R A L U C R I C Y M O ECON
Sustainable Consumption & Production
Y E A R B O O K
2 0 1 5 / 1 6
Sustainable Consumption & Production: Towards a Circular Economy YEARBOOK 2015/16
In collaboration with:
UNEP/MAP
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Regional Activity Centre for Sustainable Consumption and Production
SwitchMed
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Publication title: Yearbook 2015/16 – Sustainabe Consumption & Production: Towards a Circular Economy
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"Take nothing but pictures. Leave nothing but footprints. Kill nothing but time."
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c o n t e n t s PUBLISHER’S NOTE Michael Spanos Managing Director Global Sustain Sustainable Consumption and Production: Towards a Circular Economy
Facts & Stats
KEYNOTE ARTICLES Gaetano Leone Coordinator, UNEP/ Mediterranean Action Plan/Barcelona Convention Secretariat UNEP An Urgent Response to Climate Change in the Mediterranean
Enrique de Villamore, Director Magali Outters, Team Leader Regional Activity Centre for Sustainable Consumption and Production (SCP/RAC) SwitchMed Policy Area From Regional Commitment to Local Actions: Towards a Circular Economy in the Mediterranean Countries
Frans Timmermans First Vice-President European Commission The European Commitment to Circular Economy
Sirpa Pietikäinen Member of the European People’s Party (EPP) European Parliament A Win for our Economy and the Environment Dr Janez Potočnik Co-Chair International Resource Panel From Optimism to Optimising Dr Christian Avérous Former Head of the Environmental Performance & Information Division Organisation for Economic Co-operation and Development (OECD) The Context of Circular Economy
Facts & Stats
INSTITUTES & NETWORKS Marion Courtois Business Engineer & Circular Economy Senior Expert ACR+ Lock or Key? The Role of Governments in Deploying Product-Service Systems Máté Kriza Chairman Foundation for Circular Economy, Hungary Redesigning How we Make and Use Stuffs-Circular Economy and the Cradle to Cradle Design
CB Bhattacharya Founder Center for Sustainable Business (CSB), ESMT Circular Economy: From Whether to How Seigo Robinson Senior Consultant-Circular Economy Lead The European Remanufacturing Network (ERN) Remanufacturing as a Key Loop of the Circular Economy
Andrew Bovarnick Global Head, Green Commodities Programme & Lead Natural Resource Economist Elodie Vieux Junior Programme Advisor United Nations Development Programme (UNDP) Mainstreaming Sustainable Production and Consumption to Reduce Poverty and Preserve the Environment
Facts & Stats
Facts & Stats
Virginia Janssens Managing Director European Organisation for Packaging and the Environment (EUROPEN) Towards a Competitive and GrowthOriented Circular Economy: the Role of the Packaging Value Chain
EDUCATION & RESEARCH
Marlehn Thieme Chairwoman German Council for Sustainable Development There is no Waste: Towards Holistic Resource Management Mathis Wackernagel Founder & CEO Global Footprint Network Constraints Rule a Finite Planet Vanya Veras Secretary General Municipal Waste Europe Circular Economy – Sustainable Growth
Dr Klas Eric Soderquist Associate Professor Department of Management Science and Technology, Athens University of Economics and Business Academic Institutions in Support of Sustainability Dr Nancy Bocken Associate Professor,TU Delft Industrial Design Engineering & Senior Research Associate Institute for Manufacturing, University of Cambridge The Role of Circularity in the Creation of Sustainable Business Models
Facts & Stats
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c o n t e n t s Dr Fiona Charnley Lecturer in Sustainable Product & Service Design Centre for Competitive Creative Design (C4D), Cranfield University Circular Innovation: The Future of Consumer Goods Production and Consumption Athanassia Athanassiou Senior Researcher & Coordinator of Smart Materials Group Nanophysics Department, Istituto Italiano di Tecnologia Defending the Environment Using Novel Materials Carlo Ratti Director MIT Senseable City Lab How Big is Big Data?
Facts & Stats
Facts & Stats Xavier Houot SVP Safety, Environment, Real Estate SCHNEIDER ELECTRIC Schneider Electric: Delivering More Value to Customers with Lower Resource Content
Facts & Stats
Alex Athanassoulas President & CEO STIRIXIS Sustainability in New Business Concept Design
Nick Duckworth Senior Vice President Rental & Used TOYOTA MATERIAL HANDLING EUROPE Second Life Strategy
CORPORATE Dionisis Ammolohitis CEO MANIFEST A Holistic View of Circular Facilities OTE GROUP Sustainable Development with Information and Communication Technology
Ioannis Kallias CEO TÜV AUSTRIA HELLAS Circular Economy: How Certification Counts
Nadine Cino LEED AP, CEO & Co-inventor TYGABOX “Unstuff” the Planet | Share Your “Stuff”
Facts & Stats
Facts & Stats
VISIONARIES Anders Wijkman Co-President Club of Rome A Circular Economy for Lower CO2 Emissions and More Jobs
About Global Sustain
About Yearbooks
Facts & Stats
Ida Margrete Meier Auken Founder Ditte Lysgaard Vind Co-Founder Danish Network for Circular Economy Circular Economy Is the Opportunity of a Life Time to Ensure Sustainable Growth for All Volkmar Klein Member German Bundestag Circular Economy: A Policy Maker’s Perspective Wanda Lopuch Chairwoman Global Sourcing Council Responsible Supply Chain Management and Sustainable Consumption and Production: True stories
Acronyms and abbreviations
List of tables, graphs, figures, facts and stats
Michael Spanos Managing Director Global Sustain
Sustainable Consumption & Production Towards a Circular Economy
T
he current “take-make-dispose” linear economy approach results in massive waste while growing tensions around geopolitics and supply risk are contributing to volatile commodity prices. Circular economy is a generic term for an industrial economy that is producing no waste and pollution, by design or intention, and in which material flows are of two types: biological nutrients, designed to reenter the biosphere safely; and technical nutrients, which are designed to circulate at high quality in the production system without entering the biosphere. Circular economy goes beyond recycling as it is based around a restorative industrial system geared towards sustainable consumption and production; some call it the next industrial revolution. In order to secure that future generations can meet their own needs, the way we produce and consume must be revisited. The discipline of industrial ecology (also known as industrial symbiosis) explores how concepts like closing-the-loop, cradle to cradle, waste=food, biomimicry, the blue economy and whole-systems thinking are being used to apply the metaphor of natural systems to the
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production of goods and services in the industrial economy. The business case for circular economy is compelling and businesses around the world are now developing new models that incorporate sustainable consumption and production principles. Ground-level innovation in this field is being driven by large corporations which are piloting business models based on leasing, sharing, product performance, remanufacture and extended life cycle thinking. Barriers in circular economy exist at a macroeconomic level where there are upfront costs that any organisation faced with retooling will have to confront before reaping the benefits of longer-term mitigation of resource price volatility. Barriers also exist in relation to traditional retail finance which can make it costly for SMEs to access finance to support their cash flow if they switch from a sales based business model to a performance-based business model and, lastly, the question of who will own and/or fund the infrastructure for reverse cycles is unclear. Academic research in the field of circular economy, closed-loop systems and sustainable consumption and production is led by the world’s most prominent institutions. Findings in internationally renowned journals now suggest solutions to overcome the barriers in mainstreaming circular economies and present tangible and measurable opportunities as well as competitive advantages not only for large corporations but also for SMEs and startups. Governmental and institutional support and incentives towards circular economy are also on the rise. The European Commission adopted an ambitious Circular Economy Package, which includes revised legislative proposals on waste to stimulate Europe's transition towards a circular economy which will boost global competitiveness, foster sustainable economic growth and generate new jobs. Research and innovation in Europe are financially supported by the Horizon 2020 programme, which is also open to participation worldwide. China has set up CACE, a government-backed association, to encourage circular growth; Scotland has issued its own circular economy blueprint, while the UK economy is 19% circular already. Once a Scandinavian specialty, circular economy has gained momentum in the US where multinationals have taken the lead while regulation is high on the list, particularly for the role it can play in ensuring a decent supply. The circular economy revolution is also in full alignment with the newly adopted United Nations Sustainable Development Goals that shape the 2030 Agenda. Goal 12 aims to “Ensure sustainable consumption and production patterns”, while the eight targets of this Goal cover everything from governmental support, efficient use of natural resources and chemical and waste management to corporate reporting and sustainable lifestyles. Circular economy is presented as an attractive and viable alternative that businesses have already started exploring today. As this Yearbook demonstrates, circular economy has profound consequences for employment, education, money and finance but also induces a shift in public policy, production and consumption models, taxation as well as lifestyles. Some say it is the only way forward for mankind, a statement that an increasing number of stakeholders now endorse.
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Simplified Illustration of a Circular Economy Source: “Scoping study to identify potential circular economy actions, priority sectors, material flows and value chains”. Funded under DG Environment’s Framework contract for economic analysis ENV.F.1/FRA/2010/0044, European Commission, August 2014.
The Environment
POLLUTION PRESSURE AND IMPACTS
[ ]
The Economy Recycling Companies
Imports Raw material extractors
Recycling Eco-design
INOGRANIC
Outputs: Products Services Waste
PRODUCTION PROCESS internal Material Reuse
RemanufacturingRefurbishment
Waste Management Companies
Maintenancereuse distribution
Industrial Symbiosis
Biological resources & Ecosystem services provision (Domestics)
Recycling /Reuse
Parts Manufacturer
Product Manufacturer
Raw material extraction (Technical Materials)
Technical Materials
Maintenance
DISTRIBUTION: Local to national service Provision e.g. leasing
Byproduct Re-use
ENERGY RECOVERY
Demand/Use: Domestic Public, private sector Households EXPORTS Food Sharing
BIO-BASED
Product Re-use Second Hand Goods
Retailers & Service Providers
COLLECTION
LANDFILL
Other Disposal
Cascade Exports
Farmers, foresters, fishes Extraction of biochemical feedstock, Anaerobic Digestion / biogas & Composting
Imports
POLLUTION PRESSURE AND IMPACTS
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[ ] Biological Materials
Farmers & Argo-Food industry
The Circular Economy - an Industrial System Restorative by Desing Source: “Towards the Circular Economy: Accelerating the Scale-up Across Global Supply Chains� World Economic Forum, Ellen MacArthur Foundation, 2014. Biological materials
Technical materials Mining/ materials manufacturing
Farming/ collection1
Restoration
Parts manufacturer
Biochemical feedstock
Biosphere
Recycle Refurbish/ remanufacture
Product manufacturer Service Provider Cascades
Reuse/ redistribute
Biogas Maintenance
Anaerobic digestion/ composting2 Extraction of biochemical feedstock2 1 Hunting and fishing 2 Can take both postharvest and
postconsumer waste as an input
Consumer
User
collection
collection
Energy Recovery Leakage - to be minimised
Landfill
Mother Earth… cries out to us because of the harm we have inflicted on her by our irresponsible use and abuse of the goods with which God has endowed her.
We are what we repeatedly do. Excellence, then, is not an act, but a habit.
Pope Francis,
Greek philosopher and scientist (384 B.C. – 322 B.C.)
266th and current Pope of the Roman Catholic Church (1936 – )
Aristotle,
The nation behaves well if it treats the national resources as assets, which it must turn over to the next generation increased. Theodore Roosevelt,
American statesman, author, explorer, soldier, naturalist and reformer, 26th President of the United States of America (1858 – 1919)
You see things as they are and ask why? I dream things as they never were and ask why not? George Bernard Shaw, Irish playwright, critic and controversialist (1856 – 1950)
K e y n o t e
A r t i c l e s
An Urgent Response to Climate Change in the Mediterranean
Gaetano Leone Coordinator UNEP/Mediterranean Action Plan Barcelona Convention Secretariat
L
ooking beyond the perspective of the historian, the philosopher, the ar tist, the tourist and the researcher — who passionately come to the Mediterranean — one sees that this uniquely beautiful, rich and complex region, probably more than any other regional sea in the world, is a fundamental source of development; a vast set of coastal and marine ecosystems that delivers valuable benefits to all of its inhabitants. Here, the importance of ecosystems to livelihoods, economic, social, physical and mental well-being as well as cultural heritage is under our eyes; it is an integral part of our identity as peoples of the Mediterranean. However, in several fields, development and progress still conflict with environmental considerations. The transition to a green economy and long-term sustainability is progressing at a slow pace. At the same time, climate change is arguably one of the most critical challenges that the Mediterranean region is facing. The basin has been identified as one of the two most responsive regions to climate change, globally. The recent IPCC Fifth Assessment Repor t considers the region as “highly vulnerable to climate change”, one area that “will suffer multiple stresses and systemic failures due to climate changes”. Currently, responses to climate-related pressures and hazards are often
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limited to short-term and reactive local emergency measures. However, building environmental and socioeconomic resilience against climate change at the regional level is about proactive, longer-term and integrated planning that addresses existing aspects of unsustainable development as drivers of vulnerability and guides the economic development of the region in a more sustainable direction. In this framework, the shift to sustainable patterns of consumption and production leading to a circular economy is a key solution to respond to climate change with a long-term vision, which is attractive for the business sector as it offers new economic opportunities and boosts job creation. These new paradigms are likely to illuminate the paths to the necessar y decoupling between prosperity and use of resources and to provide credible responses to the sustainability challenges being faced today. A new study from the Club of Rome, a global think-thank, highlights that moving to a circular economy by using and reusing rather than using up would yield multiple benefits, and concludes that by 2030, carbon emissions could be cut by almost 70% if a key set of circular economy policy measures were adopted. The recently adopted EU Circular
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
Economy Package is a ver y good step towards this direction. And the Mediterranean region is not at the rear of the pack. In February 2016, the 22 Contracting Par ties to the Convention for the Protection of the Marine Environment and the Coastal Region of the Mediterranean (known as the Barcelona Convention) adopted a Regional Action Plan on Sustainable Consumption and Production. The document constitutes a forward-looking framework to move towards a circular economy in the region. The Barcelona Convention, which celebrates its 40th anniversary this year, constitutes one of the most advanced regional policy frameworks for sustainable development. It is an international treaty that has identified the shift to sustainable patterns of consumption and production as a necessary objective to decouple human development from the degradation of marine and coastal environment. At the same time, the Governments of the Mediterranean have launched a Mediterranean Strategy for Sustainable Development 2016-2025, which also builds on new and emerging paradigms, such as the circular economy vision of a sustainable Mediterrenean, where sustainable development takes place within the carrying capacity of healthy ecosystems. But, as crucial as it is, building and
mobilising public policy is only the first step towards that vision. The most arduous par t is ahead of us: implementation. The challenges to make it happen are multiple and the regional action plan will have to be translated into national commitments and finally local actions. Furthermore, the development of specific funds to suppor t sustainable innovations in the private sector is a prerequisite for their success. The goods manufacturing industry; the housing and construction sector; the food and agriculture area; and, also, the whole tourism value chain are among the key targeted sectors in the region to shift towards long-term sustainability and new paradigms in the use of resources as well as the production and consumption patterns responding constructively to the challenges posed by climate change. All stakeholders, from big businesses to individual citizens, have a role to play. Several Mediterranean entrepreneurs have already made the shift. Those changemakers, gathered in the Switchers platform, must be multiplied urgently in all sectors as the Mediterranean region needs them to ensure its future. The process towards a circular economy has started, and its relevance to the complexity of the Mediterranean region is vital to find effective responses to the challenges of climate change.
INFO Gaetano Leone, a national of Italy, is the Coordinator of the UNEP/Mediterranean Action Plan-Barcelona Convention Secretariat. He has served as Senior Programme Officer in the Division of Regional Cooperation in Nairobi, Kenya. He has also served as the Secretary of the Committee of the Whole for UNEP’s Governing Council from 2005-2007. Mr Leone has extensive experience in international relations and management, including broad UN experience in programme and administration in both headquarters and in the field. Prior to joining UNEP in 2002, Mr Leone worked with UN-Habitat for over a decade in posts such as Personnel Liaison Officer (Programme Support Division, Kenya), The Cities Alliance Member of the Secretariat (World Bank, Washington, DC), Liaison Officer (New York), Special Assistant to the Executive Director/Secretary-General of the Habitat II Conference (Kenya) and AHSO, Inter-Organization Affairs Unit (Kenya). He has also worked with UNICEF and UNDP during his professional career. The United Nations Environment Programme (UNEP) is the leading global environmental authority that sets the global environmental agenda, promotes the coherent implementation of the environmental dimension of sustainable development within the United Nations system and serves as an authoritative advocate for the global environment. www.unep.org The Mediterranean Action Plan (MAP) is a regional cooperative effort involving 21 countries bordering the Mediterranean Sea as well as the European Union. Through the MAP, these Contracting Parties to the Barcelona Convention and its Protocols are determined to meet the challenges of protecting the marine and coastal environment while boosting regional and national plans to achieve sustainable development. The 22 Contracting Parties to the Barcelona Convention are: Albania, Algeria, Bosnia and Herzegovina, Croatia, Cyprus, Egypt, the European Community, France, Greece, Israel, Italy, Lebanon, Libya, Malta, Monaco, Montenegro, Morocco, Slovenia, Spain, Syria, Tunisia and Turkey. www.unepmap.org www.theswitchers.eu
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From Regional Commitment to Local Actions: Towards a Circular Economy in the Mediterranean Countries
S
hifting to Sustainable Consumption and Production involves the combined implementation of a range of tools and measures aiming at redesigning the way in which goods and ser vices are produced and consumed, with the objective to drive the revitalisation of the industrial and socioeconomic development towards nonpollutant and circular economies.
Enrique de Villamore Director
Magali Outters Team Leader
SwitchMed Policy Area, Regional Activity Centre for Sustainable Consumption and Production (SCP/RAC)
Regional Activity Centre for Sustainable Consumption and Production 24
Last Februar y, the 19th Ordinar y Meeting of the Contracting Parties to the Convention for the Protection of the Mediterranean Sea Against Pollution (hereinafter the Barcelona Convention), gathering ministries representatives of the 22 Contracting Parties, adopted decisions on key strategic actions, for the short- and the mid-term, addressing the dramatic environmental degradation trends in the Mediterranean region. One of the most supported unanimous decisions consisted in the adoption of a Sustainable Consumption and
Production Action Plan for the Mediterranean. The preparation of such a strategic document included a long consultation process involving Governments and regional stakeholders. The Mediterranean Action Plan of the United Nations Environment Programme (hereinafter UNEP/MAP) has been a pioneer in integrating Sustainable Consumption and Production (SCP) in its regional strategic programme since 2005. This forefront position has been consolidated by the identification of SCP as cross-cutting theme of the UNEP/ MAP Mid-term Strategy for 2016-2021 and as one of the six main objectives of the Mediterranean Strategy for Sustainable Development (MSSD) 2016-2025. Furthermore, SCP/RAC is a centre established by the Barcelona Convention with the specific mandate of providing support to the Contracting Parties in the promotion of SCP.
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
But What Is This SCP Action Plan About? The SCP Action Plan is a strategic document that gives clear orientations on the actions that should be developed in the region in order to switch to sustainable patterns of consumption and production. The document is structured around four key areas which are essential for the socioeconomic development and the job market but, at the same time, are contributing significantly to the pollution loads and the environmental degradation of the region. Those four areas are the sectors of food, fisheries and agriculture, tourism, goods manufacturing as well as construction and housing. For each of the four sectors, the SCP Action Plan identifies three categories of operational objectives: the first one is focusing on the establishment of a strong knowledge base, research and development and the use of innovative
technologies, ecodesign and best practices to implement the circular economy. The second one aims at promoting good governance, policy and institutional framework to support practices. It includes the development of sustainable procurement procedures for public purchases which often represent one third of the GDP but, also, the design of economic development to support sustainable products markets. Last but not the least, the third category of objectives focuses on sensitising and raising awareness of all stakeholders, including consumers. It also aims at building capacities to support marketing processes and market development tools aimed at promoting sustainable consumption and livelihood models. Furthermore, it also includes actions for the better visibility of ecolabelled products and services on the market.
Who Is to Implement the Action Plan? Being aware of the challenges the
region is facing for its prosperity and sustainable development, Mediterranean governments are striving to initiate the policy reforms required to accelerate the adoption of techniques and strategies enabling the shift to circular economies. Many countries are doing it either through new sectorial regulations addressing strategic sectors (waste, tourism, industry, food, education, etc.), specific national plans, strategies on green economy or sustainable consumption and production. Public authorities will have to facilitate the framework in order to enable the transition and give clear signals to the economic operators and the society at large; however, they cannot act on their own. SCP Action Plan objectives will only be achieved through the combined and ar ticulated implementation of diverse actions, involving not only policy makers but also businesses, retailers, academia, civil society and consumers.
In particular, economic actors will be essential in driving this process forward. But they will need a clear signal from consumers asking for better offer of sustainable products and services and, at the same time, a strong support from financial agents. The latter will be crucial to driving the sustainable investments and supporting the Mediterranean SMEs and green entrepreneurs providing eco and social innovative solutions.
And How to Implement It? The EU-funded SwitchMed Programme is currently providing great support for the implementation of the SCP Action Plan objectives in the Southern and Eastern basin of the Mediterranean. This five-year programme includes a policy, a demonstration and a networking component and provides technical support to policy makers, businesses, entrepreneurs and civil society organisations for developing measures to boost ecoefficiency and ecoinnovation. TheSwitchers.
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The 19th Ordinary Meeting of the Contracting Parties to the Barcelona Convention, Athens, 2016 eu platform, developed under this programme, showcases successful stories of entrepreneurs and SMEs from the Mediterranean countries and the main economic sectors targeted by the SCP action plan. It is a space to inspire and connect those who want to join the increasing number of Mediterranean changemakers that are offering alternatives to the consumers in the framework of circular economy.
From a Regional Strategy to Local Impacts The recognition of SCP as key priority for the sustainable development of the Mediterranean region is undoubtedly an essential step and a great milestone. But it is the first seed for the translation of this individual action into numerous
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and diverse local actions that will actually create the expected impact. The main challenge is now for the development of mechanisms to move from global and regional commitments to national engagements and, finally, to local results. Suppor t for small-and medium-sized businesses, which represent 80% of the Mediterranean companies, and green entrepreneurs is critical. This support is necessary in order to develop, create and replicate ecoinnovative ideas that will contribute to building Mediterranean circular economies and offer new alternatives to the consumers. The good news is that citizens and civil society are taking the lead in
making the change happen. New business opportunities and models are following them, as well. Although still a minority, more and more people are deciding to switch to consumption choices and lifestyles through which they can contribute to a shift towards environment - and health-friendly economies. In Spain, Som Energia, a Catalan renewable energy cooperative founded in 2010, already counts 25,000 members only five years after its launching. In 2015, also in Spain, Triodos, a bank only investing in businesses and initiatives considered to be of social or ecological benefit, especially in the fields of renewable energy, organic farming or culture,
increased its number of customers by 15,4%, amounting to a total of 204,000 and with a 26% of growth compared to 2014. In Egypt, Sekem evolved from a biodynamic farm to a holding company producing and distributing sustainable food, textile and pharmaceutical products, always keeping at its core the sustainable development principle and the community wellbeing values. Nowadays, Sekem employs 1,350 people in its companies and the Sekem Development Foundation and hundreds of seasonal workers. In Lebanon, VEA™ is a fashion brand producing high quality bags and fashion accessories. Their products are made of old tyres, inner rubber tubes from bicycles, cars and trucks that VEA collects and are then converted into elegant
INFO
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
Enrique de Villamore is the SCP/RAC Director. He has been involved in SCP/ RAC since 2002. He worked as project manager from that year to 2010 when he was appointed as the centre’s Director. Mr De Villamore and other members of the center jointly led a process of transformation of the SCP/ RAC through which the centre was finally assigned the mandate of promoting SCP in the 21 contracting member countries of the Convention of Barcelona. In that task, he actively contributed to the progressive integration of SCP and green enterpreneurship as well as the empowerment of civil society as main drivers for sustainable development within the framework of the UNEP/ Mediterranean Action Plan. Mr De Villamore has a Law degree from the Autonomous University of Barcelona. Ever since he was awarded his degree, he has directed his career to sustainability-related issues. He has, inter alia, a Master degree in Environmental Law from the Basque Country University.
creations sketched by professional local designers, exclusively for the company, and manufactured in an environmentally sustainable manner. In Algeria, Eco-labina is a young company created by two women that develop construction materials, like mudbricks, based on local, natural and renewable resources and with excellent technical performances. The above mentioned initiatives are just few of an increasing movement of changemakers, entrepreneurs and businesses that are leading the transition towards circular economies in the Mediterranean countries, however they need better suppor t from public authorities and financial actors. Governments and organisations
promoting the cooperation among the Mediterranean countries recognised this necessity and are striving to develop the instruments required to provide the appropriate incentives and signals to accelerate the shift to patterns of consumption and production that are sustainable and in line with the circular economy approach. That is what the SCP Action Plan is aiming at; strengthening the framework that favours and supports the multiplication of such initiatives.
Magali Outters, Team Leader of the SCP/RAC Policy Area, holds an Engineering degree in the specialty “Materials: Economics and Environment” from the University of Technology of Troyes (France). She, also, holds a Master degree in Industrial Ecology, precursor of circular economy, as well as a postgraduate degree in International Development. She gained significant expertise in sustainable consumption and production in the Mediterranean region after more than 10 years of promoting this approach and by being actively involved in numerous capacity building projects and technical studies; developing specific tools and pilot initiatives with governments, private sector organisations and civil society. She recently coordinated the process of developing a Mediterranean SCP Action Plan adopted by all the Mediterranean countries last February. The Regional Activity Centre for Sustainable Consumption and Production (SCP/RAC) has an official mandate assigned by the Contracting parties to the Barcelona Convention to promote the development and innovation in the production sector and civil society, based on Sustainable Consumption and Production Patterns (SCP). Likewise, SCP/RAC is also Regional Centre for the Stockholm Convention, an International agreement involving around 180 countries to fight against persistent organic pollutants, highly polluting and toxic substances. In the framework of its mandate SCP/RAC aims at providing knowledge, training, advice and networking opportunities to businesses, entrepreneurs, financial agents, civil society organisations and governments on: • initiatives for innovation and entrepreneurship that contribute to a healthier and more sustainable lifestyle for citizens; • adopting eco-innovation and eco-design as factors of competitiveness and economic performance for SMEs; • preventing the generation of hazardous chemicals and their use by means of safe alternatives, best available techniques (BAT) and best environmental practices (BEP); • introducing education on sustainable consumption and lifestyles into the work plans of civil society-led initiatives; www.scprac.org / www.switchmed.eu / www.theswitchers.eu
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The European Commitment to Circular Economy
W Frans Timmermans First Vice-President European Commission
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hile global consumption is set to increase, many natural resources are finite and the pressure on land, water, climate and energy is huge. This means that the “take-make-dispose” pattern on which most of our economies rest is no longer sustainable. The challenge Europe faces is to transform our economy from a “linear” to a “circular” model. The job creation potential of the circular economy is considerable and the demand for better, more efficient products and services is rising. We need to find the right policy and market tools to remove the barriers that make it difficult for businesses to optimise their resource use. It is high time we had a functioning internal market for secondary raw materials, to give just one example. The European Commission
wants to achieve real progress on the ground in the coming years, delivering on an ambitious programme, together with not only the 28 Member States, regions and municipalities, but also small businesses, big industr y and civil society.
Closing the Loop One of the first things the new European Commission committed to do, when taking office in November 2014, was to prepare a new Circular Economy Package. The aim was to close the loop and make the circular economy truly circular, meaning going beyond setting targets for waste reduction. The new approach combines ambitious recycling targets with the creation of economic conditions for a sustainable approach
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
throughout the whole product cycle. It is not enough to just ask our consumers and businesses to find a solution at the end of the product life cycle when it comes to disposing their waste. Some of the questions we put to ourselves were: • How can we expect people to recycle more and avoid landfilling when there is no market to recycle waste products? • How can we ask people to dismantle products and extract secondary raw materials if they are not designed with this in mind? • How can Europe change the way the whole world produces if we are holding on to an economically unsustainable model?
