis of transition gained by multiple stakeholders, collaboratively enabling and driving the transition to a new ecosystem was formed. This high-level hypothesis was validated in the workshop and discussed in detail below.