CEPS Task Force shines light on the role of business in the circular economy

Launched in November 2016 by the Energy Climate House team, a new CEPS Task Force has been engaged in an in-depth examination of the role of EU policy and regulation to guide businesses and industry in navigating the circular economy. Special attention has been given to the barriers and enablers that companies encounter in their attempts to introduce circularity into their business operations as well as the measures needed to help businesses adapt to the changing environment and to take advantage of new market opportunities. On February 2nd, CEPS organised the third meeting of the Circular Economy Task Force, focusing on the linkages between the circular and digital economies and featuring presentations by experts from policy and business, followed by an open discussion with the Task Force members.

The main topic of discussion was the EU’s role in harnessing these linkages as well as potential solutions to the existing challenges. It was highlighted that action is needed at the national and local levels since not all action can be taken at the EU level. The EU could play a useful role in facilitating the exchange of best practices between local actors. Business representatives presented case studies illustrating the various opportunities and challenges linked to the digital economy and showing that technology can be one of the enablers of the circular economy by, for example, taking the so-called ‘product as service’ model forward. By providing an alternative to the traditional model of ‘buy and own’, this business model allows products to be used by one or many customers through a lease or pay-for-use arrangement, thereby turning incentives for product durability and upgradability upside down and shifting them from volume to performance.

According to the speakers and participants, however, digitalisation can also disrupt the supply chain as the role of retailers in a product as service model may decrease. Overcoming the disruptions poses a challenge that requires negotiation and trust among all actors in the supply chain. The CEPS research team is currently preparing the Task Force Report, including key policy recommendations. A draft version of this report will be discussed during the next meeting on May 11th.

For more information about the Task Force, see https://www.ceps.eu/content/role-business-circular-economy