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Sustainability thinking: How can a circular economy help?

Tareq Zahirul Haque | Friday, 22 October 2021


There will be more plastic than fish in the sea by 2050 if current trends aren’t reversed, according to the World Economic Forum. Only 14 per cent plastics are recycled. What about the rest?

About 90 per cent of the time our cars are parked. Why should we need then produce new cars every day?

All such questions are alarming for our future existence on the planet. Sustainability has thus become one central organising principle for many decision-makers around the world regardless of government, business, civil society, or community in the current national and international economic, political and business environment.

However, what is sustainability? Still, there are unawareness, complexities, and contentions on its meaning. The World Commission on Environment and Development (WCED) of the United Nations presents the most popular definition of sustainability: Sustainability meets the needs of the present without compromising the ability of future generations to meet their own needs.

This definition calls for inter-generational development needs. But how to achieve needs for both the present and future generations equitably, where the future is uncertain, not entirely known, or even unknown, leaves a critical question for sustainability. This author is not, however, going to focus this academic discussion on this article. But the fact is that the universal recognition of saving the planet and making it a safer place for living for now and for the future can be seen as the vital essence of sustainability.

So, immediately after providing this concept of sustainable development in 1987, sustainability became a globally agreed agenda, at least theoretically, in planning, policy, program, and research worldwide. For example, Local Agenda 21, a universal document, is the first comprehensive program of action for sustainability for making the local development economically, socially and environmentally sustainable. This global agenda situates sustainability ideas into the local planning and policy activities at the city, neighbourhood or community scale. It acknowledges the local governments’ potential to promote long-term and global sustainable development through local activities. This agenda came into action from the Rio Declaration of the United Nations’ Earth Summit held in Rio de Janeiro, Brazil, in 1992.  Despite the lack of legal obligation, national governments, UN organisations, international agencies, NGOs, including other independent actors, are ethically bound to implement this agenda.

Similarly, countries across the world are now undergoing the process of achieving the UN Sustainable Development Goals (SDGs) by 2030. World Commission’s idea of sustainable development is the foundation of these global sustainable development initiatives. The economy, society and environment are the three core and inter-connected elements of this sustainable development approach. This is also known as the Triple Bottom Line concept of sustainability that advocates a balance of the three intertwined sustainability components while reporting, measuring, and managing of organisation’s economic, social, and environmental impacts.

Let’s now come back to the core discussion of today’s article about how a circular economy might help achieve organisational sustainability goals.  To understand the circular economy, it seems helpful to briefly talk about our consumption and production functions of the traditional economic system and its adverse impacts on the ecosystem. The current linear economic growth models are widely based on the take-make-dispose principle, which requires more natural resource consumption, which is detrimental to the environment and ecosystem because the planet has a resource limitation. The environmental resources we directly consume and use to make products and services and afterward dispose of waste and emissions to the environment deplete the limited planetary resources faster than the ecosystem's regenerating capacity. Consequently, ecosystem balance is disrupted, resulting in environmental degradation, climate change, and the extreme episodes that the world is now facing today.   

On this, if the traditional linear consumption and production pattern is gradually reduced and replaced by a circular flow of natural resources, fewer natural resources will be used in the production process of the economic system. This, in turn, would help the ecosystem maintain its sink function and thereby, an ecosystem balance and sustainability can be achieved. Based on this principle, the circular economy has appeared as a strategy for achieving sustainability goals. Unlike the linear take-make-dispose model, a circular economy is a closed-loop model of economy. It calls for the re-use, repair, recycling, repurpose, and design of products and services so that they can be turned back to the economic system as much as and as long as possible rather than disposed to the environment.  

So, whenever we think about sustainability and our future existence, it is crucial to think about our natural environment and the economy and society and their interdependencies. One core principle of the circular economy is the recognition of scarce natural resources. It does not, however, mean that the linear economic system does not recognise the scarcity of resources. Instead, resource scarcity is a common economic concept, and thus the efficient allocation of scarce resources is already there.  However, the overriding economic principle is that the profit seeks financial return and creates value for the business. In this reading, the circular economy concept or business combines profit with environmental and social benefits. The circular business model reads the society, environment, economy, respectively, as the People, Planet and Profit or the 3Ps, also known as the Triple Bottom Line (TBL) as mentioned above.

This TBL is an accounting framework of the organisational sustainability performance from the combined counts of the People (social), Planet (environmental) and Profit (financial). The social measures include the parameters such as health care, education, equitable access to resources, the quality of life and wellbeing, including the social capital and many others. The environmental measures entangle the natural resources such as air, water and soil quality, solid wastes, toxic chemicals, emissions etc. Finally, the economic measures entail the cash flow of money and profit.

All such variables can potentially measure the sustainability performance of an organisation or a business. It can then tell an organisation's environmental, economic, and social benefits or costs and what can be done where it does not work well. This is how businesses can make strategic plans to fulfil their corporate social responsibility and environmental integrity and build a good image and branding. On the other hand, the government can formulate policies and regulations to facilitate them and bring them under compliance when it goes against sustainability. Consumers can make choices about their consumption behaviours and buying preferences of products and services to be responsible citizens who care for the environment and the future generation.

The aspiration of the circular economy lies in its core principle of Credle to Credle¾the design and manufacture of a product in such a manner that it can come back to the production cycle over and again at the end of its life. If it needs to return to the earth, it will go as a safe. In contrast, the linear economy is based on the principle of Cradle to Grave¾use it, lose it and buy it. This is, however, the shifting from leaner to circularity is not an easy task. Still, there are academic disagreements about the sustainability concepts and its Triple Bottom Line framework of operationalisation. The complexities and contradictions associated with the circular economy open up a new avenue to refine and advance the concept and its application to achieve the global sustainability goals.   

To end, neither businesses, government, or other social actors such as academia, civil society, community, or individual people could achieve sustainability goals alone unless these actors do not take coordinated efforts. Thus, it is the responsibility of all such actors and institutions to conceive the problems of our linear economic model and come forward to save the planet by halting further ecological destruction and nourishing the health of the ecology through the vehicle of the notion of a circular economy. 

Tareq Zahirul Haque is a PhD candidate, Centre for Urban Research, School of Global Urban and Social Studies, RMIT University, Melbourne, Australia

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