Kenneth Alston | Circular economy as a business model and the decarbonization of production and consumption systems

Good morning.

I am very happy to be invited here to speak with you today and I want to thank the organizers for making it possible.

We are going to try a little experiment here, I hope that you will be sing some of my slides in Spanish on the man screen and whereas I will see them in English down here, so I still know what I’m talking about.

This topic is… I think we switched to the wrong slide here in front of me. Thank you.

This topic, the circular economy as a business model, is a huge one and the decarbonization of production and consumption systems; it is enormous, and so it is very difficult to do it just in one hour, but I will do my best to cover the ground.

The title also includes a number of assumptions which I want to also discuss and perhaps challenge a few. And as I talked to you this morning, I want you to think about language; not just English and Spanish, but the words we chose, the particular words we choose to describe things.

Of course, we’re talking about sustainability and I want to do a quick review of the history of sustainability, because I think it helps us to understand how we got to where we are today and why we need to do many new things in many directions; and I want you to think about changing our intentions of where we want to go, because where we have been going so far has led us to all the problems that we know that are included in the sustainable development topic.

I also want to cover some key design principles because, fundamentally, the problems that we face are because we’ve not designed all of the products and services that we have today and we enjoy in our economy, we have not designed them for sustainability and we’ve not designed them for circular economy.

And there is a piece of the puzzle that’s also been missing, that most people haven’t been talking about and I want to cover that; and then I want to end for some ideas for what’s next and where do we go from here.

So, the first part of the topic is the circular economy as a business model. So let's talk for a minute about what the circular economy is. This is a picture you will know well, here in the city, and note the word “basurero,” waste, trash, the word gives away the meaning; and one of the things I will talk about is how we have to change this word in order to change  the outcome that we’re getting.

And this issue is the same all over the world; this is what happened here two years ago and you have obviously a problem that you need to deal with and that problem is common everywhere around the world.

(It seems like my slides are taking a long time to change.)

This is a picture that was taken when I was in the island of Aruba last year, and I’ve used a very highly technical term here: “stuff,” for all of the materials the things that are happening. (Is it possible to put my slides up on the screen for people to see, because it doesn’t work if they only see me? Thank you)

So, this is a beach in Trinidad and Tobago (I will just go back to show you the one before which we missed).

I have to go on here because the slides are working in the wrong direction.

So this is the underlying problem behind the situation we face is that our current economics model is linear: We take materials from the Earth, we make things from the, we sell the products, we buy the products, we use the products, and then we throw them away; and that is why we end up with landfills everywhere we go.

And the pictures that unfortunately we missed were of similar situations in Trinidad and Tobago, in Aruba, where the trash was falling off the end of the island, bursting into flames, and falling into the ocean. Clearly something is wrong with our way of doing things. And this linear model is also unsustainable, completely unsustainable.

So what we need: We need to change in paradigm, we need a complete change in how we think about this topic; and so this change in paradigm is the circular economy as opposed to the linear economy.

I want to have a short history of sustainability. This is a book that I actually own in my own library and it’s a book that I brought as an undergraduate, when I was 19 years old. The book is called “Silent Spring,” and it is arguably the book that started the beginnings of environmental consciousness around the world.

And she tells a story of birds that were nesting, unable to make their eggs because of the pollution from pesticides that had been applied on the land. And this effect was going up the food change gradually and was noticed by Rachel Carson, when birds were unable to make their eggs, so in the spring there would be no bird song and so we would have a silent spring.

And so this was probably the book that started my environmental consciousness and arguably studied environmental consciousness around the world.

So we start in 1962, when that book what published, and 10 years later another book was published called “The Limits to Growth.” (I don't know why my slides are not moving forward here… There we go. Now it’s going too far.)

So “The Limits to Growth” was a book that first told the story that maybe we couldn’t continue to grow and grow and grow, year after year, because there were some constraints in our ultimate amount of resources that we had available to us. So, this was another evolution in thinking.

And then, importantly, in 1987 was the book “Our common future,” which is the book in which the very words of sustainable development and the description of what sustainable development were first developed. And this talks about development that meets the needs of the people today while also allowing for the needs of people in the future. (Do I need to point this somewhere else? There we go.)