We made “the economy” a central par t of the circular economy and put “circular” at the heart of it. Our objective: to make recycling and efficient resource use a financially rewarding thing to do as well as a morally and environmentally rewarding thing to do.
An Ambitious Commission Proposal The European Commission proposal presented at the end of 2015 gave a positive signal to those waiting to invest in the circular economy in Europe. The message is clear: Europe wants to be the best place to grow a sustainable and environmental - friendly business. To this end, we take action in each step of the value chain — from
production to consumption, repair and remanufacturing, waste management and secondar y raw materials that are fed back into the economy. The transition towards a more circular economy is clearly set into motion and is about reshaping the market economy and improving our competitiveness. Moreover, it can create local jobs, which are not easy to relocate, both low and high-skilled jobs as well as opportunities for social integration. As far as the targets for waste reduction are concerned, we have designed our scheme to reflect the wide diversity of star ting points between our 28 countries. There is, however, no blank cheque for those who are lagging behind; while there is some flexibility, everyone will be expected to make an important
effort. Our goals are ambitious but feasible and give the public and private sector the long-term certainty that will trigger investment and make lasting changes in economic models. Given their national competences, our Member States have an important role to play in creating the right economic incentives and will have to make greater use of economic instruments — such as landfill taxes and incineration charges. These have proved to be very effective instruments on the ground, at local and regional levels all over Europe. As long as landfilling is a cheap option, it is an option a local mayor will not give up on. We also have to be careful that diminishing landfill does not only lead to the cheap option of incineration, so
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WHAT IS CIRCULAR ECONOMY?
we have foreseen a perspective that allows investors to make a smart switch avoiding long-term lock-in investments.
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Building a Competitive Edge for Europe
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With resource efficiency, leadership in green technologies, smart product design and strict waste management, we can build a competitive edge, generate new business opportunities and create jobs. Creative initiatives by businesses and citizens already show the way; there are more and more examples, whether it is car sharing, repair cafÊs or green packaging. So the question is not whether we will go circular, but how fast we will go circular and how quickly we can create these jobs and attract the necessary investments. We are therefore backing up our legislative and policy proposals with financial instruments and funds — with
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Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
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EUR 650 million from our research funding programme Horizon 2020 and EUR 5.5 billion from our structural funds from now to 2020. The right investments should help us to be more resource efficient and reduce our dependency on scarce raw materials and put us in the lead on the production and consumption patterns of the future. We will not compete on wages; we want to compete on the way we produce and the sustainability of our products.
A Sustained Commitment to Sustainable Development The Action Plan which we adopted at the end of 2015 establishes concrete and ambitious measures that set a clear environmental and economic direction for Europe. In the next years, we will put these plans into practice to boost investment in competitive technologies and businesses, create
green jobs, promote sustainable economic growth and ensure that we protect our planet for future generations. Making this transition towards a circular economy is not only a must-do for Europe, but also for the world. A shift towards more sustainable production and consumption is a key part of the global 2030 Agenda on Sustainable Development adopted by the UN in September 2015. Moreover, the circular economy can bring a substantial cut in carbon emissions and enhance energy efficiency, supporting the ambitions of the Paris climate agreement of December 2015. Europe is committed to take the lead in this global transition and seize the opportunities of developing a low-carbon and competitive circular economy.
Frans Timmermans ser ves as the First Vice-President of the European Commission and is in charge of Better Regulation, Inter-Institutional Relations, Rule of Law and the Charter of Fundamental Rights in the Juncker Commission as from 1 November 2014. Mr Timmermans previously served in the Dutch Civil Service (1987–1998), as Member of the Dutch Parliament, representing Partij van de Arbeid (Dutch Labour Party, 1998–2007; 2010–2012), as Minister of European Affairs (2007–2010) and as Minister of Foreign Affairs (2012– 2014). Mr Timmermans obtained a degree in French language and literature from Radboud University Nijmegen (1980-85), followed by postgraduate courses in European Law and French Literature at the University of Nancy (1984-85). The European Commission (EC) is the European Union’s (EU) executive body. It represents the interests of the EU as a whole (not the interests of individual countries). The term “Commission” refers to both the College of Commissioners and to the institution itself. The EC’s main roles are to propose legislation which is then adopted by the co-legislators, the European Parliament and the Council of Ministers; enforce European law (where necessary with the help of the Court of Justice of the EU); set objectives and priorities for action, outlined yearly in the Commission Work Programme and work towards delivering them; manage and implement EU policies and the budget; represent the Union outside Europe (negotiating trade agreements between the EU and other countries, for example). The EC has its headquarters in Brussels, Belgium, and some services also in Luxembourg. The Commission has Representations in all EU Member States and 139 Delegations across the globe. A new team of 28 Commissioners (one from each EU Member State) is appointed every five years. The current Commission’s term of office runs until 31 October 2019. Its President is Jean-Claude Juncker. The Commission sets an example by reducing the environmental impact of its own activities through EMAS. This includes using natural resources efficiently, reducing overall CO2 emissions, preventing waste, ensuring recycling and reuse, green public procurement and sustainable mobility. www.ec.europa.eu
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A Win for our Economy and the Environment
Sirpa Pietikäinen
Member of the European People’s Party (EPP) European Parliament
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I
t has been forecasted that global demand for resources will triple by 2050, including some 70% increase in demand for food, feed and fibre. We already consume some 1.5 globes worth of resources every single year and, following the estimates, would need around four planets full of resources to satisfy the demand by 2050 under business as usual. There are however limits to growth — we only have this one planet.
either going to be hit the hardest by resource scarcity or benefit the most from resource use efficiency.
We are in overshoot mode, and that mode has to be switched to a more sustainable one. What we need is a true paradigm shift, one that will benefit both our economy as well as our environment.
In this challenge there is also a huge oppor tunity, however. The one who can deliver solutions for the resource efficiency dilemma is also the winner of the new economic race: this means solving the problem of doing more with less, getting more added value with less resources. In circular economy there is no waste, products are designed to be durable, reusable, repairable and recyclable and, when they come to the end of their life, the resources contained in these products are pumped back into productive use again.
Europe is extremely dependent on imported raw materials and energy, much more so than many of our competitors. Resource scarcity increases prices — that is simple economics. Almost 90% of European companies expect their material input prices to continue rising, according to a Eurobarometer survey. With raw materials running shor t, Europe is
If we look at these facts, it is clear that European economy cannot sur vive, let alone grow, unless we take some radical steps to increase our resource efficiency and move towards a true recycling economy. We have to stop wasting precious resources and start using them more efficiently.
Business-driven studies demonstrate significant material cost-saving
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
opportunities for EU industry and a significant potential to boost EU’s GDP. The Commission has, for example, calculated that increasing resource productivity by 30% by 2030 would create two million new jobs while boosting our GDP by one percent. Many businesses have already recognised these facts and started to act accordingly. They have taken a leap to a different mindset, to one where the whole logic of successful business is turned upside down. These firms have created new business models to deliver greater resource efficiency and circular models, including increased renting, sharing, leasing, bio-innovations, remanufacturing. In order to support this change we, however, also need to change the rules of the game. A lot of our thinking and the bulk of the current legislation are created for the needs of consumeand-throw-away society. We need a new regulatory framework that fits the new world order. That is the work of us politicians. Regulation is never neutral. Legislation is one of the essential
drivers of the business revolution, as businesses and investors alike need a stable and predictable regulator y environment in order to change. To drive the business revolution, we need commonly-agreed and harmonised indicators to measure the change. We need clear targets. We need to draft such legislation that will make sure that what is considered waste nowadays is not considered such anymore ⎯but is seen as a resource. This requires a change to how things are being produced: products need to become more durable, easy to upgrade; reuse; refit; repair; recycle and dismantle for new resources. A reformed and enlarged EU ecodesign directive is a crucial tool to ensure resources stay in the loop. Perhaps the most compelling reason to embrace resource efficiency and circular economy models is that we do not really have a choice. Further pressure on supplies of resources as demand increases in emerging markets will force us, sooner or later, to use those resources more carefully.
INFO Sirpa Pietikäinen is a Finnish member of the European People’s Party (EPP) in the European Parliament. Ms Pietikäinen is former Finnish Minister of Environment (1991-1995). Her career at the Finnish parliament is extensive, ranging from the year 1983 to 2003. She first came to the European Parliament to replace Alexander Stubb in 2008, and was re-elected in 2009 and 2014. At the European Parliament, Ms Pietikäinen is member of the Economic and Monetary Affairs Committee and substitute member of the Environment, Public Health and Food Safety Committee, Special Committee on Tax Rulings as well as of the Women’s Rights and Gender Equality Committee. In the ENVI-committee she has been responsible for own-initiative report on Circular Economy. She was also the EPP-shadow person attending the work of the Special Committee on the Financial, Economic and Social Crisis. A graduate from the Helsinki School of Economics, Ms Pietikäinen holds an MSc in Business and still teaches university courses on negotiations theory and practices. The European Parliament is an important forum for political debate and decision-making at the EU level. The Members of the European Parliament are directly elected by voters in all Member States to represent people’s interests with regard to EU law-making and to make sure other EU institutions are working democratically. Over the years and with subsequent changes in European treaties, the Parliament has acquired substantial legislative and budgetary powers that allow it to set, together with the representatives of the governments of the Member States in the Council, the direction in which the European project is heading. In doing so, the Parliament has sought to promote democracy and human rights not only in Europe, but also throughout the world. www.europarl.europa.eu/portal/en
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From Optimism to Optimising
2 Dr Janez PotoÄ?nik Co-Chair International Resource Panel
015 was for me a year for optimism. Why you might ask. Two major successful international conferences mark a clear development towards sustainable societies: the adoption of the Sustainable Development Goals (SDGs) in September 2015 and the adoption of the Paris Agreement on Climate Change in December 2015. Both agreements are bold and ground breaking. They are universal and reaching out to every UN state party. They require action from all — the poor and the rich; the developing and the developed countries; from the G7 to the G77. And what both of them also have in common is that they mark the
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transition towards a new economic model: the integration of environmental sustainability with economic progress. Achieving all of the 17 SDGs requires the sustainable use of our resources and Goal 12 on sustainable consumption and production is a prerequisite to realise many of them, from ensuring health and well-being (SDG 3) to sustainable cities (SDG 11) to combating climate change (SDG 13), just to mention a few. In just one generation, by the year 2050, we will be 9.7 billion people sharing this planet. Even more important, the middle class will, according to the estimates made by McKinsey, increase from 1.8 to 4.9 billion people between 2010 and 2030, meaning an increase
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
of 170%; this will be the key driver of changing consumption patterns. Just as an example, in Ghana, within six years, the ownership of cars and motorbikes increased by 81%. If you scale such examples up to cover global needs for mobility and housing and food, the quantity and the variety of the needed resources will dramatically increase worldwide. About 68 billion tonnes of materials were used globally in 2009, a third more than in the year 2000 and two thirds more than in the year 1990. As a consequence, there is a growing demand for other natural resources. For example, the production of a mobile phone does not only require 60 different materials, such as metals, ceramic or plastics, but also 1.300 litres of water.
As our consumption increases we put strain on the finite resources. Another important factor to be taken into account is the worldwide increase of import dependency as clearly shown in one of the recent repor ts of the International Resource Panel (IRP) on "International Trade in Resources: A biophysical assessment, 2015". More and more countries worldwide are becoming net importers of materials and in doing so they become increasingly reliant on trade to supply the resources they need. Europe, for example, has to impor t 90% of its requirements for 54 scarce and economically important raw materials from abroad. But also emerging countries have an
increasing demand for imports. Our interdependency can be beneficial as it enables specialisation and efficient resource allocation; however, it also increases our vulnerability. The message of these facts is clear: we cannot continue to increase our wellbeing only through increasing resource consumption. The linear economic model of �take-make-consume-dispose� is outdated. As Ban Ki-moon stated, "The era of consumption without consequences is over"1. But what does this imply for our society and for our economic model? The IRP, set up by the United Nations Environment Programme (UNEP) in
2007, is building and sharing the knowledge needed to improve our use of resources worldwide. It provides a science-policy inter face responding to economic growth, the escalating use of natural resources and the deterioration of the environment and climate change. Our reports provide analysis and advice which connect the perspectives of policymakers, industry and the community on ways to improve global and local resource management. Our 2011 report on "Decoupling natural resource use and environmental impacts from economic growth" tackles the fundamental question of how we change our current consumption patterns in order to achieve a sustainable lifestyle.
1 http://www.un.org/press/en/2016/sgsm17695.doc.htm
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Decoupling growth from resource use and environmental impacts was clearly identified as the way forward. Raising resource efficiency and monitoring four factors — materials, land, water and GHG emissions — were identified as being essential for the development of policies and the promotion of investment to lower our resource consumption and GHG emissions. Such measures also confer social and health benefits, such as more equitable access to resources and products, reduced pollution, longer lasting products and better access to their services. The problem of climate change is intrinsically linked to natural resource management. GHG emissions can
only be curbed effectively when we star t reducing our demand for both energy and virgin materials. The nexus is very visible here: less consumption of material requires less energy and, consequently, reduces the emission of GHG. The decoupling of our economic growth and human well-being from our resource use must be an integral part and prime concern of climate policy. Resource efficiency is about increasing productivity; doing more with less. Circular systems are taking this to another level by maintaining the value of products, materials and resources in the economy for as long as possible and minimising the generation of waste. It requires action
2 http://www.unep.org/annualreport/2015/en/in-focus-achim-steiner.html
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along the whole product life cycle, from production to consumption, repair and remanufacturing, waste management and secondary raw materials. It provides far greater possibilities to decouple economic growth and well-being from the consumption of resources; it spurs innovation and new business models. One trend, for example, is to offer access to the performance instead of selling the physical product. Lighting producers are selling light, instead of light bulbs; the producer retains ownership of the physical product and is responsible for the performance. This revolutionises the design of products which become more durable and less wasteful. We can also witness a shift in the consumer behavior. Airbnb, Zipcar, Netflix focus
on access rather than on ownership. The circular economy not only offers us a sustainable, low-carbon, resource ef ficient economy by decreasing our resource demand and resource dependency, but it will also increase employment and improve our competitiveness. Achim Steiner, Executive Director of UNEP, summarised it in one sentence: "The idea that environmental sustainability is not an impediment to, but a driver of, development and human well-being"2. With the "Rapid Assessment on Global resource efficiency prospects and economic implications" the IRP has prepared a synthesis repor t at
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
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the request of the G7, highlighting the potentials and prospects for resource efficiency in industrialised countries as well as in emerging market economies and developing countries. It clearly shows that there are substantial opportunities for increasing resource efficiency and productivity in the global economy and by realising these opportunities, a sound foundation for sustainable economic growth is provided. The good news is that it is already happening. It will be a disruptive change, but also a creative one. Our challenge is to maximise the creative potential whilst minimising the destructive impacts. The role of policy makers is to provide the stable framework conditions for that to happen.
Since we face a systemic problem, we have to come up with systemic solutions. Therefore, an integrated policy approach is needed; circular economy is not just an environmental policy; it is an industrial, agricultural, trade, taxation, transport and housing policy and so on. Understanding how to adopt these to a circular future in a systematic way is a challenge and the IRP is here to help. It has encompassed a “systems thinking”, going beyond individual resources. 2015 was the year of optimism, 2016 is the year to start optimising. It is the year to put our global agreements into action; to move from words to deeds.
Dr Janez Potočnik (1958) graduated from the Faculty of Economics of the University of Ljubljana, Slovenia (PhD degree 1993). After a successful career starting in 1989 in Slovenia as a researcher at the Institute of Economic Research, he was appointed Director of the Institute of Macroeconomic Analysis and Development (1994). Following this, he was appointed Head of the Negotiating Team for Accession of the Republic of Slovenia to the EU (1998). He was also Director of Government Office for European Affairs (2000), Minister Councillor at the Office of the Prime Minister (2001) and Minister responsible for European Affairs (2002). In 2004, he joined the European Commission, first as "shadow” Commissioner for Enlargement and then as Commissioner responsible for Science and Research. In 2010, Dr Potočnik became Commissioner for Environment. His term ended on November the 1st 2014. In November 2014, he was appointed for a three-year term as a member and Co-Chair of International Resource Panel hosted by the United Nations Environment Programme. In the same month, he was also appointed as Chairman of The Forum for the Future of Agriculture and RISE Foundation and a Member of the European Policy Centre's Advisory Council. The International Resource Panel (IRP) was launched by the United Nations Environment Programme (UNEP) in 2007 to build and share the knowledge needed to improve our use of resources worldwide. The Panel consists of eminent scientists, highly skilled in resource management issues. Their reports distil the latest scientific, technical and socioeconomic findings around global resource use. They provide advice and connections between policymakers, industry and the community on ways to improve global and local resource management. The Panel includes scientists and governments from both developed and developing regions, civil society, industrial and international organisations. The Panel’s goal is to steer us away from overconsumption, waste and ecological harm to a more prosperous and sustainable future. www.unep.org/resourcepanel
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The Context of Circular Economy
Dr Christian Avérous Former Head of the Environmental Performance and Information Division Organisation for Economic Co-operation and Development (OECD)
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T
he year 2015 was an exceptional key year with three major UN summit meetings for reorienting sustainable and inclusive development: Addis Ababa (June 2015) reforming the financing of development, New York (September 2015) adopting Sustainable Development Goals (SDGs) and, Paris (December 2015) agreeing on fighting climate change. Together they provide universal commitments full of wisdom and ambition towards 2030 and beyond. This reorientation of development efforts is buttressed by those towards green and inclusive growth from OECD, IMF and the World Bank, as well as G20, the European Union and other regional structures. What is now required is implementation, implementation and implementation. A transition towards sustainable consumption and production patterns and towards green and inclusive growth requires the necessar y conditions for reducing carbon dependency and improving resource efficiency globally, regionally, nationally. Perhaps the concern with resource ef ficiency and resource stocks was the most important contribution of the green growth movement. In short, establishing resource efficient economies and moving to circular economies have become fundamental to achieving green growth and more broadly achieving sustainable and inclusive development.
Resource ef ficiency and circular economy are part of many of the new UN Sustainable Development Goals. Measuring resource ef ficiency is central to understanding the circular economy concept and to policy action towards related improved sustainable consumption and production. It requires a framework to address the material basis of the economy, including material flows and resource productivity, related data and related indicators. This means, inter alia, knowledge on flows and stocks of resources, on their economic and environmental significance, their physical (e.g. in kg) and economic amounts (e.g. in monetary units), on circular business models, on global and sector aspects. Resource efficiency is also related to trade concerns. For instance, it is an import concern for material intensive economies (e.g. Korea, China, Japan, Germany, EU); for example, France’s trade balance in recycled material reached close to EUR 3 billion in 2014, and was multiplied by eight over the last 15 years. About 20% of the raw materials extracted in the world end up as waste. Their recycling and reuse leads to growing secondary material markets. Unused ”urban mines” could become further sources of raw materials. While there are signs that the global economy used less and less material per unit of GDP over the last three decades (i.e.
INFO absolute decoupling), the material used per capita remains high, generating concerns of overuse of the natural asset base of the planet and excessive “footprints” for some materials. The framework needs to respond to the policy context including relationships between consumption and production, economic growth, international trade, environmental issues and technological changes. The material basis of the economy refers to stocks and flows of major groups of material: i) biomass for food and feed, ii) wood, iii) fossil energy, iv) construction minerals, v) industrial minerals, vi) metals and metal ores. It also refers to flows of waste and recycled materials and to stocks of material whether natural or man-made (“urban mines”). Data and indicators are available for material and products of international importance such as iron and steel, copper, aluminium, paper, phosphorus and rare ear th elements. For instance the latter include Cerium, Europium, Lanthanum, Neodymium, Praseodymium, Promethium, Samarium as well as Dysprosium, Erbium, Gadolinium, Holmium, Lutetium, Terbium, Thulium, Ytterbium and also Scandium and Yttrium, which are used in batteries, catalysts, ceramics, glass industry, magnets, metallurgy, phosphors and other applications in the defense, chemicals, nuclear and water
sectors. They have significant economic, security of supply and environmental dimensions. Over the last 15 years, much progress has been made towards such metrics to analyse material flows and resource efficiency, although gaps concerning, for instance, resource prices, taxes and subsidies are remaining. Today, the leading international programmes are those of the UNEP, the OECD and the EU. Overall, resource efficiency changes are partly due to policy actions, with some countries achieving absolute decoupling of material consumption from economic growth thanks to good waste management, resource efficient strategies, extended producer responsibility. But the development of the services sectors increases in offshore resource production, and economic cycles are also influential factors. Knowledge is now available for major actions and advances towards resource efficiency improvements, globally, regionally and nationally. Why is this? Perhaps it constitutes an international community response to the economic and financial crisis of 2008 and subsequent years, the ecological mounting threats, the potential loss of trust in public and private governance and the geopolitical challenges and wars.
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Keynote Articles
Dr Christian Avérous is an economist, an engineer and former Head of the Environmental Performance and Information Division of the OECD, Environment Directorate. His competencies include green growth, sustainable development, environmental management, environmental economics, environmental resources and international co-operation. At OECD (1973-2008), he has directed programmes concerning environmental information, country environmental reviews, sustainable development and resource efficiency. He has created and led programmes on environmental information (e.g. pressure-stateresponse model, environmental data, environmental indicators, measuring material flows and resource efficiency). This work has translated into OECD Council Acts, many publications, seminars and conferences and it has contributed to the establishment of an international measurement regime. At OECD, he has also created and led the OECD programme of environmental performance reviews (70 country examinations and publications, including for OECD countries such as Australia, Japan, Korea, Canada, Mexico, USA, Italy, France, Germany, Greece, Poland, Spain, Turkey, United Kingdom, and other countries such as Chile, China and Russia). He has taught in a number of universities (e.g. Berkeley, Caracas and Paris). He has worked as a consultant for, inter alia, the World Bank, OECD, UN, UNEP, EU and ADB. He has been President of the environment committee of the French CNIS and contributed to the Stiglitz-Sen report. He has conducted environmental evaluations of the World Bank Group and of the REC for Central and Eastern Europe. Dr Christian Avérous holds degrees in engineering (ENPC, Paris) and in economics (PhD UC Berkeley, French State Doctor). The Organisation for Economic Co-operation and Development (OECD) as an intergovernmental organisation has long played a key role as a pathfinder for effective and economically efficient responses to environmental challenges: from pollution issues to waste management and resource issues. It has played a pioneering role in helping countries around the world by promoting green growth and resource efficiency. The concern with resource efficiency can be traced back internationally to the “Koizumi proposal” requesting the G8 to promote the 3R concept of reducing, reusing and recycling waste. In the OECD, it was translated into i) elaborate methodology to define and measure material flows, ii) formal OECD Council recommendations (2004, 2008) on material flows and resource productivity, and iii) actual metrics with “green growth indicators” and ‘”material resources productivity” measures. Furthermore, the 2008 OECD-UNEP forum conference on resource efficiency helped generate the creation of the UN International Panel on Sustainable Management of Resources. Gradually the circular economy vocabulary (used early in China) replaced the 3R formulation. www.oecd.org
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2030 Scenarios – Mobility, Food & Built Environment Source: “Growth within - A Circular Economy Vision for a Competitive Europe”, McKinsey Center for Business and Environment, Ellen MacArthur Foundation, September 2015.
Annual total cost of production and using primary resources, EU-27, € trillion1
7.2
-1.8 trillion (-25%)
1.1 0.2
6.3
1.0
2.0
0.1
1.9
5.4 1.5
3.4 2.7
3.0
1.8
Today
1.4 Improvements
Rebound effect
Current development scenario
Primary-resource costs2
1.2
2030
Additional Improvements
Rebound effect
2030
Circular - economy scenario
Other Cash-out costs3
Externalities4
1 All numbers rounded to €100 billion: figures may not sum, because of rounding 2 Primary resources include agriculture land and water use (€0,29/cubic meter), fuel (€68/metric ton for coal, €1,45/litre for diesel,€1,64/litre for gasoline, €0,91/litre for heating oil, and €0,067/kilowatt-hour for natural gas, land for residential and office building, nonrenewable electricity (€0,20/ killowatt-hour), pesticides, virgin automotive and construction material, and virgin synthetic fertillizer(€535/ meric tonne). 3 Other cash-out costs include all household and goverment expenditures on food, mobility and residential housing and office space, excluding the primaryresourse costs. 4Externalities include adverse health effects due to idoor environment and transport time (related to urban planning) CO2 (€29/metric tonne), land-opportunity costs, noncash health effects of accidents, opportunity costs related to obesity, pollution and noise, and traffic congestion.
A Resource Efficient and Sustainable Europe Source: “Advancing Resource Efficiency in Europe�, European Environmental Bureau (EEB), March 2014.
The situation the Earth is in today has been created by unmindful production and unmindful consumption. We consume to forget our worries and our anxieties. Tranquilising ourselves with overconsumption is not the way. Thίch Nhât Hạnh,
Vietnamese Buddhist monk, teacher, author, poet and peace activist. (1926 – )
Infinite growth of material consumption in a finite world is an impossibility. Ernst Friedrich “Fritz” Schumacher,
German influential economic thinker, statistician and economist, writer of the book “Small is Beautiful” (1911 – 1977)
I do not do celebrity endorsements. My work with Conservation International is a good use of whatever celebrity I might have to draw attention to important problems. I have the same responsibility as everyone to reduce consumption and to teach children to respect the environment. Harrison Ford,
American actor, film producer and vice-chair of Conservation International (1942 –)
An invasion of armies can be resisted but not an idea whose time has come. Victor Hugo,
French poet, novelist and dramatist (1802 –1885)
I n s t i t u t e s
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N e t w o r k s
Lock or Key? The Role of Governments in Deploying Product-Service Systems
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hen it comes to speeding up the transition of our production and consumption methods to make them more compatible with earth’s physical limits, governments have an important role to play, one which goes beyond the traditional tasks entrusted to them. Across the board, governments must connect stakeholders, whether they be companies, public authorities, scientists or consumers.
Marion Courtois Business Engineer & Circular Economy Senior Expert ACR+
In most common modern business models, the growth of a company’s markets goes hand in hand with an increase in units produced and resources used. One of the methods to find a way out of that impasse is to develop a Product-Service System (PSS) which only has a slight impact on or even benefits the environment, but also meets consumers’ needs and generates profit. In a Product-Ser vice System, consumers buy mobility rather than a
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vehicle, warmth rather than a heater, a degreasing service for industrial parts rather than a solvent... The value of a product for consumers lies in the benefits that they derive from using it, not from owning the product in question. The consequence is a major change to relationships between producers and consumers and to methods for cooperation between companies. Three business model categories exist: Product-oriented PSS: supplying an additional service for the product sold, such as a company that sells lifts and five-year maintenance service packages. Use-oriented PSS: use of the product is sold, rather than the product itself, such as an internet platform which sells access to a local network of 3D printers, rather than selling printers outright. Result-oriented PSS: the producer guarantees that it will meet consumers’ needs, regardless of the combination of products and ser vices used, for
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Institutes & Networks
INFO example, buying an optimum lighting ser vice rather than buying lighting equipment. Directors of small - and medium sized enterprises rarely adopt business models of this type, as they see some risk in “undoing locks”, such as consumers’ resistance to change, governments, professional associations and entrepreneurs themselves. The chances are that a transition to Product-Service Systems will not succeed unless the government takes on the role of structuring partnership facilitator between stakeholders. That role involves easing companies’ financing during the transition to a Product-Ser vice System business model, stimulating public procurement as a lever to boost demand, raising consumers’ awareness to change their attitude towards objects and services and monitoring and following the phenomenon of the transition towards
that model. Other impor tant steps to take include: helping to launch training, suppor ting enterprises through the transition, structuring research, adapting market instruments, strengthening regulatory instruments and setting up regional coordination for projects. The government can take on a much wider role because of the advantages that it has as a bridge between parties. First of all, government bodies have the benefit of being relatively stable, and investment in a transition process enables them to ensure sustainability and successful adoption of the model, which thereby guarantees private par ties’ investment. Secondly, the fact that government bodies are seen as a legitimate, strictly neutral third-party guarantor that is restricted by public interest is a definite advantage when it comes to building bridges between private interests.
