Ever Increasing Circles? An Exploration of the Limitations of the Circular Economy

Screen Shot 2013-10-06 at 21.26.57In a time where cynicism is arguably the default condition of the contemporary adult human, most large multinationals rarely inspire anything beyond a glance at their share price – or perhaps protests at some of their more egregious conduct. But recently, our Creative Director and CSO came across an article which reminded him of the capacity for positive change which can emanate from even some of the world’s most gargantuan and maligned corporations. We need to create a circular economy (Wired UK magazine, August 2013), authored by Ulrike Sapiro – the Coca-Cola Company’s Environmental Sustainability Director, Europe – outlines most concretely the case for companies and societies to reconceptualise how they do business in the context of the colossal waste that productive processes generate.

Sapiro – who is based out of offices in Brussels, Belgium – posits that by reusing waste as raw materials for production, amazing amounts of money could be saved. For example, the total material value of the world’s consumer goods sector is estimated to be £2.1trn, but only around 20% of this is recovered at present. With conservative circular economy advocates claiming that a 30% recovery rate could be attained relatively easily and that a 50% recovery rate is possible, it is easy to see the benefits of better industrial recycling and reutilisation policies. The application of circular economy principles to food waste could save nearly £1bn per year in the United Kingdom alone, while the field of durable goods such as washing machines and cars could yield sums in the trillions of dollars.

Sapiro’s article is a timely and welcome contribution to the circular economy literature and corporate social responsibility more generally. However, we remain concerned that not enough is being said or done to make these principles seem relevant (for surely they are relevant) to SMEs. Transforming the circular economy from a concern of large corporations and governments into something that can be embraced by small-scale enterprises that cannot leverage anything like the capital/debt, labour, and logistics of bigger entities is arguably the real challenge given that in the vast majority of the world’s territories these are still the dominant form of economic organisation. Yet it seems imperative to address this lacuna if, as Sapiro points out, we are to avoid the shame of consuming two entire planets’ worth of material by 2030.

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Filed under Economic Development, Economics, Environment, Technology

2 responses to “Ever Increasing Circles? An Exploration of the Limitations of the Circular Economy

  1. Well if anyone can do it Coca-Cola can. I think we need to work on how cooperation can be used to implement ideas like this. It’s not going to work by simply suggesting it. It needs consumer participation/education and economic motivation for people and companies before something can happen. The question is would Coca-Cola work with SME’s to make this happen?

    • Coca-Cola would probably eventually insist on the SMEs within their supply chain following certain environmental standards in the context of the circular economy, but beyond that it would take a real visionary to expand their mission beyond those horizons. I think it’s up to SMEs to address this issue themselves. Governments, NGOs and educational institutions can play their part, of course…

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