Sustainability in 2025: A Priority Checklist for CPG Enterprise Technology Leaders

As 2025 begins, enterprises in the consumer packaged goods (CPG) space are facing increasing pressure from virtually all sides to do business more sustainably. Regulators, consumers, and investors are expecting these companies to ensure that their business success does not come at the expense of society. This article outlines the top sustainability objectives on which CPG technology leaders like CDOs, CDAOs and CIOs should be focusing to help meet these expectations this year and in the future.  

For CPG enterprises, embracing sustainability requires rethinking traditional business models and supply chain strategies. Traditionally, these companies have operated within the so-called linear economy, an economic model characterized by a “take-make-dispose” paradigm where raw materials are extracted, processed into products, used by consumers, and ultimately discarded as waste.

Progress towards the circular economy — an economic model characterized by the “reduce-reuse-recycle” paradigm — is a central objective of the global push toward sustainable business practices.

Now more than ever, CPG enterprises must go beyond merely claiming progress toward sustainability. They need to back up these claims with credible data. Technology leaders play a pivotal role in ensuring their organizations’ data is both ready and leveraged for achieving sustainability objectives.

The most critical sustainability objectives for technology leaders to focus on supporting are as follows:

Figure 1: The most critical sustainability objectives for technology leaders to focus on

Below are more details on why these objectives matter and the best technology solutions and strategies to achieve them.

Objective 1: Reduce resource consumption with prescriptive analytics, digital product passports, and optimization tracking  

The first steps towards embracing the circular economy often involve tackling its “reduce” component within existing supply chains focused on getting goods into consumers’ hands. Such initiatives can lay the groundwork for transforming current operations to align with future circular models encompassing what consumers do with goods post-purchase.

The most promising of these kinds of initiatives involve a combination of: 

Figure 2: The most promising technology initiatives for reducing resource consumption

This combination can help minimize waste and resource consumption across all the five core linear economy supply chain functions of sourcing, manufacturing, transportation, warehousing, and inventory management. Here are example use cases for predictive analytics, optimization tracking, and digital product passports with respect to each function:

Objective 2: Reuse and recycle materials to advance the transition to circular economy supply chains 

For enterprises, embracing circular economy principles means adopting regenerative business practices through strategic initiatives such as creating new revenue streams — by recovering and reusing materials in closed-loop or product-as-a-service models — and designing products for durability, reuse, and remanufacturing.

Leaders driving these initiatives will require high-quality, actionable data. To meet this demand, technology leaders should focus on enhancing the capabilities of solutions initially implemented to reduce resource consumption, incorporating features that enable the reuse and recycling of products.

Figure 3: Where data fits into the circular economy paradigm

Ways to enhance existing solutions might include using:

• Digital twins to simulate a product's performance under varying conditions and help optimize its design for durability and remanufacturing. 
• IoT devices that aid in product lifecycle assessment, allowing manufacturers to measure end-of-use, post-production emissions, and environmental impact versus industry benchmarks. 
• Third-party logistics management solutions that factor in 3PL providers’ capabilities to implement circular economy principles like reverse logistics.

It is also worth exploring innovative solutions that help drive and measure consumers’ engagement in the circular economy. One effective approach is to use labels or QR codes on packaging that provide clear instructions for recycling. Taking the concept a step further, several global retailers are already implementing more advanced circular strategies. For example, Patagonia offers buy-back programs and sells refurbished items, while IKEA has introduced furniture leasing and second-hand stores.

Objective 3: Report on sustainability metrics & goals using reliable data from across the entire value chain 

Most if not all CPG enterprises doing business in Europe are already subject to the European Union’s Corporate Sustainability Reporting Directive (CSRD). The directive requires comprehensive sustainability reporting covering environmental, social, and governance (ESG) pillars. The CSRD came into effect at the beginning of 2024 and the first reports are due later this year. 

The concept of value chain reporting — the comprehensive measurement of both upstream and downstream sustainability impacts — features prominently in the CSRD. It is also in the complementary European Sustainability Reporting Standards (ESRS), which provide specific requirements on how to report on sustainability topics, and the Corporate Sustainability Due Diligence Directive (CSDDD), which mandates due diligence to identify, prevent, and mitigate adverse human rights and environmental impacts throughout the value chain. 

Also, across the Atlantic, rules proposed by the United States Securities and Exchange Commission regarding climate-related disclosures are set to come into effect in 2025 for companies listed on the country’s stock exchanges.  

Figure 4: Reliable data is essential for sustainability reporting in the EU and the US.

Most technology leaders and their teams will not be directly responsible for creating compliant sustainability reports, but they will almost certainly be responsible for ensuring that the data used to create these reports is accurate and available to right people. Doing so requires the development and execution of an effective data strategy that: 

• Covers the entire value chain and most likely incorporates data from a broad range of sources including suppliers, consumers, and third-party providers.
• Supports the verification of sustainability data not just by internal stakeholders but also third-party assurance providers. Both the CSRD and proposed SEC framework require companies to have their sustainability reports independently verified.

Key Recommendation: Don’t Just Check the Boxes; Think Beyond Them

In the short term, how technology leaders handle sustainability data is undeniably critical. Data-driven sustainability reporting is now a regulatory necessity, and leveraging data to implement solutions that reduce supply chain resource consumption aligns with traditional linear economy financial logic.

As the focus shifts toward the long-term transition to a circular economy, however, what will matter even more is how technology leaders think about — and champion — innovative ways to harness sustainability data for transformative impact.

In other words, technology leaders should resist viewing sustainability data strategy as a simple “check-the-box” technical exercise to ensure compliance or support the company’s bottom line. Instead, they should approach it as a strategic foundation for generating circular economy business value.

Although circular economy success metrics are less established than traditional performance indicators, technology leaders have a unique opportunity to craft a data-driven narrative that highlights how their organization is innovating to enhance both its financial performance and societal impact.

To fully capitalize on this opportunity, technology leaders should aim to:

• Foster collaboration, alignment, and an exploratory mindset across the entire C-suite, as every member has a role in leading the organization profitably into the circular economy. Cross-functional, data-driven ideation will be essential.
• Extend their data strategies to encompass circularity by focusing on the collection, integration, analysis, visualization, and verification of new data types across the organization’s value chain.

Lingaro’s sustainability experts and the rest of our Supply Chain Analytics Practice are here to help! Please get in touch to learn more.