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Thoughts about the Concept of Circular Economy

15/06/2020
by Volker Ludwig
Language: EN
Document available also in: DE IT LV

original language: italian


Konzept Kreislaufwirtschaft

Thinking about Circular Economy by Dr. Volker Ludwig (CC-BY 4.0)

Starting Position without Circular Economy

“Economy  (from Greek οίκος – "house" and νέμoμαι – "manage"). The economy is defined as a social domain that emphasizes the practices, discourses, and material expressions associated with the production, use, and management of resources”

In the traditional economy, "house" has a private sense, a space closed by walls, and taken away from the community. In this model, the economy and the environment are in a linear relationship tending towards infinity: the economy produces and the environment collects waste and garbage, like a box.

It soon became clear that this box is not infinite and that the economy and the environment are not in a linear relationship, but in a circular relationship because the economy is a piece of a larger system. This system is a closed system and the economy must take into account and respect intrinsic limits.

So there is a problem: how to keep profit and environment together and make this relationship sustainable? It is a paradigmatic problem because it concerns the rules that govern relations between man, his needs, the resources to satisfy them and the environment.

The circular economy gives a response by placing the environment on the same level as the economy and no longer downstream of it and changing the meaning of "house": it is no longer something that is yours and nobody else's, but it is the place that hosts you and you share with everyone else, house = environment.

Being a paradigm shift, it will be necessary to reorganize social values, the concept of responsibility, and the way we meet our needs. There is a whole world to rethink.

New Basic Concepts for the Economy

What are the fundamental concepts around which to reorganize economic thinking and rules? I have identified five and they are innovation, responsibility, values, limits, and circularity.

 

Innovation 

Business models based on the concepts of the platform and sharing instead of walls and properties and innovation in product design, improving the concepts of modularity, reusability.

 

Responsibility

Corporate responsibility must be a strategic resource to give value, and the social impact of the product must be a strategic aspect of marketing.

The individual responsibility of the citizen concerns not only the passive part of the refusal and of the payment for the management but also the active part of the purchasing behavior and of the management of the product before it becomes a waste.

 

Value

It is necessary to shift the attention from the product as such to the function it performs and the relationships it establishes with the environment, in terms of impact and environmental costs. To do this, the concept of ownership must be replaced with the concepts of ownership, rental, reuse, sharing.

 

Limit

It has always been given an essentially negative value, the meaning of redefinition should be enhanced more, thus becoming the basis on which to draw the whole process.

 

Circularity

This is the founding concept of the whole system, it is the concept that allows you to overcome the crisis generated by linearity. If the line goes to infinity by de-responsible for the present action, the circle holds everything together giving the same value to the past, present, and future.

 

About the author:

  Leonardo Filiani

Leonardo Filiani. Trainer and mentor on business creation issues. Every day he works with passion on issues related to business models and project management. He collaborates as a project manager with Euronet and Godesk on some European projects, among which The SCRCE project on cross-border circular economy.

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