You’ve probably heard it before: the Circular Economy is not only about recycling. But what does that actually mean? An important difference between the CE compared to more narrow concepts like closed-loop supply chains or reverse logistics is that the zero-waste vision of CE requires the continuous restoration and regeneration of technical and biological materials. Firstly, restoring technical materials allows things like electronics, batteries, and engines, or anything that cannot be returned to nature, to circulate within the economy as long as humanly possible. For a concrete example, Repack provides reusable packaging materials that customers can mail back to the product provider after delivery. On the other hand, regenerating biological materials allows them to be returned to nature without harming the environment or local communities. For example, Ecovative design provides biodegradable packaging that is made of mushrooms. In isolation, these examples aren’t enough to create a circular economy, as we will need to build ecosystems of companies to enable truly circular material flows. However, companies like Repack and Ecovative are excellent examples of restoration and regeneration.
Another big difference between recycling and the CE is that in a truly circular supply chain, companies not only restore and regenerate their own products but collaborate as part of a business ecosystem to help other companies do so as well. The idea is that one company’s waste may be a useful raw material for another, which goes back to cradle-to-cradle thinking, popularized by Michael Braungart and William McDonough. To enable cradle-to-cradle, we need to holistically redesign entire industries, from raw materials gathering and parts manufacturing to product design, assembly, and distribution. It is a huge undertaking, and we need everyone in society to take part in it.
Below is a very helpful distinction between linear supply chains, closed supply chains, and circular supply chains provided by Farooque et al. (2018). A circular supply chain requires collaboration between different sectors to enable a truly regenerative and restorative system, whereas in a closed-loop supply chain, circular resource flows are contained within the primary supply chain.
Picture source: Farooque, M., Zhang, A., Thürer, M., Qu, T., & Huisingh, D. (2019). Circular supply chain management: A definition and structured literature review. Journal of Cleaner Production, 228, 882–900. https://doi.org/10.1016/j.jclepro.2019.04.303