Marion Courtois is a Business Engineer and Circular Economy Senior Expert at ACR+. She has completed projects for Brussels-Capital Region (Belgium) on the transition of the economy. Her main interests are par ticipator y processes, transdisciplinarity (collaboration between researchers and field actors), public authorities as bridging actors, SME’s role in the new economy and innovative business models like the Product-Service System and Circular Economy. Ms Courtois holds postgraduate degrees in Business Engineering and Environmental Economics. Thanks to her professional background, she is familiar with various stakeholders like NGOs, ministerial cabinets, multinational corporations, public companies and administrations. She has also developed a broad experience in both project management and co-construction processes. ACR+ is an international network of cities and regions who share the aim of promoting smart material resource consumption and sustainable material resource management. ACR+ has an ever-growing membership of nearly 100 entities representing around 1,100 municipalities; and also welcomes NGOs, academic institutions and private organisations. Since 2014, ACR+ has and continues to support local and regional authorities with the preparation and implementation of ambitious circular economy strategies. This ACR+ commitment has taken the form of the Circular Europe Network (CEN), which gathers ACR+ members that are committed to improving their resource strategies and strengthening sustainable development in their territories. This initiative builds on the expertise of European frontrunners within the ACR+ network in order to gather, analyse and exchange information on efficient circular economy strategies implemented by cities and regions. These good practices are available as factsheets on the Circular Europe Network website (www.circular-europe-network.eu). www.acrplus.org
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Redesigning Ηow We Make and Use Stuffs: Circular Economy and the Cradle to Cradle Design
W Máté Kriza
Chairman Foundation for Circular Economy Hungary
e are all aware of the fact that our current linear economic model — often called the “take-make-waste” economy — is not sustainable. The Earth’s resources are limited, keep degrading and ever more expensive and sophisticated methods are required to extract them while the demand is constantly growing for more and better stuffs by the enlarging global middle class. The ecological impact of the extraction, production, logistics and use of the products is clearly shown by the dramatic loss of biodiversity, pollution of the oceans and the alarming trend of climate change. The businesses have been also feeling the pressure through the increasing and volatile resource prices in the past 10-15 years, which has made them thinking how to decouple growth by using fewer resources to produce more. Resource efficiency has been on the
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agenda for quite some time and has delivered impressive results, but it has its limits as the incremental efficiency improvement converges to zero. Add to this that using too much or wrong materials in the goods we use is not only an environmental or an economic problem: many of our everyday stuff contain toxic substances which can have negative effect on our health and wellbeing. Therefore, resource efficiency in itself is not sufficient for all these problems to be tackled. So what could be the solution that addresses the economic, ecological, health and social challenges of our current, non-sustainable linear economic system? It is always useful to invoke nature if we are seeking a systemic solution. In nature there is no waste, only the constant circulation of nutrients. A blossoming cherry tree has thousands of flowers, but many
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of them will fall on the ground and never become a cherry. Is this a waste problem for nature? Quite the contrary, as each fallen flower will be gradually decomposing providing nutrients for the soil or other living organisms. The cherry tree — as all the other plants or animals — is part of a system which is based on different metabolisms, where no resources (be it cherry flower or basic elements) are lost, and everything can be used in different forms over and over again. So what if we had a similar system for our economy, where we wouldn’t worry about waste or toxic materials poisoning ecosystems or our health? The circular economy is not only about being more efficient but also about being more effective, meaning having a positive impact on the environment, people, society and the economy. In the circular economy waste becomes
nutrient and is used again and again for the same or another purpose; either in a technical cycle, where nonbiodegradable materials circulate (like metals, plastic, chemicals) or in a biological cycle where we can safely deposit ingredients in the nature (like food waste, fibres, yarns). Failed, unused or outdated products are not necessarily recycled — since recycling often means downcycling, i.e. losing value and quality — but designed and produced to last and be reused, remanufactured or refurbished, as long as possible. In this quasi-closed loop system companies shall keep track of and take back their materials after their useful life, as a caring material stewardship process. The restorative design aims to keep the value and the embedded labour, energy and material of a product, not just to minimise waste. In this way we can fully eliminate waste from our economic system, which can
have a double positive impact on the environment i.e. less demand for raw materials (including energy and water) and substantial reduction of pollution and GHG emissions. The circular economy does not only mean a different approach and mindset to the use and making of resources and stuffs but a new business and consumer model as well. Just think of a simple electric drill in your home, which is used in average for only 15 minutes in its entire life time. Idle products and assets are also contributing to the wasteful use of resources, therefore a shift away from ownership to renting, leasing or sharing can entail less resource use and a new business model already applied successfully by businesses. Some corporations are already making a profit out of providing the performance or the service, instead of selling a durable good, thus keeping the ownership
of the product and generating a new revenue stream through maintenance and upgrading.
The Cradle to Cradle Design The concept of circular economy has its main root in the Cradle to Cradle Design, which was conceived and elaborated by Michael Braungar t, a German chemist, and William McDonough, a US architect, back in the 90s. Their book, “Cradle to Cradle – Remaking the way we make things” was published in 2002 and it soon became a hit among environmentalists, product designers and company managers. The idea has gradually turned into practice, and in the past fifteen years many products, processes and entire cities have been based on the Cradle to Cradle principles. By today, the Cradle to Cradle certification has evolved into a complex and sophisticated product assessment and certification process, which takes
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into account the material health and the material reutilisation of the product, the use of renewable energy and water during the production process as well as the social fairness practiced by the employers involved in the entire value chain. Currently the San Franciscobased Cradle to Cradle Products Innovation Institute — an administrator of the Cradle to Cradle certifications — has a registry of more than 400 active Cradle to Cradle certified products from all over the world. The Cradle to Cradle (or in short, C2C) means a design concept related to circular economy, where all materials, equipment, tools, products, etc. are healthy as well as reused to the maximum extent. The main focus lays not on the reduction of use of environmental goods but on the recycling and reuse of these goods.
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With C2C quality, health and safety of products are assured and at the same time the highest level of environmental and health protection is taken into consideration as well. The products are developed according the model to maintain the quality of raw materials over multiple life cycles taking the production processes, the use and the reutilisation into account. This means no waste; all ingredients are considered as nutrients. The right materials are integrated in defined cycles (metabolism) at the right time and place. The Cradle to Cradle Design doesn’t define only the form, functionality and ingredients of a product. The goal is to strive for a new dimension in quality and safety in endless cycles. Consumer goods (natural fibres, cosmetics, detergents, etc.) are designed so that
they can be used in biological cycles over and over again. They decompose to organic nutrients and promote biological nutrients and systems such as plant growth. The renewable raw materials are, in turn, the basis for new products.
conventional recycling mostly ends in downcycling, whereas inevitable residues remain and decreased quality occurs. Cradle to Cradle, however, searches for strategies; how materials can remain in closed loops without losing the quality of the materials.
Ser vice products (TV sets, cars, synthetic fibres, etc.), the so-called technical nutrients, are separated to enable the production of new commodities after fulfilling their initial function. The users/consumers purchase only the relevant services, e.g. television. The materials remain the property of the manufacturer, which retains them through collection and reenters them into the technical cycle. Maintaining the quality of materials and integrating them into product design over multiple life cycles remains to be an enormous challenge. The
The Cradle to Cradle Design transmits the principle “Quality equals Quantity” to industrial systems. Materials together with material flows are designed to be beneficial and useful for the regeneration and conservation of biological and technical resources. This approach liberates us from the present obligation to diminish, reduce or slow down the need to eliminate the negative environmental impacts.
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The Netherlands
The enthusiasm for Cradle to Cradle (C2C) started in 2006 following a documentary broadcasted on Dutch television. The following wide spread interest for Cradle to Cradle was not limited only to designers, developers and politicians but spread throughout the region, peaking in the town of Venlo where everyone from local business people to local bar staff began their own initiatives. Since then, Limburg has adopted Cradle-to-Cradle as their own vision for regional growth and engine of innovation.
Tanatex Chemicals
TANATEX believes that C2C is the next generation environmental guiding principle as it is the only alternative for prolonged use of scarce global raw materials. TANATEX is at the moment (2011) the only textile chemicals supplier with a complete C2C system approach. The EPIC3 system and its underlying products have received an official “Quality Statement” from EPEA Switzerland and EPEA Int. Umweltforschung stating that these products can be used without any problems in certification of C2C end-articles.
Dystar – Textile Dyes Material Health Certification
DyStar® Group is a solution provider, offering customers across the globe a complete range of colorants, auxiliaries and services. The DyStar Group has offices, competence centers, agencies and production plants in over 50 countries to ensure the availability of expertise in all important markets. With a heritage of more than a century of product development and innovation for the textile and leather industry, DyStar has developed into new markets and now, in addition, serves the paper, plastic and many other specialty chemical industries.
Gessner AG – Climatex Switzerland
The first worldwide Cradle to Cradle Product since 1993. Originated as Rohner Textil AG by Albin Kälin and today is known as Gessner AG, located in Switzerland. The product is used as seat cover in the AIRBUS A 380.
Trigema – Germany
Cradle to Cradle Innovator Award 2014 1200 employees manufacture sports and leisurewear, 100% made in Germany. Being a manufacturer in an environmentally conscious country such as Germany, TRIGEMA strives for innovation. TRIGEMA was therefore the first company within the apparel industry to embrace Prof Braungart’s Cradle to Cradle® (C2C) idea. Since 2006, the collection features biodegradable textiles such as T-shirts, polo shirts, sweatshirts and sweatpants, manufactured strictly according to C2C standards.
Lauffenmuehle – Germany
Cradle to Cradle Innovator Award 2015 A breakthrough in textile innovation for corporate wear, work wear and hygiene and healthcare: After years of intensive research and technical optimisation, Lauffenmuehle is now offering an innovative yarn and textile concept with excellent technical performance, safe for biological systems.
Material Health
GOLD
INFO Máté Kriza, Chairman of the Foundation for Circular Economy, Hungary,
graduated from the Budapest University of Economic Studies in 1991 and was awarded his MA from the College of Europe, Bruges, in 1993. For several years he worked in the financial sector as an accountant and later on as a corporate finance manager. In 1999, he started his own consultancy business in public affairs and strategic communications. In the beginning of the 2000s, his interest started to turn towards sustainability issues and in 2005 he opened the Hungarian chapter in the World Business Council for Sustainable Development, a CEO-led business coalition, for which he worked as an executive director for seven years. In 2013 he became the founder and chairman of the Foundation for Circular Economy, a platform providing knowledge sharing and cooperation for various stakeholders to promote circular economy in Hungary. He is also the Hungary representative of EPEA Switzerland GmbH, a consulting company specialised in Cradle to Cradle design innovation projects. The Foundation for Circular Economy (FfCE) was established in 2013 as a private foundation to promote the awareness and the application of circular economy in Hungary. The primary aim of the FfCE is to create a platform for cooperation among business, academia, local and regional authorities as well as NGOs in order to collect, share and develop knowledge, experience and practice with regards to circular economy. The FfCE’s activity has been covering various topics in the past two and a half years, ranging from resource efficiency, ecodesign and material health to new business models (sharing/collaborative economy). In April 2016 the Foundation launched its supporter and business club, the Circular Club. The FfCE has also established a growing and effective international partnership network. In 2015, it joined the Association of Cities and Regions for Recycling and Sustainable Resource Management (ACR+). The Foundation is also the member of the European Circular Economy Network (ECEN), an informal professional community sharing knowledge and practices. www.circularfoundation.org
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Circular Economy: From Whether to How
CB Bhattacharya Center for Sustainable Business (CSB) ESMT
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ecent headlines such as “Climate change is a business problem” remind us yet again that our economic development aspirations have become incompatible with the linear growth model. Given that the demand for nonrenewable resources continues to grow, many experts believe that we are facing the risk of running out of commodities that are vital for economic growth such as oil and precious metals in a matter of 50 to 100 years. As a collective, we are guilty of the “tragedy of the commons” phenomenon where the quest for maximum personal or corporate gain leads to irreversible environmental and social problems. Thus, the key question surrounding the circular economy is not whether, but how. Indeed, it is possible to achieve economic growth while minimising one’s environmental footprint as showcased by companies that are integrating circular economy principles into their business models. Traditional business models in the “take, make, waste” economy illustrate how economic value is created through conversion of resources and capabilities. Whereas in these models, value proposition usually involves product and service offerings that only have an economic return, in a sustainable business model, the value proposition creates measurable societal and environmental benefits along with economic impact.
Currently, at our Center for Sustainable Business we are running a research project on how sustainability is embedded into day-to-day operations of multinational companies with a large global footprint. Our initial results indicate that circular economy principles are an integral par t of embedding sustainability. Many firms in our sample operationalise business models that are long term oriented and have a focus on renewability, reuse and dematerialisation of processes. The three key pillars that bring such models to life are strategy, systems and processes and organisational culture. To bring circular economy to life, firms must conduct a strategic review of their operations and a materiality analysis across the entire value chain to assess their resource usage and, thus, possibilities of reduction and increased efficiency. Second, to systematise processes from procurement to disposal and operate at scale, firms must invest in management systems for tracking footprint and make this information easily available to all employees via dashboards and tickers. In addition, firms must also invest in training and development so that employees are competent in using techniques such as ecoefficiency analysis. Finally, creating a supportive organisational culture where employees feel empowered to cocreate and bring forth suggestions
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for reducing footprint goes a long way. To take a few implementation examples of the above principles, materiality analysis often points to sustainable innovation as one of the main drivers of creating a circular economy. Unilever, for example, introduced the world’s first compressed aerosol deodorant in Europe which offers the same product with the same spray time as its older counterpart, but in a can half its original size. This innovation cuts down the carbon footprint by 25% and business growth has also been substantial in markets such as the UK and France. Unilever made this technology available to competitors using “radical openness” thus inspiring others to reduce resource usage. Concentrated detergents and laundry rinse aid that reduces the water needed for rinsing clothes in water stretched regions represent the same business logic. Similarly, waste management is another tangible way to implement circular economy principles. Unilever has zero waste to landfill which was achieved collectively through the joint effort of all employees and created significant cost reductions. BASF, the largest chemical producer in the world, has been dealing with the issue of waste for about 150 years now. It started with the idea to use residues of illuminating gas production as raw materials for
dyeing products. Today, their site in Ludwigshafen, Germany, is composed of 260 factories operating on minimum waste. Usually, one plant’s waste is another’s raw material. IBM is yet another best practice example of using powerful management systems. IBM utilises analytics to provide environmental intelligence to business units and set footprint reduction targets for each one. This intelligence is communicated through hard numbers which makes employees understand what they are dealing with and buy in. They are able to calculate ROI and estimate the payback thus ensuring transparency and inspiring confidence. As demonstrated by these examples, there is a big economic opportunity in energy ef ficiency and waste management. Expectedly, moving away from the traditional “take, make, waste” economy will be a challenge at times, but there is solid proof that more and more companies are reaping the benefits of circular economy principles and gaining in on competitive advantage. It is time to leave the linear growth model behind and go for a proactive corporate strategy that adopts sustainable business models that meet the challenges of resource scarcity and customer expectations.
INFO CB Bhattacharya is the Pietro Ferrero Chair in Sustainability and Director of the Center for Sustainable Business at ESMT European School of Management and Technology in Berlin, Germany. Prof Bhattacharya has published over 100 articles and has over 14,000 citations per Google Scholar. He is co-author of the book “Leveraging Corporate Responsibility: The Stakeholder Route to Maximising Business and Social Value". He places 10th in the category Top 100 current researchers and 14th in the category Top 250 researchers/ lifetime achievement in the Handelsblatt Business Administration Ranking. He has consulted for many organisations such as Allianz, AT&T, Eli Lilly, E.ON, Procter & Gamble Company and others. He is often interviewed and quoted in publications such as Business Week, Forbes, Financial Times, Newsweek, The New York Times and The Economist. He received his PhD in Marketing from the Wharton School, University of Pennsylvania in 1993 and his MBA from the Indian Institute of Management in 1984. The Center for Sustainable Business (CSB) is a platform for research, teaching and thought leadership on implementing sustainability in business. Research is tailored to the needs of companies and concentrated on best practice and answering key questions: how to balance the diverse goals and stakeholders of a business and engage all employees in sustainability. The interdisciplinary teaching approach allows executives to tap into resources from many fields including development economics, marketing and ethics. The Center offers learning and networking opportunities for sustainability professionals and their colleagues from different corporate departments through the Sustainable Business Roundtable. CSB was founded by the European School of Management and Technology (ESMT) in 2015. www.esmt.org/csb
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Remanufacturing as a Key Loop of the Circular Economy
Seigo Robinson Senior Consultant-Circular Economy Lead The European Remanufacturing Network (ERN)
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ccording to British Standard 8887Part 2, remanufacturing is an industrial practice of:
“Returning a product to at least its original performance with a warranty that is equivalent or better than that of the newly manufactured product.” It is an impor tant component of a resource-ef ficient manufacturing industry and a key strategy (or “loop”) within the circular economy: by keeping components and their embodied
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material (including “critical” or “advanced” materials) in use for longer, significant energy use and emissions to air and water can be avoided. It also provides opportunities for the creation of highly skilled jobs and economic growth. Despite these positives, remanufacturing is an under valued part of the industrial landscape and an under-recognised sustainable industr y. To help tackle this issue, we recently led the development of a comprehensive review of the European remanufacturing industry as part of the
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Institutes & Networks
European Remanufacturing Network (ERN).
least meet the original performance specifications.
Process: From a customer viewpoint, a remanufactured product can be considered the same as a new product. Generically, it involves dismantling the product, restoring and replacing components and testing the individual parts and the whole product to ensure that it is within its origin design specifications.Per formance after remanufacture is expected to at
Economics: It should be noted that not every product can be remanufactured — indeed, we see the three key variables of high value, high reconstructability and low evolution rate as governing enablers for it to be profitable. These conditions often favour producers of durable, often metal, manufactured assemblies e.g. automotive components, machinery and medical equipment.
In most cases, remanufacturing businesses have grown in response to a business opportunity, not driven by an altruistic “green” mission. We found that remanufacturers’ top motives are higher profit margins, environmental responsibility, strategic advantage and increasing market share. These all point to an encouraging view of the future of the industry from those within the business. Top barriers include customer perception, volume/availability of “core”(a used part intended to become a remanufactured product), quality of
core and high labour costs. In comparison with traditional manufacturers, remanufacturers generally make less per product due to consumer misunderstanding of the product’s quality. However, they spend significantly less on input resources and more on personnel costs due to the more intensive labour requirements. Taking all this into account, remanufacturers often end up with similar or higher profitability.
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REMANUFACTURING PROFITABILITY
MANUFACTURER REVENUE VARIABLE COSTS FIXTED COSTS GROSS PROFIT
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REMANUFACTURER
Our review of the European market suggests that the current industr y has annual revenues of approx. EUR 30 billion; while this is a substantial figure, it represents an intensity of only 1.9% (remanufacturing to traditional manufacturing ratio). This points to a substantial headroom for growth — given the right interventions and framework conditions, we estimate that revenues could rise to almost EUR 100 billion by 2030. Social: The various loops within the circular economy seek to regenerate a product to its former glor y through
the use of renewable resources and energy including human labour. Remanufacturing is par ticularly attractive from this perspective, as it requires the highest levels of skill and expertise of any circular economy loop — it, therefore, has the ability to create employment in niches that e.g. recycling cannot. Remanufacturing is underpinned by the recovery of core that has far more inherent value than products destined to be recycled (whole components vs. simply molecules) and this means that smaller volumes can support greater employment and/ or higher pay. Our review suggests that the EU remanufacturing industry
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Institutes & Networks
employs some 190,000 people, and with enabling policies and industr y investment this could rise to 600,000 by 2030. Environmental: Remanufacturing has the ability to divert large amounts of product away from landfill and avert CO2 emissions. A high proportion of the worked material — typically up to 80% — is retained from the original core product. This trait helps over two million tonnes of material being diverted from landfill and some eight million tonnes of CO2 emissions being averted annually in Europe.
Remanufacturing is not the panacea that will allow all products to enter the circular economy. However, where it is applicable, it has an enormous potential to deliver vast economic, social and environmental benefits. It should therefore be championed as a clearly distinct loop of the circular economy with its own needs, characteristics and benefits.
INFO Seigo Robinson is Circular Economy Lead at Oakdene Hollins and Head of the Centre for Remanufacturing & Reuse (CRR). He leads circular economy market and advisory work, with a strong focus on remanufacturing, and led the development of the recent Remanufacturing Market Study for the European Remanufacturing Network. He holds an MEng MA in Chemical Engineering from the University of Cambridge and has a strategy consulting background with focus on the energy and industrial sectors and has been based in London, Bahrain, Riyadh and New York. He has been an invited speaker on remanufacturing at international conferences in Denmark, South Korea and the Netherlands. He is Chair of Trustees of a city farm and a Governor of a school in London. The European Remanufacturing Network (ERN) is a research and innovation programme funded by the Horizon 2020 Framework Programme of the European Union. The ERN consortium consists of eight partners from six different EU Member States where organised remanufacturing occurs at scale. The consortium includes expertise in the whole length of the remanufacturing supply chain. www.remanufacturing.eu
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Generation of Hazardous Waste by Economic Activity, EU-28 Source: Eurostat, 2012.
Wholesale of waste and scrap, 1.0% Agriculture, forestry and fishing, 1.0% Households, 3.5% Electricity, gas, steam and air conditioning supply, 8.0%
Manufacturing, 25.5%
Services (except wholesale of waste and scrap), 11.0%
Mining and quarrying, 13.5%
Water supply; sewerage waste management and remediation activities, 20.5%
Construction, 16.0%
Extended Producer Responsibility Schemes Source: “Redesigning Producer Responsibility - A New EPR is Needed for a Circular Economy�, Zero Waste Europe, September 2015.
EPR schemes and products covered City
Member state
Barcelona
Spain
Berlin
Germany
Brussel
Belgium
Bucharest
Romania fee
London
United Kingdom
Madrid
Spain
Oslo
Norway
Paris
France
Rome
Italy
Sofia
Bulgaria
Stockholm
Sweden
Tallinn
Estonia
Warsaw
Poland
Zagreb
Croatia
Towards a Competitive and Growth-Oriented Circular Economy: the Role of the Packaging Value Chain “It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change” Charles Darwin (1809-1882)
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Virginia Janssens Managing Director European Organisation for Packaging and the Environment (EUROPEN)
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ndeed, shifting our Linear Economy towards a Circular Economy will require change and thus responsiveness from producers and consumers. How to move towards business models with virtually no waste but only (secondary) raw materials that are reinjected into a Circular Economy? What kind of European policy framework is needed for the packaging supply chain in Europe to drive investments towards a competitive and growth-oriented Circular Economy? How do we take into account the globalility of value chains in this European framework? These are just a couple of questions EUROPEN is addressing amidst policy discussions related to the EU’s recently launched Circular Economy proposals. This policy framework will impact a wide range of sectors and materials, including the packaging and packaging waste sector. One precondition to achieve a growth-oriented Circular Economy is a well-functioning Internal Market which should be protected. For our sector, the Internal Market principle ensures
the free movement of packaging and packaged goods across Europe in its 28 Member States. It helps avoid national trade barriers while providing a Europe - wide economy of scale often needed for investments in making packaging materials and packaged goods more “circular” and resource-efficient in a resource and land restraint Europe. EU policy-makers are slowly embracing life cycle thinking in their policy deliberations which come hand in hand with “Circularity”. For the packaging supply chain, life cycle approaches (LCA) take into account trade-offs, as changes in one part of the chain will inevitably affect another part. For instance, changing the type, weight or design of packaging may negatively impact the pack’s ability to protect, preserve or market a particular product. Packaging should therefore always be considered in the context of the product it contains, and not solely based on the end of life phase. Packaging contributes to resource efficiency in all phases of its life cycle by optimising resource use, helping to prevent product and food waste, extending a product’s shelf-life, protecting products along different value chains, providing consumers with varied uses, choices and benefits
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of the products it contains and, finally, recovering the used packaging at the ”end-of-life” phase intended for a next economic cycle. By answering these challenges, packaging is not only vital to our modern societies and lifestyles, but forms a crucial part of our Circular Future. A key instrument that links the Circular Economy, the Internal Market and the packaging waste policy is Extended Producer Responsibility (EPR) for used packaging. This end-of-life instrument is currently applied in 25 Member States in the European Union and has been instrumental to enable the separate collection and sorting of used packaging to reach European and national recycling targets for packaging. EPR is seen as a key interface between the supply and demand sides of material flows which are reinjected as products or materials into the economy. This important role and potential is acknowledged in the Circular Economy Package, which calls for binding European minimum per formance requirements on EPR compliance schemes (packaging recovery organisations) to ensure more transparency and cost-effectiveness on existing EPR schemes and proper enforcement in the countries
implementing EPR. A minimum level of harmonised European rules will help producers and importers in Europe to comply with their legal obligations under EPR and will ensure more control and transparency on their end-of-life costs. Better functioning EPR will ultimately boost qualitative and quantitative secondary raw material markets which will help industr y to better manage volatile (virgin or secondary) material markets and related material supply and demand challenges that businesses face in Europe and beyond: the essence of the Circular Economy objectives. The Circular Economy Package offers a great opportunity to address regulatory and market barriers in the European Union and its Member States. Along with a well-functioning Internal Market for packaging and packaged goods, the packaging supply chain in Europe remains committed to further transition to a resource-efficient and competitive Circular Economy in which we see a more transparent and functioning EPR framework as key for our industry to meet its current and future sustainability challenges.
INFO Virginia Janssens has been Managing Director for the European Organisation for Packaging and the Environment (EUROPEN) since July 2012. Prior to joining EUROPEN in January 2010 as EU Affairs Manager, Ms Janssens acquired considerable experience in the Brussels arena working both as a public affairs and public relations consultant for various clients coming from the environment, food, chemical and energy sectors. Ms Janssens obtained a master’s degree in Political and Social Sciences at the Catholic University of Leuven in Belgium and a second master’s degree in Intercultural Management at the ICHEC Business School in Brussels. The European Organisation for Packaging and the Environment (EUROPEN) is an EU industry association in Brussels presenting the opinion of the packaging supply chain in Europe, without favouring any specific material or system. EUROPEN members are comprised of multinational corporate companies spanning the packaging value chain (raw material producers, converters and brand owners) plus national packaging organisations, all committed to continuously improving the environmental performances of packaged products, in collaboration with their suppliers and customers. www.europen-packaging.eu
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There is no Waste: Towards Holistic Resource Management
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Marlehn Thieme Chairwoman German Council for Sustainable Development
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Thr eefold Approach to Sustainable Development Goals One of the main features of a Circular Economy is to keep materials at the highest possible utility at all times, thus to prevent the loss and deterioration of materials and substances and to close the loop that entails the provision of resources, the design and manufacturing of products, their use phase in cascades and, finally, their end-of-life treatment according to the EU’s waste hierarchy. The need to move towards a circular economy has been emphasised with the adoption of the universal Sustainable Development Goals (Goal no.12: “Ensure sustainable consumption and production”). An industrialised countr y’s commitment to these goals has to be threefold: in order to ensure sustainable consumption and production patterns at the global level, Germany has to further advance recycling and address additional material flows (implementation within Germany), as well as to export viable solutions to other countries (by transferring technology and expertise) and, finally, to support other countries
through global partnership and bilateral cooperation.
Resource Productivity and Waste Management In 2016, Germany updates its sustainable development strategy in order to link it with the SDGs at the UN level. So far, the strategy aims to double resource productivity until 2020 (compared to 1994 levels). This has led to a range of activities, including a resource efficiency programme that focuses on market incentives as well as voluntar y measures and initiatives. Its perspective is mainly domestic, which will have to change in the future. In regard to Germany’s resource productivity goal, the Council for Sustainable Development, therefore, demands to consider the global dimension of resource consumption by factoring in all imports, both direct and indirect. Furthermore, this goal has to be differentiated in order to make visible advances towards a circular economy. As well as other industrialised countries, Germany has developed a sophisticated recycling system for some materials,
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Institutes & Networks
put into practice the concept of product responsibility for packaging and, nowadays, almost closes the loop for paper, glass and copper. However, Germany is far from reaching high levels of recycling for other material flows, which are crucial for the industry and, finally, for society as a whole — e.g. plastics, phosphorus, technology metals and building materials. While the treatment of some wastes has become efficient and economically feasible, the bulk of materials put through the economy is being downgraded at most or not reused at all. Changing this can only be achieved through a change in perspective: away from waste management and towards holistic resource management.
