• Retail

Tax systems should support sustainable materials and practices

Everyone wants to protect the environment as long as the price is right, says Hesburger chairman Heikki Salmela. The politicians should set that price right through taxation.

"I've become a true environmentalist over the years, but my conversion hasn't really been about nature per se. It’s been about best choices for business," says Heikki Salmela, the founder and Chairman of the Board of the Finnish restaurant chain Hesburger.

"If non-sustainable materials were more expensive than sustainable ones, all businesses would choose sustainable."

Salmela has experienced the western world’s journey in packaging first-hand. When he first opened his small café-grill in the small town of Naantali, Finland, in 1966, the only packaging for the sausages he served was a piece of parchment paper.

As his restaurant chain grew and the fast-food business evolved, Hesburger started packing its hamburgers in the same polystyrene containers as its international competitors were using. Once it became clear how much waste those boxes created, in the 1990's the pendulum started to swing in the other direction again.

Today, Hesburger's hamburger wrappers, French fry bags and tray liners are all biodegradable and carton boxes are manufactured from plastic-free paperboard.

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Taxation should be focused on taxing environmentally problematic raw materials

Salmela has one suggestion for the European Union on how to advance sustainability in the world: institute taxation based on environmental impact of raw materials.

"We should eliminate all taxes on work and entrepreneurship and focus instead on taxing raw materials that pollute or otherwise harm the environment," Salmela says.

"These taxes should be determined by scientists and not by politicians. As an entrepreneur, I know that all businesses look for materials and ingredients that are as high-quality and affordable as possible. If non-sustainable materials were more expensive than sustainable ones, all businesses would choose sustainable."

The role of politicians is to make sustainable solutions the sensible choice from a business perspective. Fossil fuels, wastewaters that pollute, and throwing away plastic have to become more expensive than renewable energy, cleaning the waters, and recycling the plastics.

The same should apply to global trade. The EU should determine sustainability standards that products sold within the EU should meet regardless of where those products have been manufactured.

Salmela can give an example of how regulation and financial constraints direct businesses to create more sustainable processes – from his own experience.

When the Finnish authorities started charging an additional waste management fee for used cooking oil from restaurants, Hesburger started turning the oil into biodiesel for producing electricity and heat for Hesburger's production facilities. Today, the oil is used for example for biofuels for ships.

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Biggest problem for switching away from plastic are long supply chains

When it comes to plastics, Hesburger has worked effectively to reduce the use of plastics in its operations.

In 2019, Hesburger eliminated the use of plastic straws entirely from its Finnish operations, replacing them with paper straws. Restaurants in the Baltic countries and Bulgaria are moving in the same direction.

Hesburger uniforms are made from fabrics that contain recyclable plastic bottles. Worn out uniforms are made into outdoor table sets for Hesburger restaurants. The table sets can last up to 50 years and, when that time comes, the material can be recycled once again for re-use.

However, what works for a fast-food chain might not work for the whole food system.

"Plastic is still the best packaging material for many products. At the same time, it is clearly the worst material for nature as it isn't effectively collected and recycled," Salmela says.

"One of the biggest problems for reducing the use of plastics is the current model of grocery store supply chains. The logistical chain of getting food from the farm or factories to the grocery store and to consumers is so long and slow that products have to keep for a long time. So far, this can only be achieved with plastic packaging."

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Customer experience is key when moving to circularity

Another challenge for restaurants is the customer experience.

If a paper straw or a single-use spoon made of wood feels more uncomfortable in the mouth than a plastic one, customers will keep opting for the plastic option.

A vegetarian hamburger has to taste as good or better as a meat-based option or again, customers will not choose it. Because of this, Hesburger has kept perfecting its vegetarian options and built its own production facility for plant-based proteins.

As an entrepreneur, Salmela firmly believes that investing in sustainable solutions is a sound business decision – as long as the rules are clear.

"In the end, I believe every individual and every company wants to protect the environment even if they don't say it out loud. We just have to make sure that investing in sustainability does not put you at a disadvantage in relation to competitors. Everyone should have to play by the same rules."


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