WRAP chief issues stark warning to businesses over pursuing 'throwaway linear models'
EXCLUSIVE The "throwaway linear economic model" that businesses currently subscribe to will become a millstone around the necks of firms if they do not quickly adopt a circular approach, WRAP chief executive Liz Goodwin has warned. Scroll down for full video
Speaking at Sustainability Live in Birmingham, Goodwin said that UK companies that adopt a circular economy model will steal a march on their competitors by achieving substantial economic gains.
She said that businesses had been slow to adopt a circular approach and that the linear model was an "unsustainable model and will serve to undermine future business strategies and therefore needs addressing".
Goodwin addressed a rhetorical question to company directors about their future business strategies and stated: "Think about your competitors. Can you afford for them to steal a march on you on this?"
Drawing on WRAP's work, she said there was a wealth of opportunities on offer through a circular economy. For instance, she said that WRAP has found that there was scope for 10,000 new jobs to be created in the recycling sector alone by 2020 if businesses adopted a circular approach.
WRAP also found that businesses could reduce their costs by more than £50bn a year.
She warned delegates that there has been much talk about the circular economy but "because there is a perception of little actual take up we face a real danger". The move to a circular economy was in danger of losing momentum and going "off the boil" and that should not "be allowed to happen", according to Goodwin.
Speaking about the challenges businesses face when adopting a circular approach, she said: "I recognise that the idea of changing a business model is daunting, and that there is an aspect of 'if it isn't broken, don't fix it'".
She also warned delegates that there "needs to be a micro position, not just macro. That is the only way a properly considered bespoke business case can be made".
She said there was not a one-size fits all approach for businesses: "What works for a multinational electronic brand may not work for a small medium-sized enterprise facilities management company."
Giving practical examples of successful circular economy projects to date, Goodwin said that WRAP had worked with facilities management company Carillion.
Goodwin said that WRAP worked with Carillion to identify the value of assets it was discarding because its culture became focused on the "core business" of winning and completing contracts successfully.
When WRAP's business case showed how much Carillion could save with a simple asset management, Carillion started to redeploy assets, Goodwin said.
She added: "In fact in the first six months they redeployed 75,000 assets. We're currently assessing the avoided cost of buying replacement products and we expect it to be substantial."
Elsewhere, Goodwin reiterated that WRAP would be working at a community level "as we will soon be launching a new fund, as announced in England's Waste Prevention Programme, to stimulate community innovation to increase waste prevention, repair and reuse".
She exclusively said: "Exact details will be released over the next few weeks; however, I can confirm it's going to be an £800,000 scheme run over two years. It's aimed at bringing together community partnerships, such as local businesses and schools together."
She concluded that WRAP could help companies to innovate and assess the business case for a new model "to take that first step to test the market, and ultimately see the way to making your whole business more profitable, more resilient and more sustainable". Play video from 1.40.