Circular Economy

Circular Economy Principles

For most of us, using a product once before throwing it away is a daily habit. Beverage bottles, food containers, and other packaging are sanitary and convenient, but our disposable world brings consequences that must be addressed: Trash is ending up in our rivers and oceans, threatening wildlife and food supplies.

To allow for the benefits of safe packaging without creating a flood of waste into the environment, we need to create a circular economy, where products are designed to last longer and eventually come back into use as new materials rather than going to landfills.

National Geographic recently convened a group that included CEOs, city officials, and recycling experts to talk about how we can bring the circular economy from concept to reality.

Here are five notable concepts that emerged during the discussion February 26 at National Geographic’s headquarters in Washington, D.C.

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1. The circular economy is bigger than you think

When we talk about reducing waste, the temptation is to think recycling is the answer.

But recycling alone will not save us from a surfeit of stuff, noted Andrew Morlet, CEO of the Ellen MacArthur Foundation: “The circular economy is a bigger idea that takes the entire system into mind.”

That means rethinking how products are conceived at the start, minimizing unnecessary use of resources, designing items to be used as long as possible, and planning to funnel material back into the economy afterward.

Achieving this will require massive investment in collection, sorting, and recycling infrastructure, but especially in developing economies, governments won’t be willing or able to invest at the pace needed.

“It’s not a $1 billion problem—it’s a $150 billion problem,” Morlet said.

“We need to have industry stepping up and actually contributing to the creation of that infrastructure so that these systems can work.”

2. For businesses, green is good

While the mantra “greed is good” from the movie Wall Street ruled the 1980s, companies today are turning away from a solely profit-driven definition of success. Smart business leaders recognize both the obligation and the opportunity in pursuing growth while safeguarding resources.

Managing future risks associated with climate change are an important driver of focusing on environmental impacts, but not the whole story.

Halsey Cook, CEO of Milliken & Company, pointed to a recent Ethisphere ranking of most ethical companies, which included Milliken.

“The data is very clear that companies that focus on doing the right things over time have higher returns,” he said, when compared to the Large Cap Index.

Among other initiatives, Milliken has invested in PureCycle Technologies, a technology that transforms post-consumer polypropylene into a like-new version of the resin that, Cook added, could potentially be valued more highly by industry.

3. Cities can lead the way

In cities around the world, municipal governments are becoming incubators for ideas that can inform broader policies and can inspire action in both public and private sectors.

Toronto, for example, collects organic waste from the city’s households and turns it into biogas that can fuel truck fleets or be used for heating.

In New York, the city is looking at ways to boost its already strong recycling initiatives by extending the life of products before they go into the bin.

At least 4,500 New York City businesses focus on repair, reuse, and the sharing economy.

“It’s there, it’s under the radar,” noted Bridget Anderson, deputy commissioner for recycling and sustainability for the city’s Department of Sanitation.

“So the question is, how do we scale those things up for the products that can have a second life before they become recycled.”

Here’s what you need to know about the global movement to rethink materials and waste.

4. Carbon needs to be factored in

“We have to decide what we’re solving for,” said Milliken CEO Halsey Cook.

“It’s easy to [say you want to] eliminate plastics, but you might replace that with other materials that might have a big disadvantage” from a carbon footprint perspective.

Some argue that strong policy targeting carbon emissions is key to making progress.

A policy that holds companies responsible for waste from the products they make, for example, “needs to be first rooted in how we track our carbon,” said Nina Butler, CEO of the consulting firm More Recycling.

The better producers do at shrinking the lifecycle carbon emissions of their product, she argued, the less they should have to pay.

5. What you buy—and recycle—matters

Consumers have voiced their concerns about waste in the environment, and companies are responding.

To build on the momentum, people need to ask businesses for products made from recycled content and demand better local recycling programs from local authorities.

“Part of the answer here has to be an increase in the use of recycled materials on the back end,” said Jim Fish, CEO of Waste Management.

“Both big and small businesses play a very critical role in this.”

The more people value the reuse of materials, the easier it becomes for businesses to accelerate the circular economy: “Let the people you buy from know that recycled material is important in their container,” advised Scott Saunders, general manager of the recycler KW Plastics.

“Companies follow what their customer wants.”


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Building a circular economy: five key concepts

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