Why care about circular business models even if sustainability is not a top priority? – Board of Innovation

Sustainability goals are moving up on the priority list of many large organizations. Unfortunately, doing better for our planet and society in itself is rarely the primary trigger to innovate. Until we reach that stage, organizations need a couple of extra nudges to get motivated enough to act. Luckily there are plenty of other arguments!

Take circular business models as an example. Why do companies decide to engage in the circular economy? Aside from estimates that the circular economy is a waiting to be seized, here are 6 other reasons why you might pursue the circular economy (for entirely selfish reasons).

The direction is clear. Every single industry will, sooner or later, make significant investments to limit the negative impact of doing business. Production techniques need to be redesigned, distribution channels will need to evolve, waste management needs to level up – you get the point. But where will all these businesses go for solutions? Most organizations will not start from scratch. If you build up knowledge and IP today, you can surely monetize this in the near future. Additionally, the shift from circular to linear involves business model innovation for all players in a value chain. Shifts in business models are harder to copy than product innovations. It can be difficult to innovate with suppliers, your customers, and downstream businesses to build the relationships and infrastructure required to close the circle. But that being said, first ones to build this network have lasting competitive advantage over new entrants.