Circular Economy

The term circular economy is not new, and there is some debate as to who came up with the original concept. As with many ideas of its kind, the concept likely evolved concurrently as different factions strove to develop a more sustainable economic model.

In their 1976 report for the European Commission, Walter Stahel and Genevieve Reday described a vision of an economy in loops.

The Ellen MacArthur Foundation defines the circular economy as ‘an industrial economy that is restorative or regenerative by value and design.’

The three principles of a circular economy, or CE, are:

By contrast, in a linear economy, natural resources are turned into products ultimately destined to become waste due to the design and manufacturing process.

You can already see that the CE model aligns with more modern sustainable business concepts, such as ESG criteria. Adopting this approach to your business plan would go a long way to achieving net-zero business targets.

There are some potential disadvantages to the CE model. However, these are not so much disadvantages as setbacks that can be addressed.

CE is particularly appealing as it can be adopted by individuals and developed from the ground up, driving change in the process. It should be a centralised model. But it can be a decentralised model embraced by business pioneers.

By adopting a CE approach to different aspects of your business, you can develop a phased plan to achieve net-zero targets in an acceptable timeframe and consideration of your budget.

Take the three main principles of CE,

And apply them to aspects of your business such as.

Once you have analysed each of these (list not exhaustive), you can compare costs to improve your performance concerning the CE model and prioritise your actions.

No business will be in a position to tackle all of these transitions overnight. But there is nothing wrong with having a phased plan, only having no plan at all.

As always, involve your workforce in this process. And communicate your intent to your customers and supply chain. You can be a leading example and even foster change within your sector and the companion industries that interact with yours.

It is vital to note that this kind of business transition is self-serving. Ultimately, only sustainable businesses will survive. Don’t see this as an encumbrance. It is an opportunity. Take the time to make the process work for you.