In our current economy, we take materials from the Earth, make products from them, and eventually throw them away as waste – the process is linear. The circular economy offers a compelling contrast. In this model, we aim to eliminate waste. It’s a system of resource production and consumption that emphasizes sharing, leasing, reusing, repairing, refurbishing, and recycling existing materials and products for as long as possible.
This strategy can help tackle worldwide issues such as climate change, biodiversity loss, waste, and pollution. Examples of circular business models include sharing and leasing services, recycling, upcycling, and designing products to be reused and recycled. Technological innovation, especially digital transformation, is crucial in moving towards a circular economy. For example, platforms that provide data that can be used to assess the value and material composition of products and buildings, are facilitating reuse and recycling. Another example is the upcoming product passports in the EU, which hopefully will be able to assist both reuse and recycling, thereby contributing to the shift towards a circular economy.
Rethink production and consumption
“Embracing a circular economy doesn’t mean reverting to old ways of living. Instead, it calls for a renewed respect for the resources we consume.” Sine Beuse Fauerby, chief consultant at IDA states, and continues “I believe we need to redefine growth in terms of well-being and quality of life and not necessarily consumption of material goods”.
The Nordic countries have often been considered front runners when it comes to clean energy and sustainable solutions. However, when it comes to the circular economy the Nordic countries fall short in a global as well as a European context, according to the Circularity Gap Report1.
“Danes consume 24.5 tonnes of virgin materials per person per year, which is well above the EU average of 17.8 tonnes per person, and the global average of 12 tonnes per person. Only 4% of our consumption is circular. There are lots of historical and political reasons for this, but the bottom line is that it is not a sustainable long-term strategy”, Sine concludes.
Learnings from Finland
Finland adopted in 2021 its Circular Economy Programme. The programme aims to curb overconsumption of natural resources. It also sets limits on the use of renewable resources in Finland: by 2035, the country won’t consume more raw materials than it did in 2015. The broader vision for Finland is to establish an economy by 2035 that minimizes environmental harm and maximizes resource reuse.
Despite its ambitious goals, the programme has had a slow start for several reasons. Finland has the highest per capita domestic material consumption in Europe. Public awareness and understanding of the circular economy remain low – many still equate it with trash recycling. Furthermore, grassroots involvement was not prioritized from the outset.
Adviser, Jussi-Pekka Teini from TEK is optimistic despite these challenges. He believes that for a successful transition to a circular economy, all stakeholders – from sectorial organizations and companies to cities, regions, and municipalities – need to rethink their business models and commit to targets. He sees new commitments and voluntary initiatives being initiated by the government, sparking a renewed motivation and interest within civil society, to actively participate.
The lack of competences
A key concern for Jussi-Pekka is the lack of competencies. He says, “Engineers have hands-on experience in developing new business models and finding solutions to ensure products are designed for circularity, promoting the right to repair and reuse of resources. However, we already see a shortage of skilled engineers and STEM professionals to drive the green transition. When it comes to the circular economy, our knowledge about the STEM skills needed for this transition is limited, and it’s unclear whether these skills are being taught in current educational environments.”
To address this potential skills gap, ANE’s working group on the circular economy commissioned an analysis in 2021 to identify the specific competencies required for the circular transition. The report highlights that the competencies needed for a transition towards a circular economy include a range of technical, analytical, and cross-cutting skills, such as understanding circular Product Design Strategies and Circular Business Models.
Towards a Circular Economy
Jussi-Pekka emphasizes the need for national governments to prioritize skills and competencies in their circular economy strategies. He adds, “The transition to a circular economy is not just about changing our consumption habits, but also about equipping our workforce with the necessary skills to drive this change. We need to ensure that our education systems are preparing future generations for the challenges and opportunities that the circular economy presents.”
Both Sine and Jussi Pekka agree that the EU is the key driver for the transition to a circular economy. The EU can push in the right direction with the necessary regulations and programmes, although many proposals often get watered down when they reach the EU parliament. They also hope to see more collaboration among Nordic corporations, as they can inspire and learn from each other.