How The Circular Economy Is Helping To Turn Waste Into a Valuable Resource

Concerns that the world’s dominant linear economies are unsustainable have been growing for years. However, it took the shock of the Covid-19 pandemic to expose exactly how vulnerable the linear model really is. Among other concerns, the crisis has shown how linear economies can entrench inequalities, accelerate climate change and quickly unravel under pressure.

On a more positive note, the crisis has presented us with an unprecedented opportunity to reset, rethink and rebuild our future by moving away from linear economies and embracing the circular model.

Step One: Defining Linear vs. Circular

Step one on this journey involves understanding the key differences between the linear and circular models.

Based on take-make-waste, the linear model has its roots in the 19th Century's Industrial Revolution. There is no doubt that this model has produced numerous innovations. At the same time, however, it has also created an on-demand lifestyle where the means of production are just a click away. Consequently, we are now consuming far more than we can recycle or reuse.

The key to disrupting this increasingly unsustainable model lies in keeping disposable products and materials in use so that we can continuously close the loop on waste by reusing it to the benefit of our planet, its people and their economies.

This, in essence, is the vision of the circular economy, often referred to as circularity.

Leading The Circularity Debate

As the shift away from the linear model gathers momentum, a growing number of experts are adding their voices to the conversation around defining, designing, and measuring what it takes to be circular. At Supply Chain Reimagined, we value their leadership and guidance as we work together as an industry to shape the next normal. Here, we introduce two of the most influential thought leaders in the current circularity debate.

Raising The PACE

Launched at the annual World Economic Forum meeting at Davos in 2018, the Platform for Accelerating the Circular Economy – or PACE – has emerged as an authoritative platform for private leaders and organizations that are committed to fast-tracking circular economy solutions. It currently comprises 80 public, private, international and civil society executive leaders and over 200 members driving 18 projects worldwide. It offers a great starting point for anyone who is interested in learning more about the transition to circularity across the entire economy.

A Strong Foundation

Another important voice in the circular economy debate is the Ellen MacArthur Foundation. Under the theme Build Back Better, it places a strong emphasis on the importance of rethinking and redesigning our current economic model in response to the impact of the pandemic.

In June 2020, the foundation brought together 50 global leaders who signed a pledge to accelerate efforts to build the circular economy. Signatories included policy makers, philanthropists, academics and CEOs of the some of the world’s biggest businesses. Their joint statement calls on businesses and government around the world to invest and commit towards achieving circular economy targets.

Since the signing, the Ellen MacArthur Foundation has launched a succession of notable initiatives designed to translate the pledge into tangible results. In September 2021, for example, it announced the Big Food Redesign, an initiative designed calling on key players in the food service sector to play their part in addressing the world’s biodiversity and climate crises through circularity.

Measuring The Circularity Gap

Measuring circularity is emerging as a critical factor in understanding the global circularity gap as private and public sector organisations build the business case for shifting away from the linear economy.

The launch of the Circularity Gap Report at Davos in 2018 marked an important step towards equipping key players with the data and insights they need to fill the measurement gap and accelerate this shift. The report is produced by Circle Economy, an organization dedicated to advising cities and businesses on the practical and scalable implementation of the circular economy. Alarmingly, perhaps, the 2020 Circularity Gap Report noted that we are going backwards with 8.6% of the global economy defined as circular versus 9.1% two years earlier.

As a measure to reverse this trend, Circle Economy also launched the Global Data Alliance, an open-access data platform that is designed to improve and enrich the measurements and insights in its reporting and build a common understanding of what circular economies are, how they should perform, and how we should measure them. After all, you can’t manage something until you can measure it.

More and more countries now recognize the importance of circularity to the well-being of their people and their economies. In recent years, a number of early adopters have completed the Circularity Gap Report to capture the insights they need to boost national circularity levels and inform policy makers and businesses.

To date, Austria, Norway, the Netherlands as well as the Canadian province of Quebec have completed the report. With a circularity score of 24.5%, the Netherlands has emerged as a clear front-runner in the global circularity race.

Focus On The Netherlands: Circularity In Action

The collaboration between HAVI, McDonald’s and Neste is a good example of why the Netherlands is recognized as a circularity leader. This initiative - known as From Fries To Miles –turns used cooking oil (UCO) into hydrogenated vegetable oil (HVO) to fuel HAVI's vehicle fleet, and exemplifies the spirit of partnership that lies at the heart of circularity.

Briefly, HAVI picks up the used cooking oil from McDonald’s restaurants across the Netherlands and delivers it to the Neste refinery in Rotterdam, where it enters the production chain to be converted into renewable diesel. HAVI then buys back an equivalent amount of renewable diesel to fuel the trucks that deliver food products to McDonald’s restaurants, where the cycle starts again.

Read the full story behind this partnership here.