Circularity as the new normal - Future fitting Swiss businesses - WWF Schweiz
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Circularity as the new normal
Future fitting Swiss businesses
www.pwc.ch
Authors and contributors Table of Contents
Main authors Foreword 4
Prof. Nancy Bocken Maastricht University, Maastricht Sustainability Institute, ERC project Circular X Executive summary 5
Prof. Walter R. Stahel The Product-Life Institute Geneva
1. Introduction 6
Dr Günther Dobrauz PwC Switzerland
Dr Antonios Koumbarakis PwC Switzerland 2. Circular economy: the basics 7
Moritz Obst PwC Switzerland 2.1 Tackling the planetary boundaries 7
Patricia Matzdorf WWF Switzerland 2.2 Business risks of the linear economy 8
2.3 Lost value in the linear economy 9
Contributors 2.4 The circular opportunity 9
2.5 Defining a circular economy for sustainability 10
Thomas Vellacott WWF Switzerland
Prof. Karolin Frankenberger St Gallen University (HSG), NFP73 - Laboratory for Applied Circular Economy (LACE) 3. Circular economy: in context 11
Dunia Brunner University of Lausanne, NFP73 - Laboratory for Applied Circular Economy (LACE) 3.1 Switzerland 11
Felicitas Pietrulla St Gallen University (HSG) 3.2 European Union 14
Konstantin Meier PwC Switzerland 3.2.1 France 16
Sofia Tsankova PwC Switzerland 3.2.2 Denmark 16
Loric Szalai PwC Switzerland 3.2.3 The Netherlands 16
Martje Timmermann PwC Switzerland
4. The circular opportunity: Swiss sector deep-dives 18
Hélène Baron PwC Switzerland
4.1 Food sector 18
Marcel Tschanz PwC Switzerland
4.2 Textile sector 22
Dr. Utz Helmuth Strategy& Switzerland 4.3 Financial services sector 26
Nils Moussu sanu durabilitas 4.4 Pharma sector 31
Amadine Favier WWF Switzerland 4.5 Watch and jewellery sector 34
Ivo Mugglin WWF Switzerland
Dario Grünenfelder WWF Switzerland 5. Overcoming the challenges 37
Dr Daniela Hoffmann WWF Switzerland 5.1 The rebound effect 37
Sylvia Meyer WWF Switzerland 5.2 Energy use and recycling 37
5.3 Cost of materials 37
Reviewers 5.4 Collaboration 37
5.5 Regulatory advantages and disadvantages 38
Stephan Hirschi PwC Switzerland
5.6 Designing sustainable circular business models 38
Christophe Bourgoin PwC Switzerland
5.7 Measuring circularity 39
Elgin Brunner WWF Switzerland
Damian Oettli WWF Switzerland 6. Conclusion and recommendations 40
Franziska Zoller WWF Switzerland 6.1 Key takeaways from the Swiss sectors 41
Justus Kammüller WWF Switzerland 6.2 10-point recommendations for a circular Switzerland 42
Manuel Graf WWF Switzerland
Endnotes 45
Susanna Fieber Bundesamt für Umwelt (BAFU)
Andreas Hauser Bundesamt für Umwelt (BAFU) References 50
Niklas Nierhoff Bundesamt für Umwelt (BAFU)
Dr Melanie Haupt ETH Zurich, NFP73 - Laboratory for Applied Circular Economy (LACE)
Annex 56
Rapid circularity assessment 56
Food sector cases 58
Textile cases 60
Watch and jewellery cases 62
Contacts 64
2 | Circularity as the new normal Future fitting Swiss businesses | 3
Foreword Executive summary
Maintaining a resilient and Society and politicians continue to Across the global north and south, Our consumption of natural resourc- tackle inherent systemic risks that So, on the one hand, circularity offers
sustainable planet within neglect the implications of exceeding countries exist under varying envi- es and use of materials are on a have been made starkly apparent in Switzerland a vehicle to make meas-
planetary boundaries – the our planetary boundaries. Ample ronmental, social, political, legislative dangerous and unsustainable track: the wake of the COVID-19 pandemic urable progress for various sustain-
evidence on climate change and dev- and economic realities, and yet we the global use of natural resources and the current climate crisis. The ability commitments (Agenda 2030
case of Switzerland astating biodiversity losses show that all share and depend on the limited and Paris Agreement 2015 etc.) and
has more than tripled since 1970 and paper integrates high-level analyses
Natural cycles developed long before human activity cannot continue on set of global resources provided continues to grow, pushing climate of several sectors from a circular ultimately reduce its primary resource
the advent of humans: the water the same pathway in a ‘linear econ- by the Earth. We all have a role to stability and ecosystems world- perspective in order to analyse the usage overall. On the other hand, it
cycle, the fauna and flora cycle, the omy’. 1 In short, the current systems play in safeguarding the wellbeing wide to the limits of their resilience. benefits of circularity in five different could be an enabler for Switzerland
chlorophyll and CO2 cycles. These born out of the industrial era are not of nature and the resources for Switzerland also contributes to this sectors, their most suited resource to make the most of its advantages
cycles formed the foundations of our sustainable if we don’t address the future generations of all species. situation through its high per capi- strategies and obstacles that need (i.e. leading technical universities,
planet’s ecosystems. They don’t pro- costs at which they were achieved If businesses, citizens and states ta consumption of resources. This to be overcome in order to become high sustainability consciousness
duce any waste: all ‘lost’ resources and move to circular models of socie- strive to foster closed, slowed and means that although Switzerland more – or ideally – fully circular. In and access to financing) to catch up
become food or building stones for ty and economy. regenerative loop economies based may recycle more waste than most addition, a number of innovation cas- with countries in the EU and beyond,
other players. on regional culture and existing of its European neighbours, it’s also es are presented to highlight current which are leading the way in circular
By transitioning to modern-day forms resources, they’ll move one step one of the largest consumers and industry efforts. strategies and implementation.
