What is a circular economy?
The circular economy is an economic system where materials and products are reused, repaired, and regenerated, rather than being discarded after use. Unlike the traditional linear model of ‘take, make, use, and dispose’, the circular economy follows a sustainable loop that minimises waste and keeps products in circulation for the maximum possible time.
Four main activities
- Reduce – Minimising the creation of waste at the source by designing products and processes that use fewer resources and generate less pollution.
- Reuse – Extending the life of products through repair, redesign, and repurposing. Examples include refurbishing furniture, repairing clothes, and using reusable packaging for food delivery.
- Recycle – Breaking down products into their raw materials so that new products can be made from them, such as refurbishing e-waste for resale.
- Recover – Extracting materials or energy from items that can no longer be used in their current form, ensuring that nothing goes to waste.
History
The concept of circular economy emerged in the 1970s as a response to growing environmental concerns about resource depletion and waste. While various thinkers contributed to its development, the term gained prominence through the work of environmental economists and sustainable development advocates. The Ellen MacArthur Foundation, established in 2010, played a pivotal role in popularising the concept globally and developing practical frameworks for businesses to adopt circular principles.
Why is it relevant for HR?
As companies worldwide pursue sustainable transformation, HR professionals play a crucial role in embedding circular economy principles into organisational culture. Green human resource management (HRM) practices are becoming the norm, with HR functions focusing on eco-friendly onboarding, sustainability-focused performance metrics, and green leadership development.
The HR function is responsible for hiring talent that believes in sustainability and is resource conscious, designing training programmes that promote circular thinking, and aligning incentives with environmental goals. By facilitating cross-functional collaboration, HR helps implement circular strategies, ensuring that employees across departments understand and contribute to sustainability goals—making the workforce partners in the company’s journey towards reducing waste, reusing materials, and designing regenerative systems.