The new economy is…..Circular!

There has been a great deal of dialogue recently on decoupling economic growth from resource consumption, or revenue from resources. A new report, “Towards the Circular Economy” comes the closest to providing solid examples of how this can be achieved.

It’s all about sound product design where waste is designed out and products are designed for disassembly. Products are designed with a systems view, understanding how they will be used and how they will be reused at end of life. This is the concept behind industrial ecology. New business models that sell the service, not the product, encourage business to take ownership for product end of life. This model has been shown to cost companies and consumers less in resources and costs.

The report provides a kind of roadmap for shifting from a linear to a circular economic system. It demonstrates that it is not a niche concept. We need more examples that prove doing good for the environment adds value to your business. However, breaking the ‘take, make and waste’ habit will not be easy and it will be innovative companies who will secure first mover advantage and start to shake up our current system.
 
In the manufacturing sector, we often speak about the growing opportunity of manufacturing services. There are countless opportunities in shifting to a services offering, or packaging product and services together. An example in Australia is Orica Mining Services. Once upon a time they sold mining explosives. Today they sell services alongside the product to the sector. By selling the service in addition to the product, they not only secure additional revenue, they retain expert industry skills which will continue to add value to their business through product development and delivery.
 
Download the report, read the executive summary, and select a case study that is closer to your business to understand the benefits of the circular economy.

Bin Behaviours

I travelled to North America earlier this year, and amongst the tourist photos of Niagara Falls and the Golden Gate Bridge, are photographs of public rubbish receptacles. I was fascinated by the various levels of recycling available to innocent members of the public. For example; Yosemite was advanced and educational, Toronto was efficient and included paper! Some other places had yet to discover the joys of recycling. San Francisco surprised with dual receptacles in the hotel room and corn starch bottled shampoo. Leaving the hybrid taxis behind to head east, one discovered elements of ‘the throwaway society’ that America is renowned for, further away from the main cities.

At home we have three bins, cleared by the local council. Landfill, garden waste and recycling (paper, cardboard & plastics). Add to that one more, organics, composted by yours truly in the garden.

So, why am I writing about waste and recycling? Well moving from the social to the business perspective, at work we have one bin, and trying to introduce the three that people experience at home can be challenging. Why is it – remarked one of my work colleagues – that we leave our recycling behaviours at home when we come to work? A darn good question! One I don’t have an answer to, yet, but I think is connected to my travelling experience. Different values in different places. Barriers such as perceived and actual costs, and logistics issues – who is collecting or emptying your bins can be a real issue.

I read an article recently about a multinational that had seven, yes seven, recycling options. The culture there had advanced to such an extent, that no one wanted to be the person placing something in the landfill bin! So my workplace culture, like many out there, has some way to go yet, but one has to start somewhere. The important thing is that we have started. I think a key benefit from establishing recycling ‘bin behaviour’ in the workplace is how the culture of ‘waste not’ moves from the local bin to core business practice. If we had a seven bin culture in the workplace, just think how that would extend into our work practices and what value to the bottom line that might add. How are those perceived or even real costs looking to you now?

While writing this, I am waiting for my flight in Avalon Airport (a small regional airport 55km from Melbourne). I was approached by a young woman wanting to survey me on my travel habits and question me on improvements for the airport. As I gazed at the plentiful, oversize waste bins, I suggested that Avalon would be much improved with some recycling bins………

Australia prepares to make haste on waste

Hallelujah! Australia got smart about waste and passed the Product Stewardship Bill on 22 June 2011. This really is landmark legislation for Australia and establishes a framework for voluntary, co-regulatory (delivered by industry and regulated by the Australian Government) and mandatory schemes. TV’s and computers will be the first products to be regulated under the Act.

There are a number of E-waste schemes in place around the world. The EU has had the WEEE Directive (Waste Electrical and Electronic Equipment) in place since 2003, and recently revised their recycling rules for member states to reach 45% of the average weight of equipment on their national markets, eventually moving to 65%. California has an Electronic Waste Recycling Act and Japan has the Home Appliance Recycling Law in Japan.

Waste is a growing problem and landfill prices are on the increase. With such an amazing and growing variety of electronic devices available these days, it’s no wonder that e-waste is in the crosshairs. One statistic I found stated “In 2007/2008 Australians discarded 16.8 million electronic devices, 9 per cent of which was recycled and 88 per cent sent to landfill.” Current estimates for waste are over 2000kg of waste for each Australian, each year. Yikes!

Electronic waste is hazardous in landfill. Contaminants such as lead, cadmium, beryllium, mercury and brominated flame retardants are hazardous to human health not to mention their persistence in the environment should they leach from a landfill.

So, this Bill is a fabulous first step in implementing Australia’s National Waste Policy.

From a corporate responsibility perspective, leaders in product manufacture will likely be listening to the winds of change, as bills such as this one are entered into law around the world. New corporate boundaries are being shaped under product stewardship schemes, extending responsibility to product disposal and end of life. Hopefully the trend will shift from recycling to designing out hazardous materials, or designing for ease of recapture.

Now the Bill is in place, E-waste will be the first test and other products will be sure to follow.