Circular economy for sustainable business with ecological harmony


Md Abdul Latif | Published: August 16, 2024 20:38:14


Circular economy for sustainable business with ecological harmony

The traditional linear business model, with its extractive philosophy, "take, make, dispose" prioritises short-term profits over sustainability. This leads to cheap, disposable products that generate excessive waste, depleting resources and harming the environment. Resource extraction, production, transportation, and disposal all contribute to pollution, greenhouse gas emissions, and habitat degradation. This model lacks recycling and reuse, perpetuating a culture of disposability and posing supply chain risks. In contrast, the circular economy offers a sustainable alternative, emphasising waste reduction, resource conservation, and closed-loop production. Its core principles-reduce, reuse, and recycle-promote innovation, sharing, and collaboration. Products and materials are kept in use by designing out waste and pollution, regenerating natural ecosystems, and fostering a sustainable future. Walter R. Stahel coined the term, highlighting its importance for planetary survival, while Kate Raworth emphasises its focus on a regenerative business approach. The circular economy presents a path towards sustainable business opportunities and ecological harmony.
The traditional business model carries significant environmental, economic, and social costs. Its impact is substantial from water scarcity and hazardous waste to health problems, community displacement, and cultural erosion. Waste mismanagement and insufficient recycling hinder economic growth and job creation, placing a burden on society. Unsustainable resource use jeopardises future development, exacerbates inequality, and harms human well-being. Bangladesh's textile and garment industry, crucial for its economy, faces environmental challenges. Despite contributing over 84 per cent of export earnings, the sector generates significant waste, including 20 to 47 per cent of yarns, scraps, and rejects. Dyeing processes pollute rivers with hazardous chemicals, and water consumption is high, averaging 250-300 liters per kilogram of cloth. The industry also contributes significantly to CO2 emissions, increasing at an annual rate of 8 per cent over the past two decades. Notably, the growing use of synthetic fabrics like polyester and viscose staple fibre doubles the carbon footprint compared to cotton.
Bangladesh's thriving electronics industry, fueled by the widespread use of microchips in everyday devices, produces a significant amount of hazardous e-waste. The country generates 1.2 kg of e-waste per capita annually, with projections indicating a rise from 0.13 million tons in 2010 to 4.62 million tons by 2035, showing a 20 per cent annual growth rate as reported by the Department of Environment (DoE).Currently, only 3 per cent of the total generated e-waste is recycled, a lower rate than in other developing countries. Improper disposal of 97 per cent non-recycled e-waste poses significant environmental risks due to toxic elements contaminating air, water, and soil. The shipbreaking industry worsens the issue by releasing harmful electronic components from scrapped vessels, turning Bangladesh into a hazardous waste site. Contamination of recyclable Lead (Pb) has surged due to the extensive use of leaded gasoline in vehicles.
Transitioning to a circular economy eliminates reliance on virgin material streams, offering a holistic solution for interconnected social, economic, and environmental issues. The circular economy minimises waste by recycling materials in a closed-loop system, reducing dependency on new resources and environmental impact. This approach extends product life-spans through refurbishment and upgrades, minimising hazardous waste. Closed-loop production also lowers costs associated with raw material extraction, processing, and waste management, while creating jobs in areas like product design, recycling, and refurbishment. This innovative system fosters innovation by shifting from product ownership to service provision, encouraging durable and sustainable designs. This model promotes resource efficiency through platforms like sharing services (bike-sharing, co-working spaces) and developing biodegradable materials to replace traditional plastics. Transitioning to a circular economy necessitates new consulting services, innovative recycling technologies for complex materials, and diverse job opportunities. These roles span circular economy consultancy, sustainable design, refurbishment, sharing platform management, closed-loop production, biodegradable materials engineering, and product life cycle management, indicating a burgeoning field with immense potential for growth and sustainability.
Numerous initiatives demonstrate the growing momentum of the circular economy. The Ellen MacArthur Foundation, for example, works with brands like H&M, Lee, and Mud Jeans to promote recyclable and durable denim, aiming to reduce waste in the fashion industry. They also advocate for reducing single-use plastics and increasing recycling. The Loop Circular Shopping Platform partners with major brands to offer refillable and reusable packaging, further reducing waste. Tesla's Battery Recycling Programme recovers materials from old electric vehicle batteries, minimising the environmental impact of battery production and disposal. IKEA's Circular Business Model includes furniture rental, buy-back programs, and exploration of new materials. Cities like Amsterdam, Copenhagen, and San Francisco are embracing circular economy principles to improve resource efficiency, minimise waste, and create sustainable urban areas. Other notable examples include Patagonia's Worn Wear Programme, Fair Phone's Modular Smartphone, Renault's Car-Sharing Platform, Michelin's Tire Recycling Programme, and HP's Printing and Recycling Programme. These successful initiatives showcase the circular economy's ability to reduce waste, promote sustainability, and drive innovation and growth.
Bangladesh's readymade garment (RMG) industry is actively pursuing a circular economy model to foster sustainable growth and remain competitive. As per the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) data, the country leads the world in green garment factories, with 192 Leadership in Energy and Environmental Design (LEED) certified facilities, including 67 platinum-rated ones, and over 550 more in the certification process. Initiatives like the "Circular Fashion Partnership," involving the BGMEA, Global Fashion Agenda, Reverse Resources, and P4G, aim to establish a long-term, scalable circular fashion system. The overarching circular fashion system includes a specialised circular textile value chain that initiates a responsible production process to minimise Jhut waste (including cutting remnants, scraps, and fluffs), reduce resource consumption, and enhance sustainability in the RMG sector. Of the estimated 400,000 to 500,000 tonnes of Jhut waste, only 5 per cent is recycled, while 30-35 per cent is repurposed for domestic clothing, with much ending up in landfills, incinerated, or exported. The RMG sector holds significant potential to cut cotton imports and generate an additional $5 to $6 billion in garment exports through local recycling. In the e-waste sector, a robust informal network of retailers, repairers, collectors, and recyclers ensures that nearly 90 per cent of e-waste finds a second life through repurposing, repair, or recycling, highlighting the significant potential of informal networks in driving circularity within e-waste management.
To successfully compete in the global market and shift towards a circular economy, industries need to revamp production processes to value waste, enhance skills, and boost efficiency. However, the transition presents several challenges: inadequate recycling infrastructure, product design flaws for circularity, insufficient logistics and transportation systems, lack of supportive policies and regulations, inconsistent standards and certifications, improper taxation and incentives, consumer behaviour hindering circularity, supply chain complexity, insufficient investment in new technologies, limited data and metrics, and inadequate monitoring and evaluation. The barriers to a circular economy include legal, structural, operational, financial, technological, attitudinal, and human resource issues.
Overcoming these obstacles requires collaboration between governments, businesses, consumers, and civil society. Designing products with modular components, implementing closed-loop production systems with innovative waste reduction and management strategies, and offering products as a service, where ownership and responsibility are retained, are crucial steps. Adopting circularity is not just morally imperative but also a strategic business opportunity for long-term success, and a sustainable future.

Dr Md Abdul Latif (PhD in Development Policy), Additional Director, Bangladesh Institute of Governance and Management (BIGM).
abdul.latif@bigm.edu.bd

Share if you like