Human societies grew within these of circular societies, nations can closer to enabling humankind to waste-producing nations in the world.
natural cycles. Our societies have al- tackle challenges associated with prosper in the long run, respecting In order to meet the requirements for According to our findings, the circular Despite efficiency gains, Switzer-
ways had the objective of enhancing the negative legacy of the Anthro- the boundaries of our planet. It’s our operating within the Earth’s plane- economy could present a multi-bil- land is currently far from sustainable
the value and utility of local stocks of pocene2 and the transfer of negative decision. We determine our future. tary boundaries, Switzerland would lion-franc opportunity for Swiss resource use. In order for Switzerland
resources under our control, like nat- environmental externalities abroad by - Walter R. Stahel need to reduce its natural resource businesses with regard to recov- to make use of its advantages and
ural produce – plants, animals, gravel developing: consumption by two-thirds. ered resource value, access to new accelerate the transition to a resilient
and rocks – as well as cultural riches markets and green investment funds, circular society and economy, this
and physical infrastructure, buildings • innovative circular sciences – Circular economy supports sustaina- as well as the value created through white paper outlines recommenda-
and objects. It should be noted that physics, chemistry and metallur- ble development by aiming to secure new circular products and servic- tions in the following areas:
the societies which maintained local gy – which do not discharge any the resources to sustain our current es. Simultaneously, such circular
synthetic molecules into nature 1. Catching up on circular targets,
stocks of resources were generally and future generations. To allow busi- approaches can offset pressing re-
the ones that thrived. • circular economies which are built nesses, policy-makers and citizens source, market, operational, business action and policy
on maximising the use of stocks to navigate and evaluate different and legal risks associated with the 2. Going beyond recycling
The rise of the industrial revolution of objects through service-based circular economy solutions, it’s help- current linear ‘take-make-dispose’ 3. Collaborating to address envi-
brought many welcome advances, models, and close the material ful to simplify and categorise circular model. So, circular opportunities will ronmental hotspots
e.g. in fighting diseases and reducing loops on an atomic and molecular economy options according to their let Swiss businesses and society bal-
basis, discharging no objects or 4. Innovating and experimenting
poverty. In stark contrast, it resulted resource focus. This white paper ance current and future risks asso- for new circular models
materials into nature which are
in growing populations, fossil-fuel delves into the following resource ciated with the linear economy. The
incompatible with its circularity 5. Designing-in sustainability from
enabled industries and urbanisa- strategies: rethinking and redesign of current
• political framework conditions the very beginning
tion enabling mankind to out-power linear business models to circular
nature, overloading its absorption which also promote circularity for 1. Narrowing: decreasing material and ones will inevitably fuel a new wave 6. Measuring and reporting for
capacity. immaterial loops, like full environ- energy use per product of sustainable innovations which circular success
mental liability of producers for 7. Using the finance sector to ac-
2. Closing: ensuring both production capitalise on advantages (e.g. derived
their materials and products, and celerate the circular transition
Today, circular economy strategies material (and resources) and the from shorter supply chains due to a
which give preference to the use
challenge the business-as-usual of renewable resources including finished product can be – and are – focus on more locally sourced mate- 8. Developing the smart mix of
approaches of the linear industrial human labour recycled rials, products and ingredients, and a voluntary action, cooperation,
economy which continues producing 3. Slowing: consuming less and using reduction in the amount of materials regulation and incentives
• governance structures which
new objects for sale. This prevailing products for longer over time used) but also a significant decrease 9. Developing a circular economy
preserve the global commons and
desire for the incessant production 4. Regenerating: cleaner loops and in risks (e.g. less dependency on roadmap for Switzerland
give to nature what nature needs,
and consumption of goods invariably like biodiversity and water cycles organisations contributing to leaving scare resource supply and a de- 10. Keeping the big picture in mind
has a negative impact on the wellbe- – to name but two elements – and the environment in a better state creased risk of losing customers due
ing of nature. regenerate natural systems. than how it was found. to their sustainability preferences).
Thanks to circular solutions, Swiss
The different circular strategies businesses and stakeholders will be
present promising opportunities to able to contribute to an economically,
build more resilient economies and socially and environmentally resilient
societies. What’s more, they help us future.
4 | Circularity as the new normal Future fitting Swiss businesses | 5
1. Introduction 2. Circular economy: the basics
“Basic economics shows that the of their ties to WWF Switzerland and Despite efficiency gains, Switzerland 2.1 Tackling the planetary Biodiversity loss and
species extinction
planet simply cannot carry our lin- PwC’s partners. We could envision is currently far from achieving sus- boundaries
ear production path any longer.”3 writing further editions on other sec- tainable use of resources.4 Global
Climate change
tors in future versions. resource consumption is rising to More of everything – is that even pos-
Circular strategies present promising untenable levels, threatening climate sible? Our current global consump-
opportunities to build more resilient According to our findings, the circular stability and pushing ecosystems tion and production system is rather
economies and societies. What’s economy could present a multi-bil- worldwide to the limit. Switzerland linear and follows a ‘take-make-dis-
Novel entities
more, they help us tackle inherent lion-franc opportunity for Swiss busi- contributes to this situation through pose model. It’s an extractive and (not yet quantified)
systemic risks that have been made nesses with regard to recovered re- its high per capita consumption of resource-intensive model that dis-
starkly apparent in the wake of the source value, access to new markets resources. In fact, studies show that rupts the Earth’s system, breaching a
Land-system
COVID-19 pandemic and the current and green investment funds, as well Switzerland would need to reduce number of key planetary boundaries change
climate crisis. as the value created through new cir- its natural resource consumption (biodiversity, phosphorus and nitro-
cular products and services. Simul- by two-thirds5 in order to meet the gen levels) while other boundaries
Stratospheric ozone
This white paper targets businesses, taneously, such circular approaches requirements for operating within (climate change and land-system pollution
circular economy champions, NGOs can offset pressing resource, market, the Earth’s planetary boundaries, i.e. change) are at increasing risk (see
and politicians to inform, inspire operational, business and legal risks within the safe operating space. This Figure 1). So, the way we use natural
and incite more sustainable circular associated with the current linear is particularly important in mitigating resources is key to remaining within a
Freshwater use
action across selected Swiss indus- ‘take-make-dispose’ model. the climate crisis for which Switzer- ‘safe operating space for global soci-
trial sectors, namely food, textiles, land has pledged to become climate etal development’.7 In other words, to
Atmospheric aerosol
financial services, pharmaceuticals, On the one hand, circularity of- neutral by 2050.6 Circular approach- making sure we don’t go beyond the loading
watches and jewellery. It contributes fers Switzerland a vehicle to make es can help us work towards these limited biophysical capacity of our (not yet quantified)
to the on-going discussion around measurable progress with various goals, for which business, society planet.
