The Alliance to End Plastic Waste and Lombard Odier Investment Managers have announced their intention to launch a new Plastic Circularity strategy. The idea behind the strategy is to raise US$500 million from institutional and other accredited investors for scalable solutions - funds that could be used to remove plastic waste from the environment, increase recycling, and drive the global transition towards a circular economy for the plastic value chain.
The Alliance will serve as a cornerstone investor in the strategy. The Alliance selected LOIM as its partner to build and manage the strategy following an extensive and competitive tender. Both see positioning plastic waste as an investible as a means to generate positive environmental, social, and economic impact together with attractive financial returns.
There is tremendous opportunity for turning plastic waste into a resource, as well as driving economies of scale and economic returns. According to industry estimates, the transition to a circular value chain for plastic packaging represents a potential US$1 trillion global economic opportunity by 2030.
The strategy represents a compelling investment opportunity for clients, according to Jean-Pascal Porcherot, Co-Head of LOIM and Managing Partner of Lombard Odier Group, as it is focussed on opportunities across all segments of the private equity spectrum.
The strategy will target key themes which can directly contribute to a circular economy for plastic and accelerate opportunities in overall waste management (both upstream and downstream) —including collection and sorting infrastructure, technology-enabled recycling infrastructure, design solutions for improved plastic durability, reuse and recyclability. It also aims to drive innovation in plastic chemistry and production which can simplify or make end of life treatment easier or more effective.
The Alliance will act as technical adviser to the strategy via a team of experienced professionals who will provide industry-led expert advice on the technical feasibility, commercial viability and scalability of plastic circularity solutions, as well as waste management technology and infrastructure.
The obstacles to recycling are well known. Only 9% of the world’s plastic is recycled; most of it ends up in incineration, open dump sites, landfill or enters the environment as plastic waste.
“Our goal in launching this strategy with Lombard Odier is to grow investments in solutions that can help end plastic waste and contribute to a circular economy,” said Jacob Duer, President and CEO of the Alliance.
“This strategy presents a meaningful opportunity to put the plastic waste management ecosystem firmly on the agendas of institutional investors to accelerate the plastic circular economy globally,” added Jim Fitterling, Chairman and CEO of Dow and Alliance Chair.