The world produces over 2 billion tonnes of waste every year; enough to fill trucks that circle the globe 24 times over. And despite reduced economic activity over the past year, the World Bank expects this number to grow by a staggering 70% within 30 years. Increasingly, our limited resources are being converted into toxic waste that threatens habitats and species around the globe. And the largest contributor to global waste? Asia.
We take, we make, and we dispose. It’s a chain we need to break now more than ever, and we can start by embracing the circular economy.
What is the circular economy?
The circular economy aims to minimise waste by maximizing the value we can derive from it. Waste becomes a new resource and has a reduced impact on the environment. Achieving this goal requires a combined effort from companies and customers alike, from new business models to buying behaviours.
And more than just environmental sense, the circular economy also makes business sense. Reusing materials can reduce operational costs. Companies also gain more control over their sourcing cycles, making them more independent and sustainable.
Progress towards circular economy in Asia
Despite the strong imperative, many organisations across the region have yet to embrace circular business practices. One source of hesitation is cost. Revamping supply chains can be resource-intensive, requiring additional effort to collect, sort, and process disposed goods. These additional operating expenses pose a strong deterrent in the best of times, let alone during COVID-19’s financial uncertainty.
However, these concerns must be weighed against the crucial long-term benefits of circular business practices, including business survival in a rapidly changing Asian market. Responsible consumerism is becoming a prominent factor in the region, and Kantar’s 2021 sustainability study revealed that 53% of Asians stopped buying products and services that have a negative impact on the environment. Going circular is no longer a competitive advantage — it is becoming a hygiene factor.
By being creative in adopting circular business practices, companies can accelerate sustainable impact and bottom-line growth at the same time.
3 circular economy examples in Asia to learn from
Redesign waste’s value
Identifying where and how waste is generated is the first step towards a circular business model. Most value chains today follow a linear process: Companies take scarce resources from the environment to make and distribute products, which are then used for a limited amount of time before they end up in a landfill.
Recognizing what waste is generated at each stage of the value chain can yield a treasure trove of opportunities to redesign waste’s value. Samsung is one such example. Upon examining their TV value chains, two realisations became clear: TV packaging was often disposed of, and many TV buyers were also purchasing additional cabinets for their TV accessories. Their solution: the award-winning Serif Eco-Packaging. By introducing corrugated cardboard with a dot matrix design, Samsung enabled customers to breathe new life into TV boxes by reassembling them into an accessory shelf or even a cat house. As a result, these boxes are directed away from landfills and value is created for consumers.
Turn linear value chains into circular ones
Instead of following a linear process, can goods and materials be rerouted into earlier stages of the value chain, or even other value chains entirely? Can waste be reused in other ways, repaired to extend its useful life, or recycled for its parts? Doing so creates circular loops that result in additional savings for companies and consumers alike.
Style Theory, a Singaporean circular fashion platform, has embraced these loops by enabling consumers to rent or buy pre-owned designer items. Clothes that would otherwise contribute to waste can now deliver value to Style Theory and its consumers by being:
Reused: A second-hand marketplace by Style Theory allows pre-loved designer clothes and bags to be reused by consumers, either as short-term leases or long-term purchases.
Returned: Through a partnership with WeWork, Style Theory users can collect and return rented garments at convenient collection points. Their redesigned garment folder bags are equally reusable and returnable, providing consumers with a waste-free package to transport their garments to and fro.
Recycled: Unused garments are also donated to fashion students for school projects as part of an upcycling initiative, or passed to Greensquare for textile recycling.
Repaired: Style Theory offers restoration services for designer bags, prolonging their lifetimes and reducing waste.
Partner to explore synergies
The impact of circular business models can extend far beyond just one company — collaborating with other firms to create circular loops can be mutually beneficial. For example, Starbucks partners with Taiwanese textile firm Singtex to turn used coffee grounds into T-shirts, socks, and soaps. These recycled materials reduce petroleum usage by more than 25% during production and decrease each shirt’s carbon footprint by as much as a tree’s daily carbon absorption.
Such partnerships also mitigate cost concerns through win-win arrangements. GEM, a Shenzhen-based battery recycling company, partners with the likes of Samsung and BYD by sharing recycling technology in exchange for easy access to discarded batteries. The recycled outputs, such as nickel and cobalt, are key to addressing supply bottlenecks that hinder the growth of the electric vehicle market.
Circular Economy Guide
Waste reduction is becoming increasingly critical in Asia, and it’s clear that embracing the circular economy can achieve both sustainable impact and business growth. By collaborating, companies create ecosystems that have a larger impact than the sum of its parts. How can you collaborate for impact today?
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I’m Zhao Ruen Tan. Spreading innovation culture is in our DNA – if you liked the read, contribute to our mission by sharing this article.