New year, new direction: ESA chairman Stewart Davies outlines circular economy prospects for 2017

Since assuming the role of ESA chairman last November, Davies has been liaising directly with the trade body’s members to provide advice and support on a plethora of strategic issues. Top of the list of discussion points: the potential impacts of Brexit on Britain’s waste and resource management sector.

“It’s certainly a very interesting time to be taking on this role, particularly within the political environment that we’re all very aware of,” Davies said. “I guess the key word is ‘uncertainty’ as we look ahead to 2017, and that’s very critical for our member companies as it’s their interests that we’re all about here.”

Indeed, an air of uncertainty still looms over the UK’s waste management approach, and there is certianly room for improvement when it comes to recycling levels. Last week, a business-led report revealed that waste packaging and food leftovers from the recent Christmas period will have cost local authorities £72m due to a “dysfunctional” circular economy system, which also contributed to annual recycling rates falling for the first time in 14 years.

Among the key recommendations from that report was for the Government to reduce the financial burden on local councils – which have no control over product design or packaging – and to, in turn, increase the duty of businesses in delivering closed-loop production processes.

A more business-led approach to the circular economy is fully endorsed by Davies. “It aligns very much with our strategy of gaining critical mass of activity through more standardised approaches from waste and recycling collection through to processing,” he said. “But it also enables the whole supply chain to become engaged in terms of resource efficiency.”

Leaders and laggards

One approach the ESA is championing to drive business and supplier engagement is extended producer responsibility (EPR) – a strategy designed to promote the integration of environmental costs associated with goods throughout their lifecycles into the market price of the products. The ESA ran a workshop two weeks before Christmas for its key stakeholders, examining how EPR can be developed at a national level, with its conclusions expected in the early year. The organisation is also aiming to put evidence in front of Defra to make EPR a centrepiece of the department’s much-anticipated 25-year plan.

In spite of a clear necessity to address the UK’s stifled circular economy system, many big players within the business community do continue to lead a gradual move in the right direction, towards a resource-efficient future through ambitious sustainability policies. For instance, retailer Marks & Spencer has completely phased out hard-to-recycle PVC and polystyrene from its products and packaging, while coffee shop chain Costa has said it is “leading the fight” on the retail industry’s fight against coffee cup waste by trialling in-store recycling systems at 50 of its UK stores.

Davies reserves special praise for these circular economy leaders, which he believes can push the “laggards” to improve their own resource efficiency credentials. “A huge credit goes to those companies and their leaders for taking that very insightful, future focused role,” he said. “Without that, you wouldn’t have that proof case that challenges companies in the middle ground and the laggards.

“One of the things you look for in EPR is to provide a real push for the middle-ground to close the gap on those leading. You need something comprehensive or stuff starts to leak out of the system faster than the good guys can do anything about it.”

Industrial Strategy

This year, the potential for a long-term, coherent regulatory framework that promotes sustainable growth within the waste management sector hinges on talks between the UK Government and EU officials during the ongoing Brexit negotiations.

In conversations with the Government regarding the outlook for the resource sector post-Brexit, the ESA has deduced that circular economy opportunities can be created in two ways. Firstly, by addressing current areas of EU policy that can be improved upon – the Landfill Directive is one area which many ESA members feel has been “over-engineered” and has misrepresented the geographical factors of the UK, according to Davies. And the second point of concern for the ESA is the risks of losing key regulations such as the EU’s Circular Economy Package – a legislative departure that Davies believes could move the UK backwards in its sustainability ambitions.

While uncertainty looms over the implications of Brexit from both an environmental and economic perspective, Davies remains confident that the Government’s newly formed Industrial Strategy is well-placed to help British companies to ramp up resource-efficient operations. 

“This provides a focus and an opportunity to provide a more systemic approach to solve some of society’s biggest problems,” he said. “The resource efficiency opportunity can only be solved in a systemic way. The strategic approach of the UK’s Industrial Strategy is a perfect label to enable the actors in that sector to understand their impact on the resource economy. To work towards an improved outcome through things like EPR is just what is needed. It is timely, but it needs to be seized.

“The Government has a role to play with its Industrial Strategy by helping companies become insightful, future-focused and engaged in solving some of society’s problems as well as being good businesses.”

Stewart Davies on the edie Sustainable Business Covered podcast

The entire interview with the ESA’s new chief executive Stewart Davies will be available towards the end of the month in a waste and resource management special edition podcast episode. During the discussion, Davies talks about the role of the waste sector in Britain’s environmental agenda, the best route to achieving a UK-wide circular economy, and his views on the current green policy landscape – particularly regarding the impact of Brexit on waste-related policy.

Make sure you don’t miss the next episode of the Sustainable Business Covered podcast – subscribe on iTunes here and bookmark this link where a new episode will appear every week.

George Ogleby