ExPORTERS

Around the world, production processes have tended to operate under a “linear economy” model, which means that products are designed, created, and sent out under the assumption that their life-cycles will end in a landfill.

As demand rises and natural resources begin to decrease, a new kind of economy, a “circular economy”, offers strong potential for a more sustainable future.

WHAT IS THE CIRCULAR ECONOMY?

A circular economy reintroduces repaired, recycled or revamped existing materials into the production chain, hence making our consumption of resources and materials circular rather than linear. Instead of discarding all waste, parts of it are re-used within the production process or transformed into raw materials for the manufacturing of new products, and this is built into the initial design process. The aim is to generate a more efficient management of finite resources, to prolong their life-cycle and keep products, components, and materials at their highest level of utility and value at all times, within an economic scope of sustainable development.

A circular economy can open the door to an increasingly sustainable, waste-free world. Below are the top five reasons why companies should consider moving toward a circular economy model.

1 - Cost reduction

The ability to reuse materials when making new products instead of sourcing new materials can, in the long run, reduce operational costs. Additionally, as supply chain disruptions persist and certain raw materials become more difficult to source, rethinking how we handle waste and resources is becoming urgent. Adopting a circular economy business model increases the security and price stability of your supply chain.

2 - Compliance with legislation

Under the EU’s 2030 Climate Target Plan, companies are expected to reduce the amount of waste produced by them and dispose of it in a responsible manner. From the recovery of waste to its reintroduction into the production chain, a circular economy model reduces the number of materials sent to landfills. As such, a circular economy should help companies become more compliant with existing and upcoming legislation.

3 – Low carbon economy

Adapting to a low carbon economy is of increasing concern to companies and society as a whole. Reducing the amount of waste and not sending it to landfills leads to a reduction in greenhouse gas emissions. In addition, it brings businesses closer to accomplishing the 17 Sustainable Development Goals (SDGs), which have largely been accepted as a blueprint for sustainable growth.

Circular Economy

4 - brand Reputation

Companies gain an opportunity to bolster their brand image by adopting a circular model as well as fulfilling some key reporting criteria which is becoming increasingly important as more investors are looking for companies aligned with the ESG pillars. By moving towards a circular economy, companies can strengthen their position in the market.

5- Competitiveness and sustainable economic development

A circular economy leads to a reduction in the need for natural resources, in turn promoting sustainable development. The manufacture of new products from what would historically have been waste, generates competitiveness and innovation in the market, encouraging the development of new technologies and processes.

Simon McKeever (pictured), Chief Executive of the Irish Exporters Association commented:

“The circular economy model will assist the stimulation of economic growth, innovation, and job creation. Reshaping our production processes will require tremendous amounts of work and creativity, which I know the industry is capable of. The IEA is fully committed to supporting our members and the broader export and international trade industry to understand what is required to become more sustainable.”