Ocean
circular strategies which reduce sustainability commitments (Agenda and politics have a central role to
P acidification
environmental and social impacts 2030, Paris Agreement 2015 etc.) and play. But, our consumption of natural
while making business sense. The ultimately help it reduce its prima- resources and use of materials are
N
white paper integrates high-level ry resource usage overall. On the PwC Switzerland and WWF Switzer- on a dangerous and unsustainable
track: the global use of natural Biochemical
analyses of these sectors from a cir- other hand, it could be an enabler for land have joined forces with leading flows
cular perspective and makes specific Switzerland to make the most of its academics to bring you these in- resources has more than tripled since
recommendations at business level advantages (e.g. leading technical sights, as we feel strongly that transi- 1970 and continues to grow.9 The Human activities are within the safe margins
as well as a 10-point set of recom- universities, high sustainability con- tioning to a circular and more resilient extraction and processing of natural Human activities may have exceeded the boundary threshold; increasing risk of serious
resources is responsible for more consequences
mendations for more circularity in sciousness and access to financing) economy and society requires a
than 90% of biodiversity losses,
Switzerland overall. and catch up with countries in the EU broad coalition of committed actors. Human activities have exceeded the safe margins; high risk of serious consequences
water stress, and approximately half
and elsewhere, which are leading the
of our climate change impacts.10
Please note that the sectors analysed way in circular strategies and imple- We wish you interesting and This negative trend is a matter of Figure 1: Current status – planetary boundaries. The green zone denotes a ‘safe
in this report were selected on basis mentation. entertaining reading! operating space’, the yellow is the ‘zone of uncertainty’ (increasing risk) and the red is a
great concern. In addition, the social
‘high-risk zone’.8 This diagram is symbolic representation from 2015. It does not show
and environmental benefits and the actual values to date. Source: Rockström et al, 2009a; 2009b; Steffen et al., 2015b
impacts of resource use are unevenly
distributed across the planet, with
many high-income countries, like
Switzerland, transferring their
negative environmental impact
abroad, where most production takes
place.
Dr Günther Dobrauz Thomas Vellacott
Partner and Leader Legal, CEO WWF Switzerland
PwC Switzerland
6 | Circularity as the new normal Future fitting Swiss businesses | 7
2.2 Business risks of the • Operational risks refer to factors 2.3 Lost value in the linear product level modelling, a report products are manufactured in a more
that present a threat to a firm’s in-
linear economy ternal operations, including failures
economy from the Ellen MacArthur Foundation robust and repairable manner, as a
related to the supply chain, internal estimates that the circular economy result reducing commodity turnover
The effects of climate change, bio- processes or worker safety, as well Negative externalities The current take-make-dispose represents a net material cost-saving rates and its detrimental impacts.22
diversity loss and resource scarcity as the difficulty to hire or retain explained system creates a shocking amount of opportunity of USD 340 to 380 billion Although current systems don’t allow
are becoming progressively more talent etc. waste, which from a circular per- per year at EU level for a ‘transition for this, consumers’ willingness
apparent.11 NASA lists the follow- • Business risks arise due to Generally, negative externalities spective constitutes lost value. In scenario’.19 for environmental considerations
ing trends as symptoms of climate emerging societal, economic and are external costs which are in- total, some 65 billion tonnes of raw demonstrates ample opportunity for
change: “increased heat, drought political trends that affect the stra- curred by an unrelated third party materials entered the global eco- a future circular economy that pro-
and insect outbreaks, increased tegic business plan objectives of a as a result of an economic trans- nomic system in 2010.16 According to 2.4 The circular opportunity vides better services to consumers,23
wildfires, declining water supplies, firm, including changing consumer action. This includes waste and the Circularity Gap Report 2020,17 in but also tackles core sustainability
reduced agricultural yields, health demands, new technologies and pollution leading to environmental 2020 this figure more than doubled Across the board, the lifespan of challenges like climate change.
impacts in cities due to heat, flooding new business models etc. degradation. As current produc- to over 100 billion tonnes of primary consumer products in Europe has
and erosion in coastal areas” and • Legal risk results from the failure tion processes include the private materials entering the global econ- been in decline.20 A study by the Although it has great potential as a
many more. to comply with current or future costs incurred by the producer omy every year, which equals 90 European Environment Bureau (2019) solution for our global resource and
regulations, including sourcing but external costs are passed on times the total mass of vehicles in the estimated that extending the lifetime economic issues, we need to remain
In the 2020 WWF-PwC Report rules, new government policies, to society, companies have no Swiss mobility sector. Humanity’s of all washing machines, notebooks, critical about why the circular econ-
“Nature is too big to Fail”, alarm bells extended producer responsibility incentive to rethink production resource use is currently 8.6% vacuum cleaners and smartphones omy is put forward as a sustainable
rang, noting that “never in human and fines or lawsuits.14 decisions and reduce pollution. ‘circular’ – meaning that over 90% in the EU by just one year would save pathway in the first place: to meet
history has biodiversity declined as Instead, they are likely to produce of our primary resources do not around 4 million tonnes of carbon human needs while minimising the
fast as it does today. We are facing Global megatrends including dis- more than the social and environ- re-enter the resource circle. emissions annually by 2030, which is associated environmental impact.24
the sixth mass extinction and could ruptive technologies, a massively mental optimum. the equivalent of taking over 2 million So, it’s important to focus on the
witness up to 1 million species being growing middle class as well as The majority of these value losses cars off the roads for a year. In fact, environmental impact and resource
wiped out by the end of the centu- ongoing globalisation increasing the Today, most primary raw ma- occur due to materials being thrown the OECD estimates that over 50% usage when outlining the concept of
ry.” Biodiversity holds key solutions interrelation and altering the tradition- terials are often cheaper than away and primary resource use of the global greenhouse emissions the circular economy.
to mitigate and adapt to climate al roles of governments, businesses secondary raw materials. This associated with the food, mobility, are due to material management of
change.12 and citizens, don’t just increase such is largely due to the fact that housing and commercial construc- resources.21 The circular opportunities for Swit-
risks. They also provide new opportu- negative externalities are not tion industries (e.g. virgin automotive zerland specifically are discussed in
These climatic changes are symp- nities related to alternative economic reflected in the price of primary and construction material), as well as Products like mobile phones and section 4 of this white paper.
