Dramatic losses
Resource extraction and processing is responsible for 50% of greenhouse gas emissions and more that 90% of biodiversity loss. According to World Wide Fund for Nature ‘The Living Planet Report’ from 2022, populations of wildlife mammals have declined by 69% since 1970. Representation of wild mammals on Earth decreased from 10 million tons of carbon equivalent (tC) in 1900 to 3 million tC in 2015, just 2% of World’s mammal biomass.1
In the same period, the World human population increased from 1.7 billion people to 7.4 billion. The correlation is not accidental. Just in last 50 years, the volume of materials extraction increased by 193%, the production of meat by 244%, the coverage of deforested land by 40% and marine fish catch by 47%. The volume of materials entering global economy has more than tripled over the same period from 30 up to 106.6 billion tons per year, and it continues to grow. It’s expected to rise by another 60% by 2060 and the related waste production shall increase by 70% by 2050. At least 14 million tons of plastic waste end up in the oceans every year.
The pressure on natural resources is immense. In 2023, Earth Overshoot Day—the date when humanity exhausts nature’s annual resource budget—fell on August 2 (March 14 for the USA, and May 12 for Slovakia). Globally, we consume resources as if we had 1.75 planet Earths, and our current consumption trajectory points toward a demand equivalent to three planets.
Circular solutions for business and well-being
Circular economy solutions have become well known as circularity turns to be a recognized business tool, reaching the megatrend status according to the Circle Economy Foundation. At the same time, it is clear from global trends that the application of circular principles lags behind the growth rate of the global economy, as the share of secondary materials consumed has decreased from 9.1% in 2018 to 7.2% in 2023. These figures show that we are missing out on achieving broader social and environmental opportunities linked to circular solutions implementation.
Circular economy solutions have gained significant recognition, with circularity now considered a major business tool and reaching ‘megatrend’ status, according to the Circle Economy Foundation. However, global trends reveal that the adoption of circular principles is lagging behind the growth of the global economy. The share of secondary materials used has dropped from 9.1% in 2018 to 7.2% in 2023. These figures highlight the missed social and environmental opportunities that come from failing to fully implement circular solutions.
According to the World Economic Forum, the circular economy has the potential to reduce global greenhouse gas emissions by 39% and play a crucial role in addressing the biodiversity crisis. Additionally, it offers substantial value to businesses that embrace closing the production loop. By adopting circular practices, companies can lower costs, minimize risks associated with linear business models—such as resource scarcity, pollution, and commodity price volatility—and mitigate regulatory and political risks stemming from new legislation and reporting requirements. Moreover, it opens up new sales opportunities and revenue streams. In the EU alone, the circular economy is projected to generate $2 trillion and create over 100,000 jobs by 2030.
EY Slovakia and its CCaSS team is ready to provide clients from different industries with comprehensive services in implementing circular business models as in the solution of sub-projects related to mapping and adaptation of supply chains, compliance with legislative requirements or identification of metrics and disclosure requirements in connection with reporting practices. So called R-Strategies cover under 9Rs all the way from linear to circular economy, starting with product and its packaging design, smarter manufacture and use, followed by extended lifespan, efficient product application and customer service.
“In an era where the circular economy is no longer just a vision but becomes an essential trend for the survival of businesses, every end is a new beginning and an opportunity to close the loop and create sustainable value not just for business but also for the planet,” adds Tereza Hanušová, Senior consultant & circular economy expert, CCaSS EY Slovakia.
EY Slovakia and its Climate Change and Sustainability Services (CCaSS) team are ready to offer clients across various industries comprehensive support in implementing circular business models. This includes assisting with sub-projects such as mapping and adapting supply chains, ensuring compliance with legislative requirements, and identifying metrics and disclosure needs for reporting practices. The ‘R-Strategies’ cover all stages of the transition from a linear to a circular economy, following the 9R framework—from product and packaging design, smarter manufacturing, and use, to extended lifespan, efficient product applications, and enhanced customer service.
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1 The IPBES Global Assessment report concluded that 1 million species are at risk of extinction globally.
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