So this is the common definition that everyone believes in around sustainable development, but for me there is a big missing piece, and that is the question of how? How do we make this change happen? Because there is nothing in the definition that tells us how. (It still won’t change. There we go.)

And so this is where the corporate sector comes in because they have to figure out how; this is where the government sector comes in because we still have to figure out how. And we have moved on; although it’s been 31 years since the first development of that sustainable development definition, we now have 17 goals. So we began to break it down into some topic areas, but still we are completely unsustainable.

And, you know, although I love the work I do in sustainability, I also want to challenge the word itself. If I look around the audience and was to pick someone and ask you what is your relationship with your husband or your wife, or your boyfriend or girlfriend, and you said, “Sustainable,” I’d have to say, “I'm sorry, I hope it gets better.” So I want you to think about whether sustainability is even enough; even though we are so far away from sustainability, I want you to open your minds to the idea that we can go even beyond this minimum amount of just being sustainable.

And you’ll see there I highlighted “sustainable production and consumption” because that's also in the title of the talk that I was asked to give today.

So this is the question: Is this the goal of sustainability? So let’s keep going. Well what happened after we defined sustainability?

In 1991, there was a new book that came out, it was called “Changing Course,” and this was done by the World Business Counts of Sustainable Development; and it was the business community’s introduction to the Real Earth that was coming up in 1992. And in that book the word “eco-efficiency” was first used, and this is all about doing more with less stuff; it's about reducing, minimizing, and avoiding problems.

And, frankly, this has been the main approach of every body of everywhere in the world since that time. And I can tell you that eco-efficiency is important but it’s not enough on its own; it’s not enough just to reduce the negative environmental impacts of goods and the resources intensity throughout the entire life cycle of a product.

And you notice there, there is also a sense that environmental impacts are negative. Why do we always assume it is negative? Could we not have a positive environmental impact? Can we not do better than we were before? I think we can.

And so it’s not enough to progressively reduce things, it’s not enough to… also look at the life cycle. This is another term that I would like to think about changing. These products are not alive, this clicker that I having problems with is not, alive the computer is not alive, the carpet is not alive, the lights, the rooms, our clothes are not alive. They don’t have a life cycle. A butterfly has a life cycle; but a product should maybe have another word change. It should have a use cycle: We use products. And so, again, we can use this changing language to help change our thinking about what happens when we use things and where they go and where we use them again. And so think about every time you hear someone talking about environmental impact, it’s almost certain they mean that it’s negative and it's also talking about products being alive.

And this idea of efficiency as being the main tool that we have to do our work in sustainable development, is limiting. Efficiency is only about doing something the right way; we first have to think about effectiveness, and that is: Are we doing the right thing? If you think about it, efficiency doesn’t have any value. We talked about values in the earlier session.

Image I was a burglar and I was coming to rob your home. If I was an efficient burglar, I would be worse; I would do a better job at taking your possessions from your house. And so efficiency isn’t automatically a good thing.

So I found an old picture of me dating back a long time now, when I was doing all of this eco-efficiency work; and here was an example that shows the chart where in the company that I was working at that time, we reduced the amount of packaging that we used to deliver the product by 30% (almost 30%) over 10 years.

And this was a great innovation at the time, it saved the company millions of dollar; and so it was good for the economy, it was good for the business, and it was good for the environment because we were using less stuff. But did we become sustainable? No, but it was the right this to do.

And if you look at the corporate social responsibility publications that most companies come out, I guarantee you will probably find at least one, or maybe more than one chart that looks like this. There is something that the company decided that is an impact related to the company that is bad and that they want to reduce it over time, and they will set some time. They’ll say, “By 2020, we will reduce something by some percentage and we will be in a better place.” And yes of course, if something that you are doing has some negative effect then of course reduce, it’s the correct thing to do; but as a scientist, when I look at this… and it took us years to actually reconceive this... let me go back here and make a different point.

You will notice that the end result of this picture here is that the goal is 0; we’re try to reduce the negative impact to 0. But I would also ask the question: Is this the end result? Can we do better than just going to 0?

