A closer look at the climate strategy

Will we have to say goodbye to some products in favor of climate goals? If so, which?

Birk: That’s a difficult question. Let's take, for example, the comparison between hotfill and aseptic lines. In my eyes everything speaks in favor of the aseptic system: It consumes less energy, and I can use it to fill bottles that are lighter and made of rPET. So why should we offer hotfill at all? With the aseptic system, we have an alternative that is better in every respect. Even so, what do we do with customers who – for whatever reason – don’t want to or are unable to switch over to an aseptic system? Do we send them to our competitors, to a solution that will inevitably be less sustainable than ours? 

Herbst: Our aspiration is to supply the most sustainable solutions in the beverage industry, so it wouldn’t help anybody if a customer were to look for a less sustainable solution from a competitor rather than a Krones solution. At the end of the day, there is hardly any solution that would be bad or unsustainable per se. Often there are very good reasons for using a solution that on paper is less sustainable. Hygiene and operability especially often have an important role to play here. A continuously operated line producing higher CO₂ emissions can be more sustainable than the lowest-emission solution that constantly breaks down or causes too many faults. We want to enable not only sustainable but also affordable beverages for everyone everywhere – and that, too, is part of our vision.

Fischer: For me, it’s clear that we need to actively manage our portfolio. The argument that “it’s what the customer wants” doesn’t cut it for me. Our new technologies need to be so persuasive that customers use them to achieve their own sustainability goals. If we were now to start making our current PET line fit for hotfilling, that would be an investment in the past. Even just on the basis of the low number of pieces that we sell in the hotfilling segment in the first place. For most customers aseptic is the technology of choice. If we spend millions on developing a worse alternative, we will be sending absolutely the wrong signal to the market. 

How great is the pressure on Research and Development in this regard?

Birk: Very great, I put pressure on them almost every day (laughs). Seriously, though, the enviro sustainability program has been a fixed part of our product creation process since as far back as 2008, and it's now part of our developers’ DNA. It's incredibly enjoyable watching how everyone always wants to achieve more and gives each other ideas. Even so, here too there are different aspects to consider: After all, we only have limited resources to work with in development. Wouldn’t it be better, then, to concentrate only on the big innovations? What I say is that every little bit helps. And if a small improvement can be achieved relatively easily, why shouldn’t we go for it? 

Fischer: I see it rather differently. If I am faced with the choice of putting my limited resources into small, moderate or big improvements, I would always opt for the big ones where I achieve real progress. Given that time especially is in short supply, we shouldn’t be getting bogged down in the little things. 

We also need to keep an eye on what our main product is, which is the line. 85 percent of our machines are delivered as a line or part of a line. That's what we have to focus on – identifying and improving the biggest consumers at line level. In autumn last year we promised the market that Krones would present the sustainable line of the future at drinktec 2025. That is what we have to concentrate on now. And that is also what will give us the head start that we need for the future. 

Every company is simply one of many components in a complex value chain. Isolated changes aren’t going to achieve anything. Climate protection is a shared project – only if we all work together will we get it done. Martina BirkHead of Sustainability

How willing are our customers to do their bit in meeting the 1.5-degree target of the Paris Climate Agreement? 

Herbst: Enormously. While a shift isn’t going to be achieved overnight, many of our customers feel an obligation towards the 1.5-degree target and are developing strategies for meeting the requirements in the medium term and already taking steps today. 

Birk: It wouldn’t work any other way. Every company is simply one of many components in a complex value chain. Isolated changes aren’t going to achieve anything. Climate protection is a shared project – only if we all work together will we get it done.

Are there regional or industry-specific differences here? 

Herbst: International companies, which the media tend to focus on more, are already very specific about their goals and how these are to be reached. But more and more small and medium-sized enterprises have also been getting actively involved in limiting their CO₂ emissions. There are also regional differences, of course, but there isn’t any one single approach being taken by all companies in a particular region. 

What responsibility does Sales have here when it comes to getting customers interested in sustainable technologies? 

Herbst: As the direct interface, Sales has a particular responsibility to persuade our customers that sustainable products will have a positive impact not only on the environment, but also on them. This is where even more work on persuading customers is required at the moment, because unfortunately it frequently entails greater investment. Even so, in many cases this pays off sooner through energy savings and hence lower running costs than people might at first think. 

In the majority of cases the return on investment is the decisive criterion for capital spending. In other words, how quickly will choosing the most sustainable variant pay for itself? This is where Technology especially needs to supply Sales with the right arguments. Customers are persuaded by arguments that can be backed up with facts, figures and data.

After a decade of debate, we are now finally a step further. We should all know what needs to be done and can get our act together. Sven FischerHead of Research and Development

Would we also be willing to lose customers in favor of our climate goals? 

Herbst: This isn’t a black and white situation. Customers aren't lost because solutions are “too sustainable”, but not every customer can afford a higher price. That’s why we need to move in the medium term from “dearer but sustainable” towards “the same price or even cheaper but also sustainable”. 

Birk: Hopefully societal change will continue until 2030. At some point the pressure will become so great – whether from the financial markets, consumers or governments – that missing CO₂ targets will really hurt the bottom line too. 

Fischer: In many large companies – and also at Krones – sustainability has now been incentivized, which means that its progress has a direct impact on pay. That means people have a personal interest in achieving the reduction targets. The increasing pressure from the financial markets is adding to that. After a decade of debate, we are now finally a step further. We should all know what needs to be done and can get our act together.