The circular economy, which aims to reduce the consumption of non-renewable natural resources and minimise waste generation, can be seen as a sustainable way of meeting the needs of humanity while remaining within the limits of the planet.

Each year, WWF calculates the “Earth overshoot day”, i.e. the day of the year from which Humanity consumes more resources than the Earth can regenerate in one year. Since the 1970s, the situation has worsen: in 1998, the global overshoot day was 30 September. In 2019 it was 29 July. For France, it was 15 May.

In this context, there is a growing awareness that the linear economy (based on the paradigm: Extraction of natural resources – Production of material goods – Use – Production of waste) is unsustainable and depletes the non-renewable natural resources of our planet. In addition, the increasing scarcity of critical resources (e.g. rare metals) represents a significant risk for many companies due to market disruption, rising costs and reputational risk.

In contrast to linear economy, circular economy aims to reduce non-renewable natural resources consumption and to minimise waste generation. It can therefore be considered as a sustainable way of meeting the needs of humanity while remaining within the limits of the planet. Its purpose is to optimise the use of resources and products, in particular by forming loops in production and consumption chains: sharing, repairing, reusing, refurbishing, recycling, etc. This often involves setting up shorter supply chains and more local activities. It also often requires the implementation of waste collection, sorting and rehabilitation activities at the local level. On all these aspects, social enterprises can bring significant added value, and thus be major players in the circular economy. Examples abound in France, Europe and elsewhere.

The case of the fight against food waste is a good example and a major component of the circular economy, in a context where, according to the FAO, about one third of food for human consumption is lost along the value chain1. In France, Phenix, a social enterprise, manages for instance to save about 100,000 meals every day, thanks to the reuse of unsold products from 3,500 partner companies and businesses in the form of sales at reduced prices, donations to associations, donations for animal feed, composting, etc.

Another example is that of Simone Lemon. While it is estimated that 30% of fruits and vegetables in France are not marketed because of aesthetic defects, this restaurant is tackling food waste by designing its menu using “out-of-shape” fruits and vegetables, usually set aside, and by charging dishes by weight.

Giving new life to used objects is another lever of the circular economy, which can concern different types of goods. In France, Recommerce is a pioneer in the trade-in, reconditioning and resale of used telephones, while LemonTri sorts and recycles more than 30 different types of wastes (lamps, wood, coffee capsules, etc.). In Italy, Vesti Solidale of the Consorzio Farsi Prossimo, takes computers and printers from companies, reconditions them and resells them by employing people in precarious situations.

Other social enterprises help certain organisations to recover their waste and co-products. For example, Cèdre collects and recycles office waste while employing people with disabilities. ATF Gaia recycles computer equipment. Qarnot computing uses the heat released by computer servers to heat buildings.

Several social enterprises work specifically for companies or public authorities on all types of environment-related work that are labor-intensive, including waste collection, sorting, reuse and recycling. This is the case of Retrival in Belgium, Cooperativa Sociale Risorse and Consorzio Fantasia in Italy.

All these initiatives demonstrate that there are concrete alternatives to the linear economy. Many social enterprises have a good understanding of local territories and needs. They are taking up this topic and enabling individuals or organisations to reduce their resources consumption and waste production. The global transition from a linear economy to a circular economy is still in its infancy. Social entrepreneurship has a major role to play in the transformation of our methods of production and consumption.

 

Sebastien Soleille
Group Head of Energy transition and Environment
BNP Paribas
&
Claudia Belli
Group Head of Social Entrepreneurship and Microfinance
BNP Paribas

 

Footnote

1 http://www.fao.org/food-loss-and-food-waste/fr/