How do ESG ratings actually work for food packaging companies?
ESG ratings for food packaging companies work by measuring a company’s performance across environmental, social, and governance criteria using data drawn from sustainability disclosures, third-party certifications, and regulatory filings. For packaging companies specifically, the environmental pillar carries the most weight, with material choices, plastic reduction, and recyclability all feeding directly into how rating agencies score packaging-related risk. The sections below unpack each dimension of how these ratings are built, who produces them, and what they mean for procurement and reporting.
What factors determine an ESG score for a packaging company?
An ESG score for a packaging company is determined by how well the company manages environmental risks such as material waste and carbon intensity, social factors including labor standards and supply chain ethics, and governance elements such as board structure and transparency. For food packaging companies specifically, the environmental pillar typically carries the greatest weight, and packaging material choices sit at the center of it.
Rating agencies generally draw from three types of input: company-provided data such as sustainability reports and environmental impact assessments, external sources including regulatory filings and NGO databases, and independent certifications such as FSC or ISO 14001. The presence of credible third-party certification can positively influence scores because it provides evidence that a company’s claims have been externally verified rather than self-reported.
For food and packaging companies, MSCI evaluates a dedicated “Packaging Material and Waste” key issue that scores companies on their plastic packaging use intensity, their reliance on plastic as a material, and their exposure to packaging waste regulation. This means a company that has structurally reduced its plastic content, not just through voluntary pledges but through product design, will score differently from one that relies heavily on fossil-based rigid plastic.
One practical challenge is that ESG goals are now directly driving how companies reassess packaging design and operational processes. Quantifying environmental impact in a credible, reportable way is no longer a communications exercise; it is a scoring input. Fiber-based packaging, for example, simplifies ESG reporting because material tracking and impact analysis are more straightforward compared to multi-layer plastic structures. This is part of why the shift toward fiber-based formats is increasingly understood as a strategic ESG response, not just an aesthetic one.
Which ESG rating agencies evaluate food packaging companies?
The main ESG rating agencies that evaluate food packaging companies are MSCI ESG Ratings, Morningstar Sustainalytics, EcoVadis, CDP (Carbon Disclosure Project), S&P Global ESG, and ISS ESG. Each agency answers a different question and serves a different primary audience, so food packaging companies often engage with more than one simultaneously.
Investor-facing agencies: MSCI, Sustainalytics, and S&P Global
MSCI and ISS ESG measure how well a company manages ESG risks relative to industry peers, assigning letter grades from AAA to CCC. Sustainalytics, a Morningstar company, takes a risk-focused approach, scoring companies on their exposure to ESG risks and the degree to which those risks remain unmanaged. S&P Global ESG is widely used in sustainable finance and index construction. These three agencies are primarily used by institutional investors and capital markets when evaluating a company’s long-term risk profile.
Supply chain and procurement agencies: EcoVadis and CDP
EcoVadis is the dominant tool when a customer or procurement team asks a supplier to demonstrate ESG performance. It evaluates companies across four themes: Environment, Labor and Human Rights, Ethics, and Sustainable Procurement, using a 0 to 100 scale with medal tiers from Bronze through Platinum. CDP focuses on environmental disclosure, particularly climate, water, and forests, and is essential for companies that want to demonstrate transparency on emissions. For a food packaging supplier being vetted by a major food brand, an EcoVadis rating is often the first document requested.
An important nuance is that these agencies do not agree with each other as much as users might expect. MIT Sloan research has confirmed that the average correlation between prominent ESG rating agencies is around 0.61, compared to near-perfect correlation among mainstream credit ratings. Differences in what each agency measures, how it weights categories, and what data it includes account for the bulk of this divergence. This means a company can hold a strong EcoVadis score and a mid-range Sustainalytics risk rating simultaneously, and both can be accurate within their respective frameworks.
How does packaging material choice affect ESG ratings?
Packaging material choice affects ESG ratings directly because material selection determines a company’s carbon intensity, recyclability profile, regulatory exposure, and alignment with circular economy principles. A company that uses fiber-based packaging instead of rigid plastic will score differently on the environmental pillar of most ESG frameworks because the underlying material metrics are structurally different.
The core reason is that fiber-based packaging is produced from renewable raw materials, carries higher end-of-life recycling rates in existing infrastructure, and avoids the fossil-fuel inputs associated with virgin plastic production. Cardboard recycling infrastructure is mature across Europe, and recycling rates for paper and cardboard packaging have historically been significantly higher than for plastic packaging. This matters to ESG rating agencies because recyclability at scale is a measurable, verifiable outcome rather than a directional claim.
Material choice also determines regulatory risk exposure, which feeds into ESG scores. Under the EU’s Packaging and Packaging Waste Regulation (PPWR), which applies from August 2026, plastic packaging above a minimum plastic content threshold will face mandatory post-consumer recyclate targets from 2030 onwards. A packaging company whose products are primarily fiber-based with minimal plastic content faces structurally lower compliance risk under these rules. Rating agencies that model regulatory exposure will reflect this difference in their scores.
We at Jospak have built our fiber-based tray around exactly this logic. Our cardboard tray uses at least 85% less plastic than a comparable rigid plastic tray, and the design allows the cardboard shell and the thin barrier film to be separated, making the tray recyclable in existing cardboard collection systems across markets including Finland, Sweden, Germany, and Poland. This material architecture directly supports the recyclability and plastic reduction metrics that ESG frameworks measure. Selecting materials aligned with future regulation is no longer just an operational decision; it is a strategic ESG input.