And here is an example from a talk I did in Glasgow a few weeks ago where they were talking about some great work they’ve done to reduce the amount of energy they used in a production process by 30%. Of course it’s the right thing to do because you are reducing the amount of energy, you’re reducing the CO2 consumption; but it’s not making you sustainable, it is just a good business practice.

And so there's an idea here that I also want you to take away, and that is that being less bad is not being good. If you find something that is bad and you want to reduce, it you still haven't become good; you are just less bad than you were before. And so there is this whole other place that we’ve been missing which is: What is the definition of “good”? Where is it we’re going that is good and better and positive? We heard it in Dr. Soto’s opening video. He mentioned the word positive 4 or 5 or 6 times. And so the question becomes: How do we achieve more good? How do we make things better because we are here?

So this next little section I will go quickly over because it really charts the development of something called cradle to cradle design.”

An architect in the U.S., William McDonough, and a chemist in Germany, Dr. Michael Braungart, wrote the book “Cradle to cradle” in 2002; and it’s the definitive book that talks about how do we design goods and services so that they can become, not only sustainable, but also move into the circular economy.  

The book, when it was published in China, which is the second book on the topline there, is the Chinese addition of the book. The subtitle of the book in English is “Remaking the way we make things.” In Chinese it was a difficult translation and they actually translated it as “The design of the circular economy.” So this book lays out the fundamental principles we need for the design of the circular economy.

In 2006, I helped design a certification program for products that shows the extent to which they’ve been moved in the positive direction to become circular; and then this was moved into the nonprofit “Cradle to Cradle Products Innovation Institute in 2010.

More recently the Ellen MacArthur Foundation in the United Kingdom has been very vigorously promoting the idea of circular economy and they are doing an excellent job.

So, let’s as a different question of ourselves as we sit here this morning: How do we make the world better? How to we make Guatemala better? How do we make Guatemala City better? Because we are here and doing the things we are doing and I am very happy to be following my colleague from Nestlé, because he showed very clearly how there can be positive outcomes from the work companies do.

And so, can we make the world even better? Because we create a circular economy. I think we can, but it depends. You have to first say what is circular economy.

Last year at this conference in Medellin, I chaired a session where the question of “What is the circular economy?’ came up, and we had a researcher who’d gone away and checked and asked people who supposedly knew about this, what they thought about the definition of the circular economy. What is it? And 114 different people came up with 114 different answers. And… To me, that does not mean that we have to find the one perfect answer but it shows that it is so multifaceted and it is so complex that we have to pick it apart piece by piece.

There was a new report earlier this year in May, from the World Business Council for Sustainable Development, and they were also trying to answer this question which seems to be on people's minds, of what is the circular economy, and the only thing that they could conclude was that everybody they asked said that it included materials, that we had to do something about the materials, the stuff, that everything is made of.

Many people also included water, some included energy, but it wasn’t universally the case that water and energy were included, but I think all 3 should be and I think it should include social too, so that it complements the facets of sustainable development.

And as we think about what the circular economy is, I have to tell you, it’s not enough just to think about current products and say, “Oh that means we recycle them.” And the reason that it’s not just recycle more of what we do today, is because these products were never designed to be recycled; it was never part of the original design specification.

And so, we do have to go back and rethink… I mean, even the red of my tie or the blue of your jacket, what are the chemicals that we use to make that? Are they suitable to be taken back and reused in some way? I could even challenge that were they ever even looked at to see whether they were suitable for skin contact in clothing in the first place. So there is a lot of depth to this that we have to understand.

So just recycling more of the existing products isn’t the circular economy. Because a circular economy wouldn't be a good thing to do if we are taking something that was not designed correctly in the first place and we try to use it again; we’re now doing the wrong thing twice over.

William McDonough said, “Design…” He is a designer, an architect, and he said, “Design is the first signal of human intention.” And so what we have to ask ourselves is:  What is our intention at this point in the 21st century? We have to lay out what our intention is and I am pleased that the country of New Zealand has actually written a formal statement of intent of where they want to be: “We intent to go from where we are to be in this better place,” and they’ve tried to define it; and I think this idea of intentionality is very important and I think it fits with the goal of the conference and trying to make recommendations at the end of where we go.

