How Do I Invest In The Circular Economy And Waste Reduction Industry?

How Do I Invest In The Circular Economy And Waste Reduction Industry? – Looking at the end state we want to achieve, we can define a circular economy. Founder and CEO Eva Gladek explains the “seven pillars of the circular economy”.

Circular economy is a term that has gained popularity among companies and governments in recent years. As usage has evolved, many ways of defining the term have become common. Although some consensus has emerged among players working in the industry, it is not clear what “circular” means in practice.

How Do I Invest In The Circular Economy And Waste Reduction Industry?

Several groups define the circular economy based on the activities and concepts associated with it: the use of new business models, such as leasing; cooperation between supply chains; The use of waste as a resource is defined. However, these types of symptoms are not included in the latter. What exactly is the circular economy? Because it does not define a final state, the Circle is what the world will be.

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Without an answer to this fundamental question, because there is no shared understanding of what we are trying to achieve, it is impossible to measure progress in a meaningful way. For example, we design a more expensive product; certified If there are limited resources to invest in renewable sources; or for the costs necessary to enter into a product rental agreement; Which round gets more results? If we take the activity-based definitions of the circular economy, which means that the use of these practices is circular. We don’t have much insight into either option. In fact, we know that choosing renewables doesn’t always mean less environmental impact or more value – without a lease.

Our multi-year consulting and development work in the circular economy sector; We often have the problem of having to make compromises in cycle planning and decision-making or evaluating progress towards cycle goals. For this reason, it has become necessary for us to define the performance characteristics of the circular economy.

Most of the focus of the circular economy is to ensure that resource cycles are closed and similar to natural ecosystems where water and nutrients circulate continuously. So we started with this principle as a conclusion: in the circular economy. In theory, all materials should be used in such a way that they can naturally circulate endlessly.

But there are some additional problems with this statement: in theory, we don’t want to recover these materials; It should happen in a time that suits people. For example, if we create waste that takes thousands of years to utilize. If possible nuclear waste is generated; It doesn’t exactly match our original goals or ideals.

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In addition to this time scale, an important recurring principle in circular economy discussions is It’s about preserving value and complexity: if we want to make sure things can be cyclical and as valuable as possible. If possible, the whole product. Then in parts; Finally, it is recycled into basic raw materials (which can be very energy intensive). Even this trick here is simplified and can vary greatly depending on the context. for example, with an old refrigerator, which is a very energy-inefficient product. In fact, it may be systematically better to remove it and replace it with a new model in terms of energy performance than to remove it and extend the life of the entire product. But the general principle of maintaining complexity is clear.

Considering how materials should ideally be handled in a circular economy, the toxicity of materials; lack of certain materials; This leads to several additional conclusions about the durability and other limitations of certain materials in the environment. On this basis, we have developed a set of circular factors that guide the best use of materials for different functions. These products are reusable; become scarce; The metrics we use are based on its properties, such as toxicity. Using these factors, we have prepared short recommendations on how certain materials should be used to achieve the goals of the circular economy.

While doing this exercise, we immediately realized that when we started developing goals, that we had to manage things with ideas, we also faced many related problems. Materials are just one resource in our economy. All currents are ultimately interconnected and affect each other. In a world with unlimited free energy; It is very easy to design and develop systems that fully recover all materials using expensive and energy-intensive recycling processes – e.g. For example, here is how metals are currently being recovered from e-waste.

However, we also need to address this because energy is also a constraint in our current system (even renewable energy is produced with devices made of scarce materials) and often has large environmental impacts (such as CO2 emissions). It is a rare natural resource that must be preserved. After all, in a circular economy; All energy must be produced from renewable or sustainable forms. As geothermal energy, which is technically non-renewable; But we consider it a sustainable resource.

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To achieve this, the efficiency of our energy use must also be increased dramatically. We know that the total amount of energy on earth is not limited because the sun produces more than enough for all our needs, but to collect this energy in a usable form requires the use of scarce materials themselves.

While we continue to explore the consequences of pursuing a fully closed and circular economy as the basis of the economy. Throughout the economic system we encounter other relationships that must be ordered according to larger human ideas. Ultimately, this exercise resulted in a set of seven characteristics that describe the final state of a circular economy after it has truly succeeded. These are idealized activities that we may never achieve, but they give us concrete goals. In addition, each serves as the basis for cycle indicators or KPIs in many different contexts, both large and small. It can be described quantitatively.

Around the seven pillars of our circular economy, we have three emerging characteristics: capital; You may notice openness and flexibility. They refer to how a circular solution relates to the world around it. If we’re circular, if you’re designing a sustainable model, we need to focus not only on how we design the individual components, but how they relate to each other. For example, a completely recyclable mobile phone can be developed that meets the criteria of the seven pillars. But to make it truly round, we want to make sure it is.

An important note about the seven pillars of the circular economy is that not all of these outcomes should be prioritized equally in decision-making. When looking at the state of the global system; Some areas are seriously threatened and close to systematic “tipping points”. Climate change is one of these areas, but it has even more serious effects, such as the loss of biodiversity. According to WWF, the abundance of observed vertebrate species has decreased by an average of 58 percent between 1970 and 2012, and there is a risk that irreversible recommendations will be reached in this area. Therefore, we recommend prioritizing some effects (and thus indicators) over others. We also recommend this in indicator selection processes.

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All these emerging insights come together; We created our own working definition of the circular economy.

The circular economy is a new economic model for solving human needs and distributing them fairly without harming the functioning of the biosphere or crossing planetary boundaries.

CEO Eva Gladek presented the Circular Rotterdam proposal, a municipal strategy developed around the seven pillars of the circular economy.

With these clear efficiency outcomes in mind, the process of natural selection helps develop economic rules and incentive structures that actually achieve these outcomes. Technologies and business models that support not just one, but all of these seven goals will rise to the top as the most successful. So we cannot arbitrarily support “product as a service” models because they are related to the circular economy. where In what circumstances? See these models have improved cycle performance across the board.

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