UNECE emphasizes potential of digital transformation to drive economic circularity
In an era of rapid digital transformation, platforms like Google, Amazon, and Airbnb have created marketplaces by reducing transaction costs, scaling market reach, and lowering entry barriers. Yet, despite their success these platforms have yet to fully harness their potential to drive economic circularity.
To this end, the UN-ECE Transformative Innovation Network (ETIN) has developed a separate work stream to explore the potential of platforms driving the circular economy transition and transformative innovation. Partnering with TheNTWK | Digital Business Models CEO and ETIN member Maria Planas, ETIN recently hosted two sessions about platforms and ecosystem innovation at the recent TheNTWK summit in Barcelona.
The first session moderated by Immanuela Badde, Associate Economic Affairs Officer at United Nations Economic Commission for Europe, focused on how platforms can facilitate reverse logistics for the circular economy. Circular platforms may facilitate and streamline the reverse logistics processes necessary to enable the efficient collection, sorting, and redistribution of used products and materials, ensuring they are returned to the production cycle rather than becoming waste. The latter is crucial to minimize resource depletion, reducing environmental impact, and creating a sustainable economic system.
The second panel about multiple functions of circular platforms was moderated by Mikael Román, Project Coordinator of ETIN at UNECE, explored the additional functions platforms may serve in larger sustainability transitions, in addition to providing new market spaces. This session highlighted their importance for data sharing, collaboration, and continuous development of new innovative business models.
Moving forward, ETIN will leverage these insights to enhance project outcomes, foster vital collaborations in the digital platform landscape and drive sustainable innovation. The discussions underscored the need for policy support and continuous research to cultivate sustainable business models. In this context, ETIN has a clear role in facilitating continuous discussions that support transformative changes towards a more resilient, resource-efficient economy.
UNECE explores the potential of platforms in spurring the circular economy transition in the EV battery sector
The transition to a circular economy is pivotal for achieving sustainability goals, especially within the clean tech sector. Platforms can play a crucial role in facilitating this transition by connecting stakeholders, streamlining resource flows, and enabling efficient material reuse through the creation and scale-up of marketplaces. For example, in the Electrical Vehicle (EV) battery sector, a linchpin in the clean tech revolution, circular platforms can optimize batteries’ lifecycles by promoting more sustainable design, reuse, including through second-life applications, remanufacturing, and recycling.
To explore these dynamics, and the potential opportunities and challenges that circular platforms present for the circular economy transition, the UN-ECE Transformative Innovation Network (ETIN) hosted a panel session on this topic at the recent Innovation Zero Conference in London. Under the title of “the potential of platforms in spurring the circular economy transition in the EV battery sector”, the panel brought together insights from the private sector, a circular platform operating in the EV battery sector, and the research sector, looking at the policy developments in this area.
Discussions showed a growing need to ensure sustainability in the EV battery sector, with EV production expected to grow significantly in the coming years. According to the International Energy Agency (2023), the total number of EVs in circulation reached 40 million in 2023. The number of new EVs sold increased by 3.5 million from 2022 and was more than six times higher than in 2018. With production projected to grow even further in the next years, EV manufacturers are now facing the challenge of keeping up with the expected demand for EV batteries. Given also existing resource constraints for critical raw materials such as Cobalt and Lithium, needed for EV battery production, it becomes imperative to find new ways to meet this demand, as well as ensure the efficient and sustainable sourcing and use of resources and materials, also outlined in more recent policies, such as the Inflation Reduction Act in the United States and the EU Green Deal in Europe.
Circular platforms present an interesting opportunity to address these challenges. They can connect battery manufacturers, recyclers, and end-users, ensuring efficient material recovery and minimizing waste. By using a platform to adopt circular practices, such as recycling and reusing batteries, the sector can reduce waste, decrease reliance on raw material extraction, and minimize the ecological footprint of EVs. However, it will be vital to ensure that policy frameworks incentivize such circular business models and encourage collaboration across the value chain.
In addition to the panel session, ETIN also hosted a workshop for Innovation Zero participants on the topic of strategic learning for transformative innovation on 1 May as an official side-event of Innovation Zero. Strategic learning is a tool for exploration and decision making in long-term transformation processes characterized by uncertainty and complexity. Using concrete cases, workshop participants from the public and private sector discussed new and emergent needs and policies for learning to guide our efforts towards sustainability transformations, given the increased uncertainty and complexity that today’s challenges pose.
The above topics are examples of the many discussions ongoing under ETIN around challenges and opportunities in facilitating innovation for sustainable transformations.
To find out more about ETIN, please visit: https://unece.org/eci/icp/ETIN
UNECE presents circular solutions for the future world of sustainable industries at World Circular Economy Forum 2024
In today’s world of resource scarcity and the triple planetary crises of climate change, nature loss and pollution, many efforts are focused on developing new technologies, tools, products, and services that foster circular and sustainable consumption and production patterns across the textile, agriculture, electronics, and energy sectors. Public policies incentivize circular practices and sustainable use of natural resources. However, current efforts do not yet yield the results necessary to respond to the urgency and complexity of the current issues we face on a global scale.
