Business Issues and Trends 306
Hunnysid
Week8Lecture-CircularEconomySDGsCaseStudies1.pptxBUS306: Contemporary Business Issues and Trends
Lecture Week 8: Circular Economy & SDGs – Case Studies
2
Learning objectives
Upon completion of this week’s topic, students should be able to:
Understand how circular economy business models create advantage – from waste to wealth.
Learn about the interconnection between Circular Economy and its potential in implementing the 2030 Agenda for Sustainable Development (SDGs).
3
Learning objectives
Upon completion of this week’s topic, students should be able to:
Learn about some key circular economy case studies that explain the importance of systems based approaches to identifying effective circular transformations.
4
PART 1 Circular Economy Advantage
Creating Advantage in a Circular Economy
Explaining the Circular Economy Advantage
5
Source: https://www.youtube.com/watch?v=Fbc6W4lJAcc
Creating Advantage in a Circular Economy
New book Waste to Wealth shares that the real price of commodities has fallen despite rising demand for them.
The various forms of wastes recorded include:
Wasted energy and materials that are only used once
Wasted lifecycles where products are discarded after a short time, and
Wasted assets, such as cars, that stand idle for much of their lives.
6
Creating Advantage in a Circular Economy
The take, make and waste approach of traditional, linear business models has now begun to choke economic growth through unpredictable raw material prices and the increased cost of depending on less stable supplies of constrained resources (Forti et al., 2020).
7
Creating Advantage in a Circular Economy
By turning waste into wealth with new business models, companies can boost their competitiveness by reducing dependence on scarce resources and generating new innovative services that grow revenues.
8
Source: https://www.youtube.com/watch?v=zCRKvDyyHmI
Creating Advantage in a Circular Economy
Analysis by McKinsey for the Ellen MacArthur Foundation estimates that, companies that focus on encouraging the build-up of circular supply chains can increase the rate of recycling, reuse and remanufacture.
To McKinsey, over US$1 trillion a year could be generated by 2025 and 100,000 new jobs created for the next five years.
9
Source: https://www.youtube.com/watch?v=zCRKvDyyHmI
10
PART 2 Link between Circular Economy and SDGs
Link between Circular Economy and SDGs
SDGs
As the efforts of all countries for the implementation of the Sustainable Development Goals become more and more intense, Unsustainable natural resource use is having a huge impact on the environment.
Projected increase in global population and the number of people living in cities is expected to further deplete natural resources beyond sustainable limits (Allen et al., 2018).
11
Link between Circular Economy and SDGs
SDGs
With current production and consumption trends, large increase is projected for the global use of biomass, fossil fuels, metals and minerals. These trends would have huge impacts on our planet, in terms of climate change, environmental and land degradation, water stress, biodiversity loss and human health.
The new model of circular economy is meant to allow the planet to breathe, while leaving no one behind.
12
Link between Circular Economy and SDGs
Circular Economy
Circular economy has gained increasing prominence as a tool which presents solutions to some of the world’s most pressing cross-cutting sustainable development challenges.
An economy in which waste and pollution do not exist by design, products and materials are kept in use, and natural systems are regenerated provides much promise to accelerate implementation of the 2030 Agenda (Schroeder et al., 2018)
13
Link between Circular Economy and SDGs
Circular Economy
The circular economy is a holistic approach which cuts across a range of sectors including agriculture, energy, climate change, water and sanitation.
Utilizing circular economy practices across these areas, combined with social justice considerations, provides a unique framework for achieving the SDGs (Prieto-Sandoval et al., 2018).
14
Link between Circular Economy and SDGs
The circular economy holds particular promise for achieving multiple SDGs including:
SDGs 6 on energy,
8 on economic growth,
11 on sustainable cities,
12 on sustainable consumption and production,
13 on climate change,
14 on oceans, and
15 on life on land.