And basically this is the change we have to make. We have to get out of this idea that we take things, we make things, we waste things, and we have to switch it around, so that we retake things, we remake things, and we restore, we do more. It’s not just stability of status of sustainability; make it better than it was before.

And we didn’t get to where we are in one design iteration, so it will take multiple designs and redesigns before we get to where we need to be. And so, we need to redesign, we need to restore things, in every facet of the world and we need to regenerate materials, we need to rematerialize.

So the cradle to cradle design principles, the first one, and this book by the way is available in Spanish, is “Waste equals food.” This is: Eliminate the whole concept of waste. Let’s not even use that word anymore; take it away from our dictionary, and let’s talk about the idea that everything becomes food for someone else. This is how nature works; everything in nature becomes food for another system.

If the leaves fall from the tree in the autumn then the bugs and molds and all of the different creatures we have will retake those nutrients and put them back into living soil, and then we will come back again in the spring when the leaves come out, when the blossoms come out, and the cherries bloom, and all of your coffee plants also produce their flowers and their berries.

So how can we do, in our technical world, what nature has been doing forever? How can we have this circularity of things that also cycle safely? In nature, you know, you may have a poisonous snake that bites its prey and eats its prey but it has a poison which is completely compatible with, ultimately, being digested and reused even though it killed its prey.

When we do things like that and we have pesticides like in the book Silent Spring, we do it with pesticides that are… that stay in the environment, that persist in the environment. So, we have to cycle things safely; and so there is a whole protocol of the materials we select so we can be sure that we cycle things safely.

Just look around the room: Everything in this room was never designed to be reused; maybe only the glasses I see on the table, because they’re glass, and the glass making industry needs to use old glass to make new glass in an energy efficient way.

So, let's eliminate the concept of waste.

Yes! Let’s use solar income. I was so happy to see that in Nestlé they moved their production to be covered by solar and others wind, so they are completely using clean energy. This is the future for energy and we have to include the social element; we have to… In the book they talk about respect diversity and this has to be included.

A fundamental principle in eliminating the concept of waste is that we have to recognize that they are two completely different cycle that are operating: One on the left, is the biological cycle which is the nature one I talked about with the leafs; but on the right, we have to create a new one, and it’s not just basic recycling; it’s a new one that understand the materials, what they’re made from, and it puts in place the system to collect things at the end of use and bring them back, and put them into productive reuse over and over again.

Because, most things, including –you know– the cell phone I have in my pocket here: We never designed for this technical cycle and yet there are technical materials.

And we need to change the language about consumption and about production; because it’s only in this natural cycle that materials are really consumed. When I woke up this morning and brushed my teeth, I did probably consume some toothpaste and so that material was consumed and it should be safe for consumption; we should be sure that that material is safe to be consumed.

When I walked up here on the podium, I used my feet and my shoes were wearing out on the souls. What does it mean when my shoes wear out? It means the material in my shoes went into the environment, so in a sense they were consumed, they were used and then they went to the environment. Do I know whether the souls of my shoes are made from a material that is compatible with the environment? Or am I inadvertently polluting by walking around?

These are questions we’ve never been asking and we really should be thinking of these technical things, not in terms of owning but in having a service: Do I really need to own 2,500 molecules of different chemicals in my cell phone? Or do I just want to use the phone, and post my picture on social media, that I was here in Guatemala?

No, I want to use it; so you should be a product of service and the company that makes my phone should take that phone back. And when I want to upgrade to the new iPhone 10, 11, 12, (whatever we’re going), that should be okay; they shouldn't be saying, “Oh my goodness! How bad are we for keep using another phone and another phone, and another phone! All this consumption!” I am not consuming the phone, I am using it. But it was never designed to go back into this technical cycle.

So this is the challenge: How do we remake everything? Including the tablecloth, on our clothes, and everything around us, so that no matter how long or how short the time period that that product lasts in use, we know where it goes at the end of the use.