toms of the prevailing linear and often models like the circular economy. raw materials. externalities like CO2 (cost per tonne) clothing are increasingly treated as
fossil-based ‘business as usual’ Bearing in mind that a linear econo- or the non-cash health impacts of ‘disposables’ with quick replace-
approach. If businesses don’t opt to my is tied to the concept of long-term Circular business models could accidents, pollution and noise.18 ment rates, rendering the systems
adapt their business models towards economic growth, which is incon- help offset or reduce negative ex- for dealing with the increasing levels
more sustainable circular alterna- sistent with the concept of long-term ternalities, but only if the environ- This ‘lost value’ constitutes a major of waste inadequate. What’s more,
tives, they risk falling victim to future ecological effectiveness, this shift is mental and social considerations cost-saving opportunity through en- according to a European survey, 77%
volatility in resource supplies and urgently needed.15 To prepare for the are designed into the production hanced circularity. Based on detailed of EU consumers would prefer that
price, failures in the value chain and impending risks, businesses, politics process. If these considerations
disruptive new business models.13 and society must act now. are not incorporated in the de-
velopment of a circular business
The FinanCE working group, con- model, these too may result in
sisting of several financial institutions negative externalities.
interested in circular economy, cate-
gorizes the ‘linear risks’ as follows: Sources: PwC, 2019; Bundesrat
Postulates 17.3505, 2020; PwC, 2020
• Market risks refer to market and
trade-related factors that impact
the assets and liabilities of busi-
nesses, including price volatility,
resource scarcity, trade bans,
higher interest rates and lower
investor interest etc.
8 | Circularity as the new normal Future fitting Swiss businesses | 9
2.5 Defining a circular
economy for sustainability
Narrowing resource loops is about
decreasing material and energy use
per product. Many companies in the
For glass, the recycling status and
potential are high, but the energy
savings of recycling are low,29 so we
3. Circular economy: in context
To let businesses, policy-makers linear economy already engage in this must also focus on slowing the loop
and citizens navigate and evaluate strategy as it reduces costs and in- for greater environmental benefits.
different circular economy solutions, creases profit, but the eco-efficiency All the more so, because even if all
it’s helpful to simplify and categorise of designing and producing products waste could be recycled this would 3.1 Switzerland 2019 according to the International – should lend themselves well to the
circular economy options accord- in the right way can be very impactful. only cover one-fifth of the current Monetary Fund.37 And finally, the En- development and uptake of sustain-
ing to their resource focus. Here we Light weighting products is a prime material requirements.30 This means Switzerland is considered by some vironmental Performance Index (EPI) able circular innovations and strate-
introduce the following resource example of narrowing resource that more innovative environmen- as one of the most innovative, ranked Switzerland as the third most gies.
strategies: (1) narrowing, (2) closing loops, like reducing the weight of an tally-friendly substitutes are needed. wealthy and sustainable countries sustainable country globally, taking
(3) slowing and (4) regenerating re- aluminium drinks can so it’s lighter to in the world according to selected into account indicators on ecosystem But in practice the picture looks very
source loops.25 transport, or reducing the weight of Slowing resource loops is about international country rankings.35 In vitality (biodiversity, climate change different. Particularly, when consider-
an aircraft for greater fuel efficiency. using products for longer. It’s asso- 2020, it was ranked as one of the and ecosystem services) as well as ing sustainability, much depends on
We apply the following definition of ciated with the higher strategies in most innovative countries by the health (air quality, sanitation, drinking the indicator chosen and the scope
the circular economy, which is in line Closing resource loops refers to the waste hierarchy like avoidance (of Global Innovation Index for 10 con- water and waste management).38 of the factors considered.
with the sustainable development the practice of ensuring both the pro- resource use), reuse and reduction. secutive years running.36 Switzerland
concept: duction material (and resources) and The goal is to create durable and is a high-income country, with the In theory, these characteristics –
the finished product can be – and are long-lasting products which would in second highest per capita GDP in innovation, sustainability and wealth
“Circular economy supports sus- – recycled. It’s generally accepted turn slow consumption and decrease
tainable development by aiming that recycling is a widely-used and resource use. Slowing the loop is po-
to secure the resources to sustain successful environmental practice. tentially the most impactful environ-
Switzerland and the
our current and future genera- While it’s a significant and important mental strategy, but it’s also the most
tions. 26 This is achieved by mini- strategy, it should be understood challenging one to implement be- >4 planetary boundaries
mising resource inputs and waste, that for major global manufacturing cause it requires a significant rethink
>2
emission and energy leakage of materials like steel, cement, paper, of the business model focusing on Contrasting sharply to the EPI
products over time, using four glass, plastic and aluminium, recy- ‘value over volume’ and from faster to >1 rankings above, the Global Footprint
distinct strategies: narrowing, cling is complex and its assumed slower forms of consumption.
person and per year, CHF 600
higher than the global per capita tar- per capita limit. We see similar trends under the planetary boundaries. The go to waste. The environmental kg, nearly 100 kg more than in 1990), source use, supporting material val-
get value. Moreover, CO2 also causes for biodiversity loss which is 3.7 times chart below from the Federal Office impact of food waste occurs: 38% along with the consumption of natural orisation and promoting sustainable
ocean acidification. Here the Swiss higher and over-fertilization (eutroph- of the Environment provides a visual in households, 14% in gastronomy, resources.55 This observation high- consumption and circular economies.
per capita impact on ocean acidifica- ication) by nitrogen, which is twice representation of the situation.41 8% in wholesale and retail, 27% in lights the need for a circular strategy This initiative is a synthesis of seven
tion is 21 times higher than the global as high as the per capita limits set processing and 13% in agricultural which goes beyond waste manage- individual initiatives on CE proposed
production. ment and recycling to tackle the a year ago by members of parliament
• Over 50,000 tonnes of used cloth- pressing environmental issues that from various political parties, based
25
X times higher
ing and textiles are disposed of we’re confronted with. This is why the on propositions made in the counter-
throughout Switzerland every year regulatory environment has to evolve proposal by the Federal Council to
20 and go beyond a strategy that focus- the green economy initiative men-
– that’s roughly 100 tonnes per
day in Switzerland alone.52 Swiss es on minimising the symptoms of a tioned above. Since this is a legisla-
15 people have an average of 118 production and consumption model tive initiative, its goals are expressed
items of clothing in their wardrobe, that’s flawed by conception. in broad and comparatively general
10 they buy 60 new ones every year terms. Yet, several proposed provi-
and 40% of their clothes are never Political and regulatory shifts sions are worth mentioning:
worn or are only worn 2-4 times.
