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Planning for the circular economy

Editorial | July 1, 2017 | By:

Economics is an older science than ecology, created (if not perfected) during times when there were no scarcities of natural resources (and no wild-eyed college freshmen running around flashing their “Earth Day 1970” buttons at each other). In ecological science, there really is no concept of unlimited resources. Economics is necessarily focused on short time horizons, without the planetary outlook of ecology; and for years it was assumed that we could have healthy business growth or we could have clean air and water—but not both. Until recently, I’d thought that was one false dichotomy that had finally fallen out of favor (unlike alliteration).

Standard accounting techniques use the concept of “depletion” to assist in accurately identifying the value of assets on a balance sheet and to record expenses in the appropriate time period … and “the costs are held on the balance sheet until expense recognition occurs.” Until depletion of nonrenewable resources becomes a formal part of national and international accounting, we do have a lot of industries for whom expense recognition has already occurred.

On page 28 of this issue, “Closing the loop” talks about some sustainability strategies now being used by many textile manufacturers to reduce the waste stream and inspire the creation of new fibers from used textiles and textile waste: going beyond “reduce, reuse, recycle” to work toward a true “circular economy” that is, as defined by the Ellen MacArthur Foundation (, “restorative and regenerative by design. Relying on system-wide innovation,

it aims to redefine products and services to design waste out, while minimising negative impacts. Underpinned by a transition to renewable energy sources, the circular model builds economic, natural and social capital.”

Maybe it took economics to bring “natural and social capital” into the business operating equations, but it’s no longer just a mention along the bottom of those press releases I receive—it’s emblazoned across the top of the page in 72-point type. Our June issue on innovation introduced another piece of the puzzle with the debut of “The Greater Good,” which recognizes IFAI member companies that do good business while also being good neighbors, good citizens and good partners. In June, we wrote about Rainier Industries’ Scott Campbell; this month, we’re recognizing Awning Cleaning Industries’ Scott Massey. Both pieces were focused on sustainability, but that’s only part of the social capital that businesses need today.

This month, on July 26th, we recognize the anniversary of the Americans With Disabilities Act, signed in 1990 by President George H.W. Bush to prohibit discrimination against people with disabilities—one natural resource that is actually underutilized. Your employees, your customers, your community, your industry, your planet: what are you doing to help? I’m waiting to hear from you.

Or catch me in New Orleans this September at IFAI Expo. I’ll be the one wearing the “Earth Day 1970” button.

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