Reduce, reuse and recycle. A mantra that many companies are considering incorporating or are already implementing in their business strategy, as a competitive advantage and to improve their positive social and environmental impact.
Some 100 million tonnes of plastic are at the bottom of the sea or floating on the surface. Sea Threads, The Australian company has decided to use some of the plastic to make high-performance sports clothing.
This company is just one example, Ecoalf o Patagonia are true emblems of the circular economy. Since 2005, Patagonia has recycled 27 tonnes of clothing.With a purpose based on creating the best product, not causing unnecessary damage to the planet and implementing solutions to the environmental crisis, has managed to become a benchmark for quality sustainable fashion. They have an enviable loyalty ratio and an exceptional customer service, which repairs garments coherently following that purpose of reusing and repairing to avoid irresponsible consumerism.
Companies such as these have a clear impact on the environment as only 9% of plastics are properly recycled, according to Smithsonian Ocean. The rest is left stranded for years, accumulating and having a negative impact on the marine environment.
But there are many examples of circular economy. Danone is another company that puts the "3Rs" (Reduce, Reuse and Recycle) into practice. Through its Bonafont brand, it implemented one of the first bottles made from other bottles.
There are companies that turn bottles into car mats and dashboards or tyres into shoes.
What is the circular economy?
The circular economy is a systems framework that addresses solutions to global challenges such as climate change, biodiversity loss, waste and pollution.
In our current economy, We take materials from the Earth, make products from them, and then throw them away as waste: the process is linear. In a circular economy, by contrast, the aim is to stop producing waste in the first place and to reuse the waste that is generated.
This is a move away from the current linear throwaway system and towards an environmentally friendly system based on prevention, reuse, repair and recycling.
Reduce, reuse and recycle
The rule of three 3Rs - Reduce, Reuse and Recycle- reduces the negative impact on the environment, saving resources and energy.
But why not make products more sustainable by design, or why not repair them instead of buying new ones? The circular economy is bringing forward new concepts such as eco-design and repair, extending these concepts from 3R to 7R.
What are the 7Rs of the circular economy?
- Redesign: The aim is to design products with the environment in mind, i.e. on the basis of eco-design to improve functionality and sustainability.
- Reduce: The aim is to reduce the amount of products we consume and the waste we generate.
- Reuse: The aim is to extend the useful life of products, either by reusing them or by giving them a new use.
- Repair: The repair of a product that has broken down, rather than buying a new one, without even considering the option of repairing it.
- Renew: The aim is to update all outdated products so that they can be reused.
- Retrieve: consists of collecting materials that have already been used in order to reintroduce them into the production process.
- Recycle: is to reintroduce waste that has already been used in production processes so that it can be used as raw material for new products.
Why the circular economy is necessary
Resource extraction and processing cause 90% of biodiversity loss and account for about half of global greenhouse gas emissions, the Organisation for Economic Co-operation and Development (OECD) warns in its Global Material Resources Outlook to 2060.
Minimising the extraction and use of raw materials by 28% would reduce greenhouse gas emissions by 39%.with the aim of complying with the Paris Agreement and not exceeding a temperature increase of more than 1.5°C by the end of the century, as outlined in The Circularity GAP Report 2022.
Companies are challenged to adapt their businesses to reduce the impact that the manufacture of their products has on the environment.
The importance of redirecting financial flows towards a circular transition is generating increasing interest for Europe, and Spain, to make progress towards a green and sustainable recovery.
The data are compelling. Each Spaniard generates an average of 460 kg of municipal waste per year, i.e. six times their average weight.. This shocking fact is a consequence of an economic model based on extraction, production, consumption and disposal. A model that implies a high environmental cost, both in the production of products and at the end of their life cycle.
In this context, and as part of the European Green Pact, the European Commission presented in early 2022 its Circular Economy Action Plan, which aims to make sustainable products the norm in the EU, boost circular business models and empower consumers for the green transition.
The investment attraction scenario linked to the circular economy is experiencing significant growth in recent years, and has become a key element in the transition to a more sustainable economy.
In fact, since the early 2020s, assets generated through circular economy equity funds have increased from USD 300 million to more than USD 2 billion.This represents a 6-fold increase in the volume of investment.
A powerful job opportunity
The growing importance of the circular economy in companies is driving the demand for jobs related to this type of profile.
According to the International Labour OrganisationThe circular economy is set to create 24 million jobs by 2030 worldwide.. In Europe alone, an estimated 700,000 jobs will be created.
It is increasingly common to demand skills from employees related to calculating carbon footprints or manufacturing products designed to extend their life cycle and recyclability.
The challenge for society and business to join the circular economy
It is a huge challenge for society that cuts across all sectors and all levels. The most obvious are those related to the use of renewable raw materials, as well as those based on reuse, repair and recycling. And it affects many aspects of companies, such as digitalisation, logistics and accounting management. It is difficult to find a sector outside this necessary revolution.
The opportunities for companies to position themselves at the forefront of this challenge are enormous. The circular economy could reduce up to 99% of some industrial sectors' waste and 99% of their greenhouse gas emissions.emissions, thus helping to protect the environment and combat climate change. An ambitious challenge, but a necessary and cost-effective one.