The Hidden Environmental Impact and Financial Implications of Recycling

Alfred Tang

Hatched by Alfred Tang

Nov 13, 2023

3 min read


The Hidden Environmental Impact and Financial Implications of Recycling


Recycling has long been hailed as a solution to reduce waste and mitigate the environmental impact of plastic consumption. However, recent studies have shed light on a concerning issue – recycling itself contributes to the proliferation of microplastics. Additionally, there is a growing need for companies to align their financial reporting with international sustainability standards. In this article, we will explore the hidden environmental impact of recycling, the emergence of sustainable reporting standards, and provide actionable advice for individuals and businesses alike.

The Dark Side of Recycling:

While recycling may seem like a straightforward process, it is far more complex and problematic than meets the eye. Even when plastic makes it to a recycling center, it can still end up splintering into smaller bits, resulting in an alarming amount of microplastics. Research has shown that a single recycling facility could emit up to 6.5 million pounds of microplastic per year. These microplastics not only contaminate wastewater but also find their way into the air, creating potential health risks for workers inhaling them.

The Game of Diminishing Returns:

Recycling is often seen as a closed-loop system, where materials are endlessly reused. However, this is not entirely accurate. Recycling a plastic bottle, for instance, involves deconstructing it and putting it back together. Each time this process is repeated, the material degrades, ultimately reaching a point where it can no longer be recycled. This phenomenon highlights the game of diminishing returns in recycling, where the material's quality gradually diminishes with each cycle.

The Call for Sustainable Reporting Standards:

As the world grapples with the environmental challenges posed by excessive plastic consumption, there is a growing need for businesses to adopt sustainable practices and transparently report their efforts. In line with this, many countries are planning to align their financial reporting with international sustainability standards, such as the International Financial Reporting Standards (IFRS). This move aims to enhance the quality and transparency of sustainability information disclosed by companies.

Actionable Advice:

  • 1. Reduce Single-Use Plastic: The first step towards mitigating the environmental impact of recycling is to reduce the amount of plastic waste generated in the first place. Opt for reusable alternatives, such as stainless steel water bottles and cloth grocery bags, to minimize the need for recycling.
  • 2. Support Extended Producer Responsibility (EPR): Encourage policymakers to implement and enforce EPR regulations, which hold manufacturers accountable for the entire lifecycle of their products. This includes the collection, recycling, and proper disposal of their packaging materials.
  • 3. Invest in Research and Development: Governments, businesses, and research institutions should invest in research and development to explore innovative recycling technologies that can break the cycle of diminishing returns. Finding ways to maintain the quality of recycled materials will be crucial in creating a truly sustainable recycling system.


The issue of microplastic pollution stemming from recycling represents an unexpected and concerning consequence of our efforts to reduce waste. However, by understanding the complexities of recycling and taking action at individual and institutional levels, we can work towards a more sustainable future. Embracing sustainable reporting standards and implementing actionable strategies to reduce plastic waste will not only benefit the environment but also drive positive financial outcomes for businesses in the long run. It is time to rethink our approach to recycling and strive for a circular economy that minimizes waste and preserves our planet for future generations.

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