Today, 800 million people are vulnerable to the effects of climate change. Droughts, floods, heat waves and sea level rises are causing illness, injury and forcing people to abandon their homes. A radical approach to behavioural change is needed if we are to tackle global warming and stymie the disastrous effect it is having on communities around the world. 

One such approach is to adopt a new economic model that redefines success. One that focuses less on financial gains and more on value, sustainability and environmental impact.

The ‘circular economy’ suggests an innovative shift in how we produce goods. It places collaboration at its core, encouraging organisations, sectors and stakeholders to work together to share and reuse materials, ideas and products. In doing so, the circular economy model creates, ‘industrial symbiosis’, helping traditionally separate industries to foster innovative strategies for more sustainable use of resources including materials, energy, water, assets, expertise and logistics through mutually advantageous transactions. Whilst the circular economy requires revolutionary organisational and structural change, the benefits are substantial. 

McKinsey believe the adoption of this model could lead to a 3% increase in global productivity and cost savings of some EUR 600bn ($656bn) a year by 2030. Indeed, in many private sector incidences, there is already evidence of positive results. For example, the National Industrial Symbiosis Programme (NISP), is a global member organisation that challenges businesses to collaborate in the same way as the natural eco-system - where everything has a place and function, and nothing goes to waste. In just five years, the organisation has helped its 12,500 companies divert over 7 million tonnes of waste from landfill, reduce carbon dioxide by over 6.0 million tonnes and generate GBP 176mn ($216mn) in additional sales. These companies have also been able to reduce over GBP 156mn in costs for industry and eliminate over 363,000 tonnes of hazardous waste. Such is its success that the model has now been replicated in 20 countries world-wide at a national or regional level.

In addition, the circular economy framework helps to improve air quality, reduce water contamination, and protect biodiversity, each helping to achieve the greater goal of achieving zero emissions by 2050 to meet the 1.5 ̊C target set out in the 2015 Paris Agreement.

In addition to sustainability benefits, by moving emphasis away from profitability and towards environmental metrics, the circular economy begins to separate economic activity from the consumption of raw materials vulnerable to climate risks, building greater flexibility in production and industrialisation by widening materials and processes. Indeed, such is its potential that the circular economy is now a core component both of the EU’s 2050 long-term strategy to achieve a climate-neutral Europe and of China’s five-year plans. Japan also requested the circular economy concept be a priority for the 2019 G20 summit.

However, whilst the circular economy is gaining government and private sector support in the developed world, Less Developed Countries (LDCs) are struggling to drive action. Instead of placing climate change high up governmental agendas, more immediate elements such as social or economic issues demand their attention. As a result, carbon and waste targets are left as a lesser priority. 

In addition, despite LDCs already performing many of the elements critical of a circular economy, such as reusing, sharing, recycling and making raw materials last, their efforts are often left out of the global circular economy supply chain. Yet, as report by Chatham House explains, if LDC governments actively embrace the circular economy, taking current efforts to the next level and entering the global circular economy, ‘it could provide a strategy to help lower-income countries ‘leapfrog’ to a more sustainable development pathway that avoids locking in resource-intensive practices and infrastructure.’ For example, adopting adaptive design principles set out by the circular economy, could help LDCs deliver quality housing and infrastructure at low economic and environmental cost, serving to solve some of the issues that dominate their internal strategic agendas.

The principles of a circular economy offers businesses around the world a raft of innovation opportunities to reduce materials costs, increase asset utilisation, and respond to changing customer demands. Consequently, it is a powerful solution that could set the path for a global, sustainable, prosperous future. However, the success of the circular economy is dependent on the concept being embraced globally, and this includes ensuring the activities of LDCs are included. Therefore, efforts must be made to embed circular principles in industrial growth and infrastructural development strategies across all nations to meet the needs of growing and urbanising populations that also serve to mitigate against environmental pollution. 

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