How can businesses hasten the transition to a circular economy?

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How can businesses accelerate the transition to a circular economy?

It's time for businesses to put the pedal to the metal Image: Christian Englmeier on [Link]

20 Jan 2020

Peter Lacy
Senior Managing Director, Accenture Strategy

Jessica Long
Managing Director, Accenture Strategy, Sustainability, North America Lead

Wesley Spindler
Senior Manager & Circulars Program Director, Accenture Strategy

This article is part of the World Economic Forum Annual Meeting

• An estimated $4.5 trillion of value is up for grabs in the circular economy.

• Here's how businesses can transition successfully to this new paradigm.

• A combination of tech and a holistic approach can accelerate this process.

Substantial circular progress has been made, but we are not yet tipping the scale.

Over the past decade, the circular economy has come a long way. Numerous leading organizations around the globe have proven the business case for circularity by success
retrofitted into business-as-usual environments, limiting their transformative impact and scalability. To reach the full value potential of the circular economy, much more must b

In our work with dozens of clients and partners to deploy circular strategies around the globe, and through our analysis of more than 1,500 circular case studies via
competitive advantage from circularity requires more than just incremental change. It requires a fundamental reengineering of business.

Circular models have the power to transform the world as we know it—and change the bottom line for businesses. It’s not a simple or straightforward undertaking, but it couldn
of not being captured. In a report entitled Waste to Wealth, Accenture estimated the value at stake at $4.5 trillion by 2030. This is between 4-5% of the projected global gross

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The five circular business models

Moving from insight to action: the circular pivot

So, how can businesses today take bigger, bolder, more impactful steps towards the circular economy? We found that true impact and scale will only occur when companies d
opportunities, while also strengthening their core business. We refer to this as a “wise pivot.”

If industries embrace the wise pivot for circularity, it can yield astounding results. For example, analysis by Accenture has found that the fast-moving consumer goods industry
electricity, meanwhile, could help the electricity industry capture up to $250 billion by 2030.

Individual companies can also achieve substantial results by embracing the pivot. Our experience has proven that utilizing circular business models as a framework for succes
Service model. One example is Lumify, a subscription service which provides customers access to ultrasound transducers, apps and an online ecosystem. The revenue gene

CIRCULAR ECONOMY

What is a circular economy?

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The global population is expected to reach close to 9 billion people by 2030 – inclusive of 3 billion new middle-class [Link] places unprecedented pressure on na

A circular economy is an industrial system that is restorative or regenerative by intention and design. It replaces the end-of-life concept with restoration, shifts towards the u
models.

Nothing that is made in a circular economy becomes waste, moving away from our current linear ‘take-make-dispose’ economy. The circular economy’s potential for innova

The World Economic Forum has collaborated with the Ellen MacArthur Foundation for a number of years to accelerate the Circular Economy transition through Project Main

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Join our project, part of the World Economic Forum’s Shaping the Future of Environment and Natural Resource Security System Initiative, by contacting us to become a me

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Moreover, when you couple the business models with disruptive Fourth Industrial Revolution technologies - across the digital, physical and biological realms - the impact is ac

Digital + Digital: Winnow, a technology company in the hospitality sector, is helping its customers tackle the massive issue of food waste by deploying a combination of Fourt
-8%, and achieve an increase in return on investment (ROI) of up to 10 times in year one

Digital + Biological: Indoor farming leader AeroFarms’ use of aeroponics and predictive analytics reduces resource consumption and waste generation, while increasing qua
company of less than 100 employees, they receive over 2,000 job applications every month.

Digital + Physical + Biological: In tire company Goodyear’s new concept tire, Oxygene, moss grows within the sidewall of the tire by absorbing moisture from the road; the m
tons of carbon dioxide every year. Moreover, the energy harvested from the moss’ photosynthesis could then power electronic sensors in the tire that, through internet of thing

The disruptive 4IR technologies enabling the circular economy

The journey to maturity: a holistic transformation

A circular pivot does not happen by looking at segments of the organization in isolation. To capitalize on the transformational power of the circular business models and enabl

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The four dimensions of a circular pivot

No matter where you are in your circular journey, the time to act and to support the acceleration of the circular transition is now. The Circular Economy Handbook, which featu
and will be launched at this year's World Economic Forum Annual Meeting in Davos.

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Written by

Peter Lacy, Senior Managing Director, Accenture Strategy

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Jessica Long, Managing Director, Accenture Strategy, Sustainability, North America Lead

Wesley Spindler, Senior Manager & Circulars Program Director, Accenture Strategy

The views expressed in this article are those of the author alone and not the World Economic Forum.

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