HRD's pocket guide to... the circular economy

The HRD’s pocket guide series offers an explanation of areas outside day-to-day HR that business-savvy HRDs need to have a handle on

Why do I need to know about it?

As the global population increases, the amount of waste being produced is also on the rise. Some countries ship theirs to landfill sites in developing countries, while others dump it in the oceans leading to large ‘trash islands’. One known as the Great Pacific garbage patch is estimated to be between 700,000 and 15,000,000 square kilometres. This equates to the size of Texas or Russia.

To combat this problem, governments, organisations and individuals are increasingly turning to the circular economy. In this model resources are kept in use as long as possible, then regenerated at the end of their service life, rather than being sent to landfill or burnt.

“We want our resources to go around the recycling loop more than once, thereby making the very best use of them. It applies to absolutely everything: packaging, cars, mobile phones and so on. It’s a more sustainable alternative to the ‘linear economy’ model of make-use-dispose,” explains Iain Ferguson, The Co-operative Group’s environment manager.

What do I need to know?

Organisations of every type can adopt a circular economy business model. “Manufacturers, brands and retailers can consider improving their products’ designs to facilitate repair or recycling, or using more recycled content to drive the demand for secondary raw materials,” points out Jakob Rindegren, recycling policy adviser at the Environmental Services Association.

For example, The Co-op is working towards making 100% of its packaging recyclable to make it easier for consumers to also play their part. Fast-food chain McDonalds is planning to make 100% of consumer packaging from renewable, recyclable and certified materials by 2025, as well as offer packaging recycling facilities in all its restaurants worldwide.

Other sectors have similar opportunities. “Tech companies might use big data to help producers better manage resource flows, or develop apps to improve consumer information about recycling. Other examples include the chemicals industry extracting chemicals from biowaste that can be used in new products,” adds Rindegren.

Being part of the circular economy could, however, require major operational shifts. “Businesses need to change the way they think about their products and services. It might mean moving towards a service model that allows consumers to return products so they can be remanufactured,” Trewin Restorick, CEO of environmental campaign charity Hubbub, says. “It will mean collaborating with different sectors… so that there is an awareness of how products are currently disposed of. Finally, it will mean talking to customers in a different way so they understand how they can play a role.”

Where can HR add value?

HR can collaborate with the comms team to ensure internal and external messaging around the business’ waste strategy is communicated clearly.

“Any efforts to engage and educate employees about the workings of a circular economy and why it is so important must be welcomed,” says Ferguson. “HR teams play an enormous role in embedding ethical and environmentally-conscious values. They can lead by example and set best practice.”

Sustainability initiatives should also be communicated and staff encouraged to share ideas around how improvements can be made.

“HR can add value through ensuring sustainability initiatives are fully communicated and have widespread support. Employees play an important role in reducing waste and individual ideas are a powerful insight into where resources are being wasted,” explains Alex Snelling, senior director of talent for McDonald’s UK.

Anything else?

For a guide on implementing circular economy principles at an organisational level the British Standards Institution has introduced a voluntary standard (BS 8001:2017). This could be a useful tool for HR when presenting any changes or recommendations to the C-suite.