The Exponential Innovation Potential of Circular, Social Purpose Businesses

The Exponential Innovation Potential of Circular, Social Purpose Businesses

By Coro Strandberg

Multimedia from this Release

The circular economy can spark a chain reaction of exponential business innovations

Wednesday, June 8, 2022 - 12:30pm

CONTENT: Article

Society has started the long march toward living in harmony with nature’s realities. There is no other way forward. And where goes society, so goes the economy.

As concluded in the seminal circular economy report "Turning Point," issued by the Council of Canadian Academies, material extraction and waste are exceeding planetary thresholds. We are using 1.7 planets’ worth of resources. Our current economic model that takes, makes, uses and wastes is unsustainable. But seeds for the circular economy are springing up, shedding light on the path ahead to a better future for people and the planet.

And the circular economy makes business sense. These seedlings are making their circular moves to reap these commercial benefits:

  • Opening new markets and customer segments
  • Reducing operating costs
  • Increasing security of supply
  • Improving price stability
  • Driving competitive advantage

But where to start? The "Circular Economy Business Toolkit" published by the National Zero Waste Council is a practical guide, showing how to develop a circular business strategy, circularize the design process and engage stakeholders in the circular transition. It includes case studies from around the world, such as Unilever’s goal to become plastic neutral, IKEA’s circular product design principles, Signify’s (formerly Philips) lighting-as-a-service model and Walmart’s Recycling Playbook for its suppliers. (Disclosure: I was the author of the toolkit.)

My research for the toolkit into six Canadian circular businesses in 2015 and then again in 2021 uncovered a number of value drivers, summarized in another recent report from my firm, "Insights from Circular Businesses." Here are some compelling dynamics at root behind these circular pioneers.

Their social purpose is clear

Circular economy pioneers are equally driven by commercial and societal benefits. They have corporate purposes to create solutions to societal problems through their core business. Having a social purpose North Star helps the pioneers navigate the complexities of their disruptive innovation where they are fundamentally challenging the status quo.

Indeed, circular businesses with a social purpose are on the rise, as experienced by the United Way Social Purpose Institute, which helps businesses define their societal reason to exist. Here are three social purpose circular businesses (and this is just the beginning):

  • Return-It: Exists to foster a world where nothing is waste. Here is its recent video, which puts the organization’s social purpose in the context of a circular world.
  • Recycling Alternative: Exists to transform our wasteful ways.
  • BSI Bio: Exists to transform our relationship with food packaging from trash to treasure.

Another social purpose company that is barreling down the circular street is HP Inc. Its purpose is "to create technology that inspires ambitious and meaningful progress." A recent case study shows that HP’s circular solutions (HP device as a service, HP managed print services and HP instant ink) yield reduced environmental impacts, and all solutions have a smaller carbon footprint than conventional alternatives. By pursuing circular business models, HP advances social progress and its social purpose while ensuring its business is fit for the future.

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Image via Shutterstock/Virgiliu Obada