Building a more sustainable future with circular economy models

20 March 2023 5 min. read
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Planet Earth is heaving under the strain of global consumption and the waste it creates, but by transforming production processes and the lifecycles of goods into a circular value chain, companies and countries can redefine economies and contribute to the creation of a sustainable future for all, writes Carlo Stella, a partner at consultancy Arthur D. Little.

A circular economy involves fulfilling the needs of the current generation through products and services that are either restorative or regenerative, which extends the lifespan of materials maintaining those at their highest value. To do so, products need to be well maintained, easy to repair, restore, or dissemble for maximum recovery and limited degradation of materials.

The circular economy model can reduce resource consumption and harmful emissions, thus helping to tackle climate change, resource scarcity, waste, pollution, and loss of biodiversity. And there are economic and social benefits too, such as job creation and improved health among populations.

Carlo Stella, Partner, Arthur D. Little

Leading by example: The GCC

More than a theory or blueprint for the future, the circular economy model is already taking tangible form in forward-thinking countries around the world, with the UAE a case in point.

In addition to being a member of the World Economic Forum Scale 360 initiative, the Emirates has established the UAE Circular Economy Council. To date, the council has approved 22 policies across four main sectors – manufacturing, food, infrastructure, and transport – and is uncovering a raft of circular economy business opportunities.

Of particular note are the UAE’s efforts to combat the issue of single-use plastic. On this front, Abu Dhabi led the way by introducing a ban on single-use plastic bags in July 2022, while Dubai has also introduced a mandatory charge on plastic bags and plans to prohibit their use entirely starting in 2024.

Refill schemes are also gaining traction. For example, the Dubai Can Initiative is designed to curb the use of plastic water bottles through the installation of refill stations across the city. The number of stations is expected to increase over time as the scheme matures.

The refill concept is extending beyond water. One international body care brand has introduced its global refill scheme to Dubai stores, enabling shoppers to purchase an aluminum bottle that can be used for infinite refills, to the advantage of the environment and consumer pockets alike.

Meanwhile, across the border in Saudi Arabia, the kingdom has launched the Circular Carbon Economy National Program alongside other initiatives designed to divert 82% of waste from landfills by 2035 and implement circular economy principles as the country pursues its Vision 2030 ambitions.

Global pioneers

On the wider global stage, countries in Europe and beyond are setting positive examples for others to follow. For Instance, the Netherlands is pioneering several circular economy initiatives, including a flagship project to tackle the problem of discarded mattresses.

With the costs of collection and incineration of mattresses prohibitively high, the need for a sustainable solution was urgent. After strenuous negotiations, a voluntary extended producer responsibility policy was agreed by the country’s five largest mattress manufacturers and importers, with the aim of increasing the rate of recycling to 75% by 2028. Such is the initiative’s success, this goal has already been achieved.

Now, Dutch attentions are turning to the question of how to transition from low-value recycling to mattress re-design and repurposing.

Collaboration is key

The creation of robust circular economies and their related policies hinges on widespread commitment and collaboration between stakeholders. Here, it is necessary to go beyond the traditional approach of driving top-down change through government and actively include the participation of other organizations, both public and private – a concept sometimes referred to as network governance.

In addition to implementing an effective governance structure, a number of key lessons are emerging from the international stage that can inform efforts to develop a functioning circular economy. For example:

The case for change: The success of circular economy initiatives lies in the proper identification of the reason for disrupting the status quo and the benefits for each stakeholder involved;

Managing the transition: The creation and execution of a circular economy are best achieved when supported by governance bodies such as steering committees, supervisory committees, implementation teams, and other agents of change;

Course-correcting: The implementation of circular economy initiatives is far from straight forward. It requires carefully designed strategies that can be changed and adjusted as required. What’s more, commitment, adequate funding, and effective problem-solving will remain crucial throughout the lifecycle of any CE initiative.

Pathways to success

Circular economies have the potential to make a significant impact, not just in the global fight against climate change and the campaign for sustainability, but on the future prosperity – even viability – of businesses and societies across the globe. Yet, designing and implementing a successful circular economy initiative is no simple task.

To build the circular economy of tomorrow, public and private stakeholders must work hand-in-hand to design a pathway that sets nations on course for success. Crucially, they must also be prepared to course correct along the way, taking into consideration the economic, cultural, and sectoral specificities that will shape circular economy journeys from Europe to the UAE.

Each journey will be different, but the destination is the same: a bright and sustainable future for businesses, societies, and the planet we all share.