As plastic waste shoots up the political agenda, Morgan Stanley commits to 50m tonne target

How one leading investment institution is taking on the challenge

Click to sign up for a free, no-strings trial to Responsible Investor

The Council of the European Union has just adopted the Single-Use Plastics Directive and the UK government plans to introduce new controls on single use plastic items next year.

Plastic waste has shot up the political agenda, driven by environmental campaigners and high profile figures like broadcaster David Attenborough presenting harrowing images and videos that have really brought the issue into the open.

And plastics is also an increasing public health issue for humans with numerous reports warning of micro-plastics dominating the food and drink we consume. A 2018 study find Bisphenol A (BPA), a popular chemical used in plastic, had been found in 90% of teenage bodies.

Audrey Choi, Morgan Stanley’s Chief Sustainability Officer and CEO of the bank’s Institute for Sustainable Investing, cites this statistic when talking about the organisation’s commitment to prevent and remove at least 50m metric tons of plastic waste by 2030.

Choi says the issue is a personal, global, nuanced and systemic problem ranging from the formulation of plastic to recycling it after use.

While plastic can clearly be a pollutant, it still plays an important role in business, especially sustainable practices, such as reducing food waste.

The Morgan Stanley Plastic Waste Resolution is company-wide and will include seeking opportunities, creating products and engaging with companies.

Jessica Alsford, Head of Sustainability Research at Morgan Stanley, says the sectors most exposed to the issue of plastic pollution are petrochemical companies (which manufacture plastic) and consumer packaging goods companies.Divestment is unlikely, with Alsford saying “engagement is a powerful and important tool”. Topics of engagement will include chemical recycling solutions and reusable and recyclable packaging.

Other activities as part of the commitment will be Morgan Stanley Capital Markets underwriting bonds to reduce plastic waste and its institutional equities division exploring creating structured products. Its wealth management division will offer strategies on ocean conservation and its multicultural innovation lab will support early stage tech focused on plastic waste reduction.

The 2020 Kellogg-Morgan Stanley Sustainable Investing Challenge, a competition for students to design a financial product with social impact, will have an award for an innovative investment approach addressing plastic waste reduction. And Morgan Stanley will work with councils and public bodies to finance improvements to plastic waste management.

Choi admits the firm hasn’t figured it all out yet. It is currently working with the University of Michigan’s School for Environment and Sustainability to research how capital markets can tackle the plastic waste issue, and how the bank itself can measure its commitment.

It grows a growing list of investors putting serious resource behind the issue of the plastic pollution problem highlighted by RI earlier this year.

At the RI Europe Gala Dinner 2019 Natalie Fee, an award-winning environmental campaigner, will speak about her work to stop plastic pollution at source.