At Grounded, we are committed to leading the way in sustainable packaging solutions. The Australian Packaging Covenant Organisation's (APCO) 2030 Strategic Plan, released in 2024, marks a critical shift in how Australia addresses the environmental impact of packaging.
‍

This plan outlines not just ambitious targets but the necessary systemic changes needed across the packaging value chain. Understanding its goals and strategies is crucial for businesses wanting to future-proof their packaging practices and contribute meaningfully to a circular economy.

‍

Understanding APCO's Role and Mission

The Australian Packaging Covenant Organisation (APCO) is a not-for-profit, co-regulatory body that works with government and industry to reduce the environmental impacts of packaging. APCO's mission is to ensure packaging is designed for reuse, recycling, and recovery, and that businesses take collective responsibility for its end-of-life impact.

Since its inception, APCO has been instrumental in setting the National Packaging Targets, which act as critical benchmarks that guide Australia's transition to a circular packaging economy.

Until now, compliance with these targets has largely relied on voluntary participation through APCO membership. However, this is about to change.

Starting in 2026, new National Packaging Regulations will make it mandatory for businesses to meet these targets. These regulations will transform APCO’s role from an advisory and compliance partner into a key enforcement mechanism, requiring businesses to report data, design packaging for recovery, and meet strict sustainability benchmarks.

For brands, this means aligning with APCO guidelines is no longer optional. Businesses will need to adopt circular design principles, integrate recycled materials, and prepare for regulatory scrutiny to remain compliant and competitive in the Australian market.

‍

Why Change Was Necessary

Despite significant efforts, Australia has not made enough progress toward meeting the 2025 National Packaging Targets. A 2022 review found the major barriers are economic. From the high costs of recycling to inadequate collection systems and limited reprocessing infrastructure. Simply put, the market incentives to recycle or recover packaging materials have not been strong enoughIn response, Environment Ministers directed APCO to develop a more ambitious strategy. The result is a plan that recognises business-as-usual is no longer an option. It calls for urgent, coordinated action across the entire packaging system.

‍

Key Goals and Targets of the 2030 Plan

APCO's 2030 plan sharpens the focus on two overarching goals:

• Optimising resource recovery of packaging
• Preventing the impacts of litter
  ‍

These goals are supported by the existing National Packaging Targets, established in 2018:

• 100% of packaging to be reusable, recyclable, or compostable
• 70% of plastic packaging to be recycled or composted
• 50% average recycled content across all packaging
• Phase-out of problematic and unnecessary single-use plastic packaging

APCO’s new approach outlines six strategic outcomes to achieve these targets and goals, including redesigning packaging for recovery, strengthening recovery systems, driving demand for recycled materials, and embedding financial mechanisms that close economic gaps.

‍

Eco-Modulation: A Game-Changer for Packaging Design

A key innovation in the 2030 Plan is the introduction of eco-modulation. Under this system, member fees will be linked to the environmental impact of packaging. This will reward businesses that design for sustainability and place higher costs on packaging that is difficult to recycle or recover.

For businesses, this means:

• Designing smarter: Reducing material use, enhancing recyclability, and incorporating recycled content will deliver direct financial benefits.
• Equitable cost distribution: Companies will pay fees based on their actual impact rather than a flat turnover-based system.
• Greater market incentives: Packaging that supports a circular economy will become more commercially attractive.

This model mirrors international best practices and encourages innovation across the supply chain.

‍

Materials Targeted for Transformation

The 2030 Plan prioritises improving recovery rates across all packaging materials, with a particular focus on:

• Plastics: especially flexible plastics, which currently have very low recycling rates.
• Paper and cardboard, glass, and metals: all materials that still see significant volumes going to landfill despite having established recycling systems.

Notably, APCO projects that achieving the 70% recycling target for plastics would require an additional 620,000 tonnes of plastic packaging to be reprocessed annually. While this remains the National Packaging Target, APCO anticipates a more practical recycling outcome of 55% for total plastic packaging by 2030, given current economic and infrastructure barriers. This will demand new infrastructure, investment, and consumer engagement.

‍

Transforming Waste Management and Recycling Industries

The APCO plan recognises that real transformation cannot occur without systemic change. Over the next six years, the plan will drive:

• Significant investments in new collection, sorting, and reprocessing infrastructure.
• New service contracts funded by APCO to close economic gaps and support recycling pathways.
• Enhanced collaboration between brand owners, recyclers, and governments.

This will create growth opportunities for Australia's recycling sector while also shifting business expectations: brand owners will be more directly accountable for the end-of-life management of their packaging.

‍

How FMCG Brands Must Adapt to Regulations

The APCO 2030 Strategic Plan will transform how FMCG (Fast-Moving Consumer Goods) brands design and bring packaging to market over the next decade.

APCO’s role is evolving from providing voluntary guidelines to implementing an economic framework driven by eco-modulation.

This shift means FMCG businesses will no longer rely on good intentions alone, they will face both regulatory requirements and financial incentives to transition to more sustainable packaging solutions.

Key impacts for FMCG packaging include:

• Mandated Design for Recovery: FMCG brands will need to ensure that their packaging is designed from the outset to be reusable, recyclable, or compostable. Packaging formats that do not meet recyclability or compostability criteria will be phased out or become cost-prohibitive.
  ‍
• Shift Towards Monomaterials: While not explicitly stated as "monomaterials," the plan incentivizes design for recovery, which often favors simpler material compositions to improve recyclability. Complex, multi-layer packaging materials will likely be penalized through eco-modulation.
  ‍
• Higher Recycled Content Requirements: To meet recycled content targets, FMCG brands will need to integrate recycled materials across all packaging types, including primary, secondary, and tertiary packaging. This shift will drive innovation in material science and sourcing strategies.
  ‍
• Elimination of Problematic Materials: Materials that are difficult to recover, contain hazardous substances, or contribute to litter will need to be eliminated or replaced with approved alternatives.
  ‍
• Adoption of Reuse Models: FMCG brands may be encouraged, and increasingly expected, to introduce reusable packaging systems where practical, particularly for business-to-business logistics and select consumer-facing applications.
  ‍
• Clearer Labelling Requirements: Brands will need to utilise validated labelling systems, such as the Australasian Recycling Label (ARL), to provide consumers with transparent, accurate information on how to correctly dispose of packaging.

‍

What This Means for Forward-Thinking Businesses

For Grounded's customers, the APCO 2030 Strategic Plan is both a call to action and an opportunity:

• Businesses that are already investing in sustainable, recyclable, and compostable packaging will be well-positioned.
• Transparency, circular design, and material innovation will become not just good practice but regulatory expectations.
• Working with partners like Grounded who prioritise compliance with APCO guidelines, eco-modulation principles, and sustainable design will provide a competitive advantage.

Compliance with APCO's future frameworks will no longer be optional or peripheral. FMCG brands will need to embed circular economy principles directly into their packaging development processes, supply chains, and marketing strategies.

At Grounded, we see this evolution as a positive step. It will help raise the bar across the industry, drive real environmental outcomes, and ensure that businesses committed to sustainability are rewarded for leading the way.

We are committed to supporting our clients through this transition, providing data-driven insights, certified sustainable materials, and expert guidance on how to future-proof packaging solutions.

The path to 2030 may be challenging, but with the right partnerships and commitment to innovation, it represents an unprecedented opportunity to create lasting positive change for Australia's packaging landscape.

Ready to future-proof your packaging? Contact us today to start your transition.

‍