or why Circular Economy could also tackle poverty.
Article first published in Worldwatch Institute Europe on 6th October 2015.
While a subset of the European Union manufacturing sector could achieve net materials cost savings worth up to EUR550 billion per annum towards 2025, a Circular Economy in emerging markets might translate into smaller savings numbers but sizeable societal ripple effects going beyond expectations.
In the African continent, for instance, a first estimate extracted from “Reimagining Africa’s Future” from Accenture Strategy tells us that the potential opportunities of a Circular Economy could be in the area of EUR40 billion, out of the EUR300 billion opportunity for sustainable business. A much smaller number compared to the European one, however, a number that could be hiding the bigger portion of the iceberg.
We often see Circular Economy as addressing the core issue of our environmental boundaries and economic challenges, which in itself are already huge ones to overcome. Circular Economy is definitely a very impactful model that needs to be promoted, implemented and replicated wherever and whenever possible. Yet, how about reaching out to the last mile? How about defining a scheme that is fully inclusive of our people which is — I believe — what we are all intending to reach out for: well-being for all, right?
A Circular Economy today focuses — among others — on the notion of ‘Waste=Food’ from William McDonough & Michael Braungart, as well as of the Performance Economy from Walter Stahel where ‘the smaller the loops, the higher the resource efficiency and profit maximisation’. Hence, our focus is on: numbers of material saved, filing the 2050 resource gap of 40 billion tons* (*best scenario from Accenture’s ‘Circular Advantage’) and attaining some of our CO2 emissions goals. But where are the people in all these numbers? Would focusing on profit maximisation be enough? Aren’t we not made to thrive and be bold about a positive common future? Output discussions lead over the larger notion of Outcomes i.e. achieving a well-being for all vision.
Let us go a further mile and proclaim that ‘Poverty=Waste’™! Why? Because both — poverty and waste — are externalities of our current linear system. As you know waste does not exist in our ecosystems, but you may say the same for poverty! Both are human creations from a system that has been designed with a one-way motivation: always more consumption. For waste, we did not realise the depth of our damages until recently where it now makes financial sense to look at the residual and lost value. For poverty, it dates back to ancient times where there has always been groups of people dominating others by whichever means leading to inequalities.
Our linear system has created environmental externalities such as pollution, waste, toxicity, and overall climate change, but these externalities also exist at societal levels: inequality, unemployment, fictitious capital (debt) creating poverty so that wealth could be built for others, people living with disability seen as less ‘performing’, and so on.
One cannot and will not solve global issues without putting the people at their core. Thanks to its virtuous loops, its collaborative-to-survive tactics and, its learning from Nature’s Principles strategy, a Circular Economy could be seen as the right system approach to address our long-term social patterns that could not be solved in a linear thinking world. Our mission today is about designing the right framework from the start so that future generations will benefit from it.
A socially inclusive Circular Economy could have these three main people-centred pillars:
Pillar 1: People’s Inclusiveness: — where one can access goods for all — since ‘accessing goods’ no longer require owning them, this would free up financial means for other services and thus leading towards poverty eradication;
Pillar 2: People’s Value Creation: — where one can access more with less — since even with low income a decent life can still be possible, this would create less dependency on financial credit, thus generating less indebtedness;
Pillar 3: People’s Wellbeing: — where one can access secured income — since a Circular Economy would lead to jobs, micro-jobs and micro-tasks creation that do not exist yet, with the adapted tax shift* (*Walter Stahel), labour becomes this endless renewable resource, thus driving unemployment downwards.
Adding these three pillars might come as a natural pattern, especially in emerging markets where a sharing economy has always existed for people to survive. The concept of pay-as-you-go comes from Africa and is part of its people’s DNA. They are ahead of western cultures from this point of view. Besides it would be unwise to shift millions of inhabitants from collectivism to individualism thinking while the world is looking at new collaborative forms. One could learn from Africa! Internalising poverty together with waste should be our ‘1-Earth-Economy’* (*first coined by John Elkington) bold vision! One can decouple resource use from growth, but one cannot decouple societal from
environmental needs. A beneficial-for-all lateral growth is achievable as long as we redefine the notion of ‘success’ and ‘ownership’ away from monetary objectives as our sole reference. And that’s where not many of us are prepared to jump in…
One of the reason being that numbers of ‘wealthier’ humans will increase, thus more consumption, thus more pressure on our ecosystems. By looking at how permaculture and biomimicry augment our ecosystems potentials based on optimisation of functions, forms and processes, our main worry should not be how many of us can the ‘system’ supports, but whether we would move away fast enough from individualism to true humanism i.e. away from greed.
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