Initiating the Transition Towards a Circular Business Model
The buzz about circular business models as a solution for sustainability has been growing. Yet many organizations continue to ignore it. And we can all do something to change that.
Modern living is dependent on the possibilities that a highly networked world affords us. Yet so many businesses continue to operate on a linear “take, make, waste” model. This sort of model imperils the world’s continued existence as we know it by negatively impacting our environment.
Climate change exacerbates the strength and frequency of extreme weather events. It makes many areas less livable. Worse, such disturbances disrupt our global agriculture and food supply.
One proposed solution that’s been gaining traction recently is the adoption of a circular business model. The idea is to have businesses generate value from every stage of a product’s lifespan to avoid further harming the environment.
It makes sense, and the case for saving our environment is urgent, but we still don’t see widespread adoption of circular business models. We need to spark that change on an organizational level.
Making a business case
The call to save our environment is often well-received on an individual level. For various reasons, we can easily perceive what’s in it for us and feel empowered to take the next action.
Maybe you live in an area that’s experiencing worsening floods or wildfires every year or is simply getting unbearably hot. Or you might be moved by the stories of people whose lives are affected in such a manner.
Perhaps images of environmental degradation, pollution, and dying animals affect you. Or you have kids, and you want them to grow up in a world that’s still rich in environmental beauty and wonder.
Not only is it easy for people to feel motivated, but the steps we can take to help are often easy. Through lifestyle changes, we can lower our carbon footprint and energy consumption.
When it comes to organizations, however, it takes more than that to move the needle. Businesses don’t respond to an approach that can often be perceived as moralizing.
We do have the power to drive change within the groups we’re part of. But it needs to appeal to logic. If you want business leaders to listen, start preparing a business case.
Pushing to overcome inertia
However, this task often presents a barrier to many who’d want to make a difference within their organizations.
To present a convincing case, you’d need access to extensive information regarding company operations. This includes data on working capital, cash flows, investments, and projects in the pipeline. Many organizations restrict that information.
Who has such access? Chances are, only the people who are part of decision-making at the upper levels of your hierarchy. These are the same minds that tend to be entrenched in traditional, tried-and-tested methods.
Pro-environmental movements such as cleaner production or corporate social responsibility seem to have come and gone. The rebuttal might be that the circular economy is just another buzzword, a trend that will be in vogue until something else replaces it. If linear models have worked before, the thinking goes, why change?
If you happen to have a voice at the boardroom level, you can begin to draw up a presentation. For most, though, the real challenge lies in overcoming such inertia and initiating a change in company culture.
An exercise of agency
The good news is that while most people are excluded from top-level discussions, culture change isn’t top-down in nature. In fact, leaders who attempt to drive a culture shift based on a mandate will fail because such changes are movements founded on emotion, not calls to action.
A movement can start with a small group of people who are dissatisfied with the status quo. They build on small wins and gradually win over non-participants by demonstrating efficacy. Influence extends through co-opting networks until, eventually, leadership takes notice of the momentum and formalizes those changes.
Without boardroom-level access to data, you can still work with whatever piece of the puzzle falls within your job description. If you’re working on the company’s program for managing reverse logistics, you have access to information that tells you what’s going to waste in specific parts of the product lifecycle.
CEOs and CFOs make the ultimate decisions. But what they often lack is an ability to make those connections between linear models and negative impacts on the bottom line, between circular economies and opportunities to improve. Even as a link in the chain, you can provide that missing insight.
The challenge you face may still be difficult, but you have the power to make a difference. You can exercise agency in this matter and, through whatever tasks or functions you perform, start pushing for change towards a circular economy.