Squaring the circle: sustainable growth in times of crisis

The war, ris­ing ener­gy costs, labour short­ages, a cost-of-liv­ing squeeze, sup­ply chain disruption…the list of crises that busi­ness­es face grows by the day. And then, of course, there’s that plan­et-sized ele­phant in the room: cli­mate change. But what if there was a way for the c‑suite to deliv­er bet­ter eco­nom­ic and envi­ron­men­tal per­for­mance while also improv­ing organ­i­sa­tion­al resilience to world events?

In fact, there is: the cir­cu­lar econ­o­my. It involves mov­ing away from a lin­ear ‘take, make and dis­pose’ mod­el and toward a ‘reduce, reuse, repair and recy­cle’ one that keeps exist­ing resources in use for as long as pos­si­ble. For busi­ness­es, it offers a path to a more sus­tain­able future; and cru­cial­ly one that is finan­cial­ly sound and resilient to dis­rup­tion.

Firms that take the first steps along this path are like­ly to be reward­ed by the pub­lic. A recent sur­vey by the lead­ing resource man­age­ment com­pa­ny, Veo­lia revealed that while 77% of peo­ple in the UK think the risk of cli­mate dis­rup­tion is seri­ous and imme­di­ate, only 11% think it’s too late to change course. For busi­ness, over 80% of respon­dents also said they would buy every­day prod­ucts pack­aged in or made from recy­cled con­tent.

“The behav­iour of con­sumers is very impor­tant for busi­ness­es, and over the last few years we’ve seen a big increase in pledges to change and adapt – to improve the eco-design of pack­ag­ing, for exam­ple,” says Tim Duret, direc­tor of sus­tain­able tech­nol­o­gy at Veo­lia UK, which cham­pi­ons eco­log­i­cal trans­for­ma­tion. “Obvi­ous­ly it can have a cost (but not always) for indus­tries, but over the long term it will pro­vide sav­ings.”

The shift to cir­cu­lar prac­tices is essen­tial for both busi­ness­es and the envi­ron­ment. “The pub­lic are increas­ing­ly con­scious of their impact and are ready to embrace the envi­ron­men­tal solu­tions need­ed” says Gavin Grave­son, senior exec­u­tive vice-pres­i­dent, North­ern Europe zone, at Veo­lia. “It’s now up to busi­ness­es and gov­ern­ments to push faster towards eco­log­i­cal trans­for­ma­tion because we can’t rely on fos­sil fuels or vir­gin mate­ri­als. The time is now, we need to invest in resilience because we can’t afford – both finan­cial­ly and envi­ron­men­tal­ly – to do noth­ing.”

Cross-industry impact

As prac­ti­cal­ly every indus­try pro­duces a waste stream, the shift to a cir­cu­lar econ­o­my could have a deep and wide-rang­ing impact. In the petro­chem­i­cal indus­try, for instance, sul­phuric acid – one of the most wide­ly used chem­i­cals in the world – can be regen­er­at­ed to give it a sec­ond life. Valu­able sol­vent com­po­nents can also be extract­ed from mixed waste streams, sent for sol­vent recov­ery and reused, there­by reduc­ing both the need for vir­gin sol­vent and the finan­cial impact of pur­chas­ing raw mate­ri­als.

Waste­water is also a poten­tial source of ener­gy, biosolids and oth­er resources such as nutri­ents. This, as the World Bank says: “Rep­re­sents an eco­nom­ic and finan­cial ben­e­fit that con­tributes to the sus­tain­abil­i­ty of water sup­ply and san­i­ta­tion sys­tems and the water util­i­ties oper­at­ing them.” And while recy­cling and reman­u­fac­tur­ing are already prac­tised in the auto­mo­tive indus­try, car man­u­fac­tur­ers are now launch­ing ded­i­cat­ed cir­cu­lar econ­o­my ini­tia­tives to gen­er­ate high­er rev­enues and reduce mate­r­i­al sourc­ing costs.

Elec­tric vehi­cle (EV) bat­tery cir­cu­lar­i­ty is of increas­ing impor­tance too. An antic­i­pat­ed 350,000 tonnes of end-of-life EV bat­ter­ies are pre­dict­ed to be in the UK by 2040 – a source of vast amounts of valu­able resources like lithi­um, nick­el, cop­per and cobalt.

