The circular economy may not only become the mainstream economy in the next few years, but perhaps even the only economy. It is predicted that by 2029, supply chains will not be permitted to produce waste since many governments and consumers will find it unsuitable. The amount of resources we use today is around 60% more than what the planet can regenerate annually. Our existing linear system relies on extraction, which is harmful to economies, people, and the planet as it causes 53% of global carbon emissions and more than 80% of biodiversity loss. Furthermore, a third of our waste is improperly managed, and our waste is out of control.
LINEAR ECONOMY VS CIRCULAR ECONOMY
Linear economy refers to the conventional model where raw materials are gathered and converted into goods that consumers use until discarding them as waste, without consideration for their ecological footprint and effects. Whereas circular economy refers to an approach to production and consumption that minimizes our use of the world's resources, cuts waste, and lowers carbon emissions. Through repair, recycling, and redesign, products are kept in use for as long as feasible so they can be used repeatedly.
CIRCULAR ECONOMY IS A MUST
The circular economy drives sustainability all the way toward its goal: zero waste. The Wharton School of the University of Pennsylvania found that consumers' intentions, such as aiming to better the environment (30%), decrease manufacturing waste (23%), lower their carbon footprint (22%), and be concerned about animal welfare (17%), were the top reasons they choose sustainable products and brands. Consumers are increasingly expecting organizations to contribute to positive environmental impact in every aspect of their business operation. As a result, brands that do not address the environmental issues risk losing market share to the brands that do.
IMPLEMENTATIONS
I:CO and a multinational clothing company, H&M, collaborated to gather 29,005 tonnes of textiles for recycling and repurposing. Customers of H&M who return worn clothing to the stores are given discount coupons for future H&M purchases. I:CO gathers the clothes and divides them into three categories: recycle (made into textile fibers for things like insulation), reuse (made into other textile items like cleaning cloths), and rewear (sold on the secondhand market). Another example is a sportswear brand—Patagonia. It is the first brand with a resale program in the fashion industry, called Worn Wear, that only accepts trade-in goods. Customers are welcome to trade in their Patagonia equipment for store credit, after which the items are sold to a new owner to extend the lifespan of the business's apparel products. This initiative encouraged other fashion brand businesses like Lululemon and COS to get involved in the circular economy debate. Within the next five years, the market share of fast fashion will decrease in favor of used goods.
As zero waste is one of sustainability's ultimate goals, and the world now needs a circular business model, "born-circular" companies are probably going to disrupt "linear" businesses and weaken their market positions. Businesses that can embrace new circular business models to make people, the planet, and profit grow together will survive, the Triple Bottom Line must be integrated into the business model of both new and legacy businesses.