The current linear “take-make-waste” economy, highly successful in delivering economic development throughout the 20th century, is no longer viable for continuing progress in the 21st century. Commerce and production processes in large part follow this linear model, which has been that products and their component resources are eventually discarded as waste.
The concept of a “circular economy” has emerged as an alternative to that linear model. Also known as “closed-loop” or “cradle-to-cradle,” a circular economy is a restorative model that decouples economic growth from natural resource use, and emphasizes longevity, reuse, and recycling. All resources and energy are renewable and regenerative, all durable resources are endlessly cycled back into supply chains, and waste does not exist.
Circular economy models will also play an important role in the private sector's ability to meet the United Nation’s Sustainable Development Goals (SDGs). Circularity directly supports SDG 12 – Ensure sustainable consumption and production patterns. This goal is concerned with sustainable management and efficient use of materials, environmentally sound management of chemicals and waste, and decreasing waste generation and food waste while increasing reuse and recycling. Circular economy models can also indirectly support other SDGs, such as decent work and economic growth (9), and protecting life under water and on the land (14&15) by creating innovative techniques to materials through the economy and keeping those materials out of the ecosystem.
A key consideration is to avoid “burden shifting,” or when a positive change in one location results in an increased impact in another location. For example, using a new material that is more recyclable but that increases worker exposure to harmful chemicals during manufacturing is an example of burden shifting. Life cycle analysis (LCA) is frequently used to help identify where trade-offs like this may happen when a new process or material is introduced. Knowing where and how the inputs you use are manufactured and how they are handled at the end of their useful life is also key to avoiding burden shifting.
Research from Accenture shows that shifting to the circular economy could unlock $4.5 trillion in global economic growth by 2030. To leverage that growth and be a part of the circular economy, however, companies need to learn how to incorporate circular economy principles and practices throughout their business - the goal of this Circular Economy Toolbox.