15
Link between Circular Economy and SDGs
1. SDGs strongly and directly benefitting from CE practices
SDG 6 – Clean Water and Sanitation
SDG 7 – Affordable and Clean Energy
SDG 12 – Sustainable Consumption and Production
SDG 15 – Life on Land
2. SDGs indirectly benefitting from CE practices
SDG 1 – No Poverty
SDG 2 – Zero Hunger
SDG 11 – Sustainable Cities and Communities
16
Link between Circular Economy and SDGs
3. SDGs facilitating the uptake of CE practices
SDG 4 – Quality Education
SDG 9 – Industry, Innovation and Infrastructure
SDG 13 – Climate Action
SDG 17 – Partnership for the Goals
4. SDG cooperation promoting CE practices
Almost all the SDG goals and in particular SDG 17 – Partnerships for the Goals, have targets that can allow for partnerships and collaboration that could help promote CE practices.
17
Circular Economy and SDGs Examples
SDG 2: Zero Hunger
The circular economy includes regenerative agricultural practices that restore soils and new innovations such as hydroponic gardening, which together with reducing the amount of food we waste and sustainable diets are key to reducing malnutrition and eliminating hunger (Rodriguez-Anton et al., 2019).
18
Source: https://sdgs.un.org/goals/goal2
Circular Economy and SDGs Examples
SDG 6: Clean Water and Sanitation
CE practices such as small-scale water purification, sustainable sanitization, waste water treatment, water reuse and recycling, nutrient recovery, biogas systems etc. can help increase access to safe drinking water and equitable sanitation, reduce pollution and improve water quality (Schroeder et al., 2018).
19
Source: https://sdgs.un.org/goals/goal6
Circular Economy and SDGs Examples
SDG 7 – Affordable and Clean Energy
Renewable energy systems, incl. small-scale biomass technologies and 2nd generation biofuels, energy (heat) recovery and improved utilisation in industrial systems (e.g. industrial symbiosis) all contribute to this goal (Schroeder et al., 2018).
20
Source: https://sdgs.un.org/goals/goal7
Circular Economy and SDGs Examples
SDG 9: Industry, Innovation and Infrastructure
New circular business models based on digital solutions, additive manufacturing such as 3D printing and new logistics systems to close resource loops, are key elements for resilient and sustainable economies (Dantas et al., 2020).
21
Source: https://sdgs.un.org/goals/goal6
Circular Economy and SDGs Examples
SDG 12: Responsible Consumption and Production
Circular economy practices such as reduce, redesign, reuse, repair, remanufacturing and recycling are directly aligned with achieving SDG 12 (Sustainable Production and Consumption) by employing new technologies and business models, reducing the amount of unsustainable products that is produced and bought, sharing and repairing, designing out waste and safely managing toxic substances. (Rodriguez-Anton et al., 2019).
22
Source: https://sdgs.un.org/goals/goal12
Circular Economy and SDGs Examples
SDG 13 – Climate Action
CE practices contribute directly and indirectly to mitigating climate change and increasing resilience. The 2019 Circular Gap Report finds that implementing CE practices could reduce GHG emissions by more than a third by 2100, in addition to existing low-carbon technologies (Dantas et al., 2020).
23
Source: https://sdgs.un.org/goals/goal13
24
PART 3 Circular Economy business models – Case Studies
Case Study 1 - IKEA
IKEA is looking to find new ways to use renewed and recycled resources as materials, and continuously re-design the production of existing products to make it more sustainable.
IKEA is testing the potential for more circular solutions such as furniture leasing, take-back and buy-back schemes, and helping customers repair, reuse and recycle old furniture or give it a second life through reselling.
25
Case Study 1 - IKEA
26
Source: https://youtu.be/P-Pd3VsyGuo
Case Study 1 - IKEA
In our journey towards becoming a circular business by 2030, we have committed to:
Enabling our customers to obtain, care for, and pass on products in circular ways
Producing 100% circular products (raw materials – recycled – remanufactured – refurbished – reused)
Using only renewable and recycled materials
27
Case Study 2 - Nike
Nike claims 71% of its footwear is made with materials recycled from its own manufacturing process. In 2015, the brand recovered 92% of its waste.
Nike’s sustainability report includes efforts to achieve zero-waste in its supply chain, invest in technologies to drive 100% renewable energy within its factories, and reduce toxic chemical output from dying processes from entering the environment.
