Circular economy in brief N. 2 | why does it involve companies

March 09, 2017

Circular economy in brief N. 2 | why does it involve companies

An alternative economic model that produces an added value. This is the essence of circular economy, a development model involving companies and innovation and not only ethics and environment. But in what way does circular economy involve companies?
 

Circular economy and companies: a sacrifice that returns value

On one side, circular economy REQUIRES companies to implement a sustainable business model which provides, for example, for new recovery systems of goods and services, recycling strategies of industrial waste or for the facilitation of products maintenance. For this reason companies have to redesign their products thinking that they’ll never become waste but they’ll become new resources with different functionalities. This kind of process is very difficult to implement because it involves a lot of segments inside companies such as : production, logistics, marketing and sales.
 
On the other side circular economy RETURNS to the companies an added value in terms of turnover, competitiveness and reputation.
Redesigning products in terms of sustainability means gaining a competitive advantage than other companies, gaining value in terms of corporate social responsibility and saving money in terms of operating and production costs. In particular, the implementation of a sustainable business model allows companies to buy recycled raw materials at a lower prices, to cut the costs coming from energy-saving, to generate an additional revenue coming from the sale of their own industrial waste. All these measures could bring net savings of € 600 billion (8% companies annual turnover).
 
Companies future runs through circular economy and it would be a mistake to think that our own company will not be touched by this change. A company can choose to seize the opportunity now and make of it a critical factor of its success or it will have to adapt to the market needs in the near future as the only choice.