Club of Rome – “The Limits to Growth” 1972: "Man can create a society in which he can live indefinitely on earth if he imposes limits on himself and his production of material goods to achieve a state of global equilibrium with population and production in carefully selected balance.”
Increasing populations, material shortages, climate change and geo-political unrest are today’s problems. Humanity, at the same time, prospers through innovation and growth. Our current (linear) system can no longer support our need for prosperity and needs a drastic change.
Over the past two centuries, our standards of living have increased enormously. We have become experts in sourcing materials from the ground (take), producing complex products (make) that have a short lifecycle and throw them away of them after a single use (dispose). At first sight, a lot of these practices are very efficient while in fact they are not.
- We are currently sourcing so many materials from the ground that we would need 2 earths to cater for all our needs. Material shortages will occur and prices will continue to go up.
- When creating a product, we are building a valuable asset. When we dispose of this asset, all value is lost immediately.
- After the disposal of a product, the customer is free to select any succeeding product on the market. Companies, on a large scale, do not take advantage of building an intimate customer relationship.
- Our current financial models are not taking all effects of our taking, making and disposing into account. At the sametime, these models do not include the benefits of a circular approach, like accounting for retained value and the benefits of an improved customer relationship.
A circular economy is a system where customer relationships are longterm, products are appreciated at their full value and materials never become waste. In a circular economy, products and materials maintain their value by keeping them in circulation through processes like maintenance, reuse, refurbishment, remanufacturing and recycling. In a circular economy products are created and maintained for an optimal customer experience, and thus decoupling economic activity from the consumption of finite resources.
A circular economy allows us to reduce shortages and realize economic growth. This is the optimal solution for today’s problems. A correct implementation will lead to increased revenues, reduced costs and increased competitiveness. Circular solutions will improve company results sustainably.
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