28
Case Study 2 - Nike
29
Source: https://www.youtube.com/watch?v=hDOHExtc7WY
Case Study 2 - Nike
“We envision a transition from linear to circular business models and a world that demands closed-loop products – designed with better materials, made with fewer resources and assembled to allow easy reuse in new products.[…] We are re-imagining waste streams as value streams, and already our designers have access to a palette of more than 29 high-performance materials made from our manufacturing waste.”
(Mark Parker, Nike’s president and CEO)
30
Case Study 3 - Re>Pal
Re>Pal is an Australian company with its main factory in East Java, Indonesia. Using state-of-the art pallet technology, we offer environmentally responsible pallets for a wide range of applications across business supply chains.
Re>Pal that is helping tackle plastic waste with a circular economy approach. Our zero waste pallets are made from 100% waste plastic using ThermoFusion™ technology process.
31
Case Study 3 - Re>Pal
32
Case Study 3 - Re>Pal
Re>Pal manages and supplies its superior pallets to many global and domestic suppliers, including Unilever, IndoFood, Nestle and IFF — businesses interested in offsetting their carbon footprint without compromising on quality or profitability.
33
Relevant reading List
34
1. Rodriguez-Anton, J. M., Rubio-Andrada, L., Celemín-Pedroche, M. S., & Alonso-Almeida, M. D. M. (2019). Analysis of the relations between circular economy and sustainable development goals. International Journal of Sustainable Development & World Ecology, 26(8), 708-720. Available here: https://www.tandfonline.com/doi/pdf/10.1080/13504509.2019.1666754
2. MacArthur, E. (2013). Towards the circular economy. Journal of Industrial Ecology, 2, 23-44. Available here: https://www.werktrends.nl/app/uploads/2015/06/Rapport_McKinsey-Towards_A_Circular_Economy.pdf 2.
3. Circle Economy (2019). “The Circularity Gap Report 2019,”, Switzerland. Available here: https://www.circularity-gap.world/
4 MacArthur, E. “Our food system is no longer fit for the 21st century. Here are three ways to fix it | World Economic Forum,” weforum.org, 2019. [Online]. Available here: https://www.weforum.org/agenda/2019/01/how-to-build-a-circular-economy-for-food/
5 Allen, C., Metternicht, G., & Wiedmann, T. (2018). Initial progress in implementing the Sustainable Development Goals (SDGs): A review of evidence from countries. Sustainability Science, 13(5), 1453-1467. Available here: https://link.springer.com/article/10.1007/s11625-018-0572-3
Relevant reading List
35
6. Forti, V., Balde, C. P., Kuehr, R., & Bel, G. (2020). The Global E-waste Monitor 2020: Quantities, flows and the circular economy potential. United Nations University, Geneva. Available here: https://collections.unu.edu/view/UNU:7737
7. Patrick Schröder (2020). How the Circular Economy Can Help Realize the Sustainable Development Goals. Circular Economy Earth, Chatham House. Available here: https://circulareconomy.earth/publications/the-circular-economy-and-the-sdgs
8. Dantas, T. E. T., de-Souza, E. D., Destro, I. R., Hammes, G., Rodriguez, C. M. T., & Soares, S. R. (2020). How the combination of Circular Economy and Industry 4.0 can contribute towards achieving the Sustainable Development Goals. Sustainable Production and Consumption. Available here: https://www.sciencedirect.com/science/article/pii/S2352550920307983
9. Hopkinson, P., Zils, M., Hawkins, P., & Roper, S. (2018). Managing a complex global circular economy business model: opportunities and challenges. California Management Review, 60(3), 71-94. Available here: https://journals.sagepub.com/doi/full/10.1177/0008125618764692
10. Prieto-Sandoval, V., Jaca, C., & Ormazabal, M. (2018). Towards a consensus on the circular economy. Journal of cleaner production, 179, 605-615. Available here: https://www.sciencedirect.com/science/article/pii/S0959652617332146
Thank you!!!
36