Resource Neutrality is Achievable As a matter of principle, all waste has to be seen as a resource. The Council for Sustainable Development holds the vision of Germany as a resource-rich country because of all the materials and resources that have accumulated over the past decades, that Germany has become an affluent society with a highly-industrialised economy. This
vision is not immediately achievable, but it sets a practical, far-reaching goal that corresponds well with the SDGs. In this light, resource neutrality becomes an imperative for sustainability and underlines once more the strength and practicality of a circular economy. In order to achieve this, new approaches to the use of resources in production and manufacturing need to be taken: responsibility for materials and resources has to broaden the scope of both product responsibility and extended producer responsibility (EPR). Design for repair and design for recycling have to become the standard approach in developing new products. This asks for new forms of collaboration between consumers, brands, producers, material specialists, recycling experts, process engineers and policy makers. The circular economy can add value in domestic markets, create jobs in all sectors and reduce environmental impact. It helps to link dif ferent sustainability goals through a crosscutting approach to economic development — not along value chains, but within closed value loops.
INFO Marlehn Thieme has been a member of the German Council for Sustainable Development (RNE) since 2004. After acting as Deputy Chairwoman from July 2010 to February 2012, she was elected RNE Chairwoman in 2012. From 1986 to the end of 2013, she worked for Deutsche Bank AG, last as Director of the CSR/Corporate Citizenship business division and member of the Supervisory Board of Deutsche Bank AG. Ms Thieme is Member of the Council of Evangelical Church in Germany (EKD), Member of ZDF Television Board and Chairwoman of the Supervisory Board of the KD Bank. The German Council for Sustainable Development (Rat fĂźr Nachhaltige Entwicklung RNE) is an advisory body mandated by and reporting back to the German Federal Government. Appointed ad personam by Chancellor Angela Merkel for a three-year term, its 15 members are free to set their agenda. The RNE seeks to make sustainable development a fundamental goal and field of action in all areas of the political sphere. It works towards citizens living a sustainable lifestyle and towards a broad public discussion on sustainability. It urges businesses and institutions to make their economic activities sustainable, face the challenges posed by sustainability and make use of its opportunities. The RNE seeks to broaden the discussion on sustainability within society and make the outcomes of this more effective and more binding. www.nachhaltigkeitsrat.de/en/the-council/
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Constraints Rule a Finite Planet
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very day, more people share this planet. At the same time, people’s expectations for comfort and better lives are rising. Both trends lead to a growing global demand for natural resources and services, including food, carbon sequestration, fibre (for clothing and paper) and wood (for furniture).
Mathis Wackernagel Founder & CEO Global Footprint Network
Human demand on our planet’s resources, however, already exceeds what Earth can renew by over 60%. We can continue overusing and depleting natural capital as long as the stocks last. But that is a path that undermines our current and future economic possibilities. This global situation also holds true in the Mediterranean region. As the regional population has doubled over the last five decades, per capita resource consumption has increased by 24% and residents now demand 2.5 times
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more resources from the Mediterranean ecosystems than what they can renew. Both regionally and globally, the increase in human-induced CO2 emissions is among the largest footprint drivers. As par t of the 2015 Paris climate agreement, 195 countries plus the European Union pledged to collectively limit global warming to a maximum of 2 degrees Celsius overall and 1.5 degrees by the end of the century. Achieving this goal would require reducing net carbon emissions to zero no later than 2050. Yet others, such as OPEC in its 2015 World Oil Outlook, project increasing demand for fossil fuels over the next decades. But such a path would put in question a swift and smooth transition to a low-carbon, low-risk economy. Growing population and higher demand for renewable natural resources combined with either fossil fuels scenario have significant
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implications for every country. Resourceintensive infrastructure and economic sectors are most likely to be exposed to greater risk, including potential stranding of significant por tions of those sectors’ assets. Consequently, carefully managing any city’s, region’s or countr y’s natural resource dependence by setting clear goals and pursuing Ecological Footprint reduction strategies, including renewable energy, smart infrastructure, innovation and efficiency, would be the cornerstone for securing resilience and economic stability. We therefore welcome a shift towards circular economy, made possible by the implementation of Sustainable Consumption and Production policies and activities as well as the Mediterranean Strategy for Sustainable Development which aims to guarantee
the health of the region’ s threatened assets by integrating environmental concerns into key development decisions. The strategy’s objectives also include ensuring a high quality of life for the Mediterranean people without further degrading the environment and within the carrying capacity of regional ecosystems. But reality is far from this goal. According to Global Footprint Network’s analysis, the Mediterranean region now uses approximately two and a half times more natural resources and ecological services than what its ecosystems can renew (www.footprintnetwork.org/med ). This can be measured with Ecological Footprint accounting. Just as a bank statement tracks expenditures against income, Ecological Footprint accounting measures how a population uses resources and measures what is available. The Ecological Footprint adds
up all human demands on nature that compete for biologically productive space — demands for fruits and vegetables, meat, fish, wood, cotton for clothing, space for urban infrastructure and absorption of carbon dioxide from burning fossil fuels. This Footprint then is compared with all the available biologically productive space (called biocapacity). The biocapacity of a state, region, nation or the world represents what their respective productive areas can renew, including forest lands, grazing lands, cropland and fishing grounds. In order to compare all Footprints and biocapacity across the globe, these are expressed in a standardised unit: global hectares. These are biologically productive hectares with world average biological productivity for a given year. The Carbon Footprint is the portion of
the Ecological Footprint associated with fossil fuels use. It measures the biologically productive space needed to sequester the carbon emissions from burning fossil fuels. Currently, the Carbon Footprint makes up nearly 60% of the world’s Ecological Footprint. If we achieve the goals of the Paris climate agreement, the Carbon Footprint will have to fall to zero by 2050. Analysing these resource risks, opportunities are also revealed. Human ingenuity enables us to build a resourceefficient economy that provides for a thriving society within the means of nature. In a world of climate change and resource constraints, such an economy will become any nation or region’s strongest asset. The current potential for Footprint reductions is vast. At the same time, this requires significant foresight for a whole country to transform. Evaluating opportunities
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helps us find footprint reduction options that are economically and politically desirable. To find strategic wins that can provide footprint reduction gains while creating economic value, finance tools are needed to accurately assess the costs and benefits of each option. For example, the Net Present Value Plus (NPV+) method (www.footprintnetwork. org/npvPLUS ) can help identify where footprint reductions go hand in hand with financial gains. NPV+ goes beyond the conventional net present value analysis by including currently unpriced factors, such as the cost of environmental degradation and health and benefits like ecological resiliency. NPV+ also makes the assessment consistent with the investors’ explicitly stated assumed future — whether investors are government agencies, private entities or a partnership between the two. Such assumed futures help choose
more meaningful parameters for a more comprehensive cost benefit analysis. Such assessments show that many sustainability policies are both fiscally and environmentally responsible. Therefore, the combination of risk and oppor tunity tools allows us to identify policies that reduce risk while strengthening our economic standing. After all, our world is finite. But the possibilities are not.
INFO Mathis Wackernagel, PhD is cocreator of the ecological footprint analysis and CEO of Global Footprint Network. He has promoted sustainability on six continents and lectured at more than 100 universities. Awards granted to him include the 2015 IAIA award, the 2013 Prix Nature Swisscanto, the 2012 Blue Planet Prize, the 2012 Binding-Prize for Nature Conservation, the 2012 Kenneth Boulding Memorial Award, the 2011 Zayed International Prize for the Environment, an honorary doctorate from the University of Berne in 2007, the 2007 Skoll Award for Social Entrepreneurship, the 2006 WWF Award for Conservation Merit and the 2005 Herman Daly Award of the U.S. Society for Ecological Economics. From 2011 to 2014, Dr Wackernagel was also a Visiting Professor at Cornell University. Global Footprint Network is a research organisation that is changing how the world manages its natural resources and responds to climate change. Since 2003 we have engaged with more than 50 nations, 30 cities and 70 global partners to deliver scientific insights that have driven high-impact policy and investment decisions. Together, we are creating a future where all of us can thrive within our planet’s limits. www.footprintnetwork.org
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Circular Economy – Sustainable Growth
Vanya Veras Secretary General Municipal Waste Europe
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t is common knowledge that the world’s developed countries consume the greatest quantity of materials, fuels and products, also contributing the most to global warming; and Europe is one such group of countries. What is less known is that we, in the European Union, import three times more products than we export and that represents six times more raw materials than what we export. Where does it all go? Either directly or indirectly, into our waste. Creating a circular economy is all about saving materials and products from being wasted, by recovering them from our waste stream and, by doing so, recovering their value either as products to be repaired and reused or as materials to be recycled back into production. Anything that is left over can be turned into fuel or used directly in a waste-to-energy plant and play its part in providing energy security.
different products and materials at the moment that they become waste, so as to preserve their intrinsic value and facilitate their further use in the economic cycle. European municipalities bear the responsibility for creating the appropriate system so as to make sure that this happens. To make it more visible, here, we are talking of packaging waste which contains plastics, paper, metals, glass; of biowaste which can be transformed into compost for use in agriculture and biogas intended for use in vehicles, for heating or to generate electricity; of mobile phones, fridges, washing machines, computers which can be repaired and resold. All of this is already happening, but it needs to become widespread, so that all municipalities in the European Union are doing this and much more, and so that we can assist developing countries in following our good rather than only our bad consumption patterns.
Municipalities play a pivotal role in all this. They are responsible for providing services of general interest and, as such, are the link among the citizens: the consumers, who are in possession of the waste and in control of its ability to be recovered as a product, material or energy. European legislation requires the separation of
The best way of spreading such best practice is to demonstrate how it works economically as well as environmentally. Several examples of this type already exist, where the costs of waste management have been significantly reduced by moving away from collecting mixed waste and replacing it with the separate collection of different waste
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Institutes & Networks
materials and products at source, which are then sold to the market. It is clear that this is a complex system and in order for it to succeed, all parties need to work together to manage their part of the chain. Municipalities may be at the forefront of municipal waste management, which includes household waste and other similar to household waste from commerce and industry, but the producers of packaging, waste electrical and electronic equipment, batteries, vehicles and other products bear the responsibility to ensure that their products are taken back from the market once they have entered the waste stream for the purpose of being reused or recycled. European legislation is currently being revised to promote more recovery and less “loss” from the European waste stream. At Municipal Waste Europe, it is our job to make sure that European municipalities are fully supported in this task and that, in turn, we support our local economies with the resulting financial savings and the creation of new jobs. The proximity principle for waste management as presented in the European waste directives should also apply to the sale of the materials recovered for recycling. This will boost
the creation of a circular economy in Europe by delivering quality materials to the European industry. This is not to say that these materials cannot or should not be traded on the global market but, if Europe is serious about growing its economy sustainably, it should focus on reusing what has already been extracted and paid for before buying new primary materials. This is a closed-loop economy. Sustainable growth is also not something to be restricted to one region of the globe or to the developed countries. Europe is not the only continent that still exports its “unsustainable” production, seeing itself suffer financially, as a consequence. Municipalities are the ones faced with finding jobs for their citizens who are suddenly finding themselves unemployed due to the failure of an industr y. The future is linking up all strategies whether they are economic, waste, resources, water, soil or climate, as they are not separate. They are intricately inter woven and interdependent and understanding their synergies will ensure that we are able to address the root causes of global warming before it gets out of hand.
INFO Vanya Veras has more than 15 years of experience in waste management legislation, practices and systems. In 2012, she joined Municipal Waste Europe as their Secretary General. Municipal Waste Europe is the association which represents municipalities and their public waste management companies, in their public responsibility for and engagement in waste management services. Ms Veras is a multinational, multicultural professional who began her career in Brussels in 1996, in the field of environmental policy, beginning her specialisation in waste policy in 1999. After almost 12 years in Brussels, Ms Veras was offered the opportunity to return to her home country, Greece, working for Coca‐Cola Hellenic, where she held the position of Environmental Affairs Manager for three years. Opting to remain in Greece as a freelance consultant, Ms Veras worked with several companies and local authorities, advising them on a variety of environmental issues, including taking up the position of special advisor on waste management to the Mayor of Piraeus. With the benefit of this combined experience of the waste industry, the producer and the local authority, Ms Veras is now leading Municipal Waste Europe through the revision of the waste legislation. Municipal Waste Europe (MWE) is a non-profit association which represents European municipalities and their waste management companies toward the European Institutions, in their responsibility to manage municipal waste. The members of Municipal Waste Europe represent 14 Member States of the European Union, through national public waste associations which serve over 60% and up to 95% of their national population. One of the key issues for the European municipalities is the promotion of the responsibility of local and regional authorities for waste management as a service of general interest. Throughout Europe, municipalities are responsible for the recovery of material resources from the European households. The members of Municipal Waste Europe therefore play a pivotal role in leading Europe in becoming more resource-efficient. In effect, the members of Municipal Waste Europe form the bridge between the actors in resource efficiency, recovering materials from citizens and making them available to producers once again. www.municipalwasteeurope.eu/
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Mainstreaming Sustainable Production and Consumption to Reduce Poverty and Preserve the Environment
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Andrew Bovarnick Global Head, Green Commodities Programme and Lead Natural Resource Economist United Nations Development Programme (UNDP) Elodie Vieux Consultant, Junior Programme Advisor UNDP Green Commodities Programme
Empowered lives.
Reilient nations.
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ethinking the way our world produces and consumes resources is central to meeting the key sustainability challenges of our time. As income per person increases and people live longer, we will have to produce more food, goods and energy to meet the world’s projected needs. Achieving this while remaining in the current production and consumption paradigm is no longer an option as the impact on climate change and poor population will be unbearable. This major threat could also represent the greatest opportunity for the world to switch to sustainable production and consumption patterns that ensure sustainable management and efficient use of resources globally. Recognising this, the world’s leaders have committed to making fundamental changes in the way societies produce and consume goods and ser vices. Sustainable Production and Consumption has been set as one of the 17 Sustainable Development Goals of the 2030 Agenda adopted in September 2015. Developing sustainable value chains — from production to consumption — is not a new idea but the scale
is unprecedented: all Governments, companies and civil society organisations need to work together to mainstream sustainable products and services so that they no longer represent niche markets but become the motors of national economies, lifting people out of poverty while preserving our environment and promoting healthier lifestyle. It is a challenge of scale not of substance that we need to take. UNDP’s unique mandate and core strengths make it a key actor to support countries in adopting sustainable consumption and production patterns: a lasting presence in over 170 countries, a wide variety of technical expertise in poverty reduction, climate change, biodiversity conservation and democratic dialogue and a strong reputation as trusted neutral partner for governments and private companies. UNDP is active in mainstreaming sustainability within value chains by working in countries to set up the enabling environment to transform productive capacities. This means suppor ting necessar y policy and legislative reforms, facilitating access to finance and economic incentives for
INFO
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Institutes & Networks
sustainable production, diversifying the productive base and increasing value added so that employment can be generated and livelihoods created. It also requires improving national systems by supporting producers to build their capacities to adopt best production practices, increasing productivity, carbon and natural habitat on farms while reducing pressure to expand in forested areas and use agrochemicals. Consumer choices around the world and responsible purchasing policies are a key element to increase sustainable production. With the development of new technological tools to increase traceability and transparency within supply chains, the link between consumption and production can be strengthened. UNDP has developed significant and meaningful partnerships with companies at the forefront of integrating sustainability into their supply chains, such as Mondelez, Ikea, ADM and Cargill. Benefiting from its key position as a bridge builder, UNDP convenes public private par tnerships as a solution
to sectorial transformation creating links between all key actors to align positions and synergise efforts. For example, UNDP facilitates National Commodity Platforms in key agricultural commodities producing countries to devise concerted National Action Plans that are endorsed by governments and address the key barriers to sustainability of a sector. This was fostered in Costa Rica, where the National Action Plan for Strengthening the Responsible Production and Trade of Pineapple detailing collective efforts between all types of stakeholders in the next five years received support at the highest levels, with the President of Costa Rica, Luis Guillermo Solis, signing a decree making it official in early 2016. Examples like this one prove that collaboration can lead to effective change over the long term. It is thus UNDP’s duty to support this global transition and bring better quality of life to an increasing population while preser ving natural resources and reducing emissions so as not to jeopardise the needs of fur ther generations.
Andrew Bovarnick serves as the Global Head of UNDP’s Green Commodity Programme and UNDP’s Lead Natural Resource Economist. He has over 20 years of experience in international environment, agriculture and economic development issues, for both the public and private sector. Mr Bovarnick’s areas of experience within sustainable development are sustainable agriculture and commodities production, institutional capacity building, policy reform, farmer and SME finance, supply chain partnerships and economic valuation of ecosystem services. Field experience covers over 40 countries. As the Global Head of UNDP’s Green Commodity Programme (since the inception of the programme in 2009) and UNDP’s Lead Natural Resource Economist, Mr Bovarnick heads up a global team of advisors developing nationallevel projects on sustainable agricultural commodity production, in partnership with governments and global buyers. GCP aims to improve the national economic, social and environmental per formance of agricultural commodity sectors, with a focus on rural livelihoods, climate change mitigation and ecosystem services and resilience. Mr Bovarnick also has a broader global technical leadership role to introduce and apply economic approaches across UNDP’s natural resource and biodiversity conservation projects. Prior to joining UNDP, Mr Bovarnick was a Senior Consultant in the Environmental Policy and Sustainable Development team of Environmental Management Resources, a global environmental consultancy. There, Mr Bovarnick served for five years as the environmental economist working on a range of natural resource management projects funded by international donor agencies (IFC, World Bank, European Commission, EBRD, DFID, FINIDA), companies and national governments. His education includes a BA from Oxford University and an MA from Fletcher School of Law and Diplomacy, Tufts University. Elodie Vieux is Junior Programme Advisor for UNDP's Green Commodities Programme. She started working for UNDP two years ago to support external and internal communication, build the capacity of practitioners working with agricultural commodities within UNDP and Governments and strengthen the M&E framework of the Programme. Ms Vieux holds a Bachelor degree in International Relations and a Master degree in Development Studies from the Graduate Institute of Geneva. Along with her studies, she has been involved in several NGOs’ projects including maintaining a natural reserve in Argentina, teaching English to children and teenagers in an orphanage in Thailand and supporting the integration of migrants in Switzerland. She is also a Member of the Board of the Afghan NGO Action for Development, which she has been supporting during the past three years. United Nations Development Programme (UNDP) partners with people at all levels of society to help build nations that can withstand crisis and drive and sustain the kind of growth that improves the quality of life for everyone. On the ground in nearly 170 countries and territories, we offer global perspective and local insight to help empower lives and build resilient nations. www.undp.org www.greencommodities.org
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Value •Embedded value
•Labour-v-materials •Specialties
High Remanufacturing Engineering Potential
Value •Technology change
Low
•Legislation •Upgrade potential
Re-constructability
•Construction •Remediation •Knowledge
Really, the proper study of economics is fulfilment, not consumption... It does not even matter if it is a green product or a green house... It is still consumption. What matters in this world is the fulfilment of people’s needs and the fulfilment of their aspirations. Paul Hawken, American environmentalist, entrepreneur and author of the “Natural Capitalism: Creating the Next Industrial Revolution” (1946 – )
You cannot control your own population by force, but it can be distracted by consumption. Avram Noam Chomsky,
American linguist, philosopher, cognitive scientist, historian, logician, social critic and political activist, sometimes described as the father of modern linguistics (1928 – )
The production of too many useful things results in too many useless people. Karl Marx,
German philosopher, economist, sociologist, journalist and revolutionary socialist (1818 – 1883)
I only feel angry when I see waste. When I see people throwing away things we could use. Mother Teresa,
Albanian Roman Catholic religious sister and missionary and Nobel Peace Prize laureate (1910 – 1997)
E d u c a t i o n
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Academic Institutions in Support of Sustainability
Dr Klas Eric Soderquist Associate Professor, Department of Management Science and Technology Athens University of Economics and Business
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niversities and academic institutions add critical dimensions to the ef for t of developing and spreading knowledge and practices about sustainable development in a broad sense, including sustainable economic growth, sustainable product and service design, sustainable business models in supply chains and sustainable production and consumption. Academia’s central mission, to train, educate and conduct research, can be strongly coloured by the sustainability imperative. Knowhow, methods and tools (for example, in green design, life cycle thinking, circular economy and resource efficiency improvement) are complemented by training that can shape future business leaders to embrace the importance of responsible professional conduct and citizenship at the strategic and governance levels. Using leading universities’ and AUEB’s own experience, I develop below three areas of activities, with some specific examples of actions that are or can be taken within each. They are inspired by the United Nations Global Compact and the UN Principles for Responsible Management Education (www.unprme. org), frameworks that are highly valuable for guiding the implementation and evaluating the results of sustainability effor ts and orientations in higher education.
1. Responsible Internal Management Being large and people-intensive organisations, it is of utmost importance that academic institutions develop their own internal policies and programmes for ethical conduct and environmental responsibility. Environmental Committees take actions with respect to energy and resource saving, responsible purchasing, waste reduction, and recycling of all consumables and equipment that transit through the institution. Internal charts of ethical and environmental conduct are signed by all internal stakeholders, spreading the sustainability message and reminding them all about the importance and necessity of taking individual dayto-day responsibility. Sustainability issues must be supported by the top management of the institution, and the wide spectrum of actions and responsibilities should be integrated in the existing systems and processes. 2. Education, Training and Research Integration of sustainability issues in the curriculum through dedicated courses, e.g. Environmental Management, Sustainable Development, Global Resource Management, Ecodesign and Innovation, Business Ethics, Corporate Governance and Social Entrepreneurship ― only to name a few ― is obviously a central pillar of a university’s sustainability orientation.
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However, launching new and specialised courses can be difficult and take more time and energy than an ambitious sustainability strategy would have actually planned for. Hence, integration of CSR in existing courses as an integrated part of the traditional content is a way of succeeding a smoother and more gradual development. Sustainability issues are best taught through interactive learning models, including case studies, team exercises, business games and even cross-discipline projects. Encouraging sustainability projects, such as company internships and graduation projects, also gives hands-on experience to the students about how companies approach and manage these issues. Moreover, the applied nature of the sustainability problematic makes it particularly important to integrate in continuous education programmes, executive training modules and executive Masters programmes. Mirroring the approach to education and training, integration of sustainability issues in ongoing and established research is much recommended, besides conducting dedicated research on related topics. An applied dimension of sustainability research, involving companies and organisations and focusing on tools, methods and
instruments, is of utmost importance, as this kind of research inspires and drives action. 3. Networking and Dissemination Academic institutions also act as network par tners and activity coordinators of sustainability events, conferences and seminars with local and global par tners from industr y, organisations and academia. By interacting with NGOs, ministries, youth groups, media, think tanks, etc., in order to design and implement joint actions, and by organising career days, sports or cultural as well as other athletic institutional events under the “auspice” of sustainability, academic institutions leverage the sustainability thematic and reinforce the spread and impact of sustainability activities. Ιn the wider spectrum of university activities, sustainability can be a core thematic area in developing relationships with the business community and interacting with alumni and, last but not least, in applying sustainability principles in the ver y internal operations of the institution itself. Motivating students and alumni to actively participate in all such initiatives can help them adopt a new mindset of taking individual day-to-day responsibility and of driving sustainability in all aspects of business and life.
INFO Dr Klas Eric Soderquist is an Associate Professor of Innovation and Knowledge Management at the Department of Management Science and Technology, Athens University of Economics and Business (AUEB). He is Head of Academic Affairs of the MBA International Programme and heads the Innovation and Knowledge Management Unit (InnKnow) of AUEB’s Management Science Laboratory (MSL). Before joining AUEB, he was a faculty member at the Grenoble Ecole de Management, France, and has also taught at the Higher Colleges of Technology, Dubai, UAE. He holds a Doctorate of Business Administration from Henley Management College and Brunel University, and a BSc and MSc in Industrial Engineering from the Royal Institute of Technology, Stockholm. Dr Sοderquist’s teaching and research interests include Innovation, New Product Development, R&D Management and Policy, Entrepreneurship and Operations Management. He has been published in, inter alia, the Journal of Product Innovation Management, Long Range Planning, R&D Management, Omega and the Journal of Small Business Management. He serves on the editorial board of several journals in his areas of expertise. He has acted as a consultant to various companies in the manufacturing industry, to the European Union on innovation policy issues, and to UNIDO on issues related to technology transfer and strategic alliances. He has also worked as a consultant for the Swedish Office of Science and Technology in Paris. MBA International is an innovative MBA programme offered by the Athens University of Economics and Business. It is taught exclusively in English and is geared towards developing managers with practical, real-world skills, relevant to today’s fast-moving and challenging business environment. The programme is fully accredited by the Association of MBAs (AMBA), the international accreditation authority, and has recently been the recipient of the AMBA MBA Innovation Award. A rich and constantly evolving academic programme allows students to customise the curriculum to fit their personal and professional needs and interests while helping them strengthen their interpersonal and managerial skills and cultivate their entrepreneurial capabilities. With students from more than 20 countries, as well as faculty members and invited speakers from four continents, the programme embraces diversity and creates a unique multicultural environment that assists students in building a global outlook and network. www.imba.aueb.gr
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The Role of Circularity in the Creation of Sustainable Business Models
C Dr Nancy Bocken Associate Professor, TU Delft Industrial Design Engineering Senior Research Associate Institute for Manufacturing University of Cambridge
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ircularity has become a popular theme with businesses, policymakers and academics. The hope is that we can establish a new competitive landscape by moving away from linear to circular business models. This means that we need to shift away from business models typified by fast fashion and built-in obsolescence, largely reliant on fossil fuels, to circular business models where materials and products are continually reused, using renewable resources. Business models are a way to drive systems change in organisations. They describe the way business is done: what value is provided and to whom (value proposition), how that value is provided (value creation and delivery) and how value is captured (value capture). Value is an important theme, but for sustainable and circular business model innovation this extends beyond financial
value to what positive value is created to the natural environment and society. Some companies are already starting to figure out how they can become “net positive” and contribute positively to the environment and society rather than detracting from it. Outdoor company Patagonia’s mission is to “build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” Through its food business, it works with fishermen willing to fish responsibly to rebuild endangered salmon populations. As a different example, the home improvement company Kingfisher aims to grow more forests than it uses. These examples show that circular and sustainable business models are built on common sense: not taking more than you can replace and seeking to treat those you depend on well.
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Education & Research
The concepts of slowing, closing and narrowing resource loops and the use of renewable energy can be an important basis for the circular economy (see Figure 1). Although the ultimate aim is to conserve out planetary resources and use them more wisely, the circular economy does more than optimising
stocks and flows. The social and economic dimensions of the circular economy are equally important. Several new businesses are emerging that understand this social dimension well. The start-up Peerby focuses on a sharing platform that brings people together to share things they own to go against a “throw away culture”. BlaBla Car aims to make car sharing social and fun. Couchsurfing and Airbnb are making home sharing mainstream and a social experience. Most of these examples are from developed countries. However, in emerging economies, many interesting business model innovations are also being developed at a fast pace combining social, environmental and economic sustainability effectively. Locomute focuses on car sharing in South Africa and M-Pesa (Kenya) and Lendico focus on mobile banking in emerging countries and peer-to-
g fl
win arro
s ow
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Closing resource flows Linear flow
Life extension - linear
Circular flow
Life extension - circular
Solving resource flows
Already in 1994 Walter Stahel described two key directions for a circular economy. First and foremost, slowing resource usage is essential. We need to make products that last and make sure that the product lifetime can be extended through repair and remanufacturing. Second, after multiple (re)uses, we need to close loops or recycle. A third strategy of “narrowing loops” can be added which is about reducing the resources needed to manufacture products in the first place. Finally, we need to use renewable energy to manufacture these products.
