Should Business Promote a Circular Economy to Save the Planet?

What is the "true north of capitalism?" It's a vital question asked by the film Circularity: Preparing for the New Economy. 

It listens as citizens and corporations ask: How can we sustain economic growth in a world where the population is exploding, natural resources now have dubious post-dated extinction timelines, and traditional manufacturing devastates the environment? The film pulls no punches, asserting that in the future — both by necessity and for the survival of the species — we will have to mimic the Earth's natural systems.

Early in the film, Stewart Wallis, the former executive director of the New Economics Foundation, lays out the problem:

We lived in the Earth's ability to regenerate itself until 1970.

In the past 45 years, we've gone from using one planet's using one and a half, and we're on the path to three planets by 2050, if we don't change course.

Can adopting the rules of the "circular economy" head off that cataclysmic outcome? Answers come from people standing at the levers of corporate power, who explain how the world can reconcile finite natural resources and a growing global population who all demand a piece of the pie. 

Leonie Schreve, global head of sustainable lending at ING Bank, who helps manufacturers find the right path, sees only one choice:

The winners of tomorrow are working on a zero-waste concept. How we design products, how we offer products as a service, keeping them in ownership to ensure we can also recycle and reuse them.

But the transition to circularity will not be easy. As Sophie Thomas, founder of The Great Recovery Program, cautions with tough love, "This is a whole new economic model. It's not going to happen overnight. It's going to be painful."

However, the "inevitable" changes present profound opportunities for "organizations that get it right"; and research from Accenture claims that the circular economy can unlock $4.5 trillion in value by 2030, all while helping the planet survive.

As Peter Lacy, the managing director of Accenture Strategy, points out, there are already successful early adopters:

Caterpillar is able in every remanufactured component to be 90% more energy efficient and 80% more resource-efficient than when they used virgin materials and started from scratch.

"Companies need to prepare themselves," says Professor Julia Stegemann of University College London (UCL), "The opportunity is to be on the leading edge."

Indirectly, this film posits that even grand projects like the Paris Climate Accord only nibble around the problem's edge unless they're attacked systemically, beyond limited categories like "energy" and "CO2 emissions."

Will more corporations adopt a circular approach in the future?

Image: earthmover, Caterpillar