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Stewardship Tools and Economic Outcomes

Written by Equilibrium on 3 September 2018

Recent pressures on Australia’s waste industry and some local councils reveal thought-provoking views about the desired remedies and solutions. Some of them are well considered, commercially sound and informed; others seem opportunistic and motivated by self-interest.

As part of the scramble for solutions, ambitions for achieving a circular economy are to be commended and pursued, but they must also demonstrate genuine attention to the core principles of what a circular economy is and provides.

In Australia, many circular economy visions and claims seem rebranded ‘old-school’ recycling activities that are far from regenerative, restorative or closed loop. Putting recovered materials into road building is good but not really recycling or upcycling that maximises functional value or extends material life; more so it is a short step from otherwise landfilling such materials.

Such pursuits also seem to typically co-opt product stewardship as a tenet of a circular economy, often going further and binding the two together.

History, theory and reality tells us that product stewardship is about managing the life-cycle of products and this involves much more than materials or waste management. Product stewardship has grown out of chemical companies in particular safeguarding farmers and other end-users from the toxic or health threatening effects of certain chemicals and in particular herbicides and insecticides.

Product stewardship is a tool that can involve diverse interventions at different stages of the life-cycle and across the spectrum of environmental issues and impacts not excluding occupational, health and safety, energy efficiency, safe operation, or design for repair, remanufacturing and refurbishment. Indeed, in many North American companies, product stewardship is often primarily focused on the safe management of chemicals and restricted substances across the product life-cycle.

On the other hand, a circular economy is a desired outcome for managing products and materials in a more  sustainable manner. It seeks to ensure that the production and consumption process values and rewards resource productivity. A circular economy is chiefly the result of materials movement and use allocating waste as an unwanted inefficiency, ipso facto transitioning from the take-make-waste-paradigm to circularity.

Distinct and separate concepts

While there is complementarity as some elements of product stewardship can contribute to achieving a circular economy, they are distinct and separate concepts. Each one worthy and necessary, but not co-dependent, nor interchangeable. One is a tool or approach typically applied by producers and/or retailers; the other is a system-wide outcome involving more action by more players across the economy.

Some claim the need for increased product stewardship regulation in order to cover the cost of market failures or sustain the business activities of waste management providers. Others believe that increased in-country processing of recyclables will resolve the export dilemma. Yet others are convinced that recycled content in packaging with associated labeling can save the day. There is even great enthusiasm for embedding a range of post-consumer materials in road building and construction, instead of embedding it in landfill. And we haven’t even touched on the role of waste to energy and whether it is compatible with circular economy principles.

The reality is that we may need a mix of multiple responses depending on the specific issue or impact being addressed. A one-dimensional approach typically delivers questionable environmental benefit.

For a more circular economy, mandated product stewardship mechanisms might be relevant and necessary in some cases, just as voluntary models might be most desirable in other instances. There will also be myriad other economy-wide measures required, as this has been clearly evidenced by the EU’s package of circular economy measures.

The European Commission’s Circular Economy Action Plan gives us a sense of what is required in a practical policy and programs sense. It reflects system-wide, economy-wide interventions across sectors, industries and communities. It reflects a transformative approach across many players in government, industry, academia and the community. The Commission’s Action Plan also highlights the comprehensive nature of its measures and how they apply to existing policies, laws, directives, standards regulations, and codes.

The current inclination to push product stewardship and circular economy as partners working towards better waste and recycling outcomes over-plays their purpose and capacity. It also under-estimates the detail of what’s required to achieve better product life cycles and a more circular economy.

Noteworthy examples

Of course there are great examples where product stewardship and circular economy principles work well together and achieve noteworthy results.

Product stewardship is not prima facie about waste management and circular economy, and trying to make it so weakens its role and restricts solutions.

For example, Australia led the way with newsprint recycling through the Publishers National Environment Bureau (PNEB), and a model that reflected both a strong stewardship approach and the core circular economy principles. Australian newspaper and magazine publishing companies worked collaboratively to develop a program that increased recovery and recycling rates of newsprint and did so through closed loop strategies that applied across the supply chain.

This was done as paper recycling operated in a semi-circular economic fashion in its own right. While paper production on a national and global scale physically requires introduction of long fibres only achievable through virgin pulp, the paper industry nonetheless is largely circular based on the economic benefits and inherent value in recovered fibre.

Another real-world exemplar of how stewardship and the circular economy work in tandem but are not co-dependent is the commercial furniture sector. Steelcase is an American company creating products and services for the workplace and is well known for design, manufacture… and refurbishment of workstations, ergonomic seating and other commercial furniture products.

Steelcase developed their Phase 2 Program to handle high-volume furniture recovery and refurbishment activity, all of which is underpinned by a zero waste to landfill goal. It is a smartly designed initiative and seeks to maximise the useful life of office furniture by enabling a second life with other customers. There is a strong charitable and gifting focus but it is also highly commercial. They’ve worked out a model that is regenerative, restorative as well as closed-loop to a significant degree.

The Steelcase gifting and charitable process has also been fine-tuned to work at a national level and with large volumes of product, thus it’s no cottage industry. In many respects it reflects the essence of product stewardship and includes a strong social and charitable dimension while also diverting thousands of workstations and chairs from landfill on an annual basis.

Again, no regulation, producer-focused and a great example of how design for disassembly and refurbishment upstream in  the product life-cycle can deliver social, environmental and economic benefit downstream. It’s more about circular asset management, good design and a company culture that values product durability and charitable objectives.

Successful product stewardship schemes can and do operate with or without the waste industry

In electronics for example, we see product stewardship exercised through asset management programs and reverse logistics operators whereby the consolidation, collection and transport are managed by third parties to manage the remarketing, reuse and redeployment of product. This example is widespread among the mobile phone, computer and business imaging industries with no need for traditional waste management service providers or materials recycling  businesses.

So what do these examples tell us about product stewardship and the circular economy and the relationship therein?

Firstly, we need to acknowledge the difference between tools (product stewardship), and outcomes (circular economy), noting that product stewardship is not just about industry-funded post-consumer waste recycling programs, just as circular economy is more than just processing recyclables in-country.

Closing remarks

Commercial self-interest that is connected to any intervention, program or scheme needs to be called out. Simplistic claims for mandatory instruments should be approached with caution.

The waste and recycling industries have a role to play in product stewardship schemes and pursuit of a more circular economy, they are important service providers and enablers for both. However, they are not central to both, but perhaps more vital in the circular economy than in product stewardship opportunities.  They are only links in a chain.

None of this is about being unrealistic or impractical; more so it is about confronting the evidence we know and hear daily, evidence that tells us that window-dressing, half-measures, and environmental spin, will not deliver the positive change we require in order to consume sustainably and operate successful companies, social enterprises and local councils.

The restorative and regenerative principles inherent in a circular economy tell us that ‘value’ in all its forms must be maximised; that lowest cost is not always the lowest overall price when all environmental, economic and social factors are considered. It also tells us that waste disposal and down-cycling may sometimes the best of limited available options, but are still not circular.

One of the challenges and risks for all stakeholders is to resist the temptation of mediocrity. We need to guard against the broader value of tools like Product Stewardship and circular thinking being reduced to crude waste management tools.

This article was authored by John Gertsakis – director, communications, and Nick Harford – managing director of Equilibrium.

Originally published on 27 August 2018 in Inside Waste online.

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