Figure 1: Closing, slowing and narrowing loops
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peer lending respectively. SolarSister and Sunny Money take an inclusive business model approach by involving local communities, schools and female entrepreneurs to spread solar energy. Several new solar start-ups are emerging in Africa with innovative business models such as pay per use, making solar power affordable and ensuring through these contracts that panels can be easily maintained and repaired. However, to mainstream new circular businesses and business models, experimentation is needed to establish new businesses and develop innovative business models in existing businesses. Figure 2 shows 10 broad steps to be taken to develop circular projects: 1. Leadership: A vision strongly
embedded in the organisation and acted upon by authentic leaders. 2. Vision and purpose: A strong, embedded purpose. 3. Selecting your pilot: Determining the business opportunity in your industry. 4. Sketching the system: Analyse who to work with and how. 5. Visioning with partners: Create a shared visioning with partners in your sketched system. 6. Internal transformation (for existing businesses): Developing a team of change agents. 7. Circular business and revenue model innovation: To create the incentives for all partners to work together. 8. Internalising externalities: Creating benefits by embedding risks (often regarded as externalities) into the business. 9. Contract: Find a fitting contract to work with new partners.
Evaluate and leap between every step
1
10
SCALING-UP FROM PILOT TO CIRCULAR BUSINESS
LEADERSHIP
2
VISION AND PURPOSE
9
CONTRACT
10 STEPS
3
SELECTING YOUR PILOT
TOWARDS A
8
INTERNALISING EXTERNALITIES
CIRCULAR ECONOMY
4
SKETCHING THE SYSTEM
7
CIRCULAR BUSINESS MODEL INNOVATION
6
INTERNAL TRANSFORMATION
5
VISIONING WITH PARTNERS
Figure 2: 10 steps towards a circular business. Kraaijenhagen et al. (2016), www.circularcollabration.com
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INFO
10. Scaling up from pilot to circular business: Run a collaborative pilot, learn from your pilot, learn by doing, and follow up with the next pilot. There is an important role to play for existing large businesses to go through such a process of experimentation to move from linear to circular business models. Start-ups can push existing industries to change while they quickly achieve scale (consider Airbnb and Uber quickly transforming the hotel and taxi industries). Par tnerships will become more impor tant when we start to accept that, in the future, value will not be created anymore by exploiting resources but by reusing and maintaining them for as long as possible. With increasing global transparency of corporate actions it also becomes increasingly risky and difficult to continue exploitative business
models. NGOs such as WWF and Oxfam can continue to push companies in the right direction. Moreover, the required new technologies, value chains and business models cannot be developed in isolation. Collaboration can ensure existing and new businesses will be part of a new circular economy.
Dr Nancy Bocken is Associate Professor at TU Delft, Industrial Design Engineering. She was awarded the TU Delft Technology Fellowship to undertake research in the areas of sustainable business models, and design and innovation for a circular economy. Dr Bocken has a part-time post as a Senior Research Associate at the IfM, University of Cambridge. She is a Fellow at the Cambridge Institute for Sustainability Leadership. Interwoven with her academic work, Dr Bocken regularly advises a range of organisations. She is co-founder of Reduse, developing the world’s first commercial office paper Unprinter and HOMIE, a pay per use domestic appliances provider. Dr Bocken has held positions in the logistics, banking and consulting sectors. Originally from the Netherlands, she has lived and worked in France, the UK and the USA. In 2013 she was a Visiting Fellow at Yale University. Dr Bocken holds a PhD in Engineering from the University of Cambridge. The Industrial Design Engineering Faculty at Delft University of Technology is one of the oldest and largest in the world; it plays a leading role in the development of the discipline. The faculty is regarded as a global leader in the field of design research. Through its research, the Department of Design Engineering aims to explore novel product technological affordances and develop implementation principles and potential innovative application domains for smart consumer durables. Design for Sustainability, Circular Economy and emerging materials are lead focal topics. www.io.tudelft.nl The Institute for Manufacturing (IfM) is part of the University of Cambridge, Department of Engineering. It brings together expertise in management, technology and policy to address the full spectrum of issues which can help industry and governments create sustainable economic growth. www.ifm.eng.cam.ac.uk The University of Cambridge Institute for Sustainability Leadership (CISL) brings together business, governments and academia to find solutions to critical sustainability challenges. www.cisl.cam.ac.uk
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Prioritised Sectors and Products Source: “Scoping study to identify potential circular economy actions, priority sectors, material flows and value chains”. Funded under DG Environment’s Framework contract for economic analysis ENV.F.1/FRA/2010/0044, European Commission, August 2014.
Priority products & sectors
Key materials
Product packaging (incl. beverages)
Plastics; Wood; Paper & cardboard; Glass; Aluminium; Steel
- Resource efficiency - Waste reduction - Energy use
- Alternative delivery schemes with leasing arrangements - Coordinated deposit return schemes - Increased collection, reuse & recycling
Food & Food Waste
Phosphorus; Energy; biomass
- Food scarcity & security - Land use requirements for food provision and impacts on biodiversity - GHGs emitted & pesticides applied in production of food, especially that which is wasted - Competing uses for materials (e.g. energy) - Potential resource efficiency gains - Raw material security (phosphorus) - Environmental impact of food waste - GHG emissions from landfill
- Improve agriculture & land management methods (e.g. use natural fertilisers, reduce water use) - Substitute high impact products - Implement waste hierarchy (prevention, food banks, processing for food applications, feed, industrial resource, AD, composting, renewable energy, incineration, landfill) - Reduce waste throughout supply chain (e.g. reduce supply side losses, encourage surplus-sharing among farmers)
Telecommunications (incl. mobile & smart phones)
Rare earths; Gold; Copper
- Environmental impact of production & disposal - Toxicity of heavy metals & materials - Energy saving requirements - Value of materials recovery - Scarcity of rare earth minerals - Concern for social impacts of disposal (e.g. in third countries)
- Design for increased recycling & materials extraction - Leasing models - Greater capture & refurbishment of old models - Modulation of components (consumer driven repair, refurbishment) - Bring back, take back and increased repair, recycling & materials extraction
Home appliances
Fossil fuels; Rubber; Steel; Aluminium; Copper
- Resource use: energy, water, detergents (phosphorus) - Environmental impact of end of life disposal/waste - Scale: applicable to several households - Pioneer economic actor towards greater circularity elsewhere - Potential for action - sufficient scale, existing retail distribution network, limited number of suppliers
- Improved design to facilitate repair, reuse, refurbishment, & recycling - Leasing contracts & extended take-back-requirements linked to replacement - Sharing of long life, high performance products
Personal motor vehicles, trucks & motorcycles
Fossil Fuels; Steel; Aluminium; Rare earths; Plastics
- Scale: dominant transport mode for short-medium distances - Environmental impact of emissions - Energy use - Stricter CO2 emission reduction requirements
- Improved design for repair, refurbishment & recyclability & end-of life material management - Longer product durability whilst maintaining the opportunity to exploit the environmental benefits of new developments and innovation (e.g. through modularity and remanufacturing) - Shift towards leasing & vehicle sharing - Innovation for improved performance & design - Increased fuel efficiency of vehicles
Industrial motor vehicles, ships, trains & airplanes
Fossil fuels; Rubber; Metals (Steel, Aluminium Copper); Plastics
- Scale: dominant goods and passenger mode on long distances - Environmental impact of emissions - Energy use - Increasing price of resources & commodities - Increasing competition from emerging markets
- Shift towards leasing & vehicle sharing - Improved durability & remanufacturing possibilities - Improved management of end-of life material management - GPP
Furniture
Wood (timber) including forestry; residues; Textiles; Aluminium; Steel; Plastics
- Resource efficiency - Waste product contamination (flame retardants) - Pressure on resources - Competing uses for materials
- Design for disassembly, repair, reuse, refurbishment & recycling - Improved collection rate - Increase in leasing
Why is it a priority?
Envisaged circular economy transformation
A Global Perspective
CHINA JAPAN
Japan is considered a frontrunner in supporting the development of a circular economy. Its approach is underpinned by several pieces of legislation including on the circular economy, resource efficiency, waste and several sectoral pieces of legislation. These policies set objectives and targets and have been complemented by a number of supporting policies, measures and approaches (e.g. top-runner programme, eco-towns, 3R awards, green public procurement etc.). Furthermore, there is an emphasis on “eco-conception” (whereby products are designed so as to reduce the use of resources in production, repair and maintenance), a focus on substituting nonrenewable resources with renewable resources, preference for local consumption, cyclical reuse of biomass and revitalisation of local communities. Cooperation between stakeholders such as local communities, NGOs and companies is also emphasised (CGDD, 2014). The Government has adopted a Food Waste Reduction Policy which contains different food waste reduction programmes, such as campaigns for changing table settings, food waste-to energy policy, use of food waste for fodder and compost and a ban on direct landfill of food waste – all of which aim to reduce the amount of food waste (COWI, 2011). The programme also has pay-by weight food waste management system where rubbish receptacles are updated to contain RFID scanners with disposal fees billed based on the weight of the food waste a family generates (Legislative Council Secretariat, 2012).
UNITED STATES
A law on the promotion of the circular economy was adopted in 2009 which focuses on the 3Rs (reduce, reuse and recycle) and a number of resources (water, energy, raw minerals etc.). A Circular Economy Development Strategy and Action Plan (2010-2015) has also been adopted and a system of “Circular Economy Evaluation Indicators” set up to assess progress at provincial, municipalities and business level on energy consumption, recycling and reuse of resources, pollution and social development. Circular Economy Offices have been set up at the local level to provide advice to businesses and citizens. Several fiscal measures have also been introduced to foster the use of recycled products and the development of industrial symbiosis (CGDD, 2014). Efforts at different levels (business, industrial parks, regions/townships/urban systems) seek to support the transition through inter alia resource recovery, cleaner production methods and public facilities (Swiss Academy of Arts and Sciences, 2014).
SOUTH KOREA
Source: “Scoping study to identify potential circular economy actions, priority sectors, material flows and value chains”. Funded under DG Environment’s Framework contract for economic analysis ENV.F.1/FRA/2010/0044, European Commission, August 2014.
While there is currently no formal policy objective on the circular economy at the federal level, several actions have been taken at the State and local levels in this area. For example, in Madison (Wisconsin) the “Construction Recycling Ordinance” requires new constructions and remodeling above a certain cost to reduce the amount of waste sent to landfill and has a 70% target for recycling concrete and steel debris. Chicago has a “Construction and Demolition (C&D) Debris Recycling Ordinance” which sets a recycling target of 50% for all C&D waste (with an exception for wastes containing lead, asbestos and other hazardous materials). Contractors are also required to control and track the total amount of C&D debris produced and submit a “recycling compliance form”. In Boulder (Colorado), the “Green Building and Green Points Program” requires at least 50% of construction waste to be recycled and for at least 65% of total “material by weight” generated from demolition to be diverted from landfill. San Jose (California) has a “Construction, Demolition, Debris Deposit Program” which refunds fees paid by contractors/remodelers where they can show appropriate documentation of avoided landfilling of construction materials (The Delta Institute, 2011). Moreover, in November 2013, the New York City Council approved local law 2013/142, which banned the use of single plastic-foam food and drink containers (styrofoam) from restaurants and food stores in the city. (NNC, 2013)
Circular Innovation: The Future of Consumer Goods Production and Consumption
C
Dr Fiona Charnley Lecturer in Sustainable Product and Service Design, Centre for Competitive Creative Design (C4D) Cranfield University
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ircular approaches to design, manufacture and services are proposed as one of the most significant opportunities to radically rethink how we use and reuse finite resources. Despite meaningful success by manufacturers of high value engineering products to move towards more sustainable practices, there is inconsistency across the manufacturing sector, particularly in the consumer goods sector which faces complex interdependent challenges, preventing successful implementation at a whole system level. The linear production of the consumer goods industry, worth approximately USD 3.2 trillion, has remained largely unchanged since the industrial revolution and places emphasis on mass manufacture through multinational corporations and globally dispersed supply chains, with 80% of materials ultimately ending up in landfills, incinerators or wastewater. The current model of consumer goods production creates a void between the manufacturer and the end user, limiting the opportunity for upscaling of local enterprise, use of local resources and materials and the implementation
of circular business models that rely on a close relationship between the manufacturer and the end user to facilitate elements such as return, repair, remanufacture and repurposing of products. Influenced by nature, a circular economy is an inherently feedback rich system. Taking advantage of significant advancement in digital technologies and resulting data flows can enable the development of a connected, localised and inclusive model of production and consumption capable of transforming resource use across the consumer goods sector. Furthermore, a digitally intelligent and feedback rich system has the ability to support manufacturers in creating new streams of value through effective management of resources and assets throughout the value chain, reduction, monetisation and secondary markets for waste and the offer of customised products and ser vices enabling assets to be kept at their highest value and extending their useful life cycles. The application of circular innovation not
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Education & Research
only decouples economic growth from resource use but, also, aligns incentives of the end user and the manufacturer. This is demonstrated by HP whose ”Instant Ink” initiative has enabled them to move from a business model based on product sales to a per formance model for ink cartridge replacement. This has not only enabled HP to divert, on average, more than one million water bottles per day from landfills, but has catalysed stronger customer relationships through the provision of a customised replacement cartridge service, based on IOT technology, at a reduced cost. End users benefit from ink cartridges delivered direct to their door before they are even aware that they are running low and also, due to a change in ownership of the asset, cartridges have been redesigned to hold more ink and therefore need replacing less frequently. Models such as this close the loop on material flows within the consumer goods sector and also close the gap between the manufacturer and the end user, making way for more trustworthy, intelligent and customised relationships!
Holistic models of circular innovation imply a change in business making for consumer goods manufacturers, shifting focus towards dynamic and intelligent solutions offering new types of value throughout the supply chain. As such, human capital skills are central to achieving resource optimisation, rather than solely relying on solutions provided by automated tools. With new targets, more demanding users, growing product embodiment constraints and pressure to innovate while optimising resources, the need for a variety of skills to support circular innovation is evident. Such skills range from deeper knowledge of material science, engineering techniques and operational processes to proficiencies in service design and a deep knowledge of human behaviour. Stakeholders across the consumer goods sector are encouraged to seek the development of such proficiencies to boost the successful execution of circular innovation, attend to the diverse requirements of a circular economy and bring about transformational change to production and consumption.
INFO Dr Fiona Charnley is a Lecturer in Sustainable Product and Service Design within the Centre for Competitive Creative Design (C4D) at Cranfield University. She has worked and published within the field of design and manufacture for a circular economy since completing her PhD in Whole System Design and has successfully led research projects funded by UK and European Research Councils as well as industrial organisations across sectors. Dr Fiona Charnley leads the university-wide initiative at Cranfield to develop research and teaching programmes to support the transition towards a circular economy. She has collaborated with multiple organisations of varying sizes across industry sectors to implement design for a circular economy including the Ellen MacArthur Foundation, Granta Design, Cisco, Chanel, Dragon Rouge, Rolls-Royce, Unilever and Philips. Dr Fiona Charnley’s research has resulted in significant advances in transformational and closed loop models of design and manufacture, making contributions to academia and industry. Cranfield University is world-leading in its contribution to global innovation. With our emphasis on the aerospace, agrifood, defence and security, environmental and agrifood, water, leadership and management, manufacturing and transport systems sectors, we have changed the way society thinks, works and learns. Innovation is part of Cranfield’s “corporate DNA”, evolved over 60 years of commitment to this agenda. Our work informs policy for governments and produces new technologies and products for the world of commerce. We draw on this pool of research and consultancy to provide our postgraduate students with a distinctive “real-world” learning environment, allowing them to develop as professionals and transfer their new knowledge to the global economy. This has always been the “Cranfield way” but it has never been more important than in today’s world. www.cranfield.ac.uk
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Defending the Environment Using Novel Materials
T Athanassia Athanassiou Senior Researcher and Coordinator of Smart Materials Group Nanophysics Department Istituto Italiano di Tecnologia
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he explosion of production and use of plastics, the pollutants produced by industry and transportation, the chemicals used in various production chains, the fatal accidents during petroleum extraction and transportation are some of the main causes of pollution of our planet. Common background for all these pollution sources is that they have been using cutting edge technological and scientific findings with the aim to improve the human well-being, but, unfor tunately, their environmental drawbacks are now becoming clearly perceptible, negating in a great extent their benefits. Recent scientific research achievements in novel, smar t and green materials can provide a concrete solution to reverse the harmful consequences of the modern way of living for the environment and defend our planet. In this respect, the challenge that we address in the Smart Materials Group
of the Italian Institute of Technology is to develop functional and sustainable materials that help the environment and that can secure safe atmosphere, water and food for the world population. The global production of plastics grew from 116 million tonnes in 1992 to 204 million tonnes in 2002, reaching 299 million tonnes in 2013. About half of these are used in packaging and other disposable applications; that makes their recycling complicated to control and inefficient. Most plastics do not biodegrade, so, when they end up in the landfills (22% to 43% of used plastics is disposed of in landfills) or in the oceans (10 to 20 million tonnes find their way out into the oceans each year), they remain there as persistent waste for hundreds of years, occasionally releasing toxic chemical used in the plastic products.
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Education & Research
As an alternative to petroleum-based plastics, we have developed green degradable bioplastics based on processed vegetable waste. In this way, we also address the problem of vegetable waste management, which is estimated around 24 million tonnes yearly in Europe alone. We investigate different engineering techniques using cellulose-rich agricultural wastes (e.g. fruit peel, cocoa and rice husks, vegetable and herb stems, coffee leftovers, etc.). A first approach to this objective is the solvent processing of the waste that leads to homogeneous solutions or suspensions able to produce, after solvent evaporation and recycling, new composite polymeric materials with properties very similar to conventional plastics. Secondly, we have developed composite bioelastomers by mixing dehydrated micronised vegetable waste with acetoxy cure silicones. During the cross-linking of
the silicone, the released acetic acid acetylates the surface of the vegetable waste micropar ticles, resulting in excellent inter facial compatibility of the components and, therefore, in highly homogeneous composites. These bioelastomers can be processed through silicone injection moulding for large-scale applications. Another approach that we follow for large scale production of green polymeric materials based on vegetable waste is the thermal co-extrusion of the processed waste with biodegradable and bioderived thermoplastic polyesters. The next step is the use of the extruded biopolymer composites in 3D printing applications. All the developed bioplastics are totally biodegradable with various mechanical properties, ranging from PDMS-like to PET-like materials, which allows us to envision their application at sectors like packaging, constructions, design, the automotive industry, etc.
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Food packaging contributes greatly to nearly 40% of the global plastics demand for general packaging. This is because, nowadays, the food supply chains are complex, massive and international; therefore, safe packaging is the only way to ensure continuity of the foods' nutritional value, protection from contamination and safe transportation. We have dedicated one research line to the development of novel materials that can be used as containers able to ensure that food is optimally protected from the external environment, giving at the same time special emphasis to their sustainability. To fulfil the last requirement, cellulose substrates have been chosen as the alternative to plastics, since cellulose fibres are the most abundant naturally occurring and renewable fibres. In order to modify the cellulose substrates so that they become appropriate for food packaging, we apply polymeric nanocomposites that embrace the individual fibres of the substrates with a protective ultrathin layer. The
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polymers used are food-compatible and biodegradable so as to provide safe packaging with zero impact on the environment. The modified substrates retain their structural characteristics and properties such as mechanical flexibility while gaining new properties such as water or oil repellency, humidity resistance and mechanical strength. Adding nanoparticles to the polymer shell of the fibres can provide additional functionalities to the treated cellulose, as for example bacterial resistance. The treatment is customised for paper and cotton and is industrially scalable, using methods such as spraying or rod coating. Novel functional and sustainable materials have been developed by our group not only as substitutes to synthetic plastics but also as smart tools for the detection and cleaning of environmental pollutants. In order to remove pollutants from or detect them in the air, soil and water, we have developed porous materials with
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Education & Research
optimised structural characteristics and chemically functionalised porous sur faces. They are utilised for the removal of heavy metal ions or organic pollutants, for the separation of oilwater emulsions or for the efficient cleaning up of petrol or oil spills in the water. The idea behind this research is to create specific surface chemistry and appropriate structure for the porous materials to attract, retain and, in some cases, recover the targeted substances. Some characteristic examples are the use of inorganic nanoparticles or coffee and tea leftovers in polymeric foams for the removal of lead, copper, mercury and other heavy metal ions or dyes and medical pollutants from water; the use of polyurethane foams functionalised internally with oleophilic nanoparticles and externally with hydrophobic particles to remove oil spills from the water. Such porous materials can absorb tens of times their weight in oil. We have also developed porous cellulose films with the appropriate porosity and functionality in order to separate oil from
water in emulsions, aiming to recover clean water from the huge amounts of the industrially produced, emulsified wastewater. Finally, we have produced porous films incorporating sensitive organic photochromic molecules that act as detectors for gas-phase acid pollutants by changing colour upon exposure. As a concluding remark, it needs to be pointed out that setting the correct objectives of the research and using in an appropriate way the technological and scientific achievements in the field of smart and sustainable materials should be an efficient contribution to the efforts of reversing the trend of increasing environmental pollution and safeguarding our planet.
INFO Athanassia Athanassiou is Senior Researcher at the Istituto Italiano di Tecnologia in Genoa since January 2011 (tenured since September 2014) and head of the Smart Materials Group that employs 40 people. She was awarded her Bachelor’s Degree in Physics from the University of Ioannina, Greece in 1996; an MSc in Laser Photonics and Modern Optics from the Physics Department of the University of Manchester, UK in 1997; and a PhD from the Physics Department of the University of Salford, Manchester, UK in 2001. From 2001 to 2005 she was a Researcher at the Institute of Electronic Structure and Laser of the Foundation for Research and Technology–Hellas in Crete, Greece. From January 2006 to December 2010 she was a Senior Researcher at the National Nanotechnology Laboratory, CNR-Istituto di Nanoscienze in Lecce, Italy. Her research deals with composite nanomaterials, natural polymers, smart materials, laser-matter interactions, surface science, etc. She has more than 160 publications in peer-reviewed journals and she is the inventor of 16 patents. The Istituto Italiano di Tecnologia (Italian Institute of Technology, IIT) is a Foundation established at the end of 2003 jointly by the Italian Ministry of Education, University and Research and the Ministry of Economy and Finance to promote excellence in basic and applied research and to foster Italy’s economic development. The research plan of the institute focuses on Humanoid Technologies and Robotics, Neuroscience and Cognition, Nanotechnology and Materials. The Institute has a staff of more than 1,440 people and 11 sites in Italy, the central research lab being located in Genoa. IIT has broad experience in managing large research projects and has been involved in more than 130 EU funded projects. IIT has produced about 6,900 publications and more than 350 patent applications. www.iit.it
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How Big is Big Data?
A Carlo Ratti Director MIT Senseable City Lab
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few years ago, Alphabet’s CEO, Eric Schmidt, famously estimated that “every two days we produce as much information as it has been created from the dawn of civilization until 2003. However, Big Data is far more than just a matter of quantity. It is something that is dramatically impacting many aspects of our society.” Much of Big Data is produced in cities, through “sensing”, namely the ability to measure what happens around us and to respond dynamically. In the urban context, data can help us understand the world around us in detail and so to better plan its transformation — especially from a circular economy perspective. Data is already a key component of many businesses. Today, it is starting to foster more intelligent strategies and action plans not only in the private sector, but also in the public sphere. The city of
Toronto, among many others, has been experimenting with the use of data for urban resilience: it has collected statistics about city issues and urban needs through decades of floods, ice storms and other natural disasters, and made them open. Furthermore, each time new relevant insights emerged; they were shared with the general public, encouraging feedbacks and collective participation. This, in turn, generated a sense of belonging in the local communities — and supposedly the ability to better respond to any new shock. In general, the Internet of Things (IoT) technologies offer new ways to analyse and measure cities. Learning more about our cities puts us in a historicallyunique position to make more informed decisions about the infrastructure which governs almost every aspect of our lives — such as energy, food distribution, civic
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Education & Research
INFO participation, healthcare, education, traffic and waste. At the MIT Senseable City Lab we developed a project called Trash Track in which we added digital tags to several samples of trash and then followed it as it moved through the city’s sanitation system. Out of the many things we learned from this experiment, we understood that the simple sharing of information can promote behavioral change. People involved in the project were able to follow their own waste — hence rethinking their behavior. For instance, one of the participants told us: “I used to drink water in plastic bottles every day and throw them away and stop thinking about them. Now, after the project, I know that these bottles go a few miles from home to a landfill and will stay there forever. As a result, I stopped drinking water in plastic bottles.” Aligning the IoT with the circular economy principles can create vast
space for innovation. To harness the range of opportunities offered by the spread of “sensors”, citizens must be closely involved in the main urban processes. IoT has the potential to empower us to better understand how our day-to-day activities can affect the shared urban space. In order for us to scale up such opportunities, it is critical that an increasing number of people — users as well as developers of IoT — are exposed to their own personal Big Data. The quantification of the personal self can lead to the change of behavior — and hence to urban transformation. In short, Big Data should become as much as possible Open Data (at least at the individual level) to have a true, profound impact on our city.
Carlo Ratti, an architect and engineer by training, practices in Italy and teaches at the MIT, where he directs the Senseable City Lab. Ratti has co-authored over 250 publications and holds several patents. His work has been exhibited in several venues worldwide, including the Venice Biennale, New York’s MoMA, London’s Science Museum, and Barcelona’s Design Museum. Two of his projects — the Digital Water Pavilion and the Copenhagen Wheel — were hailed by Time Magazine as “Best Inventions of the Year”. He has been included in Blueprint Magazine’s “25 People who will Change the World of Design” and in Wired Magazine’s “Smart List: 50 people who will change the world”. He was curator for the “Future Food District” at Expo Milano 2015 and is currently serving as Chair of the World Economic Forum Global Agenda Council on Future Cities. He is the Founding Partner of Carlo Ratti Associati. The Senseable City Laboratory’s research focuses on studying and predicting how digital technology is changing the way we describe, design and occupy cities. Interconnected computational elements are increasingly saturating the built environment (whether small-scale mobile devices or larger-scale infrastructural microprocessors). This new condition allows us to design technology that could function as an interface between people and the city. Projects carried out at the lab are intended to help us learn how the cities are used and thus make better use of their resources and improve their design. The Lab’s researchers come from various disciplines such as physics, architecture, urban planning, the arts, electrical engineering and computer science. This allows performing technological development with an emphasis on behaviour as well as functionality and form, and evaluating design in terms of both emotion and use. www.senseable.mit.edu
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Waste Generation Worlwide Source: “State of Green Business 2016”, GreenBiz Group Inc., Trucost, 2016.
TOTAL WASTE GENERATION - US
TOTAL WASTE GENERATION - GLOBAL
Million metric tonnes
Million metric tonnes
6 5
250
4
200
3
150
2
100
1
50
0
0 2010
2011
Landfill
2012
Incineration
2013
2014
2010
2011
Company Reported Recycling
2012
2013
2014
Jobs in Circular Economy Activities across Europe Source: “Economic Growth Potential of More Circular Economies�, WRAP, 2015.
Waste collection, treatment & disposal
693 398
Recovery of sorted materials
Wholesale of waste & crap
Repair of computers, personal equipment & other household goods
164
3.4 Million jobs in circular economy activities in Europe
1198
Repair of machinery & equipment
141
640 Retail of second hand goods in store
Rental & leasing activities
126 (jobs estimates are in thousands)
Obviously Tesla is about helping solve the consumption of energy in a sustainable manner, but you need the production of energy in a sustainable manner. Elon Musk,
South African-born Canadian-American business magnate, engineer, inventor, investor, founder, CEO and CTO of SpaceX, co-founder, CEO and product architect of Tesla Motors, chairman of SolarCity, co-chairman of OpenAI, co-founder of Zip2, and co-founder of PayPal (1971 – )
Circular economy: This is not CSR or a sideshow, but is fundamental. Dominic Barton,
Canadian management consultant, managing director of McKinsey & Co (1962 – )
Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer.
Be thankful for what you have; you will end up having more. If you concentrate on what you do not have, you will never, ever have enough.
