What is the circular economy?
The term ‘circular economy’ has been around since the 1970s, but was popularised in 2012 when the Ellen MacArthur Foundation charitable organisation teamed with McKinsey & Company to determine the economic and business opportunities of eliminating waste and optimising resources in the European Union (EU). Their report, Towards the Circular Economy, argued that a subset of the EU manufacturing sector could achieve net savings on materials of up to US$630 billion each year by 2025.
How does it work?
Rather than the conventional linear model of production and consumption, the circular economy presents a framework for a continuous cycle similar to that of the natural world – it’s about return and renew rather than dispose and replace.
Designing out waste is a real focus and one of the fundamental drivers of the circular economy in the market at the moment.
In the circular economy, products and components are designed from the very beginning to be reused to eliminate waste. Flooring company Interface was a circular economy pioneer. Led by its founder Ray Anderson, the company started taking a more sustainable approach to manufacturing back in 1994. For more than 21 years, it has been recovering old carpet tiles from its customers and turning them into new ones. Car maker Renault has also adopted circular principles across its business and is now refurbishing mechanical parts and rejuvenating gearboxes.
“Designing out waste is a real focus and one of the fundamental drivers of the circular economy in the market at the moment,” says Candice Quartermain, program director and founder of Circular Economy Australia, an organisation that works with businesses to bring the vision of the circular economy to life.