Importance of the Circular Economy for Businesses

In a world increasingly concerned about environmental challenges, the circular economy has established itself as an essential strategy for businesses. Specifically, unlike the traditional linear economic model, which follows the pattern of “extract, make, use and dispose”, the circular economy focuses on maximising the value of products and materials throughout their life cycle. This involves reducing, reusing, recycling and recovering resources rather than disposing of them as waste. The circular approach in these business models implies considering the inherent environmental impact as a resource to be managed efficiently.

For businesses, adopting the circular economy is not only an environmental necessity, but also an economic opportunity. By integrating circular practices into their operations, they can reduce costs, improve efficiency and meet growing consumer demand for sustainable products and services. In other words, the environmental variable comes to be seen as a quality aspect directly linked to the value proposition of products and services.

From a circular perspective, waste is an element that reduces the efficiency of the production process, so its management with a circular approach means an improvement in the profitability of organisations, which has a direct impact on their financial ratios. In the work presented below, a tool has been developed that facilitates waste management by simultaneously assessing its environmental impact and its cost from a life cycle perspective. This gives organisations the possibility of assessing different scenarios and opting for the optimal management initiative, as comparative data are available on the variation in environmental impact and costs involved per waste and specific option.

Introducing Chemists Circular Economy Tool (CCET)

Global Factor recognises the importance of circular economy and has developed Chemists Circular Economy Tool (CCET), for the AVEQ-KIMIKA cluster, a business association made up of more than 130 companies from all over the Basque Country. It is an essential tool to help companies in the chemical industry to move towards a more sustainable model. The CCET is a simple and visual platform that allows the management and treatment options for waste generated in the chemical industry to be analysed, taking into account the environmental and economic impacts, all with a focus on the circular economy and the circularity of the company itself.

The CCET is mainly divided into three essential components: data input, calculation of impacts and presentation of results. This tool is characterised by its focus on simplicity and intuitiveness, while proving to be dynamic and adaptable, ready to constantly evolve and continuously improve.

Structure of the CCET

The tool consists of five main modules:

  1. Data Entry: Users select which waste and which type of treatment to apply to it in order to calculate the impacts associated with these two variables, as well as economic information regarding internal costs. Two scenarios are differentiated in which variables have to be selected for both, in order to be able to graph and compare the two options.
  2. Calculation of Impacts: The CCET uses Life Cycle Assessment (LCA) to calculate the environmental damage generated by current management and possible alternatives. It differentiates environmental impacts into 16 categories.
  3. Economic Impact: The tool assesses the internal company management costs related to waste treatment. It also performs a Life Cycle Cost (LCC) calculation, which economically values the environmental damage caused by waste management, broken down into 18 economic impacts linked to environmental impacts.
  4. Circular Transition Indicators (WBCSD): The CCET provides the ITC linked to the circularity of companies’ outflows, including the percentage of potential recovery and the percentage of current recovery based on the methodology defined by the WBCSD.
  5. Results: this tab plots the environmental impacts, economic impacts and circularity indicators of both scenarios, so that companies can overcome and assess changes in their waste management, having a complete overview of the advantages and disadvantages both at environmental and economic level.

Perspectives on a circular future

Global Factor’s Chemists Circular Economy Tool comes at a crucial time when companies are actively seeking solutions to embrace the circular economy and reduce their environmental footprint. This tool gives companies in the industry the ability to make informed and strategic decisions on waste management, while contributing to a more sustainable future. The CCET is a testament to how innovation can drive sustainability and, in doing so, benefit both businesses and the planet we share.

For more information on the tool please do not hesitate to contact:

Carmelo Angulo (cangulo@globalfactor.com)

Leire Vázquez (lvazques@globalfactor.com)