A few days ago, I found myself in a popular lifestyle fashion store. In amongst various ornamental pineapples, the smell of school sports hall and rails of ironic, pre-loved fashion, something caught my attention – The little book of going green. This unassuming publication represents something far more important than its modest title suggests. It’s evidence of a change in attitudes to sustainability. A sustainable lifestyle is now cool.
As consumers become more conscious of the negative impact modern lifestyles and standard ways of doing business have on the environment, the opportunities to capitalise on this trend are growing fast. This is especially important as Generation Z become economically active. They’re the post-millennial generation, and they’re more practical, less wasteful, and more open to new ideas. For businesses, getting to grips with the concept of the circular economy offers a way in.
What is the circular economy and how is it different to ‘going green’?
‘Going green’ has always felt like something to do for marketing purposes or out of guilt. Reduce, reuse, recycle is a catchy tagline, but it never seemed to make a real difference to the world.
The circular economy is about more than feel-good corporate social responsibility. It’s a system that disrupts the established order of ‘take, make, dispose’ linear economies. It demands innovative business models that drive sustainability on a global scale by refashioning linear streams of inputs and outputs so waste is put back into the system.
Seven reasons to take note
For organisations of all kinds, the time to start experimenting with the circular economy is now. Here’s why:
- Sustainability is a global trend
The United Nations has published a set of powerful Sustainable Development Goals (SDGs) designed to tackle global sustainability issues. Almost 200 countries have signed up and we’ve worked with the UN Global Compact to find technologies to help meet the goals. Aligning your sustainability strategy to these will highlight where you can capture value.
- The market opportunity is huge
Tackling the SDGs will be worth $12 trillion globally by 2030 and our partner, The Ellen MacArthur Foundation, says the circular economy will be worth more than €1 trillion to Europe alone by 2025. To ignore this emerging market is to miss out on significant opportunities for profit and growth.
- Starting now will get you ahead of the game
The circular economy is still in its infancy, giving organisations that commit to it a chance to gain a first-mover advantage. This means embedding circularity in your organisation and collaborating with partners as mutually invested coordinators of circularity.
- Unrecovered waste is uncaptured value
The statistics around waste are staggering. Across industries, we recover just five per cent of raw material value after use. This represents huge untapped value, especially when we consider that organisations have spent decades shaving tiny margins off unit costs.
- Investors are backing sustainable businesses
Investors are shifting their focus away from short-term returns to the longer-term social and environmental value of a business. They’re using the circular economy as a lens to understand the potential to appeal to a growing class of sustainability-minded consumers.
- Shortages of materials pose an existential risk
With the gap between supply and demand of crucial materials widening, cost and sourcing are a real risk for organisations stuck in the linear economy. Companies heavily dependent on raw materials, for example, will need to find new ways to build their products.
- Consumers are looking for change
Sustainable consumers aren’t necessarily interested in a greener way of living, despite what pocket-sized literature would have us believe. They’re interested in authentic brand values and want to see the impact of their sustainable choices on the world around them. That means organisations need to do more than pay lip service to the concept of sustainability.
As the post-millennial generation becomes economically active, the challenge of developing sustainable businesses will become more urgent. I didn’t buy The little book of going green in the end. But the book’s very presence in a leading lifestyle store speaks volumes for the values of today’s consumers. So, I challenge you to think critically about how your business will meet the demands of this sustainable generation.
Sukh Plaha,
Circular Economy Expert 