Why the Circular Economy
The challenges of climate change, water and resources scarcity and waste, rising unemployment, especially for youth, and food security makes a rethinking of our society necessary. The principles of the circular Economy and benefits of the circular economy are summarized in this video-clip.
The manager's guide of the WBCSD is providing a rapid overview, with links for further readings. And an overview of the benefits is provided by this document of McKinsey: a systems view of the whole supply chain is a pre-requisite!
Circular Economy: The Way Forward For A Sustainable World
The Concept of the Circular Economy is about reducing waste and increasing recycling. This would be already in place if we would have all externalities included in the costs of raw materials, subsidies of all types would be abandoned, and taxing raw materials rather than labor (see Ex-Tax below) would be better favored.
What is circular economy, and how it can be implemented in a small company is presented in this video of the EU. A dramatic acceleration will come from emerging technologies, such as AI and Robotics, at the heart of the productivity improvements expected from the emerging precision economy.
The site of the Ellen MacArthur Foundation is the major reference for any documents and tools related to the circular economy. Particularly, the report Growth Within provides the background, while the Toolkit for Policy Makers presents pathway for implementation. An educational toolkit linking to the various resources of the Circular Economy is available there as well.
more on the Ex'Tax
Europe, but not only, is facing a major challenge: it is using and wasting too many resources, and it is not generating enough employment. Still, we are taxing heavily labor, and minimally the resources. Solving this absurdity is what the Ex-Tax is aiming at.
Watch theintroduction video on the Ex-Tax.
This is one of the elements that could dramatically accelerate the transition to a more sustainable world of lower consumption of basic resources and higher employment, especially for youth. Its feasibility is very well studied, and convincing elements can be obtained at the Ex'Tax site
MORE ON TAXES: Still, other issues have to be adressed with taxation, such as taxation incentiving the development of skills, crucial for an inclusive economy, as presented by the OECD, and detailed in their Report: Investments in education have a high return for governments, resulting in achain of higher wages and higher taxes return, so that subsidizing student loans is usually a sound decision. The OECD provides background on this
Some proposals on the circular economy
The Institut Montaigne , a French Think-Tank, has issued a policy paper on the circular economy. As a summary, the circular economy is aiming at pursuing value creation by reducing negative externalities as well as the use of limited resources.
The benefits to be expected are: disconnecting growth from raw materials consumption, and favoring the re-localisation of production, for more jobs and positive trade-balance.
The way to achieve this will be by:
1) introducing standardized measures and KPI's of circularity, both at the country and the corporate level,
2) removing the regulatory barriers that hinder the adoption of circularity
3) Better embed externalities into the costing of products, e.g. by adjusting the cost of landfill or emissions, or removing hidden subsidies for coal and oil,
4) Developing funding for innovation in the circular economy
5) Stimulate the demand for products and services complying with the circularity principles.
These proposals are detailed in their extensive policy report.
Europe and the Circular Economy
The circular economy has the potential to create many jobs in Europe, while preserving precious and increasingly scarce resources, reducing environmental impacts of resource use and injecting new value into waste products.
The EU strategy towards the circular economy is captured in their document:
It is a set of measure to accelerate the transition, consisting of actions to reduce food waste, develop quality standards for secondary raw materials, foster Eco-design to promote reparability, durability, recyclability of products, and address plastics-waste in the spirit of the circular economy (recyclability, biodegradability, the presence of hazardous substances in plastics), and promote a series of actions on water reuse.
McKinsey on the Circular Economy
McKinsey has published here some very relevant research on the benefits that can be expected from a transition to a circular economy.
Additional articles are also available on their site, for:
sustainable consumption and Planned Obsolescence
What is obsolescence, planned or perceived, is described in this video. Reducing the life-cycle of product benefits to consumers through deliberate design alterations may be good for some businesses, but is certainly against the building of a sustainable economy, and must be fought back.
mobile phones and cars are 2 examples of product designs and business models that generate a huge waste, bit that could be also done differently if the right incentives or penalties would be put in place. The Fairphone,described here, is a convincing attempt to provide a responsible answer to the waste and other issues related to smart-phones.
Tangible improvements have been achieved for the design of cars, and many options are now available on the market.. The economist explains in this video why full-electric cars are not necessarily the greenest option, and BMW describes in this leaflettheir projects. However, so far, we haven't observed a reduction of consumption of raw materials through technology, improved compact design and productivity improvement, according to this MIT study: seemingly because the better the products, the higher the demand for them.