During the Circular Futures Festival held on 14.-15.09, Taival hosted a panel discussion “Circular Economy vs. Sustainability – Are all circular economy approaches sustainable per se?”, which was moderated by Michael Hanf, Managing Director of Taival Germany. The guests Justus Kammüller from WWF, Marina Proske from Fraunhofer IZM, and Max Marwede from Taival and Fraunhofer IZM discussed a wide range of topics.
The discussion focused on the conflict that can arise between the impact of circular economy approaches and the influence on other sustainability factors. In theory and on a meta-level, many studies present scenarios of how the circular economy can reduce greenhouse gas emissions, combat biodiversity loss, and influence the health of society. In theory, many positive effects are identified, but implementation does not look so trivial and trade-offs have to be made. Observations in practice make the problem clear. Companies regularly encounter hurdles in choosing the right Circular Economy activities:
- With the high use of recycled materials, and thus circular materials, recycling is a preferred option, although it should be the last option. Lock-in effects are a risk.
- Circulation of items and materials can increase transport distances and thus CO2 emissions.
- For older products, high emission-intensive chemical recycling is the only method to make materials reusable.
- The increased use of bio-based materials requires agricultural land and threatens biodiversity and food supply.
- Companies are stuck in silo thinking for each sustainability area and miss synergies. Existing impact measurements and measures take place independently and separately.
- Standardized assessment and measurement criteria are lacking to counteract the problem.
The panelists are experts with different focuses and backgrounds, but they all concentrated on how companies and products become more sustainable through the circular economy. Based on the different expert fields, the problem was examined from different perspectives.
The point of view of the panel participants:
Marina Proske works with eco-design, sustainable design, and environmental assessment of electronics. She focuses on the perspective of life cycle assessment and product adaptation, more specifically on the environmental impacts of products and their use throughout their life cycle. Marina considers the conflict of the Circular Economy to be the necessary compromises that have to be found, for example, an energy-intensive material in the product design can increase stability and longevity. In her perspective, the economy still focuses too much on the outer ring, on recycling, and too little on usage. The other aspects and measures of the circular economy are not yet considered strongly enough as solutions.
Justus Kammüller is responsible for defining new concepts and strategic orientations in the Department of sustainable business and markets. He has pursued the goal of making the concept of Planetary Boundaries applicable to businesses. This was realised through the development of the One Planet Business Framework. He then translated the framework to the topic of the circular economy. Justus emphasises that the Circular Economy requires all actors to adopt a new way of thinking. For companies, new systems thinking is required. Small-scale government measures are no longer particularly effective for a system with so many starting and balancing points. Consumers have to consider the meaning of circular economy for their utility behaviour. The topic is very complex following it becomes very detailed in the implementation.
Max Marwede has a background in the circular economy of critical raw materials and deals with the question of whether demand for these raw materials can be met, especially through recycling. Consequently, he focuses on product design for recyclable products and how such design approaches can be integrated into companies. Max underlines that there have been many circular design processes for a long time, but they fail to be applied by companies. Many methods are available; therefore, the problem seems to be the operational structures and the strategies in the companies. The question remains how those structures and processes can be changed. One hurdle for companies is the lack of cooperation between departments and especially with external partners.
Potential solutions and thoughts were discussed:
In the Circular Economy, Circular Design is at the heart of development. The design phase of the product can influence the footprint through material selection, energy efficiency, and repairability, but all phases are relevant in defining the final footprint, especially the use phase. Design approaches influence the possibility of maintenance, reuse, repair, and recycling of products. The final carbon footprint of a product, however, always depends on the actual user behaviour and whether benefits are derived from circular service offerings. The benefits of circular design and services only affect the footprint positively when consumers make use of it. An example where the design approach works well with the use of the customer group is Fairphone.
A few practical examples of positive environmental effects through circularity:
- Kamupak, a Finnish company, produces reusable containers for food in supermarkets, which are used with a deposit system. The company has been working on how to minimize the CO2 emissions related to the circular service. As a result, the containers are made of plastic.
- Houdini is a Swedish outdoor company. As part of their reporting, they looked at the impacts of all materials, to choose the materials and fabrics with the least impact. For each material, they looked at every dimension, such as climate, land use, biodiversity, etc. They show how systemic thinking works in the company. (https://houdinisportswear.com/en-se/sustainability/planetary-boundaries-assessment). Since still no one general KPI exists that links circular measures to each impact, the definition is very individual.
- A car dealership in Berlin has transformed itself into a mobility house. They combine repairment, e-mobility, and mobility advice. They have chosen the right approach for transformation and have not only focused on materials, but have looked at their business model on the whole level and adapted it.
Possible levers that drive change and create a framework for aligning the topics:
Change must come from the top to be successful in holistic implementation. Legislators and business leaders must drive it. Regulations with targets and process standards make the most sense for pushing a circular economy on the legislative side. Especially in the technology sector, there are constantly new innovations, in which context it makes no sense to regulate products that change again quickly. Processes need to be regulated.
The attitude of people and collaborators plays a bigger role. A rating of a company’s sustainability and circular economy shows that most are not yet very far along. However, this finding has motivated employees to get creative and keep working. Enough people in the companies are ready for change and all the necessary components are available.
The state of research on the issues around eco-design and the environmental impact of products also plays an important role. The topics of research have remained the same in recent years, for example, the topic of recycling material and integration. A new aspect is the interest and involvement of companies in research with a focus on products and carbon footprints.
Even though the topics in research remain unchanged, they increase in complexity. For each new innovative product, the questions of repair, recycling, and footprint have to be answered anew. Today, products are much more complex than they were 30 years ago, and the complexity of repair solutions increases accordingly.
In conclusion, all the building blocks necessary to achieve a circular economy already exist, they just need to be brought together. In general, there is no perfect recipe, we just need more creativity in the transition to a circular economy.
Unfortunately, the problem of the discussion cannot be solved in a generalised way with a KPI. At the moment, it is relevant that all influences and effects from the entire life cycle and especially the use phase are taken into account during development in order to produce sustainable circular products and services. In addition, companies should rethink the transformation from a product level to a business model level.
At the user and private level, it is important to ask which impact is most relevant. These include three topics that can be optimised in everyday life, with a high potential for emissions reduction: heating, nutrition, and personal mobility.
Every person, no matter in which field of work they are active, can contribute to increasing sustainability. Everyone should ask themselves in which condition they want to pass the world on to the next generation. We have to act and measure based on this.