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Going circular – what next?

21st July 2022 Posted by

Working with Think Tanks to drive the Agenda

As a business, SUEZ recycling and recovery UK often support, both financially and with our time, experience and insights, the work of environmental and business think tanks. These think tanks  can take fresh look at a particular issue or policy and through research and analysis develop some key policy recommendations to support government. In recent years, we have been supporting three of these think tanks: [1] the Broadway Initiative who are working behind the scenes to support DEFRA onsetting  environmental targets and their wider policy framework reforms; [2] the Aldersgate Group who combine progressive environmental debate with big business issues in particular the need for smart regulation to drive innovation and performance; and [3] the Green Alliance’s Circular Economy Task Force, designed to bring ambitious leadership to the environmental agenda, specifically the role of the circular economy in meeting future environmental objectives.

We are involved because we believe in the political dialogue that these groups can generate. We want to be at the forefront of thinking around specific policy issues and we sometimes want a broader business or environmental perspective rather than leading with a simple ‘SUEZ thinks’ narrative. These bodies enable us to understand how specific policies, targets and incentives might impact other parts of specific value chains and ensures that what is being proposed is both ambitious but pragmatic – the true sign of good policy!

Over recent years, we have contributed fully to designing research projects, scoping out new white papers, and participating in parliamentary roundtables and stakeholder working groups to progress key issues with the intention of informing live policy development and delivery. This has been particularly important during the COVID years when face to face engagement became much harder, and our reports and webinars have become the focal point for a lot of government engagement.

In this blog I reflect on the latest of these white papers, released last week by the Circular Economy Task Force – Circular business: what companies need to make the switch?

Making the switch happen?

Since COP26 the UK net zero agenda has stalled somewhat, in part a reaction to COVID, but also because of the situation in the Ukraine, and it is time for a new narrative that links environmental protection with economic recovery. We simply cannot allow the conservative party leadership contest to derail our net zero ambitions, and by reframing the circular economy we can showcase how this is good for the environment and good for the economy, just not in a traditional sense.

Circular business models will cut carbon, create jobs and boost economic growth, but too few companies are embracing the benefits. Circular approaches might involve the adoption of more reuse and resale models, increasing repair and refurbishment activities, expansion of remanufacturing, or the move to rental and leasing business models – there is probably a model here for every business and organisation if you just look hard enough.

The report highlights some of the real benefits from going more circular:

  • Refurbished electronic equipment can save 99% of emissions compared to buying new.
  • Reusable hospital gowns save 92% of emissions compared to disposable gowns.
  • Remanufactured flooring has 75% less emissions than new flooring.

Report | Circular business: what companies need to make the switch, Green Alliance, July 2022.

This report looked to address why more businesses aren’t ploughing on with more circular initiatives and what can be learnt from some of the pioneers of circularity. Through 20 anonymous interviews (from construction and retail to fashion and electricals) it became clear that much was happening within the companies, but significantly more could be done to drive forward the circular agenda with a little help from government:

  • Carbon reporting and targets are already driving greater circularity, but economy-wide incentives are lacking
  • Companies that have opted to make carbon reductions are actively influencing their clients and suppliers to adopt circular business models, but they need more government support to maximise this opportunity.
  • A few companies are finding growth opportunities in switching to circular business models, but the economic benefits are not widely understood.
  • Increased awareness of supply chain risks is a factor motivating companies to move more quickly to circular business models.

On the back of the interviews and analysis, the report proposed four key actions which would promote growth, improve economic security and reduce carbon emissions:

  1. Introduce embodied emissions reporting and circular economy statements as part of the Green Finance Strategy. Mandatory disclosure of scope 3 (value chain) emissions (including those embodied in purchased goods and services) by large, listed companies from 2024 would drive rapid change.
  2. Standardised emissions accounting must be established with up to date and accessible data will accelerate progress in the UK, whilst we engage international working groups to change things globally.
  3. Whole life carbon emissions and material use should be assessed at the planning stage of all public and private construction and infrastructure projects over a given size, by 2025, as recommended by the Climate Change Committee (CCC).
  4. Strengthen reporting requirements for large public contracts and revise public procurement guidance so suppliers have to submit a carbon reduction plan addressing all associated emissions, including those embodied in purchased goods and services.

So what next?

Many of these recommendations may not appear new to you, but because of the steering group representation (which includes WRAP, Schneider Electric, Kingfisher and Corplex) and the insights gleaned from the interviewed 20 companies this is a very strong message from industry to government on what is needed to help realise the multiple benefits of the circular economy.

Some of the UK’s leading businesses want more support from government, with greater incentives to motivate other companies to adopt circular models and to move this agenda forward now, whilst we have time to plan the transitions and learn from our experiences. We agree and will be asking government to commit to this agenda after the Summer recess, when the environment, net zero and the circular economy agendas need to be front and centre of the new Prime Minister’s manifesto for 2023 and beyond.

Most businesses (although not all consumers) recognise the need to actively plan for a move away from linear business models, focused on selling short-lived goods, to more circular models aimed at keeping products in use for much longer. SUEZ are already supporting our customers and many of our suppliers on the key questions that going circular raises – what do we buy / make / use / discard and what could we do differently?

By asking all businesses to report on their value chain emissions and with government supporting them to do so, will encourage innovation in circular, low carbon business models which will help both the balance sheet and the environment. SUEZ firmly support this agenda, and for the last three years have been embedding the triple bottom line decision-making framework into our business – how does investment deliver social, environmental and economic growth and benefit? We would welcome the opportunity to speak to more of our customers about how this approach could also work for them.

In the meantime, read the report and make up your own mind – it’s a short and punchy read! And if you can’t find a way to get your voice heard think about joining a professional body (CIWM or IEMA) or trade body (ESA) to help, or better still help to fund and support the work of think tanks like the Circular Economy Task Force who will continue to hold government to account and identify new ways of thinking that should underpin future policy development.

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