INC-5.2 Geneva negotiations end without a plastics treaty: what businesses need to know
After two weeks of negotiations in Geneva, INC-5.2 closed without agreement on a consolidated treaty text. Delegates left with only a “reflection note” from the co-chairs and no clarity on whether or when a continuation (INC-5.3) will be convened. The original ambition to finalise a global treaty on plastic pollution by the end of 2025 is now uncertain.
For business and finance, the temptation might be to pause until governments decide their next steps. But waiting is a mistake. The absence of a treaty does not mean the absence of risk.
Plastic treaty delay does not reduce business and financial risks
Plastic pollution is already reshaping the business environment. Regulation, litigation, and consumer expectations are moving faster than multilateral politics. What Geneva failed to deliver is being decided in courtrooms, parliaments, and markets across the world.
For companies, this means exposure is growing, not receding. For financiers, it means portfolios face mounting liabilities, from reputational damage to stranded assets.
Key plastic pollution risks for companies, investors and financiers
Plastic pollution translates into a spectrum of risks that are increasingly material to balance sheets.
Regulatory pressure is mounting as countries introduce bans on single-use plastics, virgin plastic taxes, and higher Extended Producer Responsibility (EPR) fees. Litigation is accelerating, with cases already brought against companies like Danone, Coca-Cola, and ExxonMobil. Corporate liabilities are projected to exceed USD 20 billion by 2030. Reputational risk is rising as NGOs and consumers demand credible action. Market and technology risks are forcing companies to invest in alternatives and redesign products. Physical and systemic risks are emerging as microplastics are detected in human lungs, placenta, and bloodstream, with growing evidence of health and ecosystem costs.
The cost of plastics pollution – especially microplastics – can be valued through several lenses, but the conclusion is the same: it already imposes a material and quantifiable cost on businesses and society. WWF estimates the lifetime societal cost for plastic produced in 2019 at about US$3.7 trillion, and the marine plastic alone imposed up to US$19 billion in 2018, through its influence on tourism, fishing, aquaculture, plus the clean-up costs. These effects constitute material risks to businesses, both in terms of their own sustainability and a reputational risk associated with plastic leakage across their whole life-cycle.
Why plastic risks differ from climate risks and what this means for business
Climate and plastic pollution share urgency, but they differ in how responsibility and impact can be traced. Greenhouse gases are fungible: one tonne of CO₂ looks the same no matter where it comes from. Plastics are not.
Each product leaves a distinct fingerprint. Textiles shed microfibres into rivers. Tires release dust on roads. Packaging polymers leak from landfills into waterways. Because these pathways are specific and traceable, accountability is easier to assign and liabilities easier to calculate.
But it goes beyond traceability. Impacts themselves vary widely. Some polymers contain additives that are more hazardous to health and ecosystems than others. Microplastics can have disproportionately higher impacts per volume than macroplastics. Leakage in different environments leads to very different levels of harm.
For companies and financiers, this means understanding impacts is essential. Without that knowledge, it is impossible to prioritise action effectively or to demonstrate credible progress. Those that do map and act on their product- and polymer-specific risks will be better placed to manage liabilities and capture opportunities.
How finance is driving accountability on plastic pollution
While most investors are not yet systematically pricing plastic exposure, momentum is shifting fast. Over 160 financial institutions, representing USD 15.5 trillion, have signed the Finance Statement on Plastic Pollution. CDP has opened a plastics disclosure platform at the request of investors managing USD 136 trillion. The EU Taxonomy and CSRD are embedding plastics criteria directly into compliance frameworks.
For finance, the direction is clear. Companies with high exposure and poor disclosure will face downgrades, higher financing costs, and shrinking access to capital. Companies that disclose, innovate, and transition will be rewarded with preferential financing, access to green bonds, and investor trust.
From a business value standpoint, lower borrowing costs and avoidance of penalties or fines create a clear incentive for investment and innovation centred around plastic leakage mitigation. Policy incentives can also drive action. For instance, in the UK and France, linking recycled content or recyclability directly to avoided costs of production shows how regulation translates into tangible business value: in the UK, including at least 30% recycled material in plastic products avoids roughly USD300 per tonne in taxation. (The safety of recycled content integration is a separate issue, as it often requires additional additives, and health-related externalities are expected to be included in future assessments.) Equally, when it comes to leakage reduction, which is not yet consistently incentivised, similar mechanisms could deliver both avoided liabilities and bottom-line savings once regulations or disclosure frameworks expand to cover this dimension.
Turning plastic risks into business opportunities and access to capital
The same dynamics that create exposure also create advantage. Companies that move early can reduce compliance costs, protect their reputation, and open new revenue streams. Reuse systems, recycled content, and product redesign are becoming competitive differentiators.
Finance is not just a risk detector but a potential enabler. Outcome-based financing, circular economy funds, and transition bonds are already directing capital to leaders. Tools such as the Plastic Footprint Network and Plasteax, combined with emerging methodologies to monetise impacts, now allow risks and opportunities to be quantified with increasing precision.
A practical demonstration of this approach can be seen in a recent case by Valuing Impact, who was tasked with developing a water stewardship strategy for a multinational apparel business, encompassing its entire value chain. Whereas previously the focus was on water scarcity and chemical contamination, the topic of microplastics is now an integral part of water stewardship strategies. It deployed the eQALY impact valuation method, together with the data from the Plastic Footprint Network, to measure the value to society in monetary terms, beyond the volume leaked. The analysis quantified plastic leakages at various stages of the business’s value chain, including packaging, textile microfibers, pellet loss, and tire wear. Through eQALY, these leakages were then translated into concrete health and ecosystem impacts, ultimately resulting in a monetary cost for society. The results showed that almost one quarter of the company’s water-related environmental impact and risks were directly attributable to plastic pollution — highlighting how central this issue was to its overall risk and mitigation strategy development.
Based on this understanding, solutions can be proposed to reduce risk through innovation and supply chain management, with the goal of minimizing leakage. And because eQALY expresses impacts in terms of societal costs, it makes clear how these externalities can become corporate liabilities — whether through regulation, litigation, or reputational loss. At the same time, acting on them can create ripple effects for business value: operational savings, reduced exposure, and gains in brand reputation and engagement.
Plastic treaty delays: why companies and investors must act now
Geneva may not have delivered a treaty, but the financial case for action is already here. Risks are real, quantifiable, and growing. Political delays do not change the fact that plastic pollution is costing businesses, societies, and ecosystems today.
For brand owners, industry leaders, and financiers, the choice is simple: act now to measure, disclose, and reduce plastic risk, or wait and face the costs later.
Those who lead today will not only mitigate exposure, they will differentiate, attract capital, and build resilience in tomorrow’s circular economy.
