The Circular Economy Trend : Are you in the know?
The Decade of Action
In 2019, the UN General-Secretary called on all sectors of society to mobilize a ‘decade of action’ to address the world’s biggest challenges extending from climate change, inequality, poverty and closing the finance gap. We are at the beginning of the ‘decade of action’ and we have just 10 years to cut emissions. The COVID-19 pandemic has had a big impact on the 17 sustainable development goals and what started as a health crisis quickly evolved into human and socio-economic crisis. It is imperative that organizations and societies move towards aggressive transformations to address future potential risks. This calls for an urgent and aggressive approach to deliver the 2030 agenda during the Decade of Action. Among the growing trends towards sustainability in 2020, many organizations have turned to the circular economy approach.
Historical perspective
Kenneth Boulding, in 1966, raised awareness of an ‘open economy’ with unlimited input resources, in contrast with a closed economy. Boulding’s work is often cited as the first presentation of a ‘circular economy’, even though he did not actually use the term.
In 1976, in a research report to the European Commission, Walter Stahel and Genevieve Reday outlined a vision of an economy in loops.
In 2003, a report highlighted the benefits of transforming business models to a restorative, circular model. This transformation has the capability of delivering savings worth$630 billion dollars to the EU manufacturing sector annually towards 2025. This could result in stimulating economic activity, in areas of remanufacturing, refurbishment and product development.
Why is a circular economy important?
Described as a framework of thinking, a circular economy can contribute to meeting the COP21 Paris Agreement. At the COP21 Paris Agreement, 195 countries signed up for emissions reduction commitments. But these are not sufficient to limit global warming to 1.5C. To achieve this ambition, it has been estimated that a reduction of 15 billion tonnes C02 per year has to be accomplished by 2030. It was identified that circular economy strategies may secure emissions reductions that could bridge the gap by half.
What is a circular economy?
A circular economy is an economic system that aims at elimination waste and the continual use of resources.- Wiki
Circular economies reduce the use of resource inputs and the creation of pollution, carbon emissions and waste. A circular economy moves away from a typical linear based industrial process, which basically encompasses the ‘take, make, dispose’ approach. It takes insights from living systems, recognising that systems should work like organisms, converting nutrients that can be fed back into the cycle.
Walter Stahel, known as the founder father of sustainability, is known to have coined the term cradle to cradle. He went on to develop a closed loop approach to production processes, co-founding the Product-Life Institute in Geneva. .
Circular economy in India
The Indian economy is at a stage where it is faced with evolving consumer trends, a rise in demand-supply constraints and an increase in stakeholder scrutiny. Most business leaders are confronted by rapidly depleting natural resources and changing stakeholder expectations. They are often left with challenges about the durability and sustainability of their business models. Therefore, under these circumstances, a Circular Economy presents a window of opportunity for organisations to address the existing resource constraints and also to be a key trigger in bringing about change that would be beneficial to consumers and businesses alike. Research suggests that half a trillion dollars, worth of India’s GDP value is at risk by 2030, which can be preserved through the espousal of circular economies.
At the St Petersburg International Economic Forum , 2017, Narendra Modi said:
“Paris or no Paris, it is our conviction that we have no right to snatch from our future generations, their right to have a clean and beautiful earth. It is part of our thinking and for that reason we do not believe in exploitation of the nature. We people do not have the right to take more than necessary from nature.”
The Indian government has identified two crucial constituents of a circular economy, solar power and waste management. (India produces around 1.40 lakh tonnes of municipal solid waste)
It is estimated that a circular economy path adopted by India could bring in annual benefits of 40 lakh crores or approximately US$ 624 billion in 2050. The greenhouse emission would reduce by 44% along with significant reduction in congestion and pollution. –Knowledge Hub
As a circular economy adopts strategies in recycling and product life extension, many organisations are exploring viable opportunities in advocating a circular business model.
written by Sherral Joseph
References : https://en.wikipedia.org/wiki/Circular_economy,