Welcome to the Circular Economy

This article provides an introduction to the circular economy and proposes that circular thinking and circular economy business models are the hottest developments going on in sustainability right now.

A wise person once said:

Things take a lot longer to happen than you think they would, but when they do happen, they happen a lot quicker than you think they could.

This is exactly what has happened with the circular economy, which has quickly risen to prominence within sustainability.


Anyone who is at all familiar with the sustainability agenda will realise that we are faced with an industrial system that extracts renewable resources more rapidly than they can be regenerated and that generates a tremendous amount of waste. The pace that this is happening at is undermining the ability of nature to regenerate itself. If this is the problem, the question is what is the solution? The answer is circular economy business models and circular thinking.

This is an exciting development as thinking about waste and recycling in new ways is opening up opportunities for strategic business models. These are cost effective and do not require state subsidy or intervention. They are great for the waste producer, who saves costs on disposal. They are great for the receiver, who gets material at little to no cost. They are great for the people who get jobs in these new and exciting businesses and they help to address many of the environmental sustainability challenges that industrial societies are faced with. Importantly, they are also popular with consumers, who are shopping in ever greater numbers for companies who are taking sustainability seriously. Circular thinking is a promising and exciting field.

What is the circular economy?


I think that a quick definition would be helpful. The definition below comes from WRAP. They are a great organisation, doing fantastic things in the waste and resources sector. They have an excellent website, which is packed full of useful and interesting content. They are a leading authority on waste management. I am a frequent visitor to their website. For more information on the circular economy and other related topics, you should visit: www.wrap.org.uk.


The Ellen MacArthur Foundation

Another organisation doing great things in this area is the Ellen MacArthur Foundation. They have put together a crisper and potentially more useful definition of what the circular economy is. This can be found below. Through their videos and other online content, they do an excellent job of reminding the public that in the living world, there is no landfill. One species waste is another’s food.

They take a very positive and optimistic approach. They emphasise that transitioning to a circular economy should be seen as an opportunity to re-think and re-design the way we make products, components and the packaging they come in.


They are strong advocates of product leasing from manufacturers rather than outright ownership. These types of business models are integral to the success of the circular economy. Essentially, you would buy light and washing, rather than ever buying light bulbs or a washing machine outright.  These are the kinds of strategic business models that we talked about earlier on in this article.

Overall, the Ellen MacArthur Foundation put forward an excellent definition of the circular economy. They have an optimistic message about how through creativity and innovation we can build a better future. One which is is circular and not linear. They have a great website, which is packed full of useful information and graphics. I highly recommend you visit: www.ellenmacarthurfoundation.org.

What you need to know

Circular thinking and circular economy business models are the hottest developments going on in sustainability right now. If disruptive circular thinking hasn’t already come to your industry, expect developments to come in 2017. Thinking about waste and recycling in new ways is opening up opportunities for strategic business models. We looked at an extended and a condensed definition of what the circular economy is. Both have their merits.

If you work for a company that manufactures and distributes products, you should seriously consider a leasing option. This would give your customers all the great benefits that they already enjoy, but with the option to return the product to  the manufacturer, for recycling and re-manufacture into new products or parts. This is very exciting and an extremely sustainable way to manufacture and distribute products.

There are two key reasons why these circular developments are going to be so important.

1.      They are great for business

2.     Consumers like them

Rarely do you see such alignment come into place, but when it does, expect things to develop exponentially. We will look into the consumer preference argument and into data on the scale of growth of circular thinking and circular economy business models in subsequent posts.

We will learn more about the circular economy in subsequent posts.

Thank you for reading

By Barnaby Nash

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