Safe & Just Circular Principles

The link between the Doughnut Economy & the Circular Economy

Published on Published on Linked In on November 14, 2016

The Doughnut Economy: a Safe & Just Space for Humanity

The Doughnut Economy has been designed by Kate Raworth, then former Senior Researcher at Oxfam. Within a single representation of our planetary and social boundaries she is explaining how one could live within a Safe and Just Space for Humanity.

“Humanity’s 21st century challenge is to ensure that every person has the resources they need to meet their human rights, while collectively we live within the ecological means of this one planet. The ‘doughnut’ of planetary and social boundaries is a playfully serious approach to framing that challenge.”

“The environmental ceiling consists of nine planetary boundaries, as set out by Rockstrom et al, beyond which lie unacceptable environmental degradation and potential tipping points in Earth systems. The social foundation consists of the eleven top social priorities identified by the world’s governments in the run-up to Rio+20 — and below this foundation of resource use lies unacceptable human deprivation such as hunger, ill-health and income poverty. Between social and planetary boundaries lies an environmentally safe and socially just space in which humanity can thrive.

The concept is described in detail in my 2012 Oxfam Discussion Paper, A Safe and Just Space for Humanity: can we live within the doughnut.” Source: kateraworth.com

Applying the Circular Economy Principles on the Doughnut Economy

What is striking with the Circular Economy is that this virtuous economic model fits in well in addressing some — not all — of the environmental ceiling, living and working differently by mimicking how nature functions.

As described by The Ellen MacArthur Foundation, the three current Principles of the Circular Economy could be considered as our “Safe” Principles focusing on re-designing our current consumption patterns by ensuring — over the long-term — a Safe(r) Space for Humanity.

As explained in Circular Economy 2.0 we might be looking at the “Circular Thinking” to also eradicate poverty, beyond eliminating waste from our systems. If this approach and complementary way of thinking (waste + poverty together), the article suggested three additional socially inclusive principles, aligned with the logic explained. If we superpose the Doughnut Economy, the Circular Economy 1.0 (waste out) and the Circular Economy 2.0 (poverty out), we could start to see so-called “Safe” Circular Principles as well as “Just” Circular Principles that could possibly — if applied in parallel — help us rebuild and regenerate our ecosystems, aligned with our living/working patterns.

“Safe” Circular Principles (Existing Principles)

Based on the work done by The Ellen MacArthur Foundation “the circular economy rests on three principles, each addressing several of the resource and system challenges that industrial economies faces.

“Safe” Principle 1: Preserve and enhance natural capital

…by controlling finite stocks and balancing renewable resource flows.

This starts by dematerialising utility — delivering utility virtually, whenever possible. When resources are needed, the circular system selects them wisely and chooses technologies and processes that use renewable or better-performing resources, where possible. A circular economy also enhances natural capital by encouraging flows of nutrients within the system and creating the conditions for regeneration of, for example, soil.

“Safe” Principle 2: Optimise resource yields

…by circulating products, components, and materials at the highest utility at all times in both technical and biological cycles.

This means designing for remanufacturing, refurbishing, and recycling to keep components and materials circulating in and contributing to the economy.

Circular systems use tighter, inner loops whenever they preserve more energy and other value, such as embedded labour. These systems also keep product loop speed low by extending product life and optimising reuse. Sharing in turn increases product utilisation. Circular systems also maximise use of end-of-use bio-based materials, extracting valuable bio-chemical feedstocks and cascading them into different, increasingly low-grade applications.

“Safe” Principle 3: Foster system effectiveness

…by revealing and designing out negative externalities.

This includes reducing damage to human utility, such as food, mobility, shelter, education, health, and entertainment, and managing externalities, such as land use, air, water and noise pollution, release of toxic substances, and climate change.” Source: The Ellen MacArthur Foundation

Proposed “Just” Principles

If we want a Circular Economy designed to address the needs of all of us, we should ensure that services are accessible, affordable and generating bottom-line benefits. Hence the people need to be at its circular core, not at its periphery.

Additional “just” principles to the current model might be added to ensure a genuine impact of this promising model:

“Just” Principle 4: Equity makes business sense

…where services would be designed to address the needs of all.

Corporate and/or government added-value would be measured in number of integrated years, i.e. ensuring that customers and citizens be kept the longest time possible in our economic system. This new definition of loyalty or satisfaction would really be based on the customers’, not corporate satisfaction as it is the case today. This new paradigm would make sense in a service economy where profits are made over the long-term. A service economy would also be much more versatile with the aim of nurturing to fulfill needs. This is clearly a new business approach that could benefit us all since it will be made to reduce life shocks. A customer- and citizen-driven model will have a positive impact on designing inequity out;

“Just” Principle 5: Developing financial ability is a priority

…where one can access more with less as even with a low income, a decent life can still be possible.

In a service-based world where systems externalities are embedded keeping people in the economy becomes a priority. Diversified accesses to means of exchanges are preferred and would unleash huge self-potential for financial abundance: finance-as-you-access, bartering-as-you-need or alternative means of exchange that will flourish away from a standardised monetary format. The higher the diversity of exchange options the better for multiplying opportunities. This would create less dependency on financial credit since we would access-as-we-need. In “need” we understand benefits as in not putting a customer at risk of being trapped in a debt cycle. Corporate and governmental value creation should be measured financial “ability-to-benefit” people to flourish — instead of the current linear “inability-to-pay” mind-set. By designing services according from people’s needs, this could help us designing financial exclusion out;

“Just” Circular Principle 6: Using labour is innovative

…where success is about the level of regenerative activities achieved in one’s career.

An era where new forms of collaboration become the norm, inter-dependencies our mantra, gratifications would be recognised by our abilities to create abundance of regenerative activities or “activity-for-purpose”, rebuilding our ecosystems. Work would be redefined as its main function would be to rebuild our capital and replenish our stocks. Maintaining value of our manufactured capital, caring for our soils, internalising what is no longer desired, centralising manpower as an unlimited access to energy for maintenance of our system’s stocks (Walter R. Stahel). Work for a purpose could become the norm since we would value replenishment over consume-and-throw.

The comprehensive approach of the Circular Economy 1.0 (waste out) & 2.0 (poverty out) could be and should be tested as part of our current design of the Next Economy. We all need to aim at a highly performing model, and this model should be giving chances for economic integration of all of us.

It is possible. We have enough brain power to achieve this model.

No more dreaming but acting.