Adam Smith,
Oprah Winfrey,
Scottish moral philosopher, pioneer of political economy, a key figure in the Scottish Enlightenment and author of “The Wealth of Nations” (1723 – 1790)
American media proprietor, talk show host, actress, producer, and philanthropist. (1954 – )
C o r p o r a t e
A Holistic View of Circular Facilities
Dionisis Ammolohitis CEO Manifest Services
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nterprises, nowadays more than ever, are called to adapt to increased, demanding and more competitive conditions. These conditions require new approaches, new ideas and practices characterised by caution, thought and most of all a sustainability mindset. Sustainability remains a dominant challenge in facility management because of the wide range of responsibilities it creates. Facility managers must develop a holistic view and knowledge of how an organisation works. Repair and maintenance of buildings; cleaning, food and catering; office furniture; utilities such as lighting and heating are all part of a complex system which facility managers oversee. Manifest Ser vices is a business strategic partner that provides flexible and management improvement solutions for the above issues and for different sectors, characterised by a holistic know-how for facilities. Circular economy is one of the main challenges that businesses face nowadays. Circular economy is all about changing systems, from production to use and consumption. From linear to circular. From the perspective of a circular economy, we are responsible for every activity and impact within the use phase, assuring the protection of
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the value of facilities and increasing their life cycle. Energy use, waste management, land use are only some of the sustainability matters that concern the facility management business and Manifest Services. Some highlights of circular services in facility management include: • Managing materials by guaranteeing the less possible loss; • Segregating materials with high accuracy; • Adding value to the recycled materials; • Reducing the energy consumption by adopting a more suitable energy approach; • Investing in green technologies; • Respecting national, European and international agreements; • Increasing the awareness of all stakeholders (employees, partners, suppliers, customers, local community).
Energy Management Manifest Ser vices, having a long experience in Technical Maintenance of E/M equipment and answering the needs of modern enterprises to reduce operating costs, offers smart measurement and management of electricity consumed in buildings, businesses, photovoltaic power plants, etc.
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Corporate
The Management and Energy Measurement System we use is addressed to sensitive business entities which want and need information on the consumption and control of electricity in real time, aim to reduce fuel consumption, save money and energy and reduce their carbon footprint.
Waste Management In a reality of ever increasing needs for waste management for the protection of the environment and the efficient contribution to sustainable growth, Manifest Services has set as a basic principle the aim for the generation of today to live their lives without compromising or sacrificing the lives of the generations to come.
solutions. Management stages: • O n source segregation stages planning; • Collection; • Transfer; • Processing in the Centre for the segregation and recycling of materials, an approved facility for the systematic segregation and bundling; • Transfer to: • Recycling factories (certified and authorised units); • Waste burial pits; • Electric and electronic equipment recycling; • Industries for reusing.
with retention of ground and water resources; • They improve the energy behavior of the installation; • T hey constitute a natural wind protection; • They shape the microclimate of the region; • They contribute to the protection of species, since each green project hosts a miscellaneous set of living organisms; • They respond to the need for privacy; • They create a hospitable zone for the population of the installation; • They enhance “well-being” and contribute to the combating of stress.
Manifest Ser vices responds to all business needs as well as global sustainability developments, offering integrated solutions, increasing the life cycle of facilities, capitalising on innovation and relying on the anthropocentric expression and social responsibility.
www.manifest.gr/en/
Green Projects
Recycling materials, packaging management systems and on source segregation contribute significantly to dealing with waste issues. The protection of the environment becomes an operational feature rather than a strategic goal for businesses.
The green projects-gardens in the environment (internal and external) of an installation improve the overall quality of its operation. They have a positive, calming and, at the same time, refreshing impact. They constitute a shelter and a source of wellness.
In terms of material segregation systems and recyclable materials as well as packaging and appliance management technologies, we add value by accurately adjusting the specific needs of our customers to alternative profitable
The green projects-gardens have multiple benefits such as: • They absorb air pollutants and noises; • They enrich air with oxygen; • They smooth out the temperature; • They constitute territorial supporting,
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Sustainable Development with Information and Communication Technology
Ι
nformation and Communication Technology (ICT) is acknowledged as having great potential to accelerate human progress and enable the development of knowledge societies. But while ICT has arguably contributed to the development of sciences and sectors, such as health or engineering, its role in promoting sustainable development and helping to secure a greener future is usually disregarded. Historically, one could claim that technological evolution has been in a constant confrontation with environmental preservation and the sustainable utilisation of natural resources. While brick-and-mor tar infrastructure integrates thousands
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of technological improvements, the struggle to achieve proper use of natural resources and sustainable development is ongoing. So, is ICT able to assist mankind in reaching this green goal? And how is OTE Group involved in this effort?
ICT and the Circular Economy Products like the smart thermostat and light products suggest an affirmative answer to this question. However, ICT is more than just terminal devices. It is wireless and wired infrastructure, Artificial Intelligence systems, neural
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Corporate
networks, big data management and analysis. Through its diverse applications ICT suppor ts the implementation of a circular economy and, ultimately, helps us restore and, to some extent, rediscover our natural habitat. The term “circular economy” describes a development strategy that drives economic growth without increasing the consumption of resources, as these are recycled and reused. A Circular Economy Action Plan was recently introduced by the EU and is expected to simultaneously greatly reduce GHG emissions, save millions of euros and create jobs. To this extent, it includes revised legislative proposals setting 1
clear targets for waste reduction and establishing a long-term path for waste management and recycling. The ICT sector is not regarded as an intensive one concerning the consumption of material resources, but it is directly linked to enabling a better environmental performance for all sectors of the economy. That, in turn, would allow for the disassociation of economic growth from the respective increase of emissions. Suppor ting this line of thought is the recent report SMARTer 2030 1 that demonstrates how ICT initiatives can improve the quality of human life all over the world by 2030, via actual figures and quantified sustainability benefits for
the environment, the economy and the society at large. According to the report, ICT will improve lives and enable sustainable growth by, among others: • decreasing energy consumption and reducing global GHG emissions across the business sector by 20% (emissions avoided by the use of ICT are nearly 10 times greater than those released by deploying it); • generating up to USD 11 trillion in economic benefits (new revenues and cost savings) per year; • providing wider access to healthcare (1.6 billion more people) and education (half a
billion) via e-health and e-learning tools, respectively; • decreasing traf fic and travel emissions via e-work solutions. • reducing energy consumption via smart metering solutions.
OTE Group’s Sustainable Consumption and Production Actions OTE Group acknowledges its pivotal role in the process of conser ving natural resources and minimising GHG emissions. The Group’s environmental strategy is aimed at: • reducing its own environmental impact and carbon footprint; • raising public awareness for acting
http://smarter2030.gesi.org/
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more responsibly towards the environment; • providing customers with products and services enabling the reduction of material use and the simultaneous increase in productivity and efficiency for all sectors of economic activity; • aiding the State in delivering greener and overall improved services to the people. a) Housekeeping and raising awareness By utilising the Environmental Management Systems (EMS) Framework, certified according to the ISO 14001:2004 standard, effective actions have been designed and implemented across the OTE Group, resulting in impressive results: • 30% decrease in direct and 8% decrease in indirect GHG emissions from energy (2008 – 2015); • 25% decrease in fuel consumption (2008 – 2015); • 10% electricity conservation; • 100% recycling of technical waste,
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generated from fixed-line and mobile telephony activities (cables, phones and accessories, electrical and electronic equipment, etc.); • EUR 6.8 million in economic benefits from energy conservation.
b) Providing smart and eco-friendly products and services for businesses
enable customers to take full advantage of high-quality broadband services in order to improve their operation and sustainable performance via: • dematerialisation, i.e. reducing or even eliminating the production of emission-intensive products and processes (e.g. by teleconferencing instead of holding meetings); • instant data collection, analysis and communication, allowing for optimal decision-making and efficiency; • system integration and energy management, enabling the optimal use of resources; • mobile device management, cloud-based applications (e.g. Smar tPros, Smar tWorks, Megaventory, Payslip, Business Cloud Storage) and Machine to Machine (M2M) communication.
Responding to its customers’ needs, OTE Group has made available to the Greek market a bundle of businessoriented services. Branded “COSMOTE Business IT Solutions”, these products
All these applications can help companies of all sizes to automate their services (e.g. computing resources; management of purchases and sales; stock management; management of
Moreover, by inviting OTE Group’s staff and customers to participate in recycling initiatives, the following results have been achieved: • 91.5 tonnes of paper and packaging materials and • 13.2 tonnes of telephone devices and accessories, as well as other appliances and peripherals, have been collected and for warded to the Group’s official recycling partner.
customers and suppliers; reporting and analytics), thus reducing processing time and increasing productivity. Furthermore, the Group has designed, developed and launched customised solutions for certain sectors and/or professionals offering them reduced IT and energy costs as well as increased productivity. Some examples include: • Tipoukeitos, for the easy management of lawyers’ caseloads; • My Health Angels, allowing medical doctors to store and manage medical files, appointments, lab results, etc. • COSMOTE e-Track and Driving Per formance, ensuring the monitoring and real-time management of corporate fleets, as well as promoting environmentfriendly and safe driving, achieving reduced operational costs in terms of fuel and maintenance; • E-Tourism, aiming at the optimisation of one of the core industries in Greek economy with
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regard to energy management, hotel infrastructure, information systems management and maintenance, digital signage, provision of added value services, etc. c) Enabling greener State services As industry leader and ICT expert, OTE Group has also undertaken several major projects, aiming at improving the countr y’s overall efficiency and sustainable development in key areas, such as communication, healthcare, energy, and emergency services. Some of these projects are: • The National Telemedicine Network, connecting healthcare facilities in remote Aegean islands to mainland hospitals; • E-prescribing, one of the most extensive electronic platforms in Greece connecting doctors, pharmacists and the National Organisation for Healthcare
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Provision (EOPYY); • The telephone line 14784, which of fers a series of integrated and direct call-centre ser vices for citizens aiming to book their medical appointments at the National Primar y Healthcare Network (PEDY) or receive information regarding medical services; • Telemetering services for the Hellenic Electricity Distribution Network Operator, through which the Electricity Network Operator will be able to optimise its performance; • Modernisation and upgrade of the 112 services, i.e. the Single European Emergency Phone Number. The project includes the implementation of the Information System for the Management of Emergency Communications as well as the supply of the necessary infrastructure, equipment and software to support effective and
up-to-date operations. d) R&D Research and Development activity is integral for any enterprise or sector committed to sustaining its competitiveness, quality of products and customer base. That is widely acknowledged by OTE Group which invests in R&D with dedicated personnel and infrastructure. R&D is crucial for the ICT sector where advances are rapid, as is the transition from developing an idea to implementing it, and both hardware and software solutions are in constant risk of becoming obsolete. Thus, early involvement in new ventures via R&D activity leads to optimal phasing-in and planning; to more restricted use of materials and other resources. Over the past six years OTE Group has participated in a total of 40 research
projects along with over 400 partners including enterprises, universities and research and innovation centres from Greece and other European countries. The total funding to be received in the three-year period of 2015-2017 is approximately EUR 3.7 million, without considering additional funding from new projects. Currently, 13 out of the 28 active R&D projects can contribute to the reduction of resource usage and/or to environmental improvement. In addition, R&D entails the additional benefits of business continuity, increased competitiveness and oppor tunities of expansion by the introduction of new business models and innovative products and services. www.cosmote.gr
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Business Success in the 21st Century Source: “Redefining Business Success in a Changing World”, 19th Annual Global CEO Survey, PwC, January 2016.
Q: To what extent do you agree that business success in the 21st century will be redefined by more than financial profit?
Global Trends for Transforming Stakeholders’ Expectations Source: “Redefining Business Success in a Changing World”, 19th Annual Global CEO Survey, PwC, January 2016.
Q: Please rank the top three global trends which you believe will be most likely to transform wider stakeholder expectations of businesses within your sector over the next five years.
Schneider Electric: Delivering More Value to Customers with Lower Resource Content
C Xavier Houot SVP Safety, Environment, Real Estate Schneider Electric
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ircular Economy is without doubt a valuable concept. With growing pressures over climate and natural resources, it is critical that a number of manufacturing and consumption patterns evolve across industr y sectors and become more “Circular”. Circular Economy represents a wise alternative to resource intensive economic models: our world’s economy contracts an “ecological debt”, as annual consumption of natural resources currently exceeds global carr ying capacity by 40%. Human consumption is projected to reach 175% of global carrying capacity in a business as usual scenario, before 2040. With this, each attempt to use fewer natural resources, in a wise
manner, is obviously welcome. Beyond resource conser vation and as this ar ticle shows, Circularity is also good for customers, and for entrepreneurial innovation. Why Now? Circular Economy concept is quite applicable and relevant today: first, there is a world race towards resource productivity in flattening economies and sustained ef for ts towards profit generation; second, customer relationship strategies always need innovations, markets are increasingly competitive and circular concepts cater to the interests of brands and producers (seeking lasting relationships),
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customers (seeking productivity, convenience, and wishing to focus on their core strength), not to forget the planet; third, technologies also enable Circularity transformations (through digitisation, machine-to-machine connections, remote ser vicing and maintenance, Internet of Things). Circularity Profile οf Electrical and Electronic Equipment Sector Today Our sector has been embracing “Circularity” for decades now: our products last long, often 20, 30, 40 years or more; they can be serviced, repaired or retrofitted to last even longer. Most of our offers allow Schneider Electric customers to reduce their own energy and resource intensity, making them more circular, as they “do more with less” thanks to our solutions. As a manufacturer with multiple factories and distribution centers across the world, we continuously strive to grow circularity of our own operations: wasting less, reusing more, recycling more. In April 2016, we reported 69 factories under the “Towards Zero Waste to Landfill” initiative and more than 90% of our waste enjoys a second or third life. Our Circularity Profile Tomorrow We still see further opportunities to harness the full potential of “Circular
Economy” and what this can further trigger for our R&D or supply chain processes as well as our business models and customer satisfaction: Circular Economy concept can be introduced as an additional lens to help invent new business models (more circular “service-repair-refurbishremanufacture-recycle” versus the typical linear “make-use-discard”) and improve customer loyalty and centricity through the relationships’ “circularity” and longer-term product-based services allow. The focus on Circular Economy also brings forth a revived momentum to the resource productivity agenda and “doing more with less” efforts, with tangible bottom-line contributions through resource optimisation or waste minimisation and reuse. Decoupling Our Economies from Planet’s Limited Resources Our industr y sector uses copper, aluminium, steel, plastics as well as some precious metals, from silver to nickel. Though metals enjoy a strong recyclability and are actually recycled in most countries wherein we operate, and though our sector is not as resource intensive as some others, we recognise the need to carefully use resources and reuse whatever can be reused. Our “ecoDesign Way” methodology introduces the systematic assessment of the CO 2 impact,
resource impact, chemical substances content as well as “Circularity profile” (repairability, upgradability, retrofitability, dismantlability) of each new offer. We have made an external commitment to have 100% of our new offers, by the end of 2017, be designed and developed with an explicit consideration and description of such"circularity facets". Circularity Is Good for the Climate We have formalised ambitious CO2 goals for 2030 as part of our COP21 commitments. Many of our offers help our Customers reduce their own CO2 footprints through energy efficiency or renewable energy solutions enablement (variable speed drives; building management systems; energy efficient cooling and data center systems; enablement of solar, wind
and hydro energy, etc.). Extending the lifespan of a product through circularity services helps reduce (decouple) carbon intensity of the service provided be it a safety service through a switchgear, an energy provision continuity through UPS (Uninterrupted Power Supply) or else. Reducing the use of virgin materials, reducing waste, prolonging product lifespan, all these circularity attributes also help fight climate change. As part of our membership to Ellen MacArthur Foundation’s Circular Economy 100 initiative, we discuss valuable practices and assess innovations in this area and strive to continuously improve. Circularity Is Good for Customer Intimacy Some industry sectors have developed over the years a strong intimacy with the
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end users and/or the end consumers and have scaled-up business models around product use rather than product ownership, around services, modernisation, spare par ts, etc. Some have managed to come up with massive repair/refurbish capacities and built entire new models. They all have developed a strategic passion for precisely knowing their asset base and keeping their customers for life. At Schneider Electric we are no different and we observed our circularity focus tends to emphasise the value of sustainable relationships with the natural resources used, and this focus, in turn, helps duplicate the exact same focus onto our relationships with customers. Being committed to product stewardship for life, repairing it, servicing it, refurbishing it and being great and competitive at at doing this is certainly one of the ways to keep customers for life. We have developed a number of retrofit solutions (“ecoFit” by Schneider Electric), have thousands of field services engineers across the world and provide industrial capabilities to handle the second and end-of-life phase of many of our products. Our repair and retrofit center in Privas,
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France and our repair center in Greensbourgh, USA, for instance, are only some of such capacities where we deliver down-to-earth circularity. See http://www.schneider-electric. com/b2b/en/services/field-services/ electrical-distribution/renew/ecofit/ for more details.
our brand tagline “Life is On”. We are active in creating a network of carefully selected professionals, using certified spare parts and employing habilitated experts. The “good circularity” will need strong regulation to ensure that nothing is done at the cost of tomorrow’s customers and consumers.
EPR (Extended Producer Responsibility) Schemes Are Only the First Steps Towards Circularity In our sector, like in several others, an EU EPR scheme Invites producers to play an active role in managing the endof-life of their products: WEEE, standing for Waste Electrical and Electronic Equipment. Such schemes mainly focus on last phase of product life cycle, however we know our producer responsibility star ts much before products’ end-of-life, as we are the best placed to service our products, upgrade them and make them deliver more for our customers as well as last longer. We claim to do it with our own engineers, or carefully selected service partners. Our products protect lives (e.g. switchgear), they help sustain life (e.g. UPS in hospitals, data centers, etc.), they enable life as reminded by
Three Forms of Circularity We Nurture and Grow A number of players have actively promoted the use of Secondary Raw Materials (SRM) in lieu of Virgin Raw Materials, to help reduce the burden on planet’s non renewable resources and to provide market opportunities to collected waste. Such form of circularity is highly relevant, especially for some FMCG (Fast Moving Consumer Goods) products, where the use of recycled plastics or cardboard reduces their environmental footprint. We could call this “Resource Circularity”. While Schneider Electric strives to push more recycled content into our products and packaging, we believe that for our highly technical, life-protecting and resource efficiency enabling products, this is only one part of the overall circularity journey. While, we do measure and
promote metal, plastic and cardboard recycled content where possible, we always maintain per formance, cost, compliance and especially security for our customers as our number one priorities. The second form of circularity is what could be called “Product Circularity”: here, key ambition is not to recover more waste, get it recycled and reintroduce recycled materials into new products, but rather to design, manufacture and ser vice products with a long life cycle and which can enjoy 4Rs ser vices (Repair, Reuse, Retrofit, Remanufacture). This form of circularity exemplifies a possible win-win-win approach for the planet, the customer and the producer. Our thousands of Service Engineers help our customers enjoy uninterrupted energy management and automation services, and we observe strong market demand for such field services. The third form of circularity relates to Change in ownership patterns: from owning to leasing, from buying to payper-use, from buying to sharing. As Electronic and Electrical equipments
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have usually been embedded as part of a new office, building, factory, data centre or form an integral part of an equipment or machinery, most of our products have been historically bought and owned. With the willingness of companies to focus on their core business, leasing of equipment is a more frequent practice today. Though sharing and pooling is not yet so applicable in sector like ours, we still see such instances. We view circularity as a blend of the above three categories and see a lot of transformative potential in the latter two. Summary At Schneider Electric we have decided to embrace the concept of Circular Economy in a strategic manner and derive tangible business value from it. We witness a set of major opportunities for our customers and for our longlasting relationships with them. We wish to stay away from the corporate responsibility jargon, as this initiative is core to our business performance and resource efficient growth path., and supports our innovations for the benefit of our customers.
www.schneider-electric.com
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Supply Chain in a Circular Economy Source: www.tradeshift.com/circular-economy/
The Upcycle Chart Source: www.mbdc.com/c2c-framework/
Sustainability in New Business Concept Design
S
ustainability has recently become — as it should — a core value in a large number of organisations. But as a core value, the fields it affects are many if not all. And the complexity of its integration in all processes can become challenging to identify, prioritise, handle and align with.
Alex Athanassoulas President & CEO Stirixis Group
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At STIRIXIS Group we have been designing, implementing and managing concepts in Retail, F&B, Leisure, Hospitality and Work Spaces since 1996, and we have successfully completed more than 500 projects in 22 countries. When we create and manage business concepts for our clients, there are three specific sustainability areas which we carefully take into consideration. These three strategic key considerations define our concept’s
DNA (how we design and implement it) and its evolution (how we manage it). Let us elaborate on these three and explain why.
a. Sustainability in the Concept (SiC) This is the first step for integrating sustainability and sustainable development values in a concept. Ιn other words, we carefully design and communicate the concept’s positive impact and balance on the three sustainability pillars: the economic, social and environmental ones. The truth is, a concept can only be successful and show returns if it has — by design — a true positive impact on all three pillars; the economic, social and environmental pillars. Nowadays, the growing awareness and concern for
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sustainability within society effectively renders this a prerequisite. So, any new business concepts must not only per form financially, but also reward society in ever-growing concentric circles through their operations and their output and, of course, ensure a holistic environmental respect.
b. Sustainability of the Concept itself (SoC)
The above are only a good star t, though. This initial Business Concept Design is inevitably based on a present and near future need analysis. In the second phase, one needs to extend the expected performance in time to ensure the designed system’s output and returns in the long term. And in a setting of accelerating change, the next inevitable question is how this concept remains agile, relevant and
productive indefinitely. What are the built-in mechanisms we should design and install that will allow it to efficiently change either proactively (feedforward) or reactively (feedback)? This area of sustainability is crucial to our work in order to ensure long-term results and returns for our clients. We have been developing tools and mechanisms to ensure the Sustainability of the Concept for the last 15 years and have successfully replaced the notion of Concept Life Cycle with a model of constant Concept Evolution and Development. What should also be noted at this point is the impressive decrease of consumed resources of this sustainable business model in comparison with the life cycle model which requires a “violent” relaunching and repositioning of the concept upon maturity.
c. Sustainability of the Organisation (SoO)
Last but not least, our business concept evolves, grows and performs within a greater organisation, usually a company. Therefore, its growth must be managed effectively and positively by this immediate super system. As part of a larger system, its relationships must be carefully studied and dynamically designed. And its output must be efficiently exploited so that this organisation can remain diverse, productive and healthy indefinitely. This is the last and most important consideration in the larger picture. Concepts which successfully and ef fectively answer these three sustainability considerations can thrive in any environment. A lack of these, in the first case (SiC) obviously results in a “crash and burn”, in the second case (SoC) in a fast concept decay, and
in the third one (SoO) in a cancerous growth that compromises the whole organisation. Supposing you visualise these three combined in one function, you would be actually seeking a formula that maximises the positive impact of the concept over time. STIRIXIS Group has been actively suppor ting its clients with a wide range of services and tools based on Systems Thinking and Design Thinking. Sustainability is integral to both our practices and our concepts, granting us various international awards. In a world of sustainability, this is how we approach our work for our clients.
www.stirixis.com
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Second Life Strategy ”High quality forklift trucks can have a very long life time. With good and
regular service, and replacing parts where needed, the trucks can last long and contribute to sustainable solutions. Toyota Material Handling is constantly working on the improvement of that approach.”
T Nick Duckworth Senior Vice President Rental & Used Toyota Material Handling Europe
oyota Material Handling Europe offers a full range of counterbalanced forklifts and warehouse equipment. All our trucks are built according to the Toyota Production System (TPS), guaranteeing high quality and minimum environmental impact. Our extensive services and solutions include ser vice contracts, genuine parts, rental solutions, approved used trucks, the fleet management system I Site and other logistics solutions. We also think about the future, which is why most of our range is available with lithium-ion and fuel cell technology.
Our Product Life Cycle The European Commission aims to present a new circular economy strategy,
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to transform Europe into a more competitive resource-efficient economy. Within our business we already have control or significant influence on most steps of our product’s life cycle. From working with our suppliers to reduce the amount of hazardous substances in our trucks to selling used trucks solutions, we remain closely involved with our trucks over their productive life.
Responsible Manufacturing The Toyota Production System (TPS) is a lean manufacturing system that works according to a pull system: we only produce what is ordered. TPS entrusts team members with welldefined responsibilities to optimise
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quality by constantly improving processes and eliminating unnecessary waste in natural, human and corporate resources. TPS influences every aspect of our organisation as it includes a common set of values, knowledge and procedures. TPS helps us focus on a continuous workflow, which we call “just-in-time”, and also ensures the quality of this workflow.
Responsible Purchasing Driven by our sustainability thinking, we make sure our suppliers adhere to sustainability criteria outlined in our Responsible Procurement Strategy as a strategic priority. • 97% of the annual price value of parts for our trucks, from suppliers with sales to us of over EUR 100,000 per year, are purchased from companies with environmental management systems certified to the international ISO 14001 standard;
• All main suppliers have accepted our Code of Conduct for suppliers by signing the Responsible Procurement declaration; • In addition, a CSR self-assessment has been launched with a pilot group of 14 suppliers;
Second Life Strategy
Production
EcoVadis evaluated our Sustainable Procurement processes in 2014 and scored us in the top 2% of global suppliers assessed in our industry.
Innovation R&D
Responsible Servicing The Toyota Ser vice Concept (TSC) describes our approach to planning, managing and delivering exceptional standards of ser vice, throughout the working life of trucks and our relationship with customers. It is based on a series of values that reflect the critical issues that we keep in focus throughout our customer ser vice operations: reliability, quality, safety, and environmental protection.
Customer use
Suppliers
Recycling industry
Service
Used trucks
Key Within our sphere of control Limited engagement for now
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Second Life Strategy Leads to More Refurbished Truck Sales Our Second Life strategy aims to continuously improve refurbishment and reduce scrapped trucks by 20% in the next five years. If trucks cannot be refurbished, they will be responsibly recycled. For low-intensity applications, used trucks are a lower carbon alternative for customers interested in reducing carbon emissions upstream in their value chain.
Approved Used Trucks Our Approved Used Truck programme contains quality assurance, guaranteeing that every truck undergoes an individual preparation programme based on their own service history, rather than a standardised preparation programme for all trucks.
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An Approved Used Truck must meet these minimum criteria: • Only used Toyota or BT forklift trucks are eligible; • Ever y truck has been fully maintained by our exper t technicians using Toyota and BT parts; Before putting an Approved Used Truck on the market: • All trucks undergo a full safety check and certification according to local market legislation; • Key components will be thoroughly checked for any functional defects ; • Ever y truck will come with a comprehensive handover pack, including an operator manual and full service history.
Used trucks sales 450% 400% 350% 300% 250% 200% 150% 100% 50% 0%
FY09
FY10
FY11
FY12
FY13
FY14
FY15
FY16 target
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Οur carbon footprint including customer use
Product use by customers Other
Οur carbon footprint excluding customer use
Factories & offices Sales force & service vans Trucks & parts logistics Raw materials production
Used Trucks – A Lower Carbon Solution A 2013 carbon footprint repor t by Climact found that 70% of Toyota Material Handling Europe’s carbon footprint — including our own emissions and the upstream emissions from our suppliers — comes from raw materials production for new trucks, mostly from metal production. Refurbishing forklift trucks extends the useful life of the metal chassis and, therefore, spreads the upfront “high carbon investment” over a longer useful life. Additionally, refurbishing a truck is mostly done in the country where it was returned to us, avoiding the emissions from logistics — which accounted for 16% of the carbon footprint according to the Climact study.
