This economic concept involves reducing waste and pollution whilst keeping materials in circulation through the economy. This is in contrast to the linear economic where raw materials enter a conveyor belt type system and are eventually discarded of.
Some industries create significant more waste and pollution than others and changes to these three industries are key to the circular economy.
The fashion industry is responsible for a significant proportion of global carbon emissions, and at some point, almost all textiles and clothes end up going in the bin.
The mining industry devastates eco systems with pollution and destroys the habitats of wildlife. In addition, much of the resources used in mining are disposed of creating significant levels of waste.
It is estimated food accounts for around 25% of all carbon emissions. With this in mind, one should be shocked that around a third goes to waste. And that is without mentioning the plastic food packaging clogging up the world’s river and destroying our oceans.
The adoption of the circular economy is integral to meeting sustainable development goals and companies establishing initiatives now will likely provide economic value to investors over the long term.
This will be explored in detail at the Impact Investing & Circular Economy Conference in mid 2020.