Impact of climate change, resource scarcity and pollution on business models. Governments and businesses see a growing need to change them.
Climate change will change how businesses operate. While there are several challenges associated with adopting a circular business model, for those that manage to do so, the pay-offs are often substantial.
Traditional economic models are poorly suited to address the challenges of resource scarcity, pollution and climate change as they tend to consider resources to be inexhaustible and fail to take the (external) effects of pollution into account. As environmental effects are coupled with rapid urbanisation, and global socio-demographic trends, the urgency to find solutions that take the effects on the environment into account, becomes ever more apparent.
As a response, governments and businesses are exploring alternatives that decouple economic growth from resource consumption through a circular approach – from production, consumption and beyond.
This publication outlines what a circular economy is, shares some perspectives for the future and discusses some of the challenges related to the transition to a circular economy (CE).