It may be a short use product that only lasts for 5 min or it may last 50 years; it may be a building that lasts 200 years, but at the end of that 200 years, maybe this hotel is taken down and a new one is built. What are we going to do with all the things that are in it? It was never part of the design and it should be.

So we have to have this new idea that we have technical nutrients and we have biological nutrients, materials that we understand what they are before we use them in our product designs; and that they can either safely reenter the biosphere or they can safely be recycled and reused and circulate as a technical nutrient. And the word nutrient is chosen deliberately to show the idea that it has to be of high quality.

Here you see what’s called the butterfly diagram of the Ellen MacArthur Foundation, which is their representation, visually, of the circular economy; and what you are seeing here is really a great exposition these ideas of technical and biological nutrients, flowing in technical and biological cycles. On the left in the green, you see the biological cycle, on the right you see the technical cycle.

So these are fundamental ideas that we have to think about when we design products and I’m inviting you all today to become designers; from this moment on you are a designer. And whether you are buying something at the grocery story, whether you are buying some clothes, no matter what you’re buying in the rest of your life, whether you are doing it for yourself personally, whether you are doing it as a part of your job, you need to be thinking in these terms and you need to be asking the companies that you are buying from: Does your product work in the circular economy? And if… At first they’ll say, “What? I don't even know what you’re talking about.” But you keep telling them the same question, over and over, until eventually enough people will be asking the question that companies have to pay attention [to], learn what it is, redesign their products, and then we can get things moving in this right way.

Because, the problem with the dumps that we have everywhere in the world is that we are trying to do something and make a high grade output from a very low grade input. We just have garbage coming in big trucks and then we try to think that we can make something useful from it. We have to change the input stream to get a quality output stream.

So, in the cradle to cradle world, there are five key elements that we have to pay attention to now that we’re all designers: One is that, the materials we choose have to be safe to be recycled in biological or technical metabolisms; that we actually have to collect the materials at the end of their use, and we have to think of them as continuous assets. They’re not one way, one trip, one flow products.

We have to use clean energy. Ah! And here’s an interesting piece: We have to have restorative carbon balances (I'll come back to that in a minute). We have to have clean water and production and use cycles, and we have to have share abundance; we have to have the concept of social responsibility as well.

This is Mr. McDonough a couple of years ago as he introduced the world’s first Cradle to cradle certified gold-level t-shirt. Something as simple and ordinary as a t-shirt had never been designed to cycle in a safe technical and biological cycle until 2 years ago.

This is the challenge we have: Everything has to be recycled; and the company CAN, based in Holland but now also operating here in the Americans, is introducing these gold t-shirts all over the world and they’ve just, in fact, recently been awarded a gold certificate for some new jeans that they designed; where everything down to the one hundred parts per million of molecules that are used in the production of that t-shirt or jean is understood and is compatible with the circular economy.

L’Oréal in the US is also certified some of their regular products too. And think about this: There is the product inside the bottle, and there is also the bottle and the cap, and the label; so all of these parts need to fit in this model. It’s not only what’s inside but it is also the packaging.

So these products are not alive, they don't have a life cycle, they don't have an end of life. They’re not consumed; most products are not consumed, there really isn’t consumption, but there is use.

So let's look for a minute at the second part of the question I was asked to talk about today and that’s the decarbonization of our economy. And we need to ask, why? Why decarbonize? And why do we have to look at this in terms of consumption and production systems? Because as I’ve said, most things are not consumed.

We need to think about production use and reuse. So we’re beginning to change our definition here from the original one I was asked to speak about, and we’re changing the words to better fit the circular economy.

So, we have to change our language away from consumption, to use; to users, not consumers; to use periods, not life cycles. And in the end, the final result we’re trying to get to is that the circular economy is restorative, it’s regenerative, and this we have to do intentionally by design; it’s a design equation.

And circularity isn’t automatically sustainable, so we really need to talk about a sustainable circular economy, because we have to include the social equity, the economics, and the ecology. And we do this by creating positive benefits in all of these elements, three elements of the circular economy through sustainability.