Flexibility for Customers Customers with just one or two trucks who opt to buy a used truck do so because they appreciate the reliability of a Toyota combined with a lower price tag. Customers with large fleets are also interested in having extra vehicles available for use in busier periods. This is why we are seeing an increase in the sales of used or refurbished trucks. When we add downstream emissions analysed by Climact in their report, we see that 95% of the total carbon footprint — covering our supply chain, our operations and our customer’s operations — is caused by products used by our customers. For any mediumto-high-intensity applications, our more recent, more energy-efficient products are often the most low-carbon option. www.toyota-forklifts.eu
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Circular Economy: How Certification Counts
Ι
n order for a sustainable world to become a reality, we see the transition from a linear to a circular economy as a necessary boundary condition. A circular economy aims to decouple economic growth from the use of natural resources and ecosystems by using those resources more effectively. By definition, it is a driver for innovation in the areas of material, component and product reuse as well as new business models such as solutions and services. In a circular economy, the more effective use of materials enables us to create more value, both by saving costs and developing new markets or growing existing ones. The Circular Economy requires businesses to rethink more than just their resource footprints and energy efficiency.
Ioannis Kallias CEO TÜV AUSTRIA Hellas
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The European Commission adopted an ambitious Circular Economy Package which includes revised legislative proposals on waste to stimulate Europe's transition towards a circular economy which will boost global competitiveness, foster sustainable economic growth and generate new jobs. The Circular Economy Package consists of an ambitious program of action, with measures covering the whole cycle:
from production and consumption to waste management and the market for secondary raw materials. The proposed actions will contribute to "closing the loop" of product life cycles through greater recycling and reuse and bring benefits for both the environment and the economy. The revised legislative proposals on waste set clear targets for reduction of waste and establish an ambitious and credible long-term path for waste management and recycling. Key elements of the revised waste proposal include: • A common EU target for recycling 65% of municipal waste by 2030; • A common EU target for recycling 75% of packaging waste by 2030; • A binding landfill target to reduce landfill to a maximum of 10% of municipal waste by 2030; • A ban on the landfilling of separately collected waste; • T he promotion of economic instruments to discourage landfilling; • Simplified and improved definitions and harmonised calculation methods for recycling rates throughout the EU; • Concrete measures to promote reuse and stimulate industrial symbiosis — turning one industry's byproduct into another industry's raw material; • Economic incentives for producers
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to put greener products on the market and suppor t recover y and recycling schemes (e.g. for packaging, batteries, electric and electronic equipment, vehicles). At the same time, the world has already experienced two great expansions of the middle class since 1800 and we are now living through the third one. In Asia alone, 525 million people can already count themselves as middle class; more than the total population of the European Union. Over the next two decades, it is estimated that the middle class will expand by another three billion people coming almost exclusively from the emerging world, driving demand and, ultimately, the production of waste. Circular Economy is not an EU “legislative” market but a global challenge! Challenges for resources availability and pricing, challenges for increasing the middle class consumers. Challenges which enable opportunities coming from: • Big data, the emergence of which has shifted the manner and scale in which problems can be solved, providing deeper market knowledge and increasing consumer-focused solutions;
• Changing legislation and governance where more and more companies are responding to sharpened, new legislation and governance models by introducing new innovative designs for their products; • C hanging models of consumer consumption where we have seen the emergence of a different type of consumer, who is interested in different ownership and business models and driven by access and performance rather than ownership; • Moving from transaction to relationship where the multichannel world has led to new levels of engagement and connectivity with consumers looking for relationships with brands that go beyond the transactional. Certification and third party assessment can contribute substantially in order to boost the main concepts of circular economy towards effectiveness for the public, efficiency for the business itself, credibility for the society. The entity going in for certification benefits from being recognised by their competitors, consumers and other stakeholders for their environmentally appropriate and socially beneficial practices.
companies underestimate problems or just ignore them because they are too painful. The third party audit ensures that things are properly calibrated against the rest of the industry. Certification in many aspects of the circular economy: • Provides senior management with an efficient management process; • Sets out areas of responsibility across the organisation; • Communicates a positive message to staff, customers and society; • Identifies and encourages more efficient and time-saving processes; • Highlights deficiencies; • Reduces costs; • Provides continuous assessment and improvement; • Offers marketing opportunities.
The circular economy aims to eradicate waste — not just from manufacturing processes, as lean management aspires to do, but systematically, throughout the life cycles and uses of products and their components. Indeed, tight component and product cycles of use and reuse, aided by product design, help define the concept of a circular economy and distinguish it from the linear take-make-dispose economy, which wastes large amounts of embedded materials, energy and labor. The main concept of systematic and circular certification can assure this! The best way to predict the future is to shape it yourself!
www.tuvaustriahellas.gr
The biggest advantage of this certification is the perspective of the third party assessment. Frequently,
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“Unstuff” the Planet | Share Your “Stuff”
I
am an impact entrepreneur on an exquisite journey. Amongst all the life lessons which this pursuit has taught me, I stand unshaken in my belief that efficiency compels markets and, as such, the market is blindly indifferent to anything other than what is most efficient — the economic manifestation of mother nature’s elegantly simple “survival of the fittest” paradigm. Consumerism as an economic model has led many nations into becoming fat, flaccid societies valuing ownership of an abundance of stuff as indicative of status and economic prowess — ironically, the antithesis of “survival of the fittest” in biological terms.
Nadine Cino LEED AP, CEO & Co-inventor TygaBox Systems, Inc.
Millennials — true to the tradition of any given generation questioning the values of their preceding generation — are questioning the value of consumerism, particularly the repetitive behavior of “consume/discard stuff”, “consume/ discard stuff” and “consume/discard more stuff”. We all understand how consumerism drives GDP and yet landfills upon landfills are overflowing with discarded stuff fat flaccid underground tombs of
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unwanted, unnecessary stuff. So the question is: are we treating ourselves and our planet in a stifling, “stuffing” way, seeking satisfaction by exercising power over things, controlling them in order to get what we want, not merely what we need? A simple observation of our fellows shows us that most humans have a natural strong desire to share. What if we could stimulate that desire so that the consumerist behaviour was impacted? Impacted in a way that would lead us to consume less and enjoy more. Would that not have a powerful impact towards conser ving our natural resources? Achieving that objective constitutes the hidden sustainability promise embedded in the concept known as “the sharing economy”. Airbnb, Zipcar, Uber and WeWork show signs of “the sharing economy” promise. What they all have in common is that
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they convert standardised large-scale, high-value assets into sharable goods and services. Their successes with large-scale assets beg the question: what about the small stuff? The unique stuff? The stuff which many of us are emotionally attached to? The common stuff populating our homes and workplaces and — unlike high-value assets — doesn’t cost too much. Right now, this is our opportunity to include that enormous, ubiquitous, untapped and unruly resource — the universe of small, inexpensive stuff — into the sharing economy. Most of the items (i.e. “stuff”) we own, other than what we use daily, are severely underutilised, perhaps by as much as 95%. Producing items that we only use to a level of 5-15% of their life expectancy constitutes a colossal waste of natural resources. The sharing economy holds the promise of democratising access to any/all items through peer-to-peer networked sharing. The life expectancy utilisation of almost any item can be dramatically improved through renting, bartering, lending,
selling or other sharing transactions. Imagine the impact on precious planetar y resources if, through the successful implementation of the “stuffsharing” economy, we globally reduce unnecessary resource consumption by as little as 5%, which may not sound like much yet when multiplied by 8 billion people is hugely impactful and translates into USD 1.068 billion or 1.5 billion tonnes! For years, visionaries have been launching star tups, attempting to establish the sharing economy at local levels in communities around the world yet, to date, the rate of adoption remains low. Why is that so, since the model is appealing and has a proven track record with standardised large-scale, highvalue items? The primary factor that our research and analysis reveal as the likely root cause is that the value of most small, common items is relatively low and, therefore, the cost of sharing it must also be commensurately low in order to attract a large number of people.
Additionally, to bring the massive universe of small, inexpensive stuff into the mainstream of the sharing economy, any solution must make shared items easy to track so that both parties of a sharing transaction can efficiently manage and account for the items shared. Also, it must fit into our mobile-minute lifestyles. We believe that what is needed towards that end is a tracking technology that meets the above criteria. Several such solutions are currently on the market, although their potential for adaptation in the sharing economy is yet to be recognised. Our company will soon introduce an RFID-based personal item tracking kit that organises items into searchable categories by description and location, much like what a playlist does for music. With a person’s item list in the cloud, they can make and save money by renting, bartering, sharing or selling their stuff. In economic terms, the sharing economy is simple: it can deliver a higher standard of living at a lower cost and enhance the daily lives of billions of people globally. In financial terms, the sharing economy
is sensible: it can convert a wasting asset into a performing one through any monetised trading process such as rental, barter, sale or donation. In practical terms, the sharing economy is appealing: it can have people choosing better quality items which, although generally acquired at a higher “first cost”, have an inherently longer life expectancy and provide a lower “cost-per-use”. In emotional terms, the sharing economy is all-inclusive: it helps us realise that the things we do with our stuff may be only half of its value. The other half may be sharing it with others. 2016 Global GDP= 76.321 billion USD (Gross Domestic Product)
2016 Global Average PCE (Personal Consumption Expenditures)
70% of GDP = 55,425 billion USD 40% PCE
is wasted
40% of PCE = 21.370 billion USD 40% of PCE = 1.5 billion tonnes
www.tygabox.com
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Ten Disruptive Technologies Source: “Waste to Wealth” - Executive Summary, a book by Peter Lacy and Jakob Rutqvist, published by Palgrave Macmillan.
1
Mobile Mobile technology spurs adoption of circular business models by enabling universal and low-cost access to data and applications. As consumption behaviour goes mobile and online, it reduces the need for physical resources ranging from paper and entertainment to stores.
2
Machine-to-Machine (M2M) Communication Machines capable of communicating with one another are not new. M2M technology has long been used in factory control systems and vehicle telematics. But we’re about to reach a critical mass for mainstream M2M use as wireless network coverage expands worldwide.
3
Cloud Computing Dematerialisation—the process of replacing something physical with a digital alternative—has placed entire industries on the endangered species list (think travel agents, music stores and newspapers). Cloud computing is key to dematerialisation, along with mobile and social technologies.
4
Social While social media started as a way for people to find and connect with friends and family, it has evolved into so much more. Social technology is foundational to sharing. It reduces the cost of setting up sharing platforms as it allows businesses to tap into existing networks such as Facebook®. It makes it cheaper and quicker for companies to receive consumer feedback to help improve offerings.
5
Big Data Analytics In the circular economy, many companies will generate their revenues from product use instead of sales, and growth will rely on how good they are at understanding and catering to product use behaviour. This means companies need to monitor and analyse data in entirely new ways. Complex analytics is especially important for the Circular Supply-Chain, Sharing Platform and Product as a Service business models.
6
Modular Design Technology Modular design technology is not only revolutionising how products function but also the length and nature of customers’ relationships with those products. When a modularly designed product breaks, only the defective part is replaced or repaired, keeping the product relevant to its users longer and extending its overall product life cycle.
7
Advanced Recycling Technology While recycling is not at all new, it has benefited from a great deal of innovation and some significant, rapid returns on circular economy investments. Because of the advances in recycling, and its increased efficiency, more and more companies are turning to the circular economy as a source of growth.
8
Life and Material Sciences Technology Life and material sciences play a key role in driving input substitution at a large scale. Ongoing innovation in this field will lead to new circular material input options. It will also bring on new ways to alter outputs so they can be used as inputs.
9
Trace and Return Systems Trace and return systems support circular business models by making it more cost-effective to collect used products to service, repair, recover, reuse, refurbish or recycle them—for example, through efficient and effective material sorting machines.
10
3D Printing Arguably one of the most-hyped technologies of the past few years, 3D printing is steadily evolving to become a major player in the manufacturing world. It has also become one of the major drivers of circular business models. It facilitates repairing by making it possible to directly print suitable parts with the exact geometry. It also creates opportunities for circular inputs, inputs that are biodegradable or infinitely recyclable.
The Circulars 2016 Source: www.thecirculars.org/finalists
The Fortune Award for Circular Economy Leadership
Professor Dajian Zhu, Director, Institute of Governance for Sustainability,Tongji University, China Estelle Brachlianoff, Senior Vice-President, UK & Ireland, Veolia (runner up)
The Accenture Award for Circular Economy Multinational (runner up) (runner up)
The Ecolab Award for Circular Economy Enterprise
(runner up)
The Young Global Leaders Award for Circular Economy Entrepreneur
(runner up)
The Award for Circular Economy Governments, Cities & Regions
The Alliance Trust Award for Circular Economy Investor
(runner up)
(runner up)
The BT Award for Circular Economy Digital Disruptor
People’s Choice Award Finalists
Canon Europe Ltd Van Hulley
If you set your goals ridiculously high and it is a failure, you will fail above everyone else’s success.
If you do not like something, change it. If you cannot change it, change your attitude.
James Francis Cameron,
Maya Angelou,
Canadian filmmaker, director, producer, screenwriter, inventor, engineer, philanthropist and deep-sea explorer (1954 – )
American author, poet and civil rights activist (1928 – 2014)
Earth provides enough to satisfy every man’s needs, but not every man’s greed. Mohandas Karamchand Gandhi,
Indian social reformer, leader of the Indian independence movement (1869 – 1948)
For all things come from earth, and all things end by becoming earth. Xenophanes of Colophon,
Greek philosopher, theologian, poet and social and religious critic (570 B.C. – 475 B.C.)
V i s i o n a r i e s
A Circular Economy for Lower CO2 Emissions and More Jobs
M
Anders Wijkman Co-President Club of Rome
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ore than 40 years have passed since the launch of the Club of Rome report “Limits to Growth”. Its key message was that a combination of resource depletion and pollution, if untackled, would ultimately — i.e. within the next hundred years — bring the global economy down. It should be emphasised that the main focus of “Limits to Growth” was the increasing physical impact of economic growth — the ecological footprint — not growth itself. Few repor ts have become ver y controversial, not least among economists, and have been ver y criticised. Most economists still today view the report negatively. They simply do not accept that the combination of resource constraints, rapid population growth and an increase in pollution and waste can lead to big and growing problems or even a collapse of the world economy. But the debate is slowly sobering up. A series of international reports have
emerged recently which essentially confirm many of the conclusions of the “Limits to Growth”. Among them, one report — “Imperative to Act” — signed in 2012 by all 18 recipients of the Blue Planet Prize, conveys a particularly stark message: “The human ability to do has vastly outstripped the ability to understand. As a result, civilization is faced with a perfect storm of problems, driven by overpopulation, overconsumption by the rich, use of environmentally malign technologies and gross inequalities.”
Too Low Resource Prices There are obvious reasons behind the way the industrial economy evolved. Companies in most sectors were benefitting from falling commodity prices and cheap energy for most of the 20th century. Consequently, the focus of productivity fell on labour and capital, not on resources. Even though modest efforts have been made in the past to enhance resource efficiency, the
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Visionaries
demand for both energy and resources has continued to increase over time.
The Resource Landscape Will Look Different Resource constraints as well as rising volumes of waste and pollution will, without a doubt, pose increasing threats to both profits and business continuity. The main reasons can be summarised as follows: i) increased competition for resources in general — leading to possible shortages and disruptions; ii) political instability or resource protectionism among key producing regions; iii) increasing levels of pollution — not least green-house gases; and iv) increasing costs for commodities over time. Hence, governments and businesses must work together to develop resource strategies to both avoid resource constraints and address increasingly serious problems of waste and pollution. The productivity concept must be broadened and include the use of natural resources.
Leveraging technology to enhance productivity is nothing new. Labour productivity, which did increase by at least a factor of 20 since the birth of the industrial revolution, is a case in point. But to quote my close colleague Ernst von Weizsaecker, “it is not labour that is in short supply in the future but rather basic resources like energy, soil and water. The same level of innovation must now go into using technology for resource productivity as was the case with labour.”
Cradle to Cradle A first important step towards a more efficient use of resources would be to significantly increase recycling rates in society. According to a report released in 2011 by UNEP, recycling rates of metals are in many cases far lower than their potential for reuse. In theory, metals can be used over and over again, minimising the need to mine and process virgin materials and, thus, saving substantial amounts of energy and water while
minimising environmental degradation and CO2 emissions. But enhanced rates of recycling are just one of several necessary steps. Decades ago the concept of “Cradle to Cradle” was introduced. The main message was not to focus only on enhancing efficiency, but to increase effectiveness. “If your system is wrong, to increase efficiency is not the solution.” What the founders of the concept — Stahel, Braungart and McDonough — were advocating was to “do things right”. The main principles behind “Cradle to Cradle” — to extend wealth, minimise waste and go for maximum reuse and recycling of materials — is gradually gaining ground. Stahel, Braungart and McDonough have been joined lately in their pleas for more intelligent resource use. The most prominent example is Dame Ellen MacArthur. The foundation she star ted — “Ellen MacAr thur Foundation” — has produced several repor ts on the benefits of moving
towards a circular economy for both companies and society. The term “circular economy” should of course be seen as a metaphor for a radically more efficient resource use; there is nothing absolute about it. Parallel to the work of Ellen MacArthur, the EU Commission has taken several initiatives to enhance resource efficiency and move the European economy towards a more circular economy, adopting a Circular Economy Package launched in December 2015.
Rethinking the Way We Measure Progress Before discussing the benefits of moving towards a more circular economy, one thing should be stressed: A prerequisite for moving in the right direction — i.e. that of lowering the ecological footprint — will be to rethink the way we measure progress in society. For too long, growth in GDP has been used as the main indicator of progress. Growth in GDP does not guarantee shared well-being
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and tells us nothing about the levels of waste and pollution and the health of vital ecosystems. There are alternatives to GDP in the form of indicators that highlight qualitative improvements. It is high time we adopted them.
Circular Economy Will Lower GHG Emissions and Offer New Jobs Material throughput is a dimension of economic development that has been largely overlooked in the past. Both from the pollution point of view, in general, and the degradation of many vital ecosystems, in particular, this is hard to understand. With regard to climate policy the neglect is of particular concern. The main focus of climate mitigation so far has been on energy use. But material flows in society are just as important. In a situation where fossil
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fuels make up almost 4/5 of energy supplies, emissions to air and water are directly proportional to the throughput of energy and materials in society. The production of raw materials accounts for almost 20% of global GHG emissions and the waste sector represents another 3 - 4%. Switching to renewables and improved energy efficiency in the production processes will help. But just as important will be to reduce material throughput through activities like reuse, recycling, extended product life and remanufacturing. We need new business logic. More circular business models must replace the linear economy, featuring practices like: multistorey buildings built of wood; electronics designed for longer life and for components to be used again; car plants, as is the case with Renault, taking back old
engines, renovating them and making use of them in new vehicles; tyre manufacturers, like Michelin, offering tyres for lease, charging per km of use; clothing companies, like Mud Jeans and Houdini, offering clothing for rent and lighting companies, like Philips, providing lighting as a service. The challenge for the future is to generate a strong breakthrough for the concept of “service instead of products” for a wide array of consumer products, computers, cell phones, household appliances, cars, furniture and textiles. Even in the property market, the same principles could apply. The crucial issue is: How can the principle of “earning revenue by selling more stuff” be replaced by the logic that revenue is increasingly the result of quality of service?
Huge Societal Benefits A new report from the Club of Rome has studied the likely macroeconomic effects of moving towards a more circular economy. Five countries — Finland, France, the Netherlands, Spain and Sweden — were analysed using a traditional input/output model. The question posed was: How would the economies perform today if they were 25% more energy efficient, had reduced the use of fossil fuels by 50% in favor of renewable energy and achieved a far more efficient use of materials? The result is intriguing. If the countries studied were to introduce all three actions in parallel, the effects would be substantial: CO2 emissions would be between 65% and 70% lower. The impact on jobs would be highly positive as well: an estimated 75,000 additional jobs in Finland, 100,000 in Sweden,
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Visionaries
INFO
200,000 in Holland, 400,000 in Spain and half a million new jobs in France. The result should not come as a surprise. An economy giving priority to caring for what has already been produced — through repair, maintenance, upgrading and remanufacturing — is more labour-intensive than both mining and manufacturing (often in highly automated and robotised facilities).
What Incentives Are Needed to Advance the Circular Economy? A circular economy will not happen by itself. Policy measures as well as targeted investments will be needed. The scope here is too limited to dwell into this. But let me make a few suggestions as concluding remarks: • binding targets for resource efficiency; by setting such targets well above the expected growth rate
in the economy, the right signals would be sent to industry for it to focus on the maximum reuse and recycling of materials; • sustainable innovation; by giving priority to sustainable design and closed material loops, the research community would give maximum attention to the principles of a circular economy; • a tax reform; by lowering taxes on labour and raising them on the use of virgin materials, hiring people would be easier and material efficiency more profitable. Fur thermore, by exempting recycled materials from VAT, the market for secondary materials would get the needed boost.
Anders Wijkman is an opinion maker and author. He is co-President of the Club of Rome, Chairman of the Swedish Association of Recycling Industries and member of the Board of the Swedish Development Authority (SIDA). In January 2015, Mr Wijkman was appointed chair of the Swedish Cross-Party Committee on Environmental Objectives. The most immediate task is to develop a strategy for a low-carbon society in 2050. Mr Wijkman has served as a Member of the European Parliament, Assistant Secretary-General of the United Nations and Policy Director of UNDP, Secretary-General of the Swedish Red Cross and Director-General of the Swedish Agency for Research Cooperation with Developing Countries. He is a member of the Swedish Royal Academy of Sciences, the World Future Council and the International Resource Panel. He is honorary doctor at Linköping University (2011). His most recent book “Bankrupting Nature” — with co-author Professor Johan Rockström — was published by Routledge in 2012. The Club of Rome is an international think-tank composed of individuals who share a common concern for the future of humanity and strive to make a difference. Its members are notable scientists, economists, businessmen, high level civil servants and former heads of state from around the world. The Club of Rome conducts research and hosts debates, conferences, lectures, high-level meetings and events. The Club also publishes a limited number of peer-reviewed “Reports to the Club of Rome”, the most famous of which being the “Limits to Growth“. The Club of Rome’s mission is to promote understanding of the global challenges facing humanity and to propose solutions through scientific analysis, communication and advocacy. Recognising the interconnectedness of today’s global challenges, its distinct perspective is holistic, systemic and long-term. www.clubofrome.org
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A Potential Consumption Time Bomb Source: “Towards the Circular Economy: Accelerating the Scale-up Across Global Supply Chains� World Economic Forum, Ellen MacArthur Foundation, 2014.
1.1 bn more people
Dramatic shift to packaged product
1.8 bn more middle-class consumers
Much greater waste at end-of-life t
Soupermarke
local grocery
Food: caloric consumption
Food: spending
+24%
+57%
Packaging
End-of-life
+47%
+41%
Sustainable Development Goals & SCP Source: www.un.org/sustainabledevelopment/sustainable-consumption-production/
1
NO POVERTY
10
REDUCED INEQUALITIES
2
NO HUNGER
11
SUSTAINABLE CITIES AND COMMUNITIES
3
GOOD HEALTH
12
RESPONSIBLE CONSUMPTION
4
QUALITY EDUCATION
13
CLIMATE ACTION
5
GENDER EQUALITY
14
LIFE BELOW WATER
6
CLEAN WATER AND SANITATION
15
LIFE ON LAND
7
RENEWABLE ENERGY
16
PEACE AND JUSTICE
8
GOOD JOBS & ECONOMIC GROWTH
17
9
INNOVATION AND INFRASRUCTURE
PARTNERSHIPS FOR THE GOALS
• Implement the 10-year framework of programmes on Sustainable Consumption and Production, all countries taking action, with developed countries taking the lead, taking into account the development and capabilities of developing countries. • By 2030, achieve the sustainable management and efficient use of natural resources. • By 2030, halve per capita global food waste at the retail and consumer levels and reduce food losses along production and supply chains, including post-harvest losses. • By 2020, achieve the environmentally sound management of chemicals and all wastes throughout their lifecycle, in accordance with agreed international frameworks, and significantly reduce their release to air, water and soil in order to minimise their adverse impacts on human health and the environment. • By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse. • Encourage companies, especially large and transnational companies, to adopt sustainable practices and to integrate sustainability information into their reporting cycle. • Promote public procurement practices that are sustainable, in accordance with national policies and priorities. • By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development and lifestyles in harmony with nature. • Support developing countries to strengthen their scientific and technological capacity to move towards more sustainable patterns of consumption and production. • Develop and implement tools to monitor sustainable development impacts for sustainable tourism that creates jobs and promotes local culture and products. • Rationalise inefficient fossil-fuel subsidies that encourage wasteful consumption by removing market distortions, in accordance with national circumstances, including by restructuring taxation and phasing out those harmful subsidies, where they exist, to reflect their environmental impacts, taking fully into account the specific needs and conditions of developing countries and minimising the possible adverse impacts on their development in a manner that protects the poor and the affected communities.
Circular Economy Is the Opportunity of a Life Time to Ensure Sustainable Growth for All
A
s a global society, we are facing great challenges in the form of climate change, increased resource prices and a rapidly growing population. However, we also face a great opportunity to turn challenges into possibilities. This opportunity is the circular economy — the decoupling of growth from materialisation.
Ida Margrete Meier Auken Founder
Ditte Lysgaard Vind Co-Founder
Danish Network for Circular Economy
In the recently released report “Growth Within: a circular economy vision for a competitive Europe”, by the Ellen MacArthur Foundation and the McKinsey Center for Business and Environment, it is estimated that the advantages of moving towards a circular economy, in Europe alone, will translate into an increase in resource productivity by up to 3% annually, generating as much as EUR 0.6 trillion per year by 2030 for European economies, while at the same time, generating EUR 1.2 trillion in non-resource and externality benefits; meaning that Europe’s economies will benefit from a total of EUR 1.8 trillion annually, in contrast with today. The repor t also shows how higher
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productivity and reduced product costs enabled by the circular economy, could lead to an increase of the avarage European disposable income per household by as much as 18% by 2030, resulting in a possible GDP growth of seven percentage points more than the current development path by 2030. While we still have much work to do, luckily, we already see innovative and successful actors from all over the world seizing the potential of circular business models. Through offering their products as services, using upcycled materials in the production or applying one of the many other circular approaches, many have successfully transformed their businesses and shown the way forward. With the adoption of the Sustainable Development Goals and the Paris agreement, we now have a shared direction and global demand for solutions. Never theless, if we are to succeed as a global society and truly benefit from the unexploited source of sustainable wealth and competitiveness, we need a strong
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Visionaries
vision and cooperation among businesses, academia and politics. One key element is, thus, for countries to create a political vision and a strategy for circular economy, making sure that the proper framework conditions are in order for circular economy business models to thrive. We suggest that such a strategy is developed in strong collaboration with businesses and academia and we believe it would be prosperous for it to have: • Strong ambitious goals for resource efficiency as well as for product lifetime and reusability; • Industrial public-private partnerships allowing innovation, demonstrationpartnerships and smart connected solutions locally and globally; • Increased research funding earmarked for the transformation towards a circular economy; • Targets for shifting public spending toward circular products and services; Simply put, circular economy creates a unique global opportunity, not only in regards to avoiding the negative consequences of our current way of production and consumption. It is as much about seizing the financial potential and creating sustainable
growth and liveability for our increasing population. Also, it is not only about the future — we all can and need to star t today. Already innovative and forward thinking companies are, as we speak, seizing the opportunity to create competitive advantage through circular economy and supply their customers with best in class sustainable and cost efficient solutions. However, if one is to succeed within the circular economy, it is essential to understand that this is not simply a new CSR or a branding project, but an essential part of core business strategy. That being said, it does not mean that there are not huge advantages in terms of branding and sales — including a unique, continuous partnership with customers, suppliers and stakeholders. If we are to succeed in creating the change which is necessary to resolve the enormous global challenges we face, we need to create profitable sustainable business models where business and the environment are each other’s prerequisites — not opposites. So let us come together to accelerate the transition towards a circular economy.