Veolia’s recent­ly announced elec­tric vehi­cle bat­tery recy­cling facil­i­ty in the West Mid­lands will have the capac­i­ty to process 20% of the UK’s end-of-life elec­tric vehi­cle bat­ter­ies by 2024. “As the demand for elec­tric vehi­cles increas­es, we will need this facil­i­ty to ensure we don’t hit a resource cri­sis in the next decade,” says Grave­son.

The plant will dis­charge and dis­man­tle bat­ter­ies before the mechan­i­cal and chem­i­cal sep­a­ra­tion recy­cling process­es are com­plet­ed, enabling the valu­able min­er­als they con­tain to be reused.

“When we go from a lin­ear econ­o­my to a cir­cu­lar econ­o­my, one of the things we are doing is increas­ing our resilience,” says Duret. “Bat­ter­ies, for exam­ple, require lithi­um – and we have minute lev­els of lithi­um in the ground in the UK.”

Recov­er­ing lithi­um and met­als such as cop­per and alu­mini­um from EV bat­ter­ies – a process known as ‘urban min­ing’ – could also cut green­house gas emis­sions from bat­tery pro­duc­tion by 50%. As an esti­mat­ed 500,000 gal­lons of water are required to extract one tonne of lithi­um using tra­di­tion­al min­ing process­es, it will also dras­ti­cal­ly reduce water con­sump­tion.

Securing supply chains

Crit­i­cal min­er­al scarci­ty could impact every­thing from mobile phones to tele­vi­sions and med­ical devices. Today’s sup­plies are pre­dom­i­nant­ly over­seas, mean­ing UK indus­try is high­ly vul­ner­a­ble to mar­ket shocks, geopo­lit­i­cal events and sup­ply chain dis­rup­tions. The fact that these min­er­als are also an essen­tial com­po­nent of wind tur­bines means they are also vital for boost­ing renew­ables and improv­ing the UK’s ener­gy secu­ri­ty.

“Again, it’s about pro­vid­ing the recy­cled mate­ri­als from the UK to man­u­fac­ture new prod­ucts with­out hav­ing to import raw mate­r­i­al from around the globe.” says Duret. “It pro­vides a green­er econ­o­my but also a more sta­ble econ­o­my, because when the source of the mate­r­i­al is with­in the UK, then we don’t have to wor­ry about trans­porta­tion, and we don’t have to wor­ry about geopo­lit­i­cal dis­rup­tion abroad. So, it’s good for the plan­et, and it’s good for the econ­o­my too.”

Food waste is anoth­er poten­tial source of domes­tic ener­gy, as it can be used for the pro­duc­tion of bio­gas. But the Depart­ment for Envi­ron­ment, Food, and Rur­al Affairs’ Envi­ron­ment Act, which will make it a legal require­ment in Eng­land for com­pa­nies to recy­cle food waste, should start to tip the bal­ance toward an even more cir­cu­lar mod­el.

“It will help com­pa­nies like Veo­lia to col­lect more [food] waste and trans­form it into either organ­ic fer­tilis­er for the farm­ers or com­post for the gen­er­al pub­lic, but also ener­gy [in the form of bio­gas],” Duret says.

Can the cir­cu­lar econ­o­my real­ly deliv­er bet­ter eco­nom­ic and envi­ron­men­tal per­for­mance while also improv­ing organ­i­sa­tion­al resilience to world events? “One hun­dred per­cent,” says Duret. “It’s a win for the envi­ron­ment, for busi­ness­es and for soci­ety.”

For more, please vis­it www.veolia.co.uk/raconteur

The war, rising energy costs, labour shortages, a cost-of-living squeeze, supply chain disruption…the list of crises that businesses face grows by the day. And then, of course, there’s that planet-sized elephant in the room: climate change. But what if there was a way for the c-suite to deliver better economic and environmental performance while also improving organisational resilience to world events?

In fact, there is: the circular economy. It involves moving away from a linear ‘take, make and dispose’ model and toward a ‘reduce, reuse, repair and recycle’ one that keeps existing resources in use for as long as possible. For businesses, it offers a path to a more sustainable future; and crucially one that is financially sound and resilient to disruption.

Firms that take the first steps along this path are likely to be rewarded by the public. A recent survey by the leading resource management company, Veolia revealed that while 77% of people in the UK think the risk of climate disruption is serious and immediate, only 11% think it's too late to change course. For business, over 80% of respondents also said they would buy everyday products packaged in or made from recycled content.