What is the circular economy? ๐Ÿ”

What do you think of when you hear the term ‘circular economy’?

When you hear the expression “circular economy”, do you immediately think of recycling bottles? ๐Ÿ”ƒ๐Ÿงƒ Or buying second-hand clothes? ๐Ÿ‘—๐Ÿ‘• Well, then you are not totally wrong, but let us tell you how many more circular economy options are out there. โ™ป๏ธ No child left behind!

Circular economy

What is the circular economy?

The circular economy is a model that aims to limit the consumption and waste of resources and products as well as the production of waste. It is about creating, prolonging, or slowing down a recurring loop: Waste is now a raw material to be reused. ๐Ÿšฑ So, you try to make the most out of your already existing products! ๐Ÿ˜

It is the opposite of the linear economy, also known as “extract, produce, consume, throw away”, which is also the model used in most societies. ๐Ÿ™

What kind of ways are there to push forward the circular economy? ๐Ÿค”

The idea of circularity can kick in throughout the different stages of a product’s lifecycle.ย ๐Ÿ”ต Letโ€™s see how:

Circular economy model

Design & Manufactureย 

At the product design stage, it is all about facilitating the repairing, the disassembling, and the recycling. The goal is to extend the object’s life and facilitate the recovery of materials. ๐Ÿชก๐Ÿงถ

The choice of raw materials is also essential. Some raw materials require a lot of resources to be extracted. ๐Ÿ˜จ In addition, some production inputs such as rare minerals are extracted in conflict zones or countries that do not respect human rights (dangerous working conditions, child labor, poverty wages, etc.). ๐Ÿฅด Therefore, the reuse of extracted materials comes as a strategy to reduce both environmental damage and the risk of modern slavery. ๐ŸŒณ๐Ÿ› 

circular economy companies

Distribution & Retailerย 

Which means of transportation to use? ๐Ÿšš๐Ÿ›ณ Home delivery or store delivery? Which container? Which packaging? ๐Ÿ“ฆ There is no universal answer while each company should think of the most sustainable solutions among the viable options.

For example: Imagine a company that sells cosmetic oils and wonders which shipping container is the most ecological. You might think they should use glass bottles since glass can be reused and recycled for an infinite amount of time. ๐Ÿฅ›๐Ÿ˜Ž But look, when using glass containers the shipment will be heavier and require more fuel than if plastic containers are used. ๐Ÿ˜ฎโ€๐Ÿ’จ On the other hand, when choosing plastic containers, concerns may arise about their lifespan and chance to recycle the material at the end of their lives. Depending on the parameters, the environmental impact of plastic can be better than glass and vice versa.๐Ÿฅด Through life-cycle assessment analysis and tools, the company can calculate the environmental impact of each solution and adopt the most eco-friendly. ๐Ÿค™

Consumption ๐Ÿด

On the buyer’s side, we consumers shall consume responsibly. You certainly don’t need to change your phone every time a new model comes out! ๐Ÿ“ต

economy in sustainability

Maximize Use – Repair & Reuse

Extending the lifetime of a product entails repairing it as much as possible or selling it if it is not used. ๐Ÿช›๐Ÿ”จ

We can also think about an economic model based on use over possession: the sharing economy. ๐Ÿซ‚

Here an example could be that if you don’t need to use a car every day, instead of buying one, you can just rent one or carpool. ๐Ÿš— This maximizes the use of existing products and spares resources from producing one for every single user. This concept can apply to other less conventional categories too like a lawn mower or a raclette machine jointly bought with your neighbors! ๐Ÿฅธ

 circular recycling

Recycling & Reprocessor

The aim here is to look for alternatives to landfills or incineration. โ™ป๏ธ Circular economy companies process their waste according to the following scheme: If the first solution is not possible, they consider the next and so on.ย Here are some questions to ask yourselfย when trying to extend a product’s life โœ…:

1) Reuse: Is it possible to reuse the object as is?

2) Upcycling:ย Is it possible to transform the object into a new product, adding a strong added value?

3) Composting & Recycling: If there are organic materials they will be composted. And if they are not, is it also possible to recycle them?

4) Energy recovery:ย As the last resort, they will turn to incineration, which generates heat by burning the non-reusable materials. So, is it possible to use the product for energy?

recycle

Are there problems with the circular economy? ๐Ÿค”

However, not everything that shines is gold. ๐Ÿ†ย Lucie Domingoย warns us against the too-easy solutions that the circular economy can present. ๐Ÿ˜ณ

Indeed, the surplus of waste and the depletion of resources are two major problems of our century, but they are not the only ones! The risk with the circular economy is that we forget about the other less visible challenges of our century such as global warming and the loss of biodiversity, which cannot be solved with this type of economic model. ๐Ÿฅต Moreover, she found, we only partially question the use of the eco-designed objects. ๐Ÿ˜ฏ We often forget their maintenance, their transport, or their usefulness for the society and the individuals who compose it. โ˜น๏ธ

Let’s take the example of water bottles: Does consuming recycled plastic water bottles on a daily basis really address the issues surrounding plastic? Shouldn’t we question the utility of plastic bottles in general? Can’t we drink tap water directly and get a water bottle for our trips? ๐Ÿคฏ

Sustainable economy

Essentially, Domingo says that the urgency of the environmental crisis needs a fundamental change in our industrial activities and our daily lives. ๐Ÿญ๐Ÿšซ The risk is to act too quickly! The focus on immediate and less effective solutions may mislead the realizations of the solutions on the long term. ๐Ÿ˜ถโ€๐ŸŒซ๏ธ

As you might have realized circularity and sustainability matters at large are complex but remember, always strive to be the movement and make!mpact! ๐Ÿ’š

Disclaimer:

We are not financial advisors, and we do not claim any responsibility for the financial choices you may make on the basis of what you read in this blog. The content of the blog is of an informative nature and has an educational purpose. It is not to be regarded as either investment advice or recommendations, nor do we relate to the readerโ€™s private, financial situation. Any use of information is at your own risk. We encourage you to seek financial guidance if you do not understand the risks in the area. We are not responsible for any choices you may make, based on what you read on the m!Club or from our company page on LinkedIn โ€” MakeImpact.

Share

More free content

Cryptocurrency and the environment ๐ŸŒฟ

Why is cryptocurrency bad for the environment?๐Ÿชด You might have heard lots of people talk about Crypto. ๐Ÿ“ฐ If the first thought โ€ฆ

SDG 5 gender equality

How SDG 5; gender equality is applied in a company like Bumble Whether you have been using it to find the true โ€ฆ

A guideline and classification system that makes it easier for investors to identify which activities are sustainable and which are not.

How to define sustainable financing? On your journey to be an impactful investor, you might have struggled to identify what is really โ€ฆ

GET THE APP TODAY ๐Ÿ”ฅ