The circular economy (CE) is staging a fast-paced ramp-up as an innovative sustainable development model, giving strong competition to the traditional linear way of production-consumption-disposal where a product is made, used, and finally discarded.
It is the design of a CE system where waste, if possible, is looped back into the system and materials are reused as much as possible (Stahel, 2016). The demand for a new economic model based on the sharing and regeneration of resources, as a way to tackle global challenges such as resources depletion, environmental degradation, and waste management, is the main reason for the shift.
At the heart of CE you will find ideas like the design of a product for durability and recyclability, resource recovery and the provision of a service instead of a product. These ideas have multiple advantages, such as saving money, job creation, and innovation that promote sustainability. Besides, the reverse logistics, waste-to-resource strategies, and policy interventions that complement this initiative manifest the comprehensive nature of the CE model positioning it as an anchor for the realization of long-term sustainability and economic resilience. One of the core principles of the circular economy is eco design, which includes designing the products so that they would be durable, modular and recyclable (Stahel, 2016). The research of Bocken et al. (2016) shares a study that indicates a relationship between product design understood as the design for reuse and remanufacturing which in a business context is the least resource intensive and the most beneficial. Businesses should switch from "planned obsolescence" model to one that gives CE needs a technological shift towards reuse of materials after the end-of-life of products. Geissdoerfer et al. (2017) pointed out that this closed-loop not solely protects the resources from exhaustion but also lessens the pollution caused by mining or waste disposal. Among the many strategies, recycling and waste recovery, which are the leading policies, according to the directive of the EU, (2008/98/EC) are the easiest for CE to get the member states to adopt. These strategies help in the lessening of landfill use and in the development of resource efficiency (Ghisellini et al. 2016).
The shift from ownership to Product-as-a-Service (PaaS) is an important contribution of CE. This situation is envisaged in which companies retain ownership of the products and provide the services to the customers, such as leasing or sharing. This forces producers to design good and repairable products which virtually eliminate natural resources and maximizes the use of resources (Tukker, 2015). Mont's (2022) study on PaaS explains that this system sparks businesses to economies of scale, whereby prolonging product lifespan by means of preventive maintenance and additional parts, thus averting speedy disposal.
Reverse logistics is the key to circular practices. It ensures the smooth running of the systems for collecting, remanufacturing, and recycling products, which are the systems where resources are conserved (Govindan et al., 2015). The application of reverse logistics can reduce the amount of needed materials that are processed into new products. It ensures the best flow of materials into and the highest rate of production (Kazancoglu et al., 2021). Weak reverse logistics systems can be a hindrance but a strong reverse logistic system will aid the industries in terms of both the environment and profitability.
CE changes the sight of waste from a threat to a resource. Technologies like waste-to-energy, composting, and anaerobic digestion launching more and more, are now enabling the conversion of organic waste to energy and nutrients (Murray, Skene, & Haynes, 2017). For instance, the invention of such methods arising from agricultural waste becoming biogas not only reduces the amount of land clogged by such wastes but also allows the production of renewable energy as mentioned in the study by Philippidis and Smith (2019).
The CE achievement is through change in consumer behavior. Indeed, behavioral economics reveals that consumer decision-making is shaped by information, motivation, and education (Thaler & Sunstein, 2008). The only way CE initiatives can be successful is if consumers are engaged, sustainable practices such as the purchasing of refurbished products or supporting of companies that are environmentally aware are taken up. It is asserted by the literature that consumer awareness campaigns and education play a significant role in the creation of the market for sustainable products (Kirchherr, Reike, & Hekkert, 2017).
The policy-making role of the government is rather vital in the process of CE principles' implementation and diffusion. Policies such as Extended Producer Responsibility (EPR) and green procurement, as well as such other policies, can act as an impetus for companies, thus, urging them to come up with innovative ideas that can help them move toward sustainability (Ellen MacArthur Foundation, 2013). Also, regulations are the ones that assist in the development of the required infrastructure for recycling and waste management. In particular, the research work of Hobson and Lynch (2016) exemplifies, among other things, how policy measures can be used to steer circular practices through tax breaks; waste reduction milestones; and penalties for environmentally hazardous behaviors.
The circular economy provides an inclusive platform to tackle global waste problems and resource scarcity. Driven by legislation, innovation, and consumer behavior shifts, CE principles can serve as a catalyst to transition from a linear to a more regenerative and resilient economic system (Borrello et al., 2017). By promoting durability, improving resource recovery, and incorporating sustainable business models, it is possible to reduce environmental degradation and support long-term economic growth.
Reference
Bocken, N. M. P., de Pauw, I., Bakker, C., & van der Grinten, B. (2016). Product design and business model strategies for a circular economy. Journal of Industrial and Production Engineering .
Ellen MacArthur Foundation. (2013). Towards the Circular Economy Vol. 1: Economic and Business Rationale for an Accelerated Transition .
Geissdoerfer, M., Savaget, P., Bocken, N. M. P., & Hultink, E. J. (2017). The circular economy – A new sustainability paradigm? Journal of Cleaner Production .
Kirchherr, J., Reike, D., & Hekkert, M. (2017). Conceptualizing the circular economy: An analysis of 114 definitions. Resources, Conservation and Recycling .
Stahel, W. R. (2016). The circular economy. Nature .