5 In 2016, a popular initiative on green
• Switzerland is home to world-re- economy suggested an ambitious • The Confederation as well as
0 nowned luxury watch and constitutional goal that could have cantons are required to safeguard
Greenhouse gas footprint Ocean footprint Biodiversity footprint Eutrophication footprint jewellery companies and is the led to various adaptations of the natural resources and increase
global leader in the gold refining the efficiency of resource use
regulatory framework. At that time,
Overshoot (exceedance of the threshold value) Established threshold value market. Around half of the largest in order to reduce environmental
the political configuration wasn’t
luxury watch brands are Swiss, harm in Switzerland and abroad.
ready to adopt either such an ambi- The government has to report
Figure 4: Switzerland and the planetary boundaries. Source: Dao et al. 2015, FOEN 2018a
and between 60% and 70% of
tious strategy that aimed at keeping regularly to parliament on meas-
the globally mined gold physically
travels through Switzerland to be Switzerland’s ecological footprint ures concerning the use of natural
refined (~2,400 tonnes in 201753). within the boundaries of one planet resources and to propose related
One further characteristic of the below 17 tonnes) between 2000 and materials can be further optimised.49 by 2050, or the counterproposal quantitative targets.
Yet, the sector with its sourcing of
Swiss environmental footprint is that 2018.45 Yet, Switzerland’s material • Regarding municipal solid waste, raw materials and the rising supply developed by the Federal Coun-
• A platform promoting CE in
many of the detrimental effects occur footprint is still considerably higher Switzerland is one of the highest of unrepairable low-quality fashion cil. Since then, the parliament has Switzerland should be created
abroad. The environmental impact than the average for EU countries recyclers worldwide. Although items and smart watches with adopted some of the articles of the by the Confederation, gathering
of Swiss domestic consumption of 14 tonnes per capita in 2017.46 the non-recyclable share of relatively low life expectancies, counterproposal (Art. 35 e, f, g, h), and fostering collaboration with
has decreased, but this decrease is Waste contributes significantly to municipal solid waste remained has a bigger ecological and social while others are being discussed at cantons, business associations as
predominantly due to a shift in reli- Switzerland’s material footprint, with unchanged, the percentage of impact than many might think. the time of writing (2020). Alongside well as scientific and civil society
ance on overseas production. Due to construction waste being by far the recycled waste is constantly policy developments at EU level, organisations.
increasing (from 45% in 2000 to
global supply chains and the high per largest waste category, generating But, despite all the recycling efforts numerous interventions have been or • Specific provisions should be
53% in 2016). The recycling focus
capita income, many of the goods above 80% of all waste. In Swit- and partial success, it’s important to are in the process of being discussed developed regarding packaging
is on established materials like
bought are imported from abroad. As zerland. The second largest waste glass, PET, aluminium, paper and mention that a sustainable circular in parliament, dealing with most of (use of circular materials, avoid-
a result, the environmental impacts category is municipal solid waste, steel. More complex products economy involves recycling as a last the dimensions of the circular econo- ance of unnecessary packaging)
of Swiss production and consump- followed by biowaste representing comprising various different ma- resort – because even if all waste my: from the traditional dimensions of and material valorisation (metals
tion have merely been ‘outsourced’ the third largest waste category.47 terials (e.g. electronic scrap, haz- could and would be recycled in Swit- closing the resource loops (material in waste, materials in construction
abroad [to regions like China (6%), ardous waste, slag or filter dust) zerland, it would only cover one-fifth and thermic valorisation), to issues waste, phosphorus in sewage
Europe (60%) and the US (12%)42], In total, Switzerland produces 80 to are being increasingly collected of the current material needs. So, related to specific materials (sustain- sludge and other waste etc.).
where they continue to increase due 90 million tonnes of waste each year, separately. But, Swiss recyclers in environmental terms it’s not the able management of plastics and • Other provisions are mentioned
to rising demand.43 with two-thirds (around 68%) of raw come of significantly worse when preferred approach, and attention in action plan against food waste etc.), on energy recovery, packaging
materials already in the economic it comes to non-PET plastic: out Switzerland should be drawn to other to provisions on slowing the resource collection and collaboration with
of 780,000 tonnes of plastic waste economic organisations.57
These environmental trends are at cycle.48 As shown below, recycling strategies like slowing and regenerat- loops (availability of spare parts and
each year, only 80,000 tonnes,
odds with the need to remain within efforts and the circular potential vary ing resource loops as well. reparability index etc.), as well as
around 10%, are recycled.50
our planetary boundaries, especially from sector to sector: broad circular economy strategies In August 2020, the “Environment,
regarding climate change. In order to • A lot still needs to be done with Regulatory trends in dealing with drivers and barriers for Spatial Planning and Energy Commit-
meet the requirements for operating • With a view to the construc- regard to biowaste. While 1.3 the transition towards CE. tee” (ESPEC) of the Swiss National
tion sector, 75% of excavated million tonnes of biowaste are Switzerland
within these boundaries, i.e. within Council set up a sub-committee
materials as well as 70% of turned into recycled fertilisers, 4.2
the safe operating space, Switzerland Going beyond closing loops While many of these interventions assigned to examine the different
deconstruction materials, which million tonnes are incinerated each
would need to reduce its natural re- Switzerland may recycle more waste are still at the beginning of a rath- concerns of the initiative in detail and
constitute valuable secondary year. In addition, a substantial
source consumption by two-thirds.44 share of food that’s thrown away, than its European neighbours (53% er long decision-making process, to prepare a preliminary draft for the
materials, are recycled. But, a sig-
nificant amount of deconstruction more than 50%, is still edible.51 recycled municipal waste), but it’s some initial results are interesting to plenary commission under consider-
Lost value in Switzerland materials (over 5 million tonnes) Food consumption in Switzerland also one of the largest consuming note. Parliament recently agreed on ation of affected industries.
