What is a Circular Economy?
A circular economy seeks to revolutionize, and in fact modernize the ways we design, make, buy, sell, dispose, and finance products, services, commodities, and natural resources.
The philosophy is founded on the principle that we can increase the productivity and output of our resources by finding value in what we traditionally view as waste streams. A circular economy keeps products and materials in use for longer, allowing for reductions in pollution and a regeneration of our natural systems.
This is not a philanthropic transformation, circularity provides many opportunities for advancing our economies along with wellbeing. For example, industries that reuse and recycle materials can save billions on the cost of raw materials, their supply risks and price volatility become more resilient – a benefit that we have learned the value of the hard way, and the transition itself presents opportunities for innovation and job creation.
Why is a Circular Economy Important?
The transition to a circular economy is becoming more important as we approach the limits of a linear economy. In a traditional linear economy, our wellbeing is being challenged by prospects of infinite growth in a world of finite resources – the primary drive of our broken system that has been revealed by the COVID-19 pandemic. We are quickly approaching our ecological ceiling in terms of pollution, biodiversity loss, and climate change to name a few.
Each of these ceilings presents its own set of threats, such as increasing menace of climate migration and the link between environmental degradation and the increase in risk of emergence, transmission, and lethality of diseases.
A circular economy is not business as usual. To reach a circular economy, business practices will need to undergo a profound transformation. For example, new business centered around the collection, transportation, transformation, and redistribution of waste products will arise, while at the same time existing business will need to modify their current practices to integrate circular economy principles.
World Circular Economy Forum 2021