You’ve probably heard of sustainability talking about the triple bottom line; well, I prefer to talk about the top line because if you’re in a business, if you don’t have a top line, you don’t have a bottom line. You have to have the sales; you have to have the good thing coming in first.

So, is the circular model for materials sustainable if you’re making, selling, using, and reusing products that are made with non-optimized toxic materials? No; so circular economy is not automatically sustainable. What if you’re not using renewable energy? Nope, that’s not sustainable either. And what if you're not using fair social practices? Nope, that’s not sustainable. So we have to add sustainability on top of circularity.

And when we do that we have some important key benefits: It drives new product innovation. Now we’re all designers and we can redesign things in a totally new way and they are examples, that I’ll show a couple of very simple ones in a moment, that the entrepreneurs in the group can begin to look for, when we think about circularity and not just the linear approach.

There will be new job opportunities, there will be new businesses. We’ll be reducing the risks because we’ll understand the chemicals and materials that we are using. We will actually like to be able to save money on average; the projects that I work on with companies save about 20%, to the bottom line. And increasingly people are going to be asking for these circularity benefits.

So I showed you this typical chart before and it is all about reducing, eliminating, avoiding the negative stuff, but actually, as a scientist, I realize that this should be charted the other way. All of those chats in the CSR reports really need to be written this way, because negative is below the line, and so becoming less bad has a positive upward trajectory to the right and so, you know, graphically speaking, this is the proper way to show what we have been showing.

And this is all about becoming less bad and, of course, become less bad if you’ve got bad things. But that begs the question: What are we missing? When we chart the chart the correct way there’s a whole half of the chart that we haven’t even talked about. And, for me, this is the more good, the beneficial, the more positive, and where I want to see goals for companies is not just to be “the goal is 0,” which is… and the middle horizontal line on the right, I want it to be on the top right.

And I want it to be, “What's 100% fabulous? What's the best thing that we could do where every time somebody bought my product and used my product, the world actually got better? It wasn’t that you selected my product because it is the least bad of all my products out there; it’s one of the best that has the [best] benefits.

So let’s get into this good space and also obviously get out of the bad space if we are in there. So let's do both, so this should be what our charts look like. And there's the goal of 100% fabulous.

So the circular economy as a business model, we’ve talked about. And the decarbonization I haven’t really covered that yet. So let's have a look at that.

Here’s carbon. I’m a chemist by training; carbon is just an element in the periodic table. Why are we picking on carbon? Poor carbon. What did carbon ever do to get such a bad rep? I mean, as a chemist, you know, I like carbon. I’m carbon, you’re carbon. You want to decarbonize? Who is leaving? Let’s really get to the bottom of what… We’re using language in a very poor way, yet again.

What should we be saying? What is…? There is an issue about carbon, of course, it's not that we’re talking about the wrong thing; we’re just talking about it in the wrong way.

And the real carbon problem is that we’ve got too much of it as carbon dioxide, methane, and it is in the wrong places. We talk about these gases in the atmosphere and this is why we are concerned; we’ve burned so much oil and gas that now we now have carbon that was in oil, under the soil, now it is in the air and now we have global warming.

So we need to put carbon back to where it should be, don't just decarbonized, that does not make sense. We need to re-carbonize. And everything should be redone over again, let’s re-carbonize and put it back where it should be. And where should carbon be? It should be in the soil; it should be a natural healthy living thing called humus. So the question then becomes: How do we get it out of the air and how to we get it into soil?

And then the problems that we have in the oceans, becoming acidified, it’s because we have carbon dioxide in the air and we then have carbonic acid when it rains. And so, if we get it out of the wrong place and get it into the right place, then carbon is okay again! It’s just an element in the periodic table and we can all live happily. So let’s not demonize elements.

And I could say it the same for lead. Everybody said, “We want to be lead free, I want to be PBC free, I want to be (you name) it free.” It just means you’ve got the wrong material choice in your product and it’s going in the wrong place. Actually, lead is good. I like lead; it's in the periodic table! (I’m going to go back here, if I can…)

When I flew here… When I flew here, I’m glad that the aircraft had electronics with lead, because they’re the best to conduct electricity, so that the pilot can control the plane and get me here safely. So I’ve got no problem with lead. If it’s in the electronics and if at the end of the use of the plane the lead is taken out and handled safely as a technical nutrient.