is still currently sent to landfill or generates 2.8 million tonnes of and waste producing nations in an initiative entitled ‘Reinforcing the
In Switzerland, raw material con- incinerated in waste incineration avoidable food waste per year at the world.54 The amount of waste circular economy in Switzerland’,56 The federal government and the
sumption (RMC) per capita de- plants. In addition, the recycling all stages of the food chain, both produced is increasing (in 2018, leading to a legislative revision aimed public administration are also making
creased by approximately 10% (to quality and reuse of building in Switzerland and abroad. Per municipal waste per capita was 705 at increasing the efficiency of re- promising steps: while answering a
12 | Circularity as the new normal Future fitting Swiss businesses | 13
• Rewarding products based on
2017 postulate58 on fiscal measures The development of clear and ambi- The new Circular Economy Action their different sustainability perfor- plan or roadmap at various adminis- European Circular Economy Roadm-
promoting circular economies, the tious targets64 would be an effective presents measures to:70 mance, including by linking high trative levels. Eight of these coun- ap is implemented, the number of
Federal Council examined over 50 tool to accelerate the transition. performance levels to incentives.72 tries, namely Belgium, Denmark, Fin- further countries is expected to grow.
options to tackle the potential of Targets would encourage a coordi- • Make sustainable products the land, France, Italy, the Netherlands,
circular economy in Switzerland. In nation between the different sectors norm in the EU. As shown in figure 5, a significant Portugal and Slovenia, have adopted In the following, France, the Nether-
this report published in June 2020,59 towards a common systemic ob- • Empower consumers and public number of European states are in the these at national level.73 A further four lands and Denmark will be presented
the Federal Council concludes that jective. What’s more, it would allow buyers. process of adopting a national re- countries have dedicated policies as three EU frontrunner examples
the most thorough way to promote monitoring and measurement of such source efficiency or circular economy pertaining to resource efficiency as in pushing forward circular econ-
• Focus on the sectors that use
the circular economy is through a goals while setting a clear signal for strategy. More precisely, out of 32 a national strategy – Austria, Finland, omy-related legislation to illustrate
most resources and where the
well-coordinated bundle of meas- strategic decisions for companies in potential for circularity is high, like: countries, 9 have adopted a dedicat- Germany and Ireland with a further concrete measures.
ures on both the supply and demand the longer term. electronics and ICT, batteries and ed circular economy strategy, action three at sub-national levels. As the
sides. These include, for example, vehicles, packaging, plastics, tex-
measures aimed at increasing the 3.2 European Union tiles, construction and buildings,
Countries which adopted a
useful life of products. Three meas- food, water and nutrients. national resource efficiency or
ures are being analysed in more de- The international market and regu- • Ensure less waste. circular economy strategy or
tail: product declaration, extension of latory environment are constantly action plan
the warranty period including repair changing, requiring Swiss compa- • Make circularity work for people,
option and registration solutions to nies to adapt accordingly in order to regions and cities. Already adopted a national circular
economy strategy or action plan (A)
secure ownership. Implementation maintain a competitive advantage. • Lead global efforts on the circular
would require legislative adjust- As the European Union is one of economy. Currently finalising a national
ments in several areas of law. Other Switzerland’s most important trading circular economy strategy or action
measures focus on the design and partners, accounting for 60% of its As part of this legislative initiative plan (B)
production of closed-loop products. trade volume in 2018,65 the imminent and, where appropriate, through
Currently finalising a national
This work will serve as a basis for a regulatory developments on circular complementary legislative propos- circular economy strategy or action
proposal for specific measures on economy in Europe are of particular als, the Commission will consider plan (C)
resource preservation and circu- relevance to Swiss businesses and establishing sustainability principles
Adopted both resource efficiency
lar economy which is expected by regulators. and other suitable ways to regulate
and circular economy strategy or
the end of 2022. Another positive the following aspects:71 action plan (A) + (C)
signal was made in September 2020 In December 2015, the European
whereby the counterproposal  Commission adopted a package • Improving product durability, reus- EEA-39 remaining countries
to the popular initiative for a sound to support the EU’s transition to a ability, upgradability and repara-
bility, addressing the presence of Outside EEA-39
climate (glacier initiative) integrates circular economy and as a result
hazardous chemicals in products,
the objective of zero net emissions started to take the lead on the topic.66
and increasing their energy and
by 2050 as a new constitutional60 In March 2019, the Commission
resource efficiency.
article. This is an important signal to announced that the action plan has
orient long-term strategy and redirect been completely executed with all • Increasing recycled content in
financial investments, which is very 54 actions included in the 2015 plan products, while ensuring their
relevant promoting circular strategies having been delivered or being imple- performance and safety.
in Switzerland. mented.67 Recently, in March 2020, • Enabling remanufacturing and
the European Commission adopted high-quality recycling.
Accelerating legislative options a new Circular Economy Action Plan • Reducing carbon and environmen-
These recent developments are which builds on the circular economy tal footprints.
steps in the right direction. In this actions implemented since 2015 and
regard, initial scientific results from is one of the main blocks of Europe’s • Restricting single-use and coun-
tering premature obsolescence.
the nationally funded LACE research agenda for sustainable growth, the
project61 indicate that the principles European Green Deal.68 • Introducing a ban on the destruc-
integrated into Swiss environmental tion of unsold durable goods.
law are in line with the circular princi- The new Action Plan – containing leg- • Incentivising product-as-a-service
ples.62 The constitutional provisions islative and non-legislative measures or other models where producers
are also setting a fruitful context for – provides initiatives throughout the keep the ownership of the product
the circular economy.63 Yet, these re- entire life cycle of products, including or the responsibility for its perfor-
sults also highlight the need to further product design, circular economy mance throughout its life cycle.
Figure 5: Overview of countries with national resource efficiency or circular economy strategies or action plans. Source:
integrate these principles and the processes, sustainable consumption, • Mobilising the potential of digitisa- European Environmental Agency, 2018
underlying life cycle approach into all and making sure that the resources tion of product information, includ-
sectoral policies, among others, by used are kept in the EU economy for ing solutions like digital passports,
translating them into directly applica- as long as possible.69 tagging and watermarks.
ble instruments in order to accelerate
the transition.
14 | Circularity as the new normal Future fitting Swiss businesses | 15
3.2.1 France is defined as an industrial practice platform which reports its revenues to lation and regulations for waste is which are sourced from old recycled
and economic model that sees goods the Danish tax authorities. shown below:81 military equipment.