What certifications improve a food packaging company’s ESG standing?
Certifications that most reliably improve a food packaging company’s ESG standing include FSC (Forest Stewardship Council) chain of custody certification, BRCGS Packaging Materials certification, ISO 14001 environmental management certification, and EcoVadis itself, which functions as both an assessment and a credentialing signal. Each certification addresses a different risk area and is weighted differently depending on which rating agency is reviewing the company.
FSC certification verifies that the fiber content of a product has passed through a verified chain of custody from responsibly managed forests. For rating agencies evaluating biodiversity risk and responsible sourcing, FSC provides independently audited evidence that a company’s raw material claims are accurate. Beyond forest management, FSC certification also signals a preference for renewable raw materials over fossil-based alternatives, which aligns with the environmental pillar of most ESG frameworks.
BRCGS Packaging Materials certification verifies that manufacturing processes meet food safety, quality, and integrity standards benchmarked against the Global Food Safety Initiative (GFSI). While BRCGS is primarily a food safety credential, it demonstrates operational rigor and governance discipline, both of which feed into ESG assessments. For EcoVadis specifically, evidence of certified management systems is a requirement for higher medal tiers; a policy statement without a certificate or audit record contributes little to the score.
We hold both FSC CoC certification and BRCGS Packaging certification at AA+ grade, the highest possible result for that standard. These two certifications together cover two independent audit frameworks: responsible fiber sourcing and manufacturing quality. For customers or procurement teams conducting ESG due diligence on a packaging supplier, holding both provides verified evidence across different risk categories rather than relying on a single credential.
Post-consumer recycled content certifications, such as the Global Recycled Standard or ISCC PLUS, are increasingly important as PPWR’s recycled content targets approach. Only post-consumer recyclate counts toward PPWR compliance targets, so a certification that covers pre-consumer or post-industrial content alone will not satisfy buyer requirements under the regulation.
How do food brands use supplier ESG ratings in procurement decisions?
Food brands use supplier ESG ratings in procurement decisions as both a compliance tool and a risk filter. Brands subject to EU sustainability reporting requirements need measurable, reportable ESG data from their supply chains, including from packaging suppliers. A supplier with a verified ESG rating or relevant certifications can provide that data; a supplier without them creates a reporting gap that the brand must explain to investors or regulators.
The mechanism is straightforward: food companies subject to the EU’s Corporate Sustainability Reporting Directive (CSRD) must disclose Scope 3 indirect emissions, which include emissions from packaging materials. This means packaging suppliers contribute to a food brand’s reported carbon footprint. Brands collecting Scope 3 data from their supply chains increasingly do so through EcoVadis assessments or structured supplier questionnaires, and a supplier’s score or certification status directly affects the quality of data the brand can report.
Beyond emissions data, major retailers are increasingly making sustainable packaging credentials a condition of supplier listing. Sustainable packaging procurement has shifted from a preference to a compliance requirement in many categories, driven by both retailer sustainability commitments and regulatory pressure under PPWR. Suppliers that can demonstrate recyclability, low plastic content, and verified responsible sourcing are better positioned in tender processes than those relying on unverified marketing claims.
The practical tool most commonly used at the procurement stage is EcoVadis. When a food brand’s sustainability team asks a packaging supplier to demonstrate ESG performance, EcoVadis is typically the platform through which that request is made. Investor-facing ratings from MSCI or Sustainalytics become relevant when the food brand itself is being scrutinized by capital markets, and it needs to demonstrate that its supply chain meets the standards its own ESG disclosures imply.
What’s the difference between ESG reporting and ESG ratings?
ESG reporting is a company’s own disclosure of how it performs on environmental, social, and governance topics. ESG ratings are an independent assessment of that performance, produced by a specialized agency using the company’s disclosures alongside other data sources. Reporting is an input; a rating is an output. A company controls what it reports but does not control how a rating agency interprets or scores it.
The distinction matters practically because the two serve different audiences. ESG reports are consumed by a wide range of stakeholders, including customers, employees, investors, and regulators. ESG ratings, on the other hand, are used primarily by investors and procurement teams who need to compare companies against each other using a standardized scale. A strong sustainability report does not automatically produce a strong ESG rating, because different agencies apply different methodologies, weightings, and data sources to the same disclosed information.
Mandatory ESG disclosure is now a legal requirement for many companies. Under the EU’s Corporate Sustainability Reporting Directive (CSRD), as revised under the Omnibus simplification package, companies with more than 1,000 employees and net annual turnover above €450 million must report against the European Sustainability Reporting Standards (ESRS). These standards include ESRS E1 for climate and emissions, which requires Scope 3 disclosure, and ESRS E5 for circular economy, which covers packaging recyclability, material composition, and resource use. For companies still in CSRD scope, these disclosures are legally binding, not voluntary.
The connection between reporting and ratings is that high-quality, structured disclosure improves a company’s ability to influence its own ESG scores. Sustainalytics research has found that companies which do not report Scope 3 emissions at all receive worse risk ratings than those that report fully, because undisclosed risk is treated as unmanaged risk. CSRD-aligned reporting, because it follows a structured and auditable format, delivers data that rating agencies can use directly across multiple scoring categories. Companies that invest in rigorous reporting are, in effect, also investing in the quality of their future ESG ratings.