But if it is used in lead based paint and it gets into kid’s toys and the kids suck on the toys, then lead is in the wrong place, because it’s then going to be ingested and it’s in the biological cycle. So it's another question of it’s the wrong material in the wrong place. So let’s just rethink how we talk about things.

I would really recommend you take a look at this article; it was written by Bill McDonough, the author of the Cradle to Cradle book; it’s at mcdonough.com/new-language-carbon and I don't have time to go over this today but it really captures this new way we need to think about carbon. And he talked about fugitive carbon, that is which escapes the air and ends up in the oceans, as you can see on the left.

In the middle we have durable carbon, that’s sort of working carbon; we can make some plastics and use carbon in them and be okay, as long as we get them in safe technical cycles. But then there's this new piece of living carbon that we have to think about, and if you follow the flows on all of the arrows here you see that it becomes a circular economy, where carbon is used in the right way in the right places.

And as you begin to apply this thinking as a designer, as Mr. McDonough does, then you can reimagine how you do everything, and this image shows all the flows in the technical and the biological cycle of water, energy, of materials and we can imagine a circular city; we can imagine building circular buildings out of materials that are designed to circular.

And I’ll show you one example on how this transformational thinking can be used as a designer and now you… (Remember you are all designers). This was Mr. McDonough’s sketch, first sketch, for a new building, a Cradle to Cradle circular inspired building, a factory in India. And it looks so simple. And here’s the building; it uses energy in eight different ways.

There are as many people working on the roof of the factories as there are working inside the factory. This is a motorcycle plant that has green houses and solar panels on the roof, and in the green house they’re creating food that is used in the cafeteria and also sold locally. There are twice as many people working in the factory and they’re taking in account of many more things than just making motorcycles. So get creative. Be a designer. Use these principles as a way to rethink how we do everything.

And not only that, but all of the materials that the building is made from are known and we know what to do with them at the end of their use at some point, however many years in the future when that building is decommissioned.

And there is an idea that I'd like you to make a note of, which is called “Buildings as material banks.” This is [a] very strong idea that started out in Holland, in the Netherlands, and it is an understanding of everything that is in the buildings, so that when, 100 years from now, that building is taken apart, we don’t just demolish it and we just have something else to put in the landfill, but all of those materials were carefully chosen to have a value that we can reutilize at the end of the buildings time. Everything changes when you change your design thinking.

So, we have the circular economy as a business model. We are now re-carbonizing soil; let’s change our agenda; and there’s a production use and reuse system, not consumption, because we’re not consuming most of these products. We are consuming your water, and I’m glad we are, but we’re not consuming most things, and we are not consuming the bottle that it came in.

So, we need to have a sustainable circular economy as our business model. We need to re-carbonize soil and we need to have the production use and reuse systems; and, can we make the world better because we create a sustainable circular economy? I think we can, when we intentionally design it that way, so it’s sustainable, it’s beneficial, and it’s circular, and it’s is based on the fundamental design principles, so that things circulate safety.

And importantly each of us, when we leave today, we can say, “We prefer to buy materials and products that are design for a sustainable beneficial circular economy. Companies have to start hearing this is what we want.

We’re fortunate to have Nestlé here with us today that’s already thinking in this way, in many ways, but most companies are not yet, and so we need to ask for these changes to be made, and in a way insist: “I don't want to buy your product X, Y, Z, unless it has these things in them.”

So I have talked about changing the language, changing the words; talked about making sure we include sustainability, that we intentionally go about our business, that we use fundamental design principles to redesign things.

I’ve talked about the missing part of the CSR chart which really should include the “more good” as well as the “less bad.” And so now, it comes to the “What’s next?” and the “what’s next” is putting it all into practice; the “what's next” is changing from just talking about it, to just doing it. And so, I want to give you a couple of examples of where this is being done.

