Circular economy requires change in the mindset of firms and customers

Transition from a linear economy brings new business opportunities.

Slovakia has adopted new legislation to make landfilling more expensiveSlovakia has adopted new legislation to make landfilling more expensive (Source: Sme)

In a linear economy, raw materials are mined and processed into a final product, which is thrown away as waste after it has been used. In a circular economy, the used product does not end up in a landfill, but is a source for the manufacturing of new products. Achieving this closed cycle to tackle emerging environmental challenges requires a change in the mindset of companies, customers as well as the state. While circular economy is no longer an unknown term in Slovakia, a lot of work still has to be done to transform the Slovak economy into a greener, more responsible one.

“In terms of awareness of circular economies, the situation has significantly improved in the last three years,” Ivana Maleš of the non-profit and non-governmental Institute for the Circular Economy (INCIEN) told The Slovak Spectator. “But in terms of its implementation, Slovakia has progressed in some sectors, while others require some more work. Slovakia is missing what leading circular economies like the Netherlands or Slovenia have – a common state policy addressing this issue. For now, the circular economy is only on the Environment Ministry’s agenda.”

Mostly the private sector and commercial companies have jumped on the circular economy wave.

“The biggest challenge they face is the change in their mindset, when not only profit, but also the transition towards the principles of a circular economy have the highest priority,” said Maleš.

New business opportunities

Companies in Slovakia understand the need to address climate change and mitigate its impacts. They create environmental innovations for their products, implement energy-saving measures, reduce their business flights by communicating via Skype, plant trees and install beehives on their roofs.

Related articleVagaská: Customers have power to push businesses to be more responsible Read more 

“All these measures are good, but companies often pursue only instant, good-looking solutions,” said Ivana Vagaská, executive director of the Business Leaders Forum (BLF). “Having a composter in the office is fine, but it would have a much bigger impact if the company modernised its production to reduce the generation of CO2.”

Vagaská sees it as a great challenge for companies to transfer to a CO2-neutral economy and adopt the principles of a circular economy, within which waste is not created at all or is processed into a new product.

“Isolated green solutions will not make the wanted change; the way business is conducted needs to be changed,” said Vagaská, adding that such a business should not support consumerism and instead produce less, but of higher quality.

She uses the company Patagonia from California as an example. This designer of outdoor sports clothing and gear has extended its services by repairing its products and sewing new products from olds ones.

“While thinking about how to not produce useless waste, it has identified this as a new potential business,” said Vagaská.

Vagaská admits that such a turn in the mindset of companies is a real challenge which requires sacrifices on the side of customers, too.

“They should give up the possibility to have everything at any time in any quantity and instead think hard about what they really need and what will happen to the item they have bought once they don’t need it anymore,” said Vagaská. “On the other hand, since it is companies that create products and services that satisfy the needs of customers, the customers are the driving force of the required changes.”

Positive examples in Slovakia

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