INFO Ida Margrete Meier Auken is Candidata theologiæ from the University of Copenhagen. She is concerned with how growth can act as a catalyst for sustainable development. Ms Ida Auken has served as member of the Danish Parliament since 2007. She served as Minister for the Environment from 2011 to 2014. During her mandate, she introduced the treatment of waste as a resource. She is a member of parliament for the Danish Social-Liberal Party where she is the spokesperson for business, the environment, consumers as well as research and education. She is the first Danish politician to be named a “Young Global Leader” by the World Economic Forum. Additionally, Ms Ida Auken is the Co-chair of The Young Global Leaders Taskforce for Circular Economy, a member of the World Economic Forum’s Meta Council for Circular Economy and has been named one of Europe’s promising leaders under 40 in “40 under 40 European Young Leaders”. Ms Ida Auken also founded the Danish Network for Circular Economy. Ditte Lysgaard Vind co-founded the Danish Network for Circular Economy with Ida Auken. Ms. Ditte Lysgaard Vind is Candidata theologiææ in Political communication and management from the Copenhagen Business School and has a Postgraduate Certificate in Sustainable Value Chains from the Cambridge Institute of Sustainability Leadership. Ms Ditte Lysgaard Vind founded the niche consultancy “The Circular Way” that specialises in advising businesses working within the circular economy on communication and stakeholder engagement in order to succeed through sustainability and increase their competitive advantage. The Danish Network for Circular Economy is a non profit network connecting the leading Danish actors of the Circular Economy across sectors, while at the same time working to increase public awareness of circular economy and the possibilities that lies within it. www.facebook.com/circular.dk/
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Circular Economy: A Policy Maker’s Perspective
Volkmar Klein Member of the German Bundestag
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I
n recent years, the concept of the circular economy has been gaining increasing attention. The continuing scarcity of resources, population growth and climate change force global policy makers to address unsustainable patterns in consumption and production. At the same time, rapid technological progress offers new opportunities to shift towards circular economy. The last year was crucial for international cooperation on sustainability issues. A wide range of new policy initiatives were adopted in 2015 to encourage the transition towards restorative economic structures across the world. On the Elmau Summit in June, G7 countries agreed to endorse sustainable consumption and production patterns. In September, the UN adopted the sustainable development goals (SDGs) explicitly referring to foster respective policies in developing countries. At the UN Paris climate conference in December, member states adopted the first universal and legally binding global climate deal. Moreover, the European Commission released an action plan
for the circular economy comprising several proposals that cover the full life cycle of products. These measures aim at extracting a maximum value of raw materials, products and waste, and to reduce emissions as well as energy usage.
The Circular Economy — Not Just Recycling, but a Driver for Sustainable Economic Growth On a national level, many states have realised the importance of the concept for their economies, irrespective of their current state of development. This is because future economic growth will increasingly be decoupled from the use of natural resources and rather be based on a country’s ability to use the given resources more effectively. Economic structures will shift from traditional linear growth models towards circular ones, driven by innovations in material and product reuse. Throughout the past decades, Germany was highly competitive regarding both innovation and implementation of sustainable practices, especially in the field of
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Visionaries
recycling. Among industrial countries, German technology continues to be leading in the field and ranks currently third on the respective European EcoInnovation Index. Moreover, a number of developing countries, such as China and India have implemented circular economy plans as their rapid industrialisation has had serious negative impacts on the environment. Also, in African developing countries waste management and the sustainable use of scarce resources, such as drinking water, remain major obstacles. Through various initiatives Germany supports those countries in improving their systems. However, current circular economy concepts go far beyond the scope of recycling. New digital technologies enable societies to significantly improve consumption efficiency. This holds especially for industrialised countries. The so-called sharing economy provides significant opportunities for a better use of goods, such as cars, machines, buildings and infrastructures. Recent studies estimate the total effect of
implementing new technologies in Europe to yield annual benefits up to EUR 1.8 trillion by 2030.
Cooperation Matters While the benefits of the circular economy are universal, the way to transform economic structures differs significantly across countries. Most industrialised nations rely on optimising their existing systems, which is both costly and time consuming. On the contrary, developing countries are yet to build up industrial and services sectors. This constitutes an advantage, as they may implement available sustainable technologies at an early stage in their growing industries. However, in order to do so, technologies need to be both accessible and affordable. Therefore, close cooperation of all stakeholders — including policy makers, companies and researchers — is ever more important. Last year, the international community reached major breakthroughs and decisions. It is now up to all of us to put them into practice in the coming years.
INFO Volkmar Klein is a Member of the German Bundestag since 2009 with the Christian Democratic Union (CDU). Within the Budget Committee of the Bundestag, he is the rapporteur for economic cooperation and development. In addition, he is a deputy member of the Committee on the Affairs of the European Union. Before joining the German Bundestag, he was a State legislator from 1995 to 2009 and a volunteer mayor of Burbach from 1992 to 1996. The German Bundestag is the national Parliament of the Federal Republic of Germany. Its seat is the Reichstag Building in Berlin. In the current electoral term, Parliament is composed of 630 Members. This is the 18th electoral term since the establishment of the Federal Republic in 1949. The most important tasks performed by the Bundestag are the legislative process and the parliamentary scrutiny of the government and its work. The Members of the German Bundestag also decide on the federal budget and deployments of the Bundeswehr (Federal Armed Forces) outside Germany. www.bundestag.de
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Responsible Supply Chain Management and Sustainable Consumption and Production: True Stories
H
ow much is your socially responsible supply chain worth? “... 30 billion dollars” would say Tim Cook, the CEO of Apple, conceivably the company with the number one global supply chain, “and much more...” he might add considering the brand value of Apple.
Wanda Lopuch Chairwoman Global Sourcing Council (GSC)
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Every sustainability practitioner can relate to challenges in assigning measurable value to social policies and social risks in business. These measures are referred sometimes to as ESG (Environmental, Social, Governance) factors, other times as “good and fuzzy things”. Until fuzzy things happened, that is. As Nike experienced over three decades ago when consumers revolted against working conditions in Nike’s facilities in Thailand. The damage for Nike was measured in immediate sales drop, but more importantly: the Nike brand was tarnished significantly, perhaps forever. As demonstrates the phrase “Nike’s sweatshops”, which became a common and generic expression in
business vocabulary. The late Steve Jobs discovered rather painfully in San Francisco in 2010 during a conference how social factors, for which Apple was not legally responsible, presented very real and very material risk. At that conference, Steve Jobs’ goal was to dazzle the crowd of loyal Apple followers with then revolutionary features of the iPhone 3. Instead, he found himself on unfamiliar territory defending the manufacturing strategy and social policies of Apple, and arguing that “Apple does not support sweatshops”. Before the D8 conference, on June 6, 2010 The New York Times broke the story about suicides among employees at Foxconn facilities. Foxconn has been, and still is, the largest private contract manufacturer in China. At that time, its 300,000 employees had been assembling products for many American and global companies including Dell, HP, Samsung, IBM, Microsoft and yes, Apple. Apple loyal customers did not like the news about 12 suicides in the Foxconn facility, which assembled
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Visionaries
iPhones and iPads. Apple investors did not feel comfortable either with the otherwise great per formance of Apple. After the first article in May 2010 about labor conditions at Foxconn, Apple stock fell by 12% wiping out tens of billions of dollars for Apple shareholders.
people rioting in the Foxconn facilities. Within two days Apple’s stock fell. There were more disturbing reports from Foxconn Mexico facility. From midSeptember 2012 to early November 2012 Apple stock lost 5% of its market cap, which translates into staggering USD 30 billion.
Figure 1. Yahoo Finance, Apple February 11, 2010 Stock Price
Figure 2. Yahoo Finance, Apple September 17, 2012 Stock Price
Feb 11, 2010:
AAPL 28.3814
Sep 17, 2012:
AAPL 99.9686 100 98 96 94 92 90 88
2010
MAR
APR
Volume 137,586,400
MAY
JUN
JUL
AUG
Moving forward two years: September 24, 2012 – despite many steps Apple had taken to enforce Suppliers Code of Conduct, TV and press reports from Taiyuan, China showed thousands of
2012
Sep 24
Oct 1
Oct 8
Oct 15
Oct 19
In its 2012 analysis “Did Foxconn bring Down Apple Stock”, StockRiters says: “The Foxconn riots and suicides have illustrated something all American companies with factories in Asian
countries should be strongly cautious about: that when American Consumers realise that behind the iPads they use, behind the bright LCDs and LEDs, the Nike shoes and the designer clothes they wear, that behind these there is an undernourished, underpaid, possibly underage labourer toiling away in some dank sweatshops in the foul underbelly of Southeast Asia, that understanding has an immediate ef fect on the stock of the responsible company. A company that resorts to, condones or ignores such business practices from its contractors, will get hurt where it matters most, its bottom-line. Therefore it is sound financial astuteness to spend money on removing this sort of incidents from ever happening”. Watching Apple’s stock performance during Foxconn crisis, shareholders of global corporations connected the dots between short-term cost savings of simple labour arbitrage and long-term benefits of a responsible supply chains. Investors took decisive steps to mitigate supply chain risks. They demanded management of their companies to
review and address social risks in global supply chains, even if these companies were not legally responsible for suppliers’ behaviours. Investors pressed for more transparency and accountability, including supplier sustainability reporting. Since 20112015, the New York City Pension Fund succeeded to implement this strategy via shareholder resolutions at its 19 holdings, mostly technology and apparel companies.
Shareholders Expectations
Mounting
Shareholders of Microsoft, led by the New York City Pension Fund, at the annual shareholders meeting in October 2011, passed a shareholders resolution which required the management of Microsoft to turn its 200,000-strong supply chain into a socially responsible supply chain. Further, the resolution imposed specific requirements for auditing vendors’ disclosure of their works and safety standards, and a long-term compliance with internationally accepted standards.
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Microsoft management followed these steps with structural and policy changes. Suppliers’ code of conduct has been reviewed and strict enforcement programme of the code has been implemented, offering industry “gold standards” in mitigating social risk in the supply chain. Now, Microsoft’s supplier selection and evaluation criteria include the so called “Global Citizenship” factors that can account for up to 11% of the total weight in vendor selection. Microsoft is hardly an exception. Companies such as Cisco, Dell, Intel, HP, Oracle – just to name a few of those with significant global purchasing power, have reviewed their supply chain procedures and elevated standards. Among the latest changes: disclosing the list of suppliers, which brings more transparency, or in Disney’s case - blacklisting countries from its list of outsourced production region. And yes, some vendors who do not comply are being dropped, sometimes in highly publicised cases. As Apple did in 2012 when it fired Pingzhou Electronics Co (PZ), one of its biggest Chinese suppliers, for a violation, and subsequent non-compliance of the
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Supplier Code of Conduct. Across companies and sectors, a social factor / social risk (S- in ESG) in vendor selection accounts for 3% to over 10% of the total score, in extreme cases like Nike's - 25% of the total score. As the ESG measures are being broadly adopted by global business, the significance and materiality of S-factor (social) to company’s bottom-line has been getting more recognition among mid-level managers who, in pre ESG reporting-times, have been rewarded for delivering savings by cutting the cost of suppliers. Shareholders of Microsoft in its resolution expressed their believe that: “The reporting requirement will also drive sustainability improvements in Microsoft’s supply chain.” As of January 2015, the New York City Pension fund has successfully introduced a total of 11 similar resolutions for the companies in its portfolio.
Outsourcing Social Responsibility? Does not work.
One may argue that the “tipping point” for the implementation of stronger social policies in supply chains was the April 2013 collapse of Rona Plaza in Bangladesh, which claimed
over 1,100 deaths. Investigations conducted by global buyers uncovered numerous violations of the code of conduct of suppliers. Outsourcing of social responsibility clearly has brought devastating consequences. As the tragedy unleashed significant change in consumer attitudes, especially demands for transparency, global brands such as H&M, Zara and Carrefour realised that they must assume responsibility for enforcing code of conduct for suppliers. AsiaInspection, a company that conducts compliance testing with global safety standards in Asia, declared 2014: the year of socially accountability for global supply chains as reported by Forbes in March 2014. After Rona Plaza tragedy, it has been finally accepted that global brands cannot outsource social responsibility.
Back to Apple and Foxconn – Lasting Change In response to the initial New York Times suicides report, Apple initiated many decisive steps in implementing the Apple Supplier Code of Conduct. Even before 2010, Apple was one of the global leaders in enforcing fair labour conditions among its suppliers. In 2005, it created a very progressive,
for that time, Supplier Code of Conduct and followed it up with a disciplined global audit system. But it was not enough. “Steve, Apple can do better” – wrote “Jay” one of many bloggers on the MacStories Blog after suicides were reported, reflecting the views of many. “You should educate yourself”, responded Steve Jobs. “We do more than any other company on the planet”. Objectively true, but it was still not enough for Apple followers. More had to be done. Steve Jobs realised that quickly after being challenged by thousands of emails. After the suicides were repor ted, Apple created a comprehensive improvement plan. It called on the Fair Labor Association (FLA) an independent international labour watch-dog group, for its involvement and guidance, to assess working conditions and make business recommendations. The FLA issued its detailed report almost two years later and made it available on the internet. Under the watchful eye of the FLA, Apple and Foxconn created an action plan consisting of 356 items; 99% have been implemented. The FLA gave Apple a high score on addressing the situation at Foxconn specifically,
Global Sustain Yearbook 2015/16 Sustainable Production & Consumption | Visionaries
and on the Chinese global market. In February 2014, Apple released again its 2013 Progress Report on Apple Suppliers Responsibility, underscoring its commitment to transparency and accountability. The company continues to put strong emphasis on its Supplier Code of Conduct, relaying not only on self-reported data, third-party audits, but more and more on its own, internal enforcement of the Code. In 2014, the number of Apple-own in-person audits increased by 40% covering 1,600,000 workers in 19 countries. Apple, arguably the most power ful global company in terms of its financial ability to enforce its business principles, made a significant mark on changing global labour conditions. The longlasting effect of Apple’s response to the 2010 Foxconn suicides brought lasting changes in labour standards in China, and other parts of the world. WalMart has experienced its share of challenges after introducing its Global Sustainability Index in 2009 as an integral part of its sustainable supply chain strategy. The main challenge has been in capturing reliable data, assure transparency, and enforce the code of suppliers conduct among secondary
and tertiary suppliers that account for 75% of products produced specifically for China.
Never let a good crisis go to waste Apple has become a tr ue transformational leader in implementing social accountability in the global supply chain. Its decisive stand on the working conditions in the Foxconn case, its persistence in implementing transparency and accountability throughout many layers of vendor management, constitutes now an integral part of Apple’s brand value. “Around the Globe, Apple employees are united in bringing equality, human rights, and respect for the environment to the deepest layers of our supply chain” says Jeff Williams, SVP of Operations, responsible for end-to-end supply chain. This is the expression of good and fuzzy things, or the “social bite” in the Apple logo, which Tim Cook might have had in mind when assessing the value of Apple' socially responsible supply chain as “30 billion…and much more”. So, how much is your global supply chain worth?
INFO Dr Wanda Lopuch’s unique combination of entrepreneurial drive, global mindset, multi-language executive skills and corporate responsibility expertise have been critical in allowing her to successfully exploit growth opportunities in technology, pharmaceuticals, biotechnology companies as well as in the not-for-profit sector. In doing so, she strongly advocates and practices the capitalism-based idea of “doing well by doing good”. In addition to her function as Chair of the GSC Board, Dr Lopuch leads MDA Associates, Inc., a consulting organisation focusing on “greening” the global operations and their supply chains while improving economic outcomes of businesses in the life sciences, IT, FMCG and financial sectors. With 20 years of experience in the pharmaceutical and telecommunication sectors spanning across the United States, Europe, and East Asia, Dr Lopuch guided international teams for maximising performance in multinational, multicultural and multifunctional projects. Prior to establishing MDA Associates Inc., Dr Lopuch was the president of Medical Data Management Inc., the company she founded and grew into a multi-million-dollar business with locations in seven countries. After the successful acquisition of Medical Data Management by Dendrite International, Dr Lopuch served as the Vice President and General Manager of Dendrite Central and Eastern Europe. Dr Lopuch holds a PhD in Administration and Supervision from Marquette University, Milwaukee, WI, and an MSc in Computer Sciences from the Wroclaw University of Technology in Wroclaw, Poland. She lectures on various aspects of international business. The Global Sourcing Council (GSC) is a non-profit organisation focused on sustainable, socially responsible sourcing practices. GSC vision is to transform the world by inspiring and empowering organisations and businesses to operate responsibly in pursuing profit with purpose. GSC also connects SMEs and corporations to encourage a pipeline of future business opportunities and success. By bringing together businesses, industry organisations, academics and trade representatives of different countries, the GSC provides an open forum for discussion of social, economic and political effects of global sourcing arrangements. www.gscouncil.org
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SCP - The Best and Worst Performers Source: “Sustainable Development Goals: Are the Rich Countries Ready?”, Bertelsmann Stiftung, 2015.
GOAL POVERTY AGRICULTURE & NUTRITION HEALTH EDUCATION GENDER EQUALITY WATER ENERGY ECONOMY & LABOR INFRASTRUCTURE & INNOVATION INEQUALITY CITIES CONSUMPTION & PRODUCTION CLIMATE OCEANS BIODIVERSITY INSTITUTIONS GLOBAL PARTNERSHIP
BEST COUNTRIES
WORST COUNTRIES
Czech Republic Finland Iceland Japan Japan Denmark & others Japan Korea, Rep. Sweden New Zealand Iceland Austria & others Ireland Iceland Norway Iceland Korea, Rep. Israel Slovakia Estonia Australia & others Canada Estonia Japan Mexico Sweden Estonia Japan Estonia & others Turkey Luxembourg Denmark Sweden Japan, Spain
Mexico Italy Korea, Rep. United States Turkey Greece Turkey Mexico Japan Korea, Rep. Israel Turkey Iceland Korea Mexico Greece Greece Chile Chile Slovakia Belgium Mexico Denmark Australia Luxembourg Estonia Turkey United Kingdom Ireland Czech Republic Mexico Mexico Israel Switzerland
Food Loss and Waste Source: “From ‘Why’ to ‘How’: Reducing Food Loss and Waste”, World Resources Institute, January 2016.
10.7
IF Food Loss and Waste Were its own Country, it Would Be the Third-Largest Greenhouse Gas Emitter 5.8 4.4 2.9
China
United States
Food loss and waste
India
2.3
Russia
GT CO2E (2011/12)* * Figures reflect all six anthropogenic greenhouse gas emissions, including those from land use, land-use change, and forestry (LULUCF). Country data is for 2012 while the food loss and waste data is 2011 (the most recent data available). To avoid double counting, the food loss and waste emissions figure should be added to the country figures.
About Global Sustain Founded in 2006, Global Sustain creates awareness and inspires and supports companies and organisations to embody sustainability, through advisory, communications, networking and training, with a focus on the people-planetprofit philosophy. Its members include corporations, non-governmental and non-profit organisations, municipalities and local authorities, educational foundations, the media, professional bodies, think tanks and other public or private entities. Global Sustain is a signatory to the Ten Principles of the UN Global Compact, a Global Reporting Initiative (GRI) Data Partner and Gold Community Partner, an affiliated member of the Academy of Business in Society (ABIS), member of the
Sustainable Consumption & Production: Towards a Circular Economy YEARBOOK 2015/16
European Foundation for Quality Management (EFQM) and Social Value International and collaborates with international organisations such as FSC International, CSRwire, Ethical Performance, CEO Clubs, Institute of Directors, TBLI, CAPITALS Business Circle , Financial Times and Business Wire. Global Sustain operates as a carbon neutral company, supports numerous sustainability conferences around the globe and organises the annual Sustainability Forum, a training, networking and professional development event. Global Sustain is headquartered in London (UK), with companies in Berlin (Germany) and Athens (Greece), an office in Brussels (Belgium) and affiliates in New York (USA), ZĂźrich (Switzerland), Dubai (UAE), Nicosia (Cyprus) and Colombo (Sri Lanka). Global Sustain is a registered trademark (TM).
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www.globalsustain.org www.sustainabilitylearning.gr www.sustainabilityforum.gr @GLSustain Global Sustain Global Sustain Global Sustain Global Sustain
About Yearbooks • 9 publications with • 260 + contributors from • 20 + countries • 14,000 + recipients in • 50 + countries
The Yearbook series aims at highlighting critical sustainability issues and constitutes a catalyst for constructive dialogue and positive change. This annual global publication is trusted by top companies and important stakeholders from all around the world. Each year, Global Sustain selects a topic of universal interest relevant to the people-planet-profit concept and analyses all aspects through the views of internationally renowned personalities, business leaders, politicians, visionaries and academia. Industry opinion formers and decision makers across the world contribute with policy and business intelligence to the publication, while leading corporations showcase their best practices and flagship products and services in the sustainability field. The hard copy publication is presented every year in special events and venues, with high level participants and is distributed to more than 50 countries.
The Spirit of the Forest Yearbook 2007 (ISBN 978-960-14-1799-8)
Innovation for Excellence Yearbook 2012/13 (ISBN 978-960-99967-2-3)
Green Development & Sustainability Yearbook 2008 (ISBN 978-960-14-1995-4)
Beyond Borders Yearbook 2013/14 (ISBN 978-960-99967-3-0)
The Future of Responsible Investing Yearbook 2010 (ISBN 978-960-99967-0-9)
The Power of Collaboration
CIRCU
LAR MY ECONO
Sustainable Consumption & Production
Y E A R B O O K
Leadership for Sustainability Yearbook 2011/12 (ISBN 978-960-99967-1-6)
The Power of Collaboration Yearbook 2014/15 (ISBN 978-960-99967-4-7)
Y E A R B O O K 2 0 1 4 / 1 5
It’s a Matter of Culture Yearbook 2009 (ISBN 978-960-14-2237-4)
2 0 1 5 / 1 6
Sustainable Consumption and Production: Towards a Circular Economy Yearbook 2015/16 (ISBN 978-960-99967-5-4)
www.globalsustainyearbook.org
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Acronyms and abbreviations 3D Three-Dimensional Space ADB Asian Development Bank AG Aktiengesellschaft - Company with Limited Liability AUEB Athens University of Economics and Business B.C. Before Christ BA Bachelor of Arts BAT Best Available Technique BEP Best Environmental Practice BSc / BS Bachelor of Science bn Billion C2C Cradle to Cradle C(S)R Corporate (Social) Responsibility CACE China Association of Circular Economy CDU Christian Democratic Union CEO Chief Executive Officer CGDD Department of the Commissioner-General for Sustainable Development CRR Centre for Remanufacturing & Reuse CSB Centre for Sustainable Business CTO Chief Technology Officer CNR Consiglio Nazionale delle Ricerche CO2 Carbon Dioxide D.C. District of Columbia D8 Developing Eight DG Directorate-General DNA Deoxyribonucleic Acid Dr Doctor e.g. exempli gratia E/M Electrical / Mechanical EBRD European Bank for Reconstruction & Development EC European Commission ECEN European Circular Economy Network EEB European Environmental Bureau EEE Electronic & Electrical Equipment EMAS European Eco-Management and Audit Scheme EMS Environmental Management System
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ENPC ENVI etc. EPEA EPP EPR ERN ESG ESMT EU EUR EUROPEN F&B FfCE FLA FMCG FSC G20 G7 G77 G8 GCP GDP GHG GbmH GSC i.e. IAIA ICHEC ICT IFC IMF IRP
Ecole Nationale des Ponts et Chaussée Committee on the Environment, Public Health and Food Safety et cetera European Protection Encouragement Agency European People’s Party Extended Producer Responsibility European Remanufacturing Network Environmental, Social & Governance European School of Management & Technology European Union Euro (Symbol €; ISO code: EUR) European Organisation for Packaging and the Environment Food and Beverage Foundation for Circular Economy Fair Labour Association Fast-moving consumer goods Forest Stewardship Council Group of 20 Group of Seven Group of 77 Group of Eight Green Commodity Programme Gross Domestic Product Greenhouse Gas Gesellschaft mit beschränkter Haftung Company with limited liability Global Sourcing Council id est International Association for Impact Assessment Institut Catholique des Hautes Etudes Commerciales Information & Communication Technology International Finance Corporation International Monetary Fund International Resource Panel
Acronyms and abbreviations Inc. IOT IPCC ISBN ISO ISSN IT KD Km. LCA LCD LED LEED M2M M&E MAP MSc MA MBA MEng MIT MoMA Mt. MWE NGO(s) No. NPV OECD OPEC OTE PCE PDMS PET PhD Prof. PSS
Incorporated Internet of Things Intergovernmental Panel on Climate Change International Standard Book Number International Organisation for Standardisation International Standard Serial Number Information Technology Kreditinstitut in Dortmund Kilometre Life Cycle Analysis (or Approach) Liquid-Crystal Display Light-emitting diode Leadership in Energy & Environmental Design Machine to Machine Monitoring and Evaluation Mediterranean Action Plan Master of Science Master of Arts Master of Business Administration Master of Engineering Massachusetts Institute of Technology Museum of Modern Art Metric Tonne Municipal Waste Europe Non-Governmental Organisation(s) Number Net Present Value Organisation for Economic Co-operation and Development Organisation of the Petroleum Exporting Countries Hellenic Telecommunications Organisation Personal Consumption Expenditure Polydimethylsiloxane Polyethylene Terephthalate Doctor of Philosophy Professor Product-Service System
R&D RAC REC RFID Rep. RISE RNE S.A. SCP SDGs SME(s) SRM SVP TM TPS UAE UC UK UN UNDP UNEP UNICEF UNIDO UPS US(A) USD VAT WEEE WRAP WWF ZDF
Research & Development Regional Activity Centre The Regional Environmental Center for Central and Eastern Europe Radio Frequency Identification Republic The Rural Investment Support for Europe Rat für Nachhaltige Entwicklung – German Council for Sustainable Development Société Anonyme Sustainable Consumption and Production Sustainable Development Goals Small Medium Enterprise(s) Secondary Raw Materials Senior Vice President Trademark Toyota Production System United Arab Emirates University of California United Kingdom United Nations United Nations Development Programme United Nations Environment Programme United Nations International Children's Emergency Fund United Nations Industrial Development Organisation Uninterrupted Power Supply United States (of America) United States Dollar (symbol: $; ISO code: USD) Value-Added Tax Waste Electrical & Electronic Equipment Waste and Resources Action Programme World Wildlife Fund Ζweites Deutsches Fernsehen German Public-Service Television
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List of tables, graphs, figures, facts & stats TITLE
SOURCE
Simplified Illustration of a Circular Economy The Circular Economy – an Industrial System Restorative by Design What is Circular Economy? 2030 Scenarios – Mobility, Food & Built Environment
European Commission World Economic Forum, Ellen MacArthur Foundation European Commission McKinsey Center for Business and Environment, Ellen MacArthur Foundation European Environmental Bureau European Remanufacturing Network Eurostat Zero Waste Europe European Remanufacturing Network McKinsey Center for Business and Environment, Ellen MacArthur Foundation Institute for Manufacturing, University of Cambridge www.circularcollaboration.com European Commission European Commission GreenBiz Group Inc., Trucost WRAP 19th Annual Global CEO Survey PwC 19th Annual Global CEO Survey PwC Schneider Electric Tradeshift MBDC / The Circulars Toyota Material Handling Europe Toyota Material Handling Europe Toyota Material Handling Europe Tygabox Waste to Wealth www.thecirculars.org/finalists World Economic Forum, Ellen MacArthur Foundation United Nations Bertelsmann Stiftung World Resources Institute
A Resource Efficient and Sustainable Europe Remanufacturing Profitability Generation of Hazardous Waste by Economic Activity, EU-28 Extended Producer Responsibility Schemes Factors for the Economic Viability of Remanufacture Barriers to Implementation Closing, Slowing and Narrowing Loops 10 Steps Towards a Circular Business Prioritised Sectors and Products A Global Perspective Waste Generation Worlwide Jobs in Circular Economy Activities across Europe Business Success in the 21st Century Global Trends for Transforming Stakeholders’ Expectations Repair and Retrofit for Customer Satisfaction Supply Chain in a Circular Economy The Upcycle Chart Second Life Strategy Used Trucks Sales Growth Carbon Footprint Including Upstream Supply Chain and Operations GDP and PCE in 2016 Ten Disruptive Technologies The Circulars 2016 A Potential Consumption Time Bomb Sustainable Development Goals and SCP SCP – The Best and Worst Performers Food Loss and Waste
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Sustainable Consumption & Production: Towards a Circular Economy YEARBOOK 2015/16
G lo b a l S u s t a i n w w w .g l o b a l s us t a i n.o r g ISBN:978-960-99967-5-4