So, in this new sustainable circular economy that we’re going to create, everything is a nutrient. Our intention is to create a sustaining, beneficial circular economy. We’re delivering services, products, and systems to users, not consumers. We have products that have use cycles, not life cycles; and it’s not only about making things last longer. I'd like to have the latest gadgets and computers, and iPhones and what have you, and it is not a bad thing, as long as it gets taken back and gets reutilized.

And what's been missing, this whole good, positive beneficial part, and what's next is the redesign, it’s the implementation, of following these sustainable circular economy principles.

So, as I think about the conference and what we’re going to recommend, you know, I think we have to look for ways to dignify and even professionalize the work of what today we only call garbage pickers. These people need to become professionalized, and become material managers. We need to change from waste management to material management.

And there’s a great report by the TIA Fund Report, by good friend of mine from Brazil, who has shown that this is possible, that is being done in Brazil as we speak.

We have to look for opportunities right now, even with the products that are designed for the linear economy, to reutilize them, and create new jobs and new products even with this linear flow; and then to work even harder to create new products that are intentionally designed to go into this circular economy.

We need to educate much more, in government, in universities, and in companies, and to the public, on the concepts that I’ve been talking about today and this idea of a sustainable circular economy. And hopefully this is the start of much more.

And we need to communicate a preference; that, when we buy things, if you are buying as the purchasing manager in a company, say that you want products, that you prefer products that are designed in the circular economy. And everyone will think you’re crazy, but you’ll keep saying it until they get it, and over time more companies will do what Nestlé is doing and will start putting this thinking inside their companies. But we have to ask for it, so start putting it in your specification, even if no one understands it.

Include requirements for sustainable circular economy in your purchasing specifications, assuming everything else is the same: Cost, performance, aesthetics; all the things you would normally ask for in a specification but add a preference for sustainable circular economy solutions, and see who steps up.

I’m helping to co-organize an event in Santiago de Chile in late November; it’s the Circular Economy Forum of the Americans, it’s our second one, and I would like to invite you all to join us there. You will have a lot of practitioners from all around the world who are doing this work that I’ve been talking about and you can go to cefa2018.com to find out more.

So let's think about some opportunities right here, before I end. Do you have any bakeries that you think at the end of the day that have some stale bread? Is that a possibility? You think maybe even in the hotel they have some bread at the end of the day or at the end of the week that isn’t being used? Probably.

Do you have cafes that are creating nice Guatemalan coffee from fresh grounds? What are they doing with those fresh grounds? Just throwing them away? Is the stale bread just being thrown away?

These are just two very simple examples of… and we could spend the rest of our time just going around the hotel looking at everything in this hotel and think about things that are being thrown away and wasted. And maybe there are some better things to do than just throwing them away in this linear economy.

In February, I was in Glasgow, Scotland, speaking at a convention and I had a good chance to meet with a young entrepreneur who’s taking stale bread from all the bakers in Glasgow and he’s making an award winning beer. So now we have circular beer from stable bread. Why can’t we do that here? Who’s going to step up and see me after the presentation and say that they want to do a project where they want to do this here? We can do this.

Where we’re going to do in Santiago de Chile, there is a small entrepreneurial team that is going around all the cafes in the city and they’re taking those used coffee grounds that nobody else knows what to do with. It’s actually a coffee roasting company. So they’re doing the roast, they’re taking the beans to the cafes, and when arrive to the cafe they not only take the new beans for the coffee, they take back the old grounds that would otherwise be thrown away, and then they’re bringing them back to a central location; they’re doing a small amount to cleaning and production on those grounds and they are putting mushroom spores into the coffee ground, using the same packaging that the coffee beans were in, which they also take back, and they’re reselling a mushroom growing kit.

So you can take the coffee ground bag, with the coffee grounds that now have some mushroom spores in it, and you can grow mushrooms to have and feed your family with.

Another simple example of ways we can look at things that we’re just throwing away without any thought and we can make it into something over again. Is it complete optimized? No, of course not, but we’re only just starting this journey to move from linear to circular.

And so, I would urge you to start thinking about all of these things that are being thrown away, what can we do now that is new and innovative, where we can use things in a circular manner, and let's work together to make these and other material flows beneficial, sustainable, and endlessly  0circular.

Thank you very much.