Transition to a circular economy demands a systematic shift of mainstream production and consumption away from traditional, fundamentally wasteful processes to a new way of thinking. It is not a tinkering with the edges, a movement for do-gooders or an edgy branding exercise for the benefit of middle-class consumers. It is the most exciting business opportunity of our time.
The circular economy designs out the concept of waste. It is based on the idea of materials flows and the continued use and re-use of valuable technical resources, while natural systems are protected from contamination or over use. It is often described as being restorative and regenerative by design.
The circular economy is exciting because for the first time in our recent industrial history it breaks the link between the using-up of natural resources and prosperity. Scarcity of natural resources such as minerals, precious metals, oil and water need no longer limit our ability to meet people’s needs today, or those of our expanding populations in the future. That is why it represents such a massive opportunity for business.
The problem remains that the issues at stake are global. We share one planet and live in a global economy where markets are governed by huge corporate entities with complex international supply chains. Transition to a circular economy will require political will, legislation and innovative disruption. Such is the inertia of the mainstream market that effort from all these parties is needed to tip the balance for the majority of large-scale businesses and their supply chains.
What is exciting to see is that innovative businesses based on the ideas of the circular economy are already springing up all over the world. Entrepreneurs are not waiting for the perfect policy landscape to emerge or for the big players to commit. They are taking the lead and doing what business does best; identifying opportunities and creating new ways to meet them. Seeing the market failures of traditional business models, far-sighted entrepreneurs are building profitable enterprises using leftover resources that may once have been called ‘waste’. They are managing resources super-efficiently with beautifully crafted modular design, modern re-manufacturing facilities and servitized offerings that give their customers exactly what they need, when they want it.
There will come a time when no one will talk about the Circular Economy anymore because it will just be the way we do things. The common sense of designing products, systems and material flows to operate effectively and harmoniously within planetary boundaries will be accepted as the norm. Innovative business is bringing that day closer and I for one am hugely exited to see it happening.