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Circular Performance Economy: Benefitting people, profits and planet

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Executive Summary

Lead contributor: Dr. Walter R. Stahel

This chapter analyzes the multitude of opportunities for economic and political actors hidden in selling the use or function of objects, such as the renting and operational leasing of “products as a service,” and providing energy and water, health, education, and other services, besides extending the service-lives of infrastructure, buildings, durable objects and molecules. 

Original equipment manufacturers (OEMs) and fleet managers of objects and molecules are key innovators of the Performance Economy, finance institutions and systems design teams its promoters, policymakers its facilitators. 

After an introduction situating the linear industrial economy, the circular industrial economy and the Performance Economy, the chapter explores many successful and some failed examples of industrial, financial, and political actors in different sectors. 

Some examples show how synergies between policymakers (authorities) and businesses (global manufacturing players) allow “shaping and implementing sustainable economic growth and inclusive prosperity,” to quote the “report on delivering the SDGs.” Others show that innovative SMEs can be highly competitive and profitable. 

The Performance Economy is about: 

  • Economics: producing, selling, and maintaining the function or performance of assets over extended periods provides corporate resilience against black swan events and resource security at low cost: “the goods of today are the resources of tomorrow at yesteryear’s commodity prices.” 
  • Innovation: the business models of the Performance Economy enable the exploitation of sufficiency and systems solutions, besides the traditional efficiency ones, and will profit from future advances in circular sciences. Multi-skill education, training, and novel long-life components will further increase the Performance Economy’s feasibility and profitability. 
  • Competitiveness: maintaining the ownership of the materials embodied in physical assets over the longest time possible needs a combination of technical and commercial innovation, saves the compliance and transaction costs of supply chains, and will profit from governmental carbon credits and water preservation bonuses. 

Within today’s discussion of zero carbon emissions, the Circular Industrial Economy plays a key role. Several studies have shown that it will reduce national CO2 emissions by 66% if implemented. The remaining 33-plus percent must come from radical innovation in circular sciences and policymaking: 

  • Circular energy led by green hydrogen and possibly micro nuclear fusion, combined with the recovery of clean steel scrap fractions, will enable the production of zero carbon (green) steel, without which there can be no zero carbon products. 
  • Innovation into circular chemistry has identified plastic monomers which can be recovered and reused ‘endlessly.’ 
  • Innovation into circular metallurgy to de-link alloys is progressing rapidly. 
  • Radical changes in policymaking such as Full Producer Liability and protection of the resources embodied in the stocks of infrastructure, buildings and manufactured objects are needed to ‘close the liability loops’ of the Circular Industrial Economy and will give producers a strong financial incentive to change their business models to those of the Performance Economy. 

Only reducing carbon emissions ‘below zero’ in the North will enable LDCs to increase their quality of life sustainably. 

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Discover what's inside

What is Performance economy?

A growing number of economic actors are producing, selling and maintaining performance. The objects range from infrastructure to building and objects or molecules as a service and include performance guarantees for pharmaceuticals and the functioning of technical systems such as lifts.

What is the importance of knowledge and skills?

People and their creativity, skills and knowledge are the foundation of a successful performance economy. Researchers identifying new energies, materials, molecules and processes to enable a fully circular performance economy with closed material and liability loops are its architects.

How can producers selling performance play a key role in performance economy?

Producers selling and maintaining the performance of infrastