Circularity beyond Recycling

Climate change is affecting every country. It has disrupted economies and affected lives across the continents. The temperature is on the rise, weather patterns and extreme weather events have become the norm of the day. The human footprint is damaging and extensive - 1.3 billion tonnes of food is wasted annually, with two billion people going hungry. Ironically, a similar number of people are obese on the globe. Agriculture is the biggest water user worldwide, and three per cent of the world's water is drinkable. Irrigation consumes close to 70 per cent of fresh water. The Computer World states that the world produces around 50 million tonnes of e-waste every year, 80 per cent of which ends up in an unknown location. Electronic devices hold a whopping 50 to 60 per cent of the world's tungsten. The pace of extraction is faster than nature can replenish it. It is time to adopt positive and affirmative actions that can slow down the depletion of natural resources.

The United Nations Sustainable Development Goal12 calls for action to ensure sustainable consumption and production patterns. The UN Secretary-General proposed six climate-positive actions. First, accelerate investments to decarbonise the economic transition to green, second action to create green jobs for sustainable and inclusive growth, and third, build a green economy to make societies more resilient. The fourth is to infuse investments in sustainable solutions by ending fossil fuel subsidies. The fifth action is to confront climate risks, and the last and sixth encourages cooperation for collective success.

A UN report states that if people everywhere switched to energy-efficient lightbulbs, the world would save 120 billion dollars annually. 29% of the world's electricity is from renewable sources, a 2% jump over a year ago. These actions need to scale up exponentially to match the growing needs and tackle climate change. A Circular Economy is one such model that can significantly contribute to combating climate change challenges. Circular Economy transforms the use-and-throw system into one where waste is eliminated, resources are circulated, and nature is regenerated. The approach provides tools to tackle climate change and biodiversity loss while addressing critical social needs. It offers opportunities to grow, prosper, and build resilience while cutting greenhouse gas emissions, waste, and pollution.

The traditional approach to Circular Economy puts much emphasis on recycling alone. Is there a better way to approach Circularity beyond recycling? Could prioritising reduction and promoting reuse result in innovation and new ways of doing business? In contrast to the take-make-waste linear model, a Circular Economy is regenerative by design and decouples growth from the consumption of finite resources.

A report by n2s titled Sustainable IT & Biotechnology says that there are up to 40 metals within the complex structure of a printed circuit board. Twenty per cent of e-waste is recycled formally. The biggest challenge in recovering and reusing products lies in how these goods are designed and produced. The single-owner intended products have zero chances of repair, and recycling is expensive and hazardous. It is economically unviable in developed nations due to their stricter regulatory norms. It is dumped into developing countries, causing environmental havoc with a lack of infrastructure and strict regulations to manage the e-waste.

There are two ways to increase and encourage Circularity, one by promoting resale and encouraging reuse. The second is to innovate environmental friendly processes for the extraction of rare and precious metals. The advancement in bioleaching looks very encouraging and promising in recovering the metallic fractions from e-waste. Further, the shared economy and rental economy ideas are revolutionary concepts to delink resource consumption with economic growth. According to PwC estimates, the global sharing economy will surpass $335 billion by 2025, with a CAGR of 30.2%. The gradual shift from the mainstream, buy-and-dispose, linear economy to a sharing economy is visible across the globe. It now includes multiple industries, including vehicle rental, ride-sharing, accommodation and clothing.

The Science-Based Target initiative, a global coalition that enables firms to set climate goals, reports that 61 Indian companies have committed to reducing greenhouse gas emissions. The stakeholders are pushing companies towards the Environment and corporate Social Governance. The current decarbonisation is centred around transitioning towards better energy efficiency and the use of renewable energy. The Ellen McArthur Foundation estimates that these measures can only address 55 per cent of our emissions. The remaining 45 per cent comes from harder-to-reduce producing items like cars, clothes, food, and other products.

A UNESCO site on marine pollution reports that there are close to 500 dead zones covering more than 245,000 km² equivalents to the surface of the United Kingdom. Plastic debris causes the deaths of more than a million seabirds and 100,000 marine mammals every year. Ellen MacArthur Foundation reports that a mere 14% of the plastic packaging used globally is recycled, while 40% ends up in landfills and 32% in ecosystems. In India, it estimates that the Circular Economy path could create an annual value of US$218 billion in 2030 and US$624 billion in 2050 and reduce greenhouse gas emissions by 44%. However, the large and significant commitments are not translating into an enormous impact because the efforts are centred around recycling instead of designing to reduce and reuse plastic packaging.

A UN outlook shows that the extraction and processing of natural resources sectors, such as mining and farming, are responsible for more than 90% of global biodiversity loss and water stress. The Circular Economy completes the picture of what is required to tackle the climate crisis. It offers an approach powered by renewable energy and transforms the way products are designed and used. The Circular Economy also increases the planet's resilience to the physical effects of climate change. Businesses can reduce economic reliance on specific materials that could be vulnerable to extinction by putting them back into the ecosystem through a cyclical model. The transformation, however, has to be tectonic as surface-level interventions are not helping.

There is no denying that some revolutionary work is happening in certain pockets and industries. It is not enough if a few companies change their practices. Every organisation, big or small, needs to embrace newer ways of doing business centred around Circularity to design products and services. Thus, the Circularity approach helps meet other Sustainable Development Goals, and the most critical among them is SDG12, responsible consumption and production.

The Circular Economy framework can improve air quality, reduce water contamination, and protect biodiversity. Its principles offer businesses a raft of innovation opportunities that reduce materials costs, increase asset utilisation, and respond to changing customer demands. Together, these attributes make a compelling case for seeing the Circular Economy not just as one option to the quest to meet climate targets but also as a robust solutions framework for a prosperous future.

By Nirbhay Lumde, Director - Corporate Social Responsibility, CGI Asia Pacific Global Delivery Centers of Excellence.