How do you make a circular economy?

Circular Economy

Our last month's blog, Packaging Sustainability’s Alphabet Soup provided background on some of the key acronyms for sustainability and the organizations behind them to feed your sustainability cravings. In this month’s blog, we’ll be talking about a circular economy and what that means for packaging.

Before we can define what a circular economy is, we should start with where we are today, a “linear economy”. A linear economy is based upon the extraction of raw materials, conversion into a product, sale of the product to the consumer, use of the product by the consumer, and the disposal of that product by the consumer as waste. The linear economy is also referred to as a “take-make-waste” model, or “cradle to grave”.

So what is a circular economy? An early concept was proposed by Walter Stahel, a Swiss architect. He articulated the concept of a “closed loop” system of economies in 1976 and coined the phrase “Cradle to Cradle” shortly thereafter. Stahel’s vision is to have an economy based on delivering services rather than products and has four goals:

  1. Product-life extension
  2. Long-life goods
  3. Reconditioning activities
  4. Waste prevention

By eliminating waste and reusing products, a closed loop system, or circular economy, is formed. Virgin raw materials and energy are conserved while pollution and waste are minimized.

Since the 70’s, those early ideas have been built upon by many others. The Ellen MacArthur Foundation is arguably one of the leading voices in the sustainability movement and an advocate for delivering on the vision of a circular economy.
Ellen MacArthur
The Foundation’s namesake, Ellen MacArthur, set a record for the fastest solo sailing circumnavigation of the world in 2004. In order to accomplish that feat, she had to be extremely efficient in how she managed her resources to keep her boat as light and agile as possible. After she successfully accomplished her goal, she realized that her journey was a microcosm of the world, and to keep the world truly sustainable, we have to use our resources as efficiently as possible. In 2010, she founded the Ellen MacArthur Foundation to “accelerate the transition to a circular economy.”

The Foundation describes a circular economy as one “based on the principles of designing out waste and pollution, keeping products and materials in use, and regenerating natural systems.” But what does that mean for packaging? In conjunction with the World Economic Forum and McKinsey & Company, the Ellen MacArthur Foundation published a report in 2016 entitled The New Plastics Economy: Rethinking the future of plastics. This report articulated a vision for the world where “plastics never become waste.”

The New Plastics Economy is comprised of six characteristics:

  1. Elimination of problematic or unnecessary plastic packaging through redesign, innovation, and new delivery models is a priority
  2. Reuse models are applied where relevant, reducing the need for single-use packaging
  3. All plastic packaging is 100% reusable, recyclable, or compostable
  4. All plastic packaging is reused, recycled, or composted in practice
  5. The use of plastic is fully decoupled from the consumption of finite resources
  6. All plastic packaging is free of hazardous chemicals, and the health, safety, and rights of all people involved are respected

In 2018, the Global Commitment was launched to unite interested organizations behind actions to achieve the New Plastics Economy vision by 2025. To date over 450 organizations have signed the Global Commitment. These organizations have committed to work to:

  •  Eliminate the plastic items we don’t need
  • Innovate so all plastics we do need are designed to be safely reused, recycled, or composted
  • Circulate everything we used to keep it in the economy and out of the environment

The Global Commitment and the New Plastics Economy have become the backbone for many 2025 sustainability goals established by Consumer Product Goods (CPG) companies, retailers, plastics manufacturers, and other companies supporting the plastics supply chain.

The New Plastics Economy is difficult to execute with available technology and processes in place today, but is definitely a vision we can all strive to achieve. Our first blog discussed Reality being the fourth “R” in sustainability and what we can do today from a packaging sustainability perspective. We have pieces of the New Plastics Economy in place today such as recycling PET water bottles and recycling polyethylene packaging materials through store drop off programs. However, the majority of our packaging waste still ends up in a landfill. There are additional investments and technological advancements that need to be made on the march towards a New Plastics Economy. The journey to get to there may be visualized as a sustainability spectrum:
sustainability spectrum
The Sustainability Spectrum shows that there are many avenues to improving sustainability on the journey from a linear to circular economy. Advancements in each area need to be made for the overall economy to move towards being more circular. Without investments in Material Recovery Facilities (MRFs) to handle more diverse packages, all the work of making polymers more recyclable or educating consumers on what to recycle will be for naught.

Longer term, investing in chemical recycling research shows promise as a way to recover input materials from plastic packaging. BASF is one chemical company working on the chemical recycling approach. They illustrate their vision for the circular economy for plastics this way:
BASF
In order to truly achieve the New Plastics Economy, we will need to incorporate facets of many of the categories noted in the Sustainability Spectrum. A Sustainability Roadmap is a great tool to help organization’s lay out a plan for how they will achieve their 2025 goals. A future blog will cover how Outlook Group can help you lay out your 2025 goals and the map to get there. Before we tackle that topic, next month’s blog will offer insights into the complexity of the current packaging supply chain, how to look at sustainability in the supply chain holistically, and how to be more sustainable by eliminating some of this complexity in the supply chain.   

Author:
Brian Conrad
Director of Market Development-Labels
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