
Reduced material usage and greater longevity, the ability to upgrade and replace existing products and materials with more effective and recyclable alternatives, and the facilitation of reuse and recycling are the three key methods that make up the circular economy.
The circular economy is founded on three design-driven principles: Eliminate waste and pollution; Distribute goods and resources (at the best possible prices); restore nature.
In the current system, we take resources from the Earth, turn them into products, and then eventually discard them as waste. Contrarily, in a circular economy, waste generation is avoided altogether.
A circular economy dissociates the use of limited resources from economic activity. It is a robust structure that benefits society, the economy, and the environment. Our current take-make-waste system needs to be transformed on all levels, including resource management, product creation and consumption, and material disposal. Only then, and as long as we stay within the bounds of our planet, can we establish a healthy circular economy.
What will it take to change our throwaway economy into one that eliminates waste, circulates resources, and regenerates nature? The circular economy equips us with the means to simultaneously address pressing social needs and the threat of biodiversity loss posed by climate change. It empowers us to increase resilience, prosperity, and employment while reducing greenhouse gas emissions, waste, and pollution. The demand for raw materials is increasing along with the global population. Therefore, there are only so many of the essential raw ingredients available.
Additionally, the ecosystem is significantly impacted by the extraction and use of raw resources. Furthermore, it raises CO2 emissions and energy use. However, CO2 emissions can be reduced by using raw resources more wisely.
Waste avoidance, ecodesign, and reuse strategies could reduce annual greenhouse gas emissions while simultaneously saving money. 45% of the CO2 emissions at this time come from the manufacture of everyday materials.
Reducing environmental stress, enhancing the security of the raw material supply, boosting competitiveness, encouraging innovation, boosting economic growth, and creating jobs are just a few of the advantages that could result from moving toward a more circular economy. Additionally, consumers will receive items that are more inventive and long-lasting, improving their quality of life and long-term financial savings.
It is becoming more and more obvious that the assumptions of the linear economy are unsustainable as the world's population continues to increase. The manufacturing business model that has prevailed since the First Industrial Revolution is under jeopardy.
Less than 1 billion people lived on Earth at that period. Today, the world's population is up to 8 billion - with a growing global middle class of consumers. We are not only using the same resources, but we are also wasting them at a startling rate. According to a report from the United Nations, global resource extraction has more than tripled since 1970. Over 90% of raw materials are not reused.
Of the 100 billion tons of resources that enter the economy each year, more than 60% are wasted or released as greenhouse gases. It is clear that we no longer live in a world with cheap and plentiful supplies. Less than one-third of the waste is reused or recycled, despite the fact that it contains valuable concentrations of steel, wood, and concrete.
If we move towards a more circular economy—one that recognizes and respects the value of our limited resources—it will be simpler to make sure we have enough food, water, shelter, heating, and other necessities for future development and success. Numerous studies undertaken by business experts show the various benefits that a circular model may offer for the economy, environment, enterprises, and consumers.
The circular economy's promise for the environment, the economy, and society is only now beginning to be used profitably by industry. According to a Torrey Project analysis of the most ethical companies on Ethisphere, businesses who invest in having a good social impact receive higher returns because they take advantage of commercial opportunities that their competitors overlook. Even while the circular economy won't be adopted broadly right away, numerous businesses are already making significant strides by putting circular initiatives and procedures into practice.
Below are just a few examples:
Plastic's ease has come at a great environmental cost. Manufacturers of consumer goods, such as Albatross Designs, are developing waste-free substitutes for the conventional plastic items we use on a daily basis. In addition to stainless steel razors from Albatross that are long-lasting, they also have a Blade Take Back Program that recycles spent blades into new items like reusable silverware sets. Veles provides yet another closed-loop home item. The firm, which views waste as a resource, has developed an all-purpose cleaner using typical organic chemical compounds that were scientifically generated from food waste.
Companies are concentrating on prolonging the lifetime of materials in the furniture business because the majority of products are robust. For instance, IKEA is working to produce 100% circular products through advocacy, teamwork, and business alliances. The biggest furniture store in the world offered 47 million things a second chance in 2019. Solid pine and acacia wood furniture can be recycled or utilized for energy recovery, while pieces constructed of veneer are simple to disassemble for maintenance and repair.
The financial industry plays a critical and growing systemic role in furthering the circular economy. The World Bank has pledged over $4.7 billion to solid waste management projects around the world, highlighting the need for urgent action. The Environmental, Social, and Governance Aligned Funds are seeing substantially greater inflows, according to the Green Finance Institute in the UK. The Investment Association (IA) said that $10.72 billion was invested into "responsible investment funds" between January and October 2020. This represented 47.5% of all net money invested in funds, which was four times more than during the same time period in 2019.
The rationale for how businesses can develop, produce, and deliver value while reducing environmental and social costs is outlined in circular business models. To significantly benefit everyone, it's all about doing more with fewer resources and doing it better. Do we still need to own things in the traditional sense, or can we get by with merely having access to them?
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