Why we need to embed circularity into whatever our new normal looks like after COVID-19
Twenty years ago, I wrote my first article on sustainability.
This was 2000. The iPhone hadn’t yet been invented. Al Gore hadn’t released his “Inconvenient Truth”, the idea that business was intimately connected to the environment was still being laughed out of boardrooms and apart from some early attempts at greenwashing, sustainability was little understood, much less practiced.
Today, while we are still a long way from where we need to be, we are moving in the right direction and there is a recognition of how urgent the issue has become.
Even through the COVID-19 crisis, I continue to work every day with firms, large and small, who have made the commitment to put sustainability and purpose at the heart of their business models. Strategies to prevent waste and redesign products are taught in business schools, and are being acted on in those very same boardrooms where they were ignored just a decade ago.
Business leaders have slowly woken up to the realization that it actually makes good business sense to be more sustainable.
Early adopters like Patagonia, in the clothing world, or Nature’s Path, in the food and beverage industry, showed that embracing purpose and sustainability led to increased revenues, reduced costs and significant brand equity growth. The strength of the business case has only grown to the point where it has now become unequivocal: purpose-driven companies that make things more sustainably make more money, do more good, attract and retain top talent, are more creative, productive, innovative and so on.
So, as a society, and as a food and beverage industry, we are making progress.
But the second inconvenient truth, to borrow the term, is that we continue to live and operate in a “take-make-dispose” system that is a long way from being sustainable.
Feeding a growing global population requires a significant amount of resources and the inefficiencies in our food production and distribution are chronic; we still waste over 40% of what we produce.
As I wrote in my blog post two weeks ago, waste has become a resiliency issue, not just for food and beverage manufacturers, but for our entire food system. As we struggle collectively through this pandemic, any product that falls off the line or goes down the drain during the manufacturing process makes getting food and beverages to those who need it that much more challenging.
And while preventing waste from going to landfill is a noble start, if we don’t address why the waste is being created in the first place then we are only putting a band-aid on a hemorrhaging jugular.
It is time to go beyond the 3 Rs and focus on the future that we want to build coming out of COVID-19, one that takes us beyond a linear system into one that is restorative and regenerative by design; one that is circular.
Circularity has become the new buzzword. But the level of understanding of what it actually means mirrors where sustainability was twenty years ago.
In a circular economy, the activity itself builds the health and sustainability of the system. Non-renewable resources are deprioritized in favour of renewable ones. Waste and pollution are designed out and natural and regenerative systems are created. According to the Ellen MacArthur Foundation, the growth, cost reduction and new innovations that are generated by circularity drive economic benefits estimated at more than half a trillion dollars over ten years in Europe alone.
As ambitious, and conceptual as all of this still sounds, this is where we are going. We have to.
For the food and beverage industry, that means that the food and drinks that we make actually need to support both people and the planet. This means growing and sourcing in ways that support soil regeneration and human health, creating manufacturing systems that are net contributors of energy and are replenishing water sources, implementing closed loop packaging, preventing waste through new product lines and much more.
Globally, the average level of circularity is 9% - and this gap is not closing. Particularly in the food and beverage industry, we cannot continue consuming resources at this rate.
We need to do better than 9%. And as the current pandemic is very starkly illustrating, we don’t have 20 years to figure it out.
Last year, the World Business Council for Sustainable Development (WBCSD) worked with forty progressive companies to understand the state of circularity at an individual business level. This required the development of a completely new set of tools, metrics, indicators, KPIs and more, breaking new ground in how to measure and quantify circularity.
We are collaborating with WBCSD to adapt these new circularity indicators to the Canadian food and beverage industry. Food and beverage was not represented within the original forty companies, so the first Food & Beverage Circularity Assessments that we will be conducting here in Canada, will continue the line of global firsts.
The role for government, even at the municipal level, can be critical in creating local circular solutions. The City of Guelph, one of the most progressive cities in Canada and our home, in partnership with Wellington County, were awarded $10M by Infrastructure Canada to implement their Smart Cities vision: Our Food Future. Through this initiative, Guelph-Wellington will aim to become the first community in the country to develop a circular food system that creates more food security while at the same time creating more sustainable economic growth. We will be piloting the Food & Beverage Circularity Assessments in this project, which in turn will help fast-track these tools so firms across the country can accelerate their progress.
Circularity is still in its very early days, but it is inspiring to see how quickly new models are emerging. One of the potentially positive outcomes of the COVID-19 pandemic could be an acceleration of this trend, particularly when we consider the kind of innovation and science that the world is producing right now because of focused attention on the problem.
While firms like P&G and Danone are pioneering work at a global level, the power of the circular mindset offers new and exciting opportunities to all, regardless of size.
One of our purpose-focused clients, Wellington Brewery, is partnering with Oreka Solutions, an insect-farm, to transform spent grain and yeast into ingredients for animal feed, helping local farmers grow healthier livestock and get them to market faster. They have a clear understanding of how circular food system relates to their purpose and this is enabling the generation of new ideas and opportunities that benefit both the planet and the bottom line.
Also in the beverage industry, Ice River Springs (whose purpose is to “redefine bottled water”) achieved what some said was impossible by moving their plastic bottled water business to a closed loop circular model by developing a new green bottle made of 100% recycled plastic. This same firm, again driven by their purpose, has recently joined forces with Canadian Mist and Conex Freight to help fight COVID-19 by producing and donating hand sanitizer in their recycled plastics bottles to those who need it most.
Twenty years ago, I was first compelled to write about sustainability, in order to enroll more leaders and companies into embracing it.
Today, as the world negotiates the most challenging and unprecedented period in a century, I am called to write about circularity for the same fundamental reasons, but with significantly more urgency.
COVID-19 is a wake-up call that we need to change our food system, one company at a time.
We need to start growing and producing food and beverages that support people and planet, and we need to increase our level of circularity well beyond 9%.
That is my purpose.
By Cher Mereweather, CEO and President, Provision Coalition Inc.