Citizens need to increase their efforts to think of new ways of creating value. This includes facilitating experimentation, learning and innovative thinking on what types of processes and business models can help scale up current initiatives. In response to its member States’ decisions, UNECE has made circular economy a cross-cutting priority and is now developing different initiatives to support the uptake of best practices and facilitate the sharing of knowledge across different areas.
At the recent World Circular Economy Forum 2024 (WCEF 2024), UNECE showcased several of its key tools that support the circular economy across four thematic, but interrelated areas: business model innovation and the platform economy, traceability in global value chains with a starting point in the textile industry, circular food systems, and Circular STEP, a UNECE platform for policy dialogue on circular economy.
Business model innovation: the platform economy
One business model that could accelerate the circular economy transition is the platform economy. Modern platforms like Amazon, Uber, Airbnb have disrupted industries and achieved global scale. However, many of these still spur the linear economy, missing out on the potential of platforms in creating circular marketplaces. If developed with circular ambitions in mind, platforms could enhance circular practices and lower transaction costs, including the triangulation of supply and demand, and traceability and transparency of supply chains.
To discuss industry examples and policy implications of platforms for the circular economy, the UN-ECE Transformative Innovation Network (ETIN) co-organized a panel session at the WCEF on the topic of Platform-driven transition: scaling circular solutions. The session revealed that the circular transition is not only dependent on technological advancements and tools, but that it needs to also consider the potential and need for market creation and human behaviour. Markets will play a critical role in circularity as they help coordinate a variety of activities, such as matching supply and demand and creating synergies and spillovers between sectors - platforms are particularly suitable to facilitate such coordination.
Traceability in global value chains. Starting point: Textile
Another circular priority sector is the garment and footwear sector, being one of the highest climate impact sectors at global level and accounting for 4% of global greenhouse gas emissions. Enhancing circularity in the textile industry means overcoming challenges in production like eco-design and waste management legal frameworks.
At WCEF 2024 UNECE-UNECLAC shared recommendations from their study on second-hand clothing trade flows from global, European and Chilean perspectives. UNECE also presented its latest tool- the Product Circularity Data Standard - an extension of its existing traceability and transparency standard for textile and leather, providing business requirement specifications (BRS) supporting the standardized data exchange for circular business models.
Moreover, since 2019 the joint UNECE-International Trade Centre’s project supported by the European Commission, has increasingly drawn attention to the enabling role of traceability and transparency to improve value chains sustainability and circularity. This has demonstrated encouraging results regarding the potential of advanced technologies, like blockchain, to achieve traceability and tools available to support companies to share product information on sustainability criteria in a standardized format and formulate claims. 100 companies and stakeholders from the sector have joined UNECE's Sustainability Pledge call to action and blockchain pilots, including the Reda Group, Inditex, SÖKTAŞ Textile, etc.
Circular food systems
WCEF 2024 had a special focus on circularity in agri-food and biobased materials. Currently, a third of all food produced is lost or wasted - around 13% between harvest and retail, and another 19% at household, food service, and retail levels, according to estimates by FAO and UNEP. When food goes to waste it means that the resources used to produce that food are wasted, highlighting the urgency to increase resource efficiency and circularity in agri-food value chains.
UNECE and the World Resources Institute (WRI) organized an accelerator session on Circular Food Systems: Enabling Policies and Successful Business Cases in the Agri-Food Sectorto spotlight actions in Rwanda and Serbia to increase circularity in agri-food sectors and highlighted the role of policies and successful business models in promoting circularity.
Food waste is not just a problem in developed countries. In developing countries, 40%of losses occur at post-harvest and processing levels (WFP). This challenge is particularly noticeable in fresh fruit and vegetable value chains. To address this, UNECE's Working Party on Agricultural Quality Standards developed a Code of Good Practice for reducing food loss and ensuring optimum handling of fresh fruit and vegetables along the value chain, providing practical guidelines for minimizing food loss and waste at production, trader, transporter and retail levels.
Circular STEP: UNECE platform for policy dialogue on circular economy
To encourage the emergence of circular solutions, it is important to create avenues for sharing experiences and lessons learned, and to empower actors by facilitating cooperation. This is where another UNECE’s Circular Economy Stakeholder Engagement Platform (Circular STEP) comes in. Established in 2022, Circular STEP facilitates peer learning and knowledge sharing among public and private sectors, organizations, and academia in the UNECE region.
At WCEF 2024, UNECE and the Mission of the Republic of Serbia to the European Union organized a session on the power of partnerships: Stakeholder Engagement Platform Circular STEP to showcase the important role of stakeholder platforms in accelerating circularity. Speakers shared experiences on the usefulness of platforms for advancing circularity, including examples from the regional EU Circular Economy Stakeholder Platform, African Circular Economy Alliance (ACEA), Global Alliance for Circular Economy (GACERE), Platform for Accelerating Circular Economy (PACE), as well as national platforms in Belgium and Serbia.
Circular STEP representatives shared experiences on circularity enabling policies and discussed digital solutions for circular transition. There was a strong recognition of the need to continue to promote and expand these platforms to ensure that more stakeholders can access the essential knowledge and tools, making the circular transition a widespread reality.
UNECE will continue showcasing its practical circular solutions at its Regional Conference on the Circular Economy Transition, which will take place in Geneva, Switzerland, on 26 June 2024.