By Alexander Collot d’Escury, CEO Desso
Design and innovation are at the heart of the circular economy – a restorative approach to economic activity that could transform our future. Instead of continuing with the linear model – shaped by the industrial revolution of the nineteenth century – in which goods are made from newly extracted finite natural materials, used and then mostly thrown away, there is another way.
Design to make the world better than it was before
It is not just about designing products so that they can be returned, disassembled and recycled. It is about thinking about how to make a product good from the start, so that it has a positive impact on the environment and human health. Cradle to Cradle® pioneers Dr. Michael Braungart and William McDonough have inspired many businesses with their call for designing for ‘eco-effectiveness’.
They describe the approach in their latest book, The Upcycle (2013):
“Human beings don’t have a pollution problem; they have a design problem. If humans were to devise products, tools, furniture, homes, factories, and cities more intelligently from the start, they wouldn’t even need to think in terms of waste, or contamination, or scarcity. Good design would allow for abundance, endless reuse, and pleasure.”
Innovation across processes, products & the wider business model
For those of us that do go down this path we soon realise it helps to drive innovation across processes, products and the wider business model. It also helps to engage employees as they will most likely be enthused by the goal of developing products and services that are commercially successful while also contributing positively to human health and the environment.
Thanks to a series of reports from the Ellen MacArthur Foundation and the management consultants, McKinsey & Co., we also know how much commercial value might be unlocked as a result. In their third report, launched at the World Economic Forum’s annual summit in Davos this year, they estimated that the circular economy could generate at least one trillion dollars per year into the world economy.
In the long run, the circular economy calls for smarter design. As Cradle to Cradle® co-founder William McDonough explained recently in a Forbes interview, upcycling is about designing processes and activities that actually makes “the world better than it was before”.
Not-for-profit initiative ‘Project MainStream’ was launched
To help us get there, the World Economic Forum, McKinsey & Co. and the Ellen MacArthur Foundation has launched the not-for-profit initiative, Project MainStream, a two year cross-industry collaborative initiative aimed at scaling up the circular economy. Desso and a number of other companies including Philips, Kingfisher and DSM have committed to being a part of this project.
Through developing new thinking around materials management, information technologies and business models, the project’s organisers estimate that the initiative could reap the following benefits over five years: US$500 million in material cost savings, prevent 100 million tonnes of waste and create 100,000 new jobs.
The circular economy as an economic opportunity
In the Guardian newspaper, McKinsey’s managing director Dominic Barton describes the economic opportunity: “The world economy is $72 trillion in size and if we applied the circular economy, this would lead to at least $1 trillion in savings now – and it can become significantly higher.” He adds: “Every day we are losing the equivalent of $3-4 billion worth of materials. If that was a financial loss, it would represent a continuous series of black Fridays, but we accept that value loss.”
I think the numbers speak for themselves.
This blog was also published on the Huffington Post website. Click here to read the full article.