What is the circular economy? ~ Investment,finance for businesses

Monday, September 20, 2021

What is the circular economy?

 What is the circular economy?

What is the circular economy?

The notion of circular economy appeared at the beginning of the 20th century. But this concept of an economic model has especially developed since the mid-2000s when the climate emergency came to light. The circular economy is indeed an economic system that advocates the reduction of consumption, the end of waste, the recycling of waste and the preservation of natural resources, for a reduced environmental and social impact.

The definition of the circular economy

As the Environment and Energy Management Agency (Ademe) indicates, there is no precise and recognized definition of the circular economy. The organization nevertheless tries to qualify the circular economy as "an economic system of exchange and production which, at all stages of the life cycle of products (goods and services), aims to increase the efficiency of use. resources and reduce the impact on the environment while developing the well-being of individuals ”.

In other words, the circular economy advocates the production of goods and services in a sustainable manner, that is to say with the objectives of limiting consumption, the waste of resources and the production of waste.

This economic system is opposed to the one in force until today, called a linear economic model, based on "all disposable" and excessive consumption. On the contrary, the circular economy is an economic model which aims to preserve resources, the environment and health, as well as reduce waste and waste, while promoting economic and industrial development not at the national and international level, but based on the territories.

Indeed, in terms of the economy and employment in particular, the circular economy revolves around new production and consumption models that are intended to be non-relocatable. This economic system, whose main objective is to preserve the environment, also encompasses social considerations and relies in particular on the creation of new jobs in connection with this model of consumption and production in "loop" which refuses waste, promotes recycling and reuse of the products and services we consume.

The principles and fields of action of the circular economy

The circular economy fully integrates the concepts of sustainable development and energy transition by promoting the preservation of natural resources, limiting waste production and energy consumption.

A circular economy system is based on different principles related to environmental and social impacts, and includes several areas of action that should be favored from one end of the economic circuit to the other:

  1.      sustainable sourcing which consists of taking better account of the resources used, from their extraction to their exploitation, with regard to their environmental and social consequences;
  2.      eco-design which incorporates environmental protection from the manufacture or design of goods or services;
  3.       industrial and territorial ecology which implements "the voluntary pooling of resources by economic players in a territory, with a view to saving them or improving their productivity", as indicated by the Ministry of Transition ecological;
  4.     the functional economy, a system that favors the use of a product rather than its sale, for example the establishment of an electric car rental service by a municipality which replaces the purchase of a vehicle by an individual or a company;
  5.     responsible consumption, which consists in informing the consumer of all the stages in the life of a product so that his purchase is carried out while knowing exactly the environmental and social impacts of the product he chooses;
  6.    extending the useful life which means ensuring that the environmental impact of consumer products with reduced shelf life is minimized. The fight against planned obsolescence, for example, is one of the tools in this area of ​​action;
  7.   improving the prevention, management and recycling of waste with the aim of limiting as much as possible the production of household waste and from the activity of all economic players, to reduce their impact on the environment. This lever also includes the fight against food waste, and objectives, for example, such as the generalization of returnable packaging, the end of plastic bags, the ban on printed advertising, or the development of recycling channels.


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