Circularity in Business
“Natural resources, and the materials derived from them, represent the physical basis for the economic system. Recent decades have witnessed an unprecedented growth in demand for these resources. This has triggered interest from policymakers in transitioning to a more resource efficient and circular economy.”
“Circular supply models replace traditional material inputs derived from virgin resources with bio-based, renewable, or recovered materials, which reduces demand for virgin resource extraction in the long run
Resource recovery models recycle waste into secondary raw materials, thereby diverting waste from final disposal while also displacing the extraction and processing of virgin natural resources
Product life extension models extend the use period of existing products, slow the flow of constituent materials through the economy, and reduce the rate of resource extraction and waste generation
Sharing models facilitate the sharing of under-utilised products, and can therefore reduce demand for new products and their embedded raw materials
Product service system models, where services rather than products are marketed, improve incentives for green product design and more efficient product use, thereby promoting a more sparing use of natural resources” “Insights from the lifecycle assessment literature indicate that the environmental footprint of circular products and services are typically significantly smaller than that for traditional products, which could have important first order environmental benefits. These first order benefits will not be evenly distributed across the product lifecycle. For example, remanufacturing reduces emissions and environmental pressures upstream associated with resource extraction, whereas sharing and product service system models also reduce pressures associated with the product use-phase.” (OECD, 2019)
This article provides an interesting business perspective on how Local Loops can go further than just focusing on their environmental responsibilities and can begin to turn towards the economic possibilities as well. In the article, it discusses how a growing resource demand has created a larger interest in the concepts of circular economies. In the article, it identifies models that can be used to recover resources and recycle them back into raw materials that are ready to be used for production, reducing the need for virgin resources. This connects directly to the problem space presented by Marble Plastics on how the manufacturing scrap can re-enter production use. The circular economy can address multiple factors of the problem space by reducing waste material and generating financial benefits, with Marble Plastics already utilizing some of the key concepts of the circular economy.
References:
OECD. (2019). Business models for the circular economy: Opportunities and challenges for policy. OECD Publishing. https://doi.org/10.1787/g2g9dd62-en
