Circular Economy


Circular Economy

Many companies are moving away from the old-fashioned business model of take, make and waste, towards a sustainable circular economy. In short, recycling materials, water and energy, so the world no longer wastes so much stuff. This is the Circular Economy.

According to CSIRO, resource scarcity will be one of six megatrends of the 21st century due to the twin drivers of global population pressure and rising affluence.
Today some of our biggest companies, like Renault, Phillips, Ikea and Unilever is working with Circular Economy.

Here are four principles that explain the philosophy.

  1. A true circular economy is zero waste. Nothing is thrown away, because waste is designed out by making things for repair, disassembly and reuse.
  2. There are two types of industrial ‘ingredients’: disposable and durable. Disposable ingredients are those that can biodegrade, such as paper or fabric. Second, there are ‘technical’ ingredients like metal or plastic that can be reused. Things must be one or the other so that everything can be either reused or put back into nature. More complex objects should be designed to be dismantled so that they can be sorted into those two categories at the end of their lives.
  3. If this industrial cycle is to be sustainable, then the energy that powers it needs to be entirely renewable. This also reduces businesses exposure to resource depletion or supply shocks.
  4. Customers are no longer consumers, but users. This means that companies will want the materials back when you’re done with them. That could mean an incentive to return things at the end of their useful life, or it could mean more leasing, renting and sharing.

If you want to know more about circular economy, I would recommend that you check out this video made by the Ellen MacArthur Foundation

Finally, as Theodore Roosevelt observed “I recognise the right and duty of this generation to develop and use the natural resources of our land but I do not recognise the right to waste them, or to rob, by wasteful use, the generations that come after us.”


Going Round, Narelle Hooper and Rodin Genoff
Advantage NSW, Creating value in the circular economy, Sustainability Advantage

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