Our current approach to the linear economy of take, make and dispose has its roots in the second industrial revolution. The first industrial revolution sparked off the railroads, coal, iron and textiles industries. The second, coming to an end just as World War I started, saw the expansion of the electricity, petroleum and steel industries.
The years following World War II generated considerable prosperity through the exploitation of the resources at hand. This approach had its downsides, namely the inception of a consumption hungry, throwaway society that carried on for many decades. The years since the turn of the millennium have of course seen an increased focus on using resources more efficiently and a recognition that we have a finite supply of many of the elements we deem critical to living our lives. We’ve seen the property industry looking at ways to negate the environmental concerns that we’ve been aware of for some time. The development, operating and management of assets being addressed in a more considered manner.
The linear economy has served many people and businesses well, unparalleled growth in the economy of many countries. In fact, being a cornerstone in the growth of many previously economically challenged nations. As the economy has grown, so too has the level of concern expressed by many that this may not remain a sustainable stance for the years to come. If we create an item, whether that be a washing machine, a pair of jeans or a stylish top, with shorter timeframes before planned obsolesce we exacerbate the challenge of rationally utilising our meagre resources.
The ‘cost’ of white goods has reached a level where many think it is not worth taking it to the local repair shop (if indeed such an outlet existed), better to replace altogether, with little thought to what happens to the ‘old’ machine much beyond ‘will the delivery driver take it with them? The thought of suggesting to my 13 year old daughter that I mend an item of clothing when a seam comes apart would see an expression of bewilderment. The whole point of fast fashion is not only to get it into the stores quickly and with a smooth supply chain but also to become out of fashion just as quickly. When an outfit can be purchased for the same price as 4 coffees at your Starbucks it is hardly surprising that this is the case.
Gerald Ratner wasn’t wrong in his infamous 1991 speech to the Institute of Directors when he basically destroyed his company by saying ‘We sell a pair of earrings for under a pound, which is cheaper than a shrimp sandwich from M&S, but probably won’t last as long.’ People don’t mind buying products that have a very short life span but do mind being told they are buying ‘crap’ to use his vernacular. The businesses of today have learnt this message and don’t suggest they are offering products built to last, the speed of stock to shelf dictates the lifespan of an item. No longer do people think in terms of years or even seasons, but more in months, weeks and ‘wears.’
The current COVID-19 pandemic has given many people time to recalibrate and perhaps to understand what is important. We’ve seen how global supply chains have shuddered to a halt, we’ve faced walking along silent high streets, driven along empty roads and looked across at shopping centres bereft of shoppers. The linear economy that has been in vogue for an extended period of time has been found wanting and the positive news is that there is another way of working, a different way to live.
The circular economy has been discussed at conferences, events, across boardroom tables and to date has not been greeted with the open arms of true recognition of what it actually means. In its simplest form it refers to the circular flow and efficient use of resources, materials and products. The anthesis of the way we have been operating for the past century. The new model supports a sustainable green agenda, environmentally protective and moves us away from a consumption and disposal-based model towards the extension of the life of products and materials and a reduction in the amount of waste being produced.
The primary aim of the circular economy being of course, to eliminate waste and drastically reduce the use of our finite resources. There are a host of environmental, climatic, societal and economic benefits. The opportunities now are in identifying the opportunities that exist and in particular enhanced public – private relationships driving us towards a new pattern of growth.
The circular economy will gain more attention as we progress back to our new normal. The focus on consumption and use of resources is something that engages people and businesses for different reasons. The recent spate of minimalism books, guides, podcasts and even films is in a part an extreme alignment with the concept of the circular economy. The premise they offer is one of buying and owning items that are critical, don’t throw away, maintain and repair. This is of course an extreme, but many will look at buying items that are longer lasting, the adage of ‘buy cheap, buy twice’ being thought of more often.
We have already seen signs that our society will emerge differently from the crisis than we entered. At a very local level doing the weekly shopping for my elderly neighbours and answering a knock on the door to find a delicious, piping hot plum crumble as ‘payment’ is a suggestion that there is a renewed hope for the use of bartering, or sharing the ‘wealth’ with others. The low cost to me, high value to my neighbour (I’m going shopping anyway and they can’t), and the low cost to them, high value to me of a plum crumble (Sheila was baking anyway and had a glut of plums from her trees, I don’t have a plum tree nor the culinary skills!) My colleague habitually offers a skillfully caught brown trout in exchange for provisions at the local store, a store in which his wife volunteers and operates to the benefit of the village. In a microcosm this is the circular society, drastically reducing waste, providing things of low cost to us, high value to others, not having to overuse our limited resources.
There have been some that suggest re-establishing economic growth will result in a pull away from the need to create a more sustainable environment and approach to life. We have to accept that this could not be further from the truth, the only sustainable approach to economic growth is by engaging with the core principles at the heart of the circular economy. Those principles of use, reuse and retain as opposed to take, make and dispose are in line with the way we will view and measure success over the remainder of the century.