Keys to the Circular Economy: a new business model

12/12/2024
Externa World

The circular economy as a driver of change.

The circular economy as a driver of change

In a world where resources are increasingly scarce and environmental pressure is increasing, the circular economy is emerging as a revolutionary model that promises to protect and contribute to the planet, and redefines how businesses can thrive on it.  
According to the European Parliament, the circular economy is a model of production and consumption that involves sharing, renting, reusing, repairing, renovating and recycling existing materials and products as often as possible to create added value. Thus, we will be contributing to the extension of the product life cycle.
The circular economy is taking the place of the linear economic model, which is based on the "use and discard" concept, which involves large quantities of cheap and easily accessible materials and energy. Therefore, the circular economy is presented as a system of resource utilization, which raises the use of raw materials with more efficiency and reduction of waste, betting on the reuse of those elements that, for their inherent properties, can’t go back into the environment.
This means minimising waste. When a product reaches the final cycle of its life, its materials are kept within the economy as long as recycling allows it. The idea is that these wastes are productively reused over and over, creating additional value. 

Environmental sustainability

In Peter Lacy’s book, "The Circular Economy Handbook," the author explains how this approach goes beyond recycling: it is an integral strategy that seeks to maintain the value of products and materials in circulation, and Reducing costs, generating revenue and strengthening business resilience.  

Embracing this philosophy is not only a matter of sustainability, but also a competitive advantage that transforms challenges into opportunities. 

The benefits of implementing the circular model, which favours the reduction of operating costs, the generation of new sources of income, compliance with current regulations in response to the growing regulatory and social pressure on sustainability issues; innovation to foster creativity and the use of new tools and technologies; among many other factors.  

The key to sustainability in the circular economy include key concepts such as:  

Design for reuse and regeneration

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Use of renewable resources

Encourage sustainable energy sources and materials that can be regenerated over time.

Transformation of waste into resources

Apply the logic of "waste from one is a resource from another" through efficient recycling and industrial symbiosis. 

Product life cycle extension

Adopt practices such as repair, reconditioning and re-manufacturing. 

Benefits of the circular economy for business

The benefits of this change are environmental protection, as re-use and recycling of materials would slow down the use of natural resources, reduce the alteration of landscape and habitat, and help limit biodiversity loss. It would even encourage job creation, saving money by consumers, since the redesign of materials and products for circular use, would favor innovation in different sectors of the economy.