Corporate social responsibility can go a long way to addressing the many challenges facing the world today. To that end, we will need to replace the linear industrial model that sees businesses and consumers take, make, use and waste – often to the detriment of natural resources and human capital ¬– with a new ‘syndustrial’ system in which corporations and people will borrow, create, benefit and return.
The practice of corporate social responsibility (CSR) and sustainable business has evolved over the past 50 years. First defensive and charitable, this model was based on legal compliance, risk management and supporting philanthropy and non-governmental organizations. When coupled with a promotional public relations approach, the CSR is used to align core business in support of social and environmental issues.
Unfortunately, despite these advances, many global problems associated with industrial economic activity are still getting worse, not better. These range from biodiversity loss and climate change, to growing income inequality and pervasive corruption.
Business – especially big business – must take adequate responsibility for the problems it has played a part in creating.
The “inconvenient truth” is that our current approaches to CSR and sustainable business are not up to the challenge. Nothing less than a transformation of our outdated industrial model will be able to reverse the effects of our present unsustainable economy.
One of our best hopes for such a revolution is the adoption of a circular economy strategy by business.
This major shift can be described as designing for industrial synergy. This means that products are designed so that, at the end of their first life, they can be easily turned back into useful materials for new products. Hence, what might have become pollution or waste from one company is transformed into resource inputs for another company.
This is because, to solve our global challenges, we need to create a society that does not build economic capital by destroying natural resources, eroding culture and exploiting human capital in the way that our current capitalist system does.
We must replace our old linear industrial model with a new – and circular – industrial model.
In the old linear industrial model, business and consumers take, make, use and waste: We take by depleting non-renewable resources and overusing renewable resources and by striving for limitless economic growth; we make by producing any products and services that the market demands; we use by buying more than needed, leading to overconsumption and individually owning what could otherwise be shared; and we waste by turning consumed products into trash and pollution, which harm people and nature.
By contrast, in the “syndustrial model” business and consumers will borrow, create, benefit and return. We will borrow by conserving all natural resources and increasing renewable resource use. Then we will create, by designing and making products with no negative impact and innovating products with positive impact.
A good example comes from Italy where Novamont, a producer of biodegradable plastics, has adopted a renew and refine strategy. Among its clients are the global coffee company Lavazza, which now sells compostable coffee capsules produced by Novamontthat biodegrade within 20-40 days after use.
Similarly, BioGen in Britain has a renew and restore strategy where it produces renewable energy (biogas) from food waste and in turn use the waste slurry as bio-fertilizer, which has been shown to produce higher crop yields compared with chemical fertilizers.
In this new syndustrial model, we benefit by extending the product life by repairing and reusing and by improving use by leasing and sharing. This all contributes to a smarter, more efficient model that works for both business and consumers.
For example, Caterpillar, the heavy machinery company, has pursued a reuse strategy through its remanufacturing centre in South Africa (the second largest in the world), which is designed to rebuild “as new” CAT components for 20 to 60 per cent less than the cost of replacing with new parts.
Similarly, the Dutch company aWEARness has created the first true “circular” clothing items. WearEver suits are made from 100per cent recyclable polyester, giving the total life of the suit between 40 and 50 years.
Tetrapak in Ecuador is part of a reinvent strategy, whereby beverage packaging waste is being “upcycled” by an independent company into a range of high quality products, such as corrugated roofing, furniture, table tops and jewellery. Similarly, REDISA in South Africa is managing the recovery and reprocessing of 70 per cent of waste tires in South Africa into a variety of rubber and steel products, while creating more than 3,000 jobs.
These examples are all featured cases in a documentary called “Closing the Loop”, due for release in June 2017. By adopting and scaling these new business models, we can achieve transformative sustainability and social responsibility, which focuses its activities on identifying and tackling the root causes of our present unsustainability and irresponsibility.
Through innovating and revolutionizing business models, products and services we create a world in which people and the planet can not only survive, but also thrive for generations to come.
Dr Wayne Visser is Director of Kaleidoscope Futures, a think-tank and media company. He is a Fellow at Cambridge University’s Institute for Sustainability Leadership and Visiting Professor in Sustainable Business at the Gordon Institute of Business Science. His work as a strategy analyst, sustainability advisor, CSR expert, futurist and professional speaker has taken him to over 70 countries in the past 20 years. He previously served as Director of Sustainability Services for KPMG and Strategy Analyst for Capgemini in South Africa.
This article first appeared in TheMarkNews