After being the first country to ban of all types deliberately made to last for
supermarkets from tossing away or a short period of time.”76 This law is one Similar to Finland, the Danish stake- • The Waste Review Taskforce anal- In conclusion, the examples above
destroying unused food approaching further means of campaigning for more holder engagement strategy ranges yses obstacles in waste legislation illustrate that the topic of circular
its best-before date, France moved durable and repairable products from from public consultation efforts to and regulations and their imple- economy has long since made
mentation (granting permits, com-
ahead in 2020 and adopted the both an environmental point of view sectoral partnerships. Public con- it onto the agenda of European
pliance assurance and enforce-
‘French act of law against waste and and a consumer rights perspective. sultations included a public Internet politics and regulators. The EU
ment), and suggests solutions.
for a circular economy’.74 The law sets portal to collect ideas and recom- and member states already set
out several concrete goals, including 3.2.2 Denmark mendations from the public. These • Exploring the possibility of an in- up ambitious and concrete goals
a 5% decrease in waste from eco- inputs were also reflected in partici- cineration ban for recyclable waste with respect to a circular econ-
nomic activity and a 15% decrease The circular economy features high patory workshops to identify a vision, and exploring a ban on destroying omy and are taking action on a
or incinerating recyclable consum-
in household trash per inhabitant by on the Danish public agenda. The targets and recommendations for legislative level. From a regulatory
er goods.
2030. In addition, the law establishes Danish government presented its circular economy. perspective there are many ways
the goal to recycle 100% of plastics circular economy strategy in 2018, • To determine whether or not a to enhance and foster circularity,
by 2025 and ban single-use plastic coupled with an initial budget of EUR An Advisory Board for Circular Econ- material or raw material is waste, ranging from incentivising waste
packaging by 2040. All in all, it con- 16 million to accelerate the transition. omy was set up and backed by four a non-binding declaratory opinion avoidance right from the start, to
tains about 50 measures providing The strategy comprises 15 initiatives industry associations – the Confed- can be formulated. Currently, such making waste production more
non-binding declaratory opinions
for: with the following six areas of inter- eration of Danish Industry, the Danish costly. With the former being a
are being formulated on whether
vention: Chamber of Commerce, the Danish preferred strategy, manufacturers
struvite from sewage sludge and
• New obligations as the producer Construction Association and the should be incentivised to redesign
beet tips are waste or not.
responsibility sectors have been 1. Strengthen enterprises as a driving Danish Agriculture and Food Council their products accordingly. As
extended and now include further force for circular transition. – to commit and plan ways to mutu- • With respect to the Locations and manufacturers’ savings due to low-
product families like toys, sports Waste Substances (Dumping Ban)
2. Support circular economy through ally drive forward the circular econo- er recycling and disposal costs are
and do-it-yourself equipment, Decree, an assessment is being
data and digitisation. my and resource efficiency agenda. low in comparison with their often
building materials, cigarette butts made as to whether the three-year
and sanitary textiles. The business community in these period for storing waste can be costly investment in redesign, as a
3. Promote circular economy through
four sectors has jointly committed to extended in the event that more result incentives may also include
• New tools to better control and design.
“increasing resource productivity by circular processing techniques subsidies for investments in rede-
sanction offences against the envi- 4. Change consumption patterns 40% from 2014 to 2030, and increas- sign.83 Undeniably, Switzerland is
become available.
ronment (greater power for mayors through circular economy. ing recycling in the same period from making steps in the right direction,
to combat littering and illegal • To improve the separate collection
5. Create a proper functioning market 58% to 80%.”79 but is lagging far behind when it
dumping), to support companies in of waste, the legal framework for
their eco-design initiatives (bonus/ for waste and recycled raw mate- waste collection in the office, shop comes to setting ambitious, clear
malus-type incentives) and to rials. 3.2.3 The Netherlands and service sectors will be looked circular and resource-based goals
assist citizens in new consumption 6. Get more value out of buildings at critically. as well as encouraging smart
practices (repairability index, infor- and biomass.77 As another frontrunner in the circular circular economy legislation, for
mation on environment and health economy, the Netherlands aims to In addition, the implementation example. The sooner it catches up,
impacts of products, and harmoni- The Danish government has esti- have achieved a fully circular econo- programme stipulates a ‘Green Deal the better.
sation of info on sorting etc.). mated that the transition towards a my by 2050. The Dutch government’s for Circular Procurement 2.0’ as
• New prohibitions on single-use circular economy will “result in up vision on the circular economy is circular procurement is considered
plastics and to fight the wasting to DKK 45 billion increase in GDP given in the ‘Nederland Circulair in an important tool for accelerating the
of food and non-food unsold and a reduction in CO2 emissions of 2050’ (Circular Economy Programme transition to a circular economy. So,
products. between 3% and 7%.”78 for the Netherlands, 2050) together the national government will use its
with the (interim) target of 50% less own purchasing power to encourage
Other recent legislative changes in There are two elements of the Dan- use of primary raw materials (mineral, the circular transition, with the aim of
favour of circular approaches include ish circular strategy that are worth fossil and metal) by 2030. achieving savings of 1 million tonnes
the promotion and availability of spare mentioning. The first relates to their in 2021 in all governmental author-
parts.75 In 2015, the French govern- national sharing economy strategy Among others, the Dutch government ities.82 This procurement approach
ment amended the French Consumer which was launched in October 2017. wants to use legislative measures to integrates the material consideration
Code to require professional sellers to The second is their broad stakeholder enhance the transition to a circular at its end-of-life stages in an attempt
disclose all information regarding the engagement approach. economy. After having identified to retain its value. According to the
availability of essential spare parts. areas where legislation needs to be circular procurement guidelines,
The law states that a manufacturer or Their sharing economy strategy con- changed in order to remove regula- the material should be bought and
importer is required by law to make tains 22 initiatives which aim to make tory obstacles to green growth, the utilised in such a way that it’s possible
these requested spare parts available it easier to for citizens and sharing Dutch Circular Economy Implemen- to reuse or repurpose the materials
within a period of two months. In the economy businesses to operate. tation Programme 2019-2023 is now to retain their value for another cycle.
same year, France made it a criminal Incentives include lower taxes on investigating necessary legislative The government is setting an exam-
offence for producers to design-in income generated from renting out amendments.80 ple with Rijkswaterstaat by building
pre-planned obsolescence into their accommodation or cars, provided a viaduct from reusable components
products. “Preplanned obsolescence that the transaction is done through a A selection of key actions for legis-
16 | Circularity as the new normal Future fitting Swiss businesses | 17
4. The circular opportunity:
Swiss sector deep-dives
Echoing European findings, the circu- The circular opportunity has the po- creased risk of losing customers due
25% of the nutrition-related environmental impact
is caused by avoidable food waste.
lar economy opportunity represents tential to benefit society as a whole. to their sustainability preferences). Households
a multi-billion-franc opportunity for Based on calculations for other Circular solutions will enable Swiss
Swiss businesses as well as promising European countries, it can be roughly businesses and stakeholders to con- 38%
social and environmental benefits.84 estimated that a rise in circular jobs tribute to an economically, socially Processing
could create around 100,000 jobs90 and environmentally resilient future.
