How the circular economy can boost the bottom line
Estelle Brachlianoff, Senior Executive Vice-President at Veolia UK & Ireland, explains how a circular revolution would propel the UK's economic growth
By 2050 the world's population will have risen by a third, from 7.2 billion to over 9.6 billion, and over 70% of those people will live in cities . Looking at this projection in pure business terms, it's clear to see that we need to address the affect this is going to have on our supply chains, to which I mean the volatility and scarcity of natural resources, and what we can do to minimalise the effects.
This circular economy was recgonised during the World Economic Forum COP 21 discussions in Davos as one such provision. Since, not only can its adoption reduce the environmental impacts from CO2 emissions, but it also enables companies to save resources, become more resilient and more profitable.
The circular economy is a business model that enables the economy to grow, while minimising the amount of raw materials that are extracted. Put simply, it means ensuring our resources are kept in use for as long as possible, whether it's as a raw material, new product, green energy or clean water, so the maximum value is extracted. Then, after complete use, the circular economy ensures the resource is recycled which is where businesses can make money from these 'waste' materials. As a result, we're not just talking about saving the environment but about saving money too.
To a resourcing or sustainability manager the circular economy makes perfect sense. However, to truly adopt this and make the change happen we need to change our entire business mindset. This starts with boardroom recognition that the earth's resources are not infinite and moves onto how the circular economy could play a significant role in spearheading the UK's economic growth.
The positive impact adopting the circular economy could have on our economy is not a theory. The facts show us how changes in the global economy offer enormous opportunities for us here in the UK. In our report: The Circular Revolution, the Imperial College London research demonstrates the growth impact the UK would experience if it fully adopted the circular economy. For example, by using resources in a closed loop system we have the potential to contribute £29 billion or 1.8% to UK GDP and create 175,000 jobs.
Furthermore, on the global stage the World Economic Forum has forecast the circular economy will contribute $1 trillion per annum globally by 2025, which truly highlights the importance of adopting the circular economy.
Still, even in light of this, companies still just want their 'waste' to be taken away, and don't fully realise they can make money from these materials, while building their corporate reputation with sustainability reporting.
From reducing the environmental impacts of CO2 emissions to enabling businesses to become more resilient and more profitable, the circular economy is a powerful lever. And the fact of the matter is every business can be more resource-efficient from the supply chain right through to reducing overheads.
I can think of 29 billion reasons why the UK needs to adopt the circular economy, and urge businesses to realise this is our Galileo moment. The world is round and the circular economy is no longer just a theory, it's happening here and now, and it should be top of the agenda in every boardroom in the country.