Global Adoption of Circular Economy Is Non-negotiable

Harald Friedl, CEO of Green Leadership, popularly known as “Circular Economist,” is a powerhouse in circular economy, sustainability, and business with over a decade of hands-on experience. A relentless innovator, he fuels growth and circularity in his clients’ companies, sharing his extensive expertise with today’s most dynamic business leaders.

In the past five years, Harald has been a driving force behind social entrepreneurship and grassroots change in Myanmar. He co-founded Impact Hub Myanmar and launched the country’s first pre-incubation program for social enterprises. Concurrently, he spearheaded market development for Myanmar’s leading electromechanical hydropower projects. Before this, Harald trained as a journalist, served as the spokesperson for Austria’s Deputy Prime Minister of Finance, and led the office for the UN Assistant Secretary General in New York.

In an exclusive exchange with The Interview World, Harald delves into the global embrace of the circular economy. He reveals how multinational corporations are embedding circular principles into their business models and stresses the critical role of consumer behavior in this transition. He also underscores the significance of international collaborations in propelling this movement forward and outlines the future trajectory of the circular economy. Here are the key insights from his interview.  

Q: How widely is the circular economy being adopted globally, and which regions or countries are leading the way?

A: The latest circular economy barometer unveils a disturbing trend: the circularity rate has plummeted to 7.2% from 9% over the past five years. This decline signals that more global materials are now destined for landfills or incineration, rather than being recycled or reused. Our economy is veering away from circularity and sustainability. With fewer materials re-entering the system, we’re straying from a sustainable model. This shift underscores an urgent call to action: we must enhance circular practices to prevent waste and boost recycling and reuse in our economy.

Q: How are multinational corporations integrating circular economy principles into their business models? Can you provide some successful case studies?

A: Companies across various industries have swiftly embraced the circular economy. Just one or two years ago, the CEO of one of the world’s largest cement companies called it the biggest business opportunity of our times and integrated it into the company’s top three priorities. Today, from consumer goods to heavy industries like cement and steel, shipping, and agriculture, the circular economy is a central focus.

Business models are also transforming from traditional sales to leasing and renting, enabling companies to retain assets in their portfolios. Furthermore, this shift has driven widespread adoption of circular practices. The circular economy has gained significant importance because it balances economic progress with social and environmental benefits. This innovative approach also merges economic viability with sustainable development.

Take the Dutch Railways, which operates entirely on renewable energy, or Patagonia, which produces goods using recycled plastic. These examples markedly highlight the shift toward using fewer resources and extending the lifespan of products. The global repair café movement furthers this by promoting repair over replacement.

Innovative business models like solutions as a service or products as a service are emerging. For instance, Mitsubishi now charges for elevator usage time instead of the full cost of the elevator. These models, both small and large, exemplify progress. However, it’s imperative to accelerate this change to achieve a sustainable future.

Q: How important is consumer behavior in the transition to a circular economy, and what strategies can be used to shift consumer attitudes and habits?

A: We can lead the charge for change from multiple fronts: demand, policy, and consumer behavior. Consumers, businesses, and regulators all play pivotal roles. When we demand sustainable and circular products, the market responds swiftly. Yet, consumer attitudes often lag. Start by examining your own habits. Identify key areas where you can drive positive change—mobility, food consumption, and everyday goods like textiles and electronics. Lastly, scrutinize your living habits. In each area, ask yourself: how can I improve to support a more circular economy?

Q: How can international cooperation and partnerships enhance the effectiveness of circular economy initiatives?

A: No one achieves success alone. This fundamental insight emerges from countless businesses, collaborative partners, consortia, NGOs, and governments. True change demands collective action. By fostering collaborative spaces dedicated to sector-wide transformation and systemic shifts, we accelerate progress.

International efforts are crucial, and partnerships are indispensable. Take our work with the entire textile supply chain as an example. Major brands united to tackle the industry’s challenges head-on. It’s not the responsibility of a single entity; it’s a shared endeavor.

Q: What is the future outlook for the circular economy on a global scale, and what key trends or developments should we watch for in the coming years?

A: In our era of resource scarcity, accelerating the circular economy is both timely and essential. Challenging times call for innovative solutions. I firmly believe the global trade system will evolve. As competition for resources heats up, consumers must adapt to new consumption models amidst a growing population.

The circular economy plays a critical role in tackling the climate crisis. We should ideally embrace these changes voluntarily, rather than being forced by natural disasters and environmental degradation.

Q: What distinguishes a circular economy from recycling, and are they fundamentally the same?

A: Many people misunderstand the waste hierarchy, often mistaking recycling for a circular economy. Recycling, though beneficial, simply reintegrates waste back into the system. It doesn’t cut material input or fundamentally change our practices. Therefore, we need to drive true change by decoupling resource use from product and service consumption. This shift will drastically reduce end-of-pipe waste, thus minimizing the need for recycling. While essential, recycling shouldn’t be our main focus. Instead, we must aim to reduce the need for it. The circular economy is much more than recycling, which only accounts for about 25% of the solution. We must concentrate on the remaining 75% to unlock the full potential of a circular economy.