Reflets Magazine #146 devotes a feature to the circular economy. As an introduction, an interview with Pierre-Emmanuel Saint-Esprit (E16), Circular Economy Director for the Manutan group, co-founder of the Global Circular Economy Chair at ESSEC, President of the think-tank EC2027 – A 5-Year Term for the Circular Economy, administrator at the National Institute for the Circular Economy and ambassador for Mouvement Impact France… in short, an expert in the matter! Here is a free online translation of an excerpt of the article… subscribe to get the next issues (in French)!

Reflets Magazine: What does the circular economy encompass, in practical terms?
Pierre-Emmanuel Saint-Esprit: The circular economy is often confused with recycling. The circular economy is seen as a specific activity at the end of the standard production and distribution chain, aimed at recovering products at the end of their life cycle to dismantle them and try to re-introduce all or part of the resulting matter in the production system. Not only is this a limited view, it also harmful. It serves as an alibi to avoid freeing the real potential the circular economy holds for environmental and social transition.

RM: What definition do you prefer?
P.-E. Saint-Esprit: That of the French Ministry for Environmental Transition: the circular economy consists in producing goods and services sustainably, by limiting resource use and wastage, as well as the production of waste matter. It is not limited to a single activity sector; any organisation can implement more circular processes to achieve a more responsible management of value.

RM: How is the circular economy more virtuous than the linear economy?
P.-E. Saint-Esprit: In the linear system which currently predominates, we produce goods which we throw away after use. This encourages a reduction in product life span to increase purchase frequency, the main lever for maximised development. As a result, we currently consume 100 gigatonnes of raw material per year, compared to 28.6 gigatonnes in 1972, according to the Meadows report. This frantic pace does not allow for natural resources to regenerate; right now, we consume the equivalent of 1.7 planets per year. This has a huge impact on climate change. The Dutch organisation Circle Economy estimates that 62% of world greenhouse gases (except for those produced by land and forest use) are emitted during the extraction, processing and manufacturing of goods, while 38% are attributed to their delivery and use. By applying the principles of the circular economy, we could reduce the use of natural resources by 28% and greenhouse gases by 39%.

RM: Where is France at with the development of the circular economy?
P.-E. Saint-Esprit: France is a pioneer in this area. The concept of the circular economy officially entered the law of 19 August 2015 on energy transition for green growth. This law recognises the transition to a circular economy as a national goal and one of the pillars of sustainable development. The law also lays down ambitious aims, such as the 30% rise by 2030 in the ratio between GDP and the domestic use of materials.

RM: Not to mention the French Anti-Waste and Circular Economy law... 
P.-E. Saint-Esprit: The anti-waste law (AGEC), enacted on 10 February, encompasses five major focus points. The first is to move away from the all-disposable, specifically through the ban on single-use plastic. The second is to provide better information to consumers, in particular through the creation of a reparability index for white and electronic goods. The third focus is to fight waste and promote solidarity re-use, which includes the ban on destroying unsold non-food goods. The fourth is to act against programmed obsolescence, and the fifth to produce more efficiently.

RM: What effect have these laws had?
P.-E. Saint-Esprit: We are still in the early stages; a third of unsold non-food goods are still destroyed every year, even if the AGEC law now prohibits this practice. Despite the regulatory effort, the link between circular economy and emission reduction has yet to fully enter the public sphere. The political responses to the shortages caused by the war in Ukraine are a perfect illustration of this; all we heard about was energy-saving, but we could also have re-thought our consumption to opt for lower-emission products.

RM: What hurdles does the circular economy continue to face?
P.-E. Saint-Esprit: I’ll give you the three main ones. First of all, the lack of a common benchmark to assess circularity. We have accounting standards, so why not develop the same thing to measure the feasibility of a product or service in terms of available resources or resulting emissions? We could draw on the Accounting for Environmental Remediation method in particular, which applies the traditional accounting standards of financial capital to natural and human capitals, to include their degradation in company results. The ISO is currently working on this with more than 90 countries.

RM: What is the second hurdle?
P.-E. Saint-Esprit: The inter-reliance of economic players generates a certain degree of inertia in terms of circular innovation. We’re seeing this right now in the framework of ESSEC’s Global Circular Economy Chair. In association with our patron, Bouygues, we are looking for a new economic model for property sale, but we have to convince a bank, insurer and materials producer to allow us to test the model, an alignment task made all the more laborious because of its implied risk for stakeholders in a context of crisis and inflation.

RM: And the third hurdle?
P.-E. Saint-Esprit: Circular economy levers lie most often in the hands of external operators, who are less interested than market players in their effectiveness if integrated in their models. Let’s take for example the collection of used products, known as the EPR sector system (for ‘extended producer responsibility'). This relies on eco-organisations for a large proportion of market goods - i.e., on a private-law company held by producers and distributors and responsible for managing the end-of-life of the equipment the latter place on the market. This externalisation is clearly ineffective: the rate of household appliance waste collection, for example, barely reaches 52% and stands at just 27% for professional appliances, while the European regulation requires 85%. Not to mention the re-use rate, which is far more virtuous in terms of CO2 than recycling...In my view, it would be much more effective for companies to internalise the collection, re-conditioning or repair of their products.

RM: How do we overcome these hurdles?
P.-E. Saint-Esprit: [Article to be continued in Reflets Magazine #146]

Interview by Louis Armengaud Wurmser (E10), Content Manager at ESSEC Alumni.  

Translation of an excerpt of an article published in Reflets Magazine #146. Click here to read a preview of the issue (in French). Subscribe to get the next issues (in French).