KO Coca Cola Company

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By Dieter Holger

Coca-Cola Co. (KO) said Tuesday it had exited the Plastics Industry Association amid mounting scrutiny over the amount of plastic that food and beverage businesses produce.

The food and beverage giant told Dow Jones Newswires that it left the lobbying group earlier this year. Its statement follows a release from Greenpeace that said Coca-Cola and PepsiCo Inc. (PEP) intended to leave the association.

"We withdrew earlier this year as a result of positions the organization was taking that were not fully consistent with our commitments and goals," a Coca-Cola spokeswoman said.

PepsiCo didn't immediately respond to a request for comment.

The Plastics Industry Association has come under fire from environmentalists for lobbying to prevent plastic bag bans in the U.S. The American Progressive Bag Alliance, an arm of the group that advocates against the bans, argues that conventional plastic has the least environmental impact compared with other bags, requiring 70% less energy and 96% less water to make than paper bags, according to its website.

The Plastics Industry Association didn't immediately respond to a request for comment.

Coca-Cola's decision to exit the lobbying group comes as consumer goods companies are boosting their recycling efforts in the face of pressure from increasingly environmentally conscious consumers. Millennial consumers are especially concerned with how eco-friendly a product is, according to a survey by market intelligence firm Nielsen, which found 73% of millennials would pay more for sustainable products compared with 66% among all generations.

"Companies understand that they cannot publicly say they want to end plastic pollution, while financially supporting an association that lobbies for our continued reliance on throwaway plastics," said John Hocevar, Greenpeace USA Oceans campaign director.

Last year, Coca-Cola partnered with the Ellen MacArthur Foundation to reduce its consumption of plastic and disclosed the amount it used in packaging. Coca-Cola said it had a plastic packaging volume of around 3 million metric tons in 2017, the highest among the companies that disclosed.

Coca-Cola said it aims to reach 100% recyclable, reusable or compostable packaging by 2025 and that more than 87% of its packaging is already completely recyclable. The company has a target of 50% recycled material in all its packaging by 2030.

PepsiCo has said it planned to achieve 100% recyclable beverage containers and that it will use 25% recycled plastic by 2025. It didn't disclose how much of its current packaging is recylable. PepsiCo also partnered with the foundation to reduce its plastic consumption but didn't disclose its volume.

Write to Dieter Holger at dieter.holger@dowjones.com; @dieterholger

(END) Dow Jones Newswires

July 23, 2019 13:40 ET (17:40 GMT)

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