2025 was supposed to be a milestone year for packaging sustainability. Brands in consumer goods, beauty, food, and beverage set ambitious targets for recyclable packaging and reductions in virgin plastic use. As those deadlines arrived, the results were humbling for much of the industry.

L’Oréal fell short of its commitment for both recyclable packaging and recycled or bio-based material content. PepsiCo acknowledged it would miss its goal to make 100% of its plastic packaging recoverable or reusable. Kenvue, the parent company of Neutrogena and Band-Aid, missed its target of making all packaging recyclable or refillable by 2025, achieving 67.1% against a goal of 100%. Target conceded it wouldn’t close the significant gap between the 34% recyclable packaging it achieved and its 100% goal. Coca-Cola pushed its packaging sustainability targets out to 2035 entirely.

The pattern is consistent enough to warrant a harder look at why. These are large companies with resources and sustainability teams working on these problems. A key challenge is that ambitious packaging goals have outpaced the infrastructure needed to make them achievable at scale.

When Ambition Meets Reality

The difference between design intent and real-world outcome is one of the central challenges in packaging sustainability right now. Among companies tracked by the Ellen MacArthur Foundation’s (EMF) Global Commitment, the share of reusable, recyclable, or compostable packaging increased from 36% in 2021 to 54% in 2024. Recycled content, which depends on what actually gets collected and processed, rose from just 8% to 14% over the same period. While manufacturers are advancing design, the recovery side isn’t keeping pace.

It’s an infrastructure problem. Collection systems vary dramatically by region. A package designed to be recycled in one market may have no viable recovery pathway in another. Multi-layer and mixed-material packaging structures are difficult to sort and process mechanically, and many plastics look identical to sorting equipment despite having different chemical compositions. When virgin plastic prices drop, recycled material becomes comparatively expensive. Consumer participation also fluctuates based on convenience and access.

Together, these factors create a system where recyclable packaging doesn’t make it to the recycling center. In other words, designing a package to be recyclable is only the first step. Without effective collection, sorting, processing, and end-market demand, recyclability on paper doesn’t always translate into circularity in practice.

The 2025 reporting cycle has prompted many companies to reassess what’s realistically achievable. Companies recognize that they set targets without sufficiently accounting for the infrastructure required to achieve them. They’re going back to the drawing board and building more credible commitments going forward.

Where Progress Is Still Being Made

Despite missed targets, real progress is underway, with collaboration being central to many renewed commitments. 

After falling short of its 2025 goals, L’Oréal has continued to work toward more achievable 2030 commitments. In partnership with Closed Loop Partners, alongside Kraft Heinz, Target, and P&G, they’re retrofitting recycling facilities so they can process small-format rigid plastics. These are common in beauty and personal care packaging and most curbside recycling programs currently can’t handle them. They’re investing in infrastructure, which is precisely what the data says is missing.

Packaging manufacturers are building their own collaborative infrastructure. This systems approach is also reflected in Plastic Reimagined, ALPLA’s educational initiative, which highlights the infrastructure investments, innovations, and cross-sector collaboration needed to advance a more circular plastics economy.

ALPLA’s closed-loop recycling project in Thailand, developed in partnership with recycler ENVICCO and local brand customers, creates a fully operational loop for high-density polyethylene (HDPE) bottles. They’re collected, processed into post-consumer recyclate, and used to manufacture new packaging that re-enters the market. At its Mansfield facility in the United Kingdom, a separate internal initiative recovers plastic from defective closures that previously went to incineration, returning more than 30 tonnes of material to production since early 2024. Both projects demonstrate that closed-loop outcomes depend on relationships across the value chain.

At the regulatory level, Extended Producer Responsibility (EPR) laws are now active in seven U.S. states. They create the financial accountability structures that make collection infrastructure investment viable over the long term. Technologies like near-infrared sensors and artificial intelligence (AI)-assisted systems are improving the accuracy and volume of what can be recovered from the stream. Chemical recycling is opening pathways for multi-layer and contaminated formats that mechanical recycling can’t reach.

Progress Looks Different Than Expected, But It’s Still Progress

While it’s disheartening to fall short of sustainability goals, there’s solid momentum around addressing the obstacles in the way. Infrastructure and sortation technology keep improving, while regulation is incentivizing circular packaging choices. Brands, manufacturers, retailers, and recovery organizations are beginning to build the shared infrastructure that no single actor could create on their own.

What the 2025 results clarify is that solving the packaging sustainability challenge requires confronting the full system of collection, sorting, consumer behavior, and economics. Recyclable packaging is just part of the equation. A package can be recyclable on paper and still fail in the real world. Closing that gap is the work of the next decade. Above all else, it depends on collaboration and infrastructure.

Contaminated collection streams, inadequate sortation infrastructure, and the economic volatility of recycled material markets affect every brand, manufacturer, and retailer that has made a sustainability commitment. These challenges aren’t proprietary, so the solutions can’t be either. 

Transparency is what makes that collaboration possible. When companies publish honest progress data, including the targets they missed and the reasons why, they give the rest of the industry something to learn from. The 2025 reckoning, uncomfortable as it was, produced more useful information about the real barriers to circularity than a decade of optimistic forecasts. That information, shared openly, is what enables better target-setting and the kind of systemic solutions that the scale of the problem demands.