Multinational firms sign up to $1.3 trillion circular economy initiative
A new global initiative to implement the circular economy has been launched in Davos, Switzerland at this year’s World Economic Forum (WEF) Annual Meeting, with signatories from over 30 international companies together worth around USD $1.3 trillion.
Factor10 is a programme set up by the World Business Council for Sustainable Development (WBCSD), a global organisation made up of over 200 transnational corporations working towards sustainability in business practice. The initiative aims to ‘reinvent the way that business produces, uses and disposes of the materials that make up global trade, by moving away from the traditional “take-make-dispose” economic model to one that is regenerative by design.’
In 2017 the organisation released a number of publications focused on practical guides, business cases and scalable solutions for implementing the circular economy, but with Factor10 it aims to move towards a wider collaborative approach to the concept, across value chains, sectors and borders.
The project has support from a range of leading private companies, including Veolia, BMW Group, Michelin, Philips and PWC. WBCSD’s President and CEO, Peter Bakker, commented: “Factor10 represents the critical mass of private sector support needed to implement the circular economy at a global scale. We look forward to seeing the companies involved shape the transition to a sustainable future.”
In 2018, Factor10 will be focusing on three priority areas:
Developing transformative cross-value chain solutions that unlock circular opportunities for business;
Generating circular economy knowledge to help business understand the landscape, best practices and leading examples, and
Amplifying the business voice globally.
Andrea Brown, the organisation’s Director of Circular Economy, said: “Through Factor10, we can move circular economy beyond the group of early adopters, into the early majority of global supply chains - opening new ways for companies to collaborate on scalable business models to gain competitive advantage."
The circular agenda certainly took centre stage on the first day of the WEF Annual Meeting, which ran from 23-26 January, bringing together world leaders in business, politics and beyond to discuss and drive change on the world’s economic, social and political challenges.
Alongside the launch of Factor10, 11 producers and retailers (including Evian, Unilever and Coca-Cola) announced or reaffirmed pledges for a circular approach to packaging, using recycled and recyclable materials, in connection with the ‘New Plastics Economy’ initiative from the Ellen MacArthur Foundation (EMF), which is working towards a circular global plastics system.
The EMF also announced the winners of its $1 million Circular Materials Challenge, which focused on recyclable alternatives to plastic packaging, while on the same day a report on the ‘world circularity gap’ by social enterprise Circle Economy claimed that only nine per cent of the resources used globally find their way back into the economy. The study referenced UN statistics which state that a circular economy could bring a 28 per cent reduction in global resource use, and a 72 per cent decrease in greenhouse gas emissions.
And aside from environmental gain, WBCSD has been keen to stress the economic benefits of a circular approach, describing it as ‘a $4.5 trillion business opportunity’. Environmental services provider Veolia has signed on to work with both WBCSD and the EMF, with CEO Antoine Frérot stating: “Through the circular economy, the Group’s mission is to produce alternative resources that compensate for the scarcity of natural resources; waste is transformed into valuable raw materials.”
The full list of companies involved with the coalition includes: Accenture, Arcadis, ArcelorMittal, BASF, BCG, BMW Group, CRH, Dow, DSM, Enel, ExxonMobil, EY, Honda, IFF, KPMG, Michelin, Navigant, Novartis, Philips, PWC, Rabobank, Renault, SABIC, Saint-Gobain, Solvay, Stora Enso, Veolia, Yara and Yokogawa.