At a recent packaging innovation conference, I was asked to provide the keynote speech. What better topic to choose at this moment in time than to talk about two words that have become the subject of much debate and discussion in industry, politics as well as in the media: circular economy.
You could say they are the latest policy ‘buzzwords’, although I suspect they may mean different things to different people. So I tried to explore what I think that means and, particularly, what it means for the packaged goods industry, now and in the future.
I have three assumptions about how I believe we should think about the circular economy:
1. Achieving a circular economy will require us to make some big changes to the way we are doing things. And clearly some of those changes may make us feel uncomfortable and may be met by resistance, but I think we can, and have to, overcome them.
2. Despite the challenges change can bring, I genuinely believe the circular economy also represents an important opportunity for the packaged goods industry - an opportunity that makes sound business sense too.
3. The reason why I am excited about the circular economy is that I am confident that the key drivers to make it happen are in reach, namely: game-changing innovation and effective legislation.
But perhaps we should first take a step back and remind ourselves why any of this actually matters in the first place.
Whatever role people play - as business leaders, regulators, campaigners, citizens and consumers - we know that we cannot continue to use more resources than our planet has; we cannot emit more emissions than our atmosphere can absorb and we mustn’t leave a wasteland behind for the ones who come after us. We need to turn the steering wheel around.
COP21 has been a great example of doing just that. It’s a sign that we are coming together to take action now, collectively, to reduce carbon emissions and the risks from dangerous climate change. That’s partly why I am excited and optimistic: I think we are headed in the right direction, including industry, and this convergence of interests is hugely encouraging.
We can make progress if we choose to. 20 years ago few people would have imagined it would be possible to move away from a carbon-based economy, but look where we are now: it now seems a realistic possibility. And I think there is even broad agreement on what mechanisms we need to make that happen: effective regulation; market-based instruments; more innovation and greater investment.
So, given what has changed on climate policy, I’m confident and very optimistic that the ‘circular economy’ can become a real game-changer for all of us. What’s important now is for business to ‘make sense of it all’ and to shape its understanding of what the circular economy means in practice.
There are five emerging business models for circular growth: the ‘circular supply chain’ (or maybe better: the ‘circular design’) model; the product life-extension model; the sharing-platform model; the ‘product as a service’ model; and the Recovery & Recycling model.
Any of these new business models may apply along a company’s value chain. At Coca-Cola, we are actually conducting some work at the moment to apply circular thinking to some of our most important material uses. However, for many reasons, product packaging has always been very much at the front and center of the circularity discussions with the ‘circular design’ and the ‘recycling model’ the most relevant options to look at.
And the closer we look, the more we will see: these two models are not new. There is a lot happening already, especially in the packaging sector. New packaging design and material innovation, recyclable and/or plant-based packaging, used packaging collection, recycled material use etc. are the new standard in packaging. But it needs to happen more widely, more deeply and more interconnected than ever before. And that, as I said at the outset, will require us to make some big changes.
This article originally appeared on LinkedIn as part of a four-part blog series from Ulrike Sapiro, Coca-Cola’s director of sustainability for Western Europe. Read the next posts in the series:
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