While sustainability has become a top priority for many leading global businesses, adoption remains slow and patchy. That’s reflected by the fact that, at the World Economic Forum in Davos, sustainability has continued to be discussed as a standalone topic, rather like the Internet was a decade or two ago. Only when it is eventually embedded in all conversations will we know progress has been made.
Building the circular economy stoked particular interest in Davos this year. How long we must wait until the concept becomes the norm for businesses at a global scale will depend on our ability to break down barriers through new forms of collaboration.
In the circular economy, goods are produced and consumed through integrated flows of raw material with zero waste and powered by renewable energy. That’s a break from today’s business models, which are designed to drive revenue at lowest possible cost, reward shareholders and enable opportunities for future growth -- three indicators of business success.
These linear models have led to a ’take-make-waste’ mindset, resulting in huge negative consequences around the globe. According to the World Bank, global urban solid waste generation is expected to grow from 3.5 million tons per day in 2012 to more than 6 million tons in 2025 -- fueled largely by increased consumption of goods in middle-income countries that are becoming more affluent.
The big question facing business leaders is how to pool the right resources, identify and overcome barriers inhibiting progress and implement practices that drive a circular economy on a global scale. Obstacles include a business culture in which competition precludes collaboration, and in which success is measured at business level rather than sector level. Weak international support from government can also be a barrier.
Collaboration on a global scale, however, can help change today’s business orientation from ‘take-make-waste’ to ‘recycle-reuse-resell’ and result in remarkable growth in resource productivity.
Next page: Changes coming