In 2019, the Swiss market for sus- in Switzerland. Further indirect social 27%
tainable investments (SI) experienced benefits are expected as the regener- 4.1 Food sector
double-digit growth of 62% to CHF ative loops promote reduced pollu- Gastronomy Agriculture
1,163.3 billion.85 Coupled with grow- tion, and both more locally sourced Tackling food waste through Wholesale and
14% 13% Retail
ing international opportunities like and less toxic products will lead to circularity in the Swiss food sector
the European Green Deal Investment improved health and reduced health- 8%
Plan (EGDIP), which plans to mobilise care costs.91 Structural waste in the Swiss food
at least EUR 1 trillion in sustainable sector is a complex matter. In line
investments over the next decade,86 And last but certainly not least, cir- with WWF priorities and with respect Figure 6: The environmental impact of food waste occurs: 38% in households, 27% in processing, 14% in gastronomy, 13% in
we identified a significant opportu- cular economy could play a key role to opportunities relating the Swiss agricultural production and 8% in wholesale and retail. Source: Beretta & Hellweg, 2019
nity for circular Swiss businesses to in paving the way to a greener future, contribution to Sustainable Develop-
capitalise on these incoming funding enabling Switzerland to contribute ment Goal (SDG) 12.3,93 we’re focus- To truly understand the scale of the year at all stages of the food chain, the environmental impact, it should
opportunities. to its sustainability commitments ing on the organic cycles and avoid- food waste problem in Switzerland, both in Switzerland and abroad. not be underestimated. In agricultural
(Agenda 2030, Paris Agreement, etc.) able94 food waste. SDG 12.3 sets the one needs to look at the statistics. production, CHF 0.6 billion go to
With regard to recovered resource Through reuse, recycling and reduc- goal of halving per capita global food An estimated 25% of Switzerland’s The environmental impact of food waste every year. There is a lack of
value, Switzerland currently recov- tion of materials, waste is minimised waste at the retail and consumer nutrition-related environmental waste occurs: 38% in households, data for the processing industry.
ers only 13% of its waste,87 with the along with its disposal costs and levels and reducing food losses along impact is caused by avoidable 27% in processing, 14% in Retail trade loses an estimated CHF
remainder coming from domestic associated damage and opportunity production and supply chains by food waste. This means that an gastronomy, 13% in agricultural 0.5 billion and the gastronomy sector
extraction and imports in 2018.88 costs for the affected landfill sites. 2030. Research at ETH Zurich95 and area equivalent to half of all the production and 8% in wholesale and around CHF 1 billion. Last but not
According to the Swiss Federal Besides reducing pollution and ad- a recent study commissioned by the agricultural land in Switzerland is retail.99 least, households let go CHF 5 billion
Statistics Office, if all waste could dressing climate change, Switzerland Federal Office of the Environment96 used to grow food that ends up being go to waste. That’s equivalent to
be recovered, this statistic could can do its part to foster new forms shed a light on the opportunities wasted at some point along the value The environmental impact is only one CHF 600 thrown out per person
increase to 20% of current material of consumption (especially related and problems of the sector. While chain. Overall, food consumption side of the coin. Although financial per year.
needs. This suggests that the overall to nutrition, mobility and housing) to the absolute volumes of avoidable in Switzerland generates 2.8 million loss in food supply chains has not
demand needs to be targeted with work towards operating within the food waste along the value chains tonnes of avoidable food waste per been studied in the same depth as
slowing resource loop strategies. planetary boundaries, sustain the are appalling, at most97 stages of the
Nevertheless, in monetary terms current biodiversity and soil health, supply chain only a small fraction
600 CHF which amounts to and wasting
the recovered resource value still
accounts for several million francs of
and gain independence from the
growing resource scarcity.
of it seems to end up in incineration
plants, which means the end of life in per person thrown 2.8 Million tonnes of 50%
recovered value in Switzerland. the Swiss waste disposal system. So, away every year foodwaste annually of Switzerland’s agricultural
Circular opportunities will enable is there a problem at all? land
In addition, some businesses con- Swiss businesses and society to bal-
sider Switzerland’s size and demo- ance current and future risks associ- Unfortunately, but not surprisingly,
graphics as favourable for piloting ated with the linear economy.92 The the environmental impact98 of food
new sustainable innovations. For rethinking and redesign of current waste increases along the different
example, the ‘H2 Mobility Switzerland linear business models to circular steps of the supply chain, because
Association’ has invested heavily in ones will inevitably fuel a new wave more resources are needed. Be it
the world’s largest fleet of hydro- of sustainable innovations which for processing, storing, packaging,
gen-electric commercial vehicles and capitalise on advantages (e.g. derived transport or otherwise. Figure 7: An estimated 25% of Switzerland’s nutrition-related environmental impact is caused by avoidable food waste. This means
is building the required infrastructure from shorter supply chains due to a that an area equivalent to half of all the agricultural land in Switzerland is used to grow food that ends up being wasted at some point
to start operations by 2023.89 In light focus on more locally sourced ma- along the value chain. Overall, food consumption in Switzerland generates 2.8 million tonnes of avoidable food waste per year at all
of Switzerland’s innovation poten- terials, products, ingredients and a stages of the food chain, both in Switzerland and abroad. That’s equivalent to CHF 600 wasted per person per year. Source: Beretta &
Hellweg, 2019
tial, a focus on circular solutions reduction in the amount of materials
could provide access to new means used) but also a significant decrease
of value creation and with this new in risks (e.g. less dependency on
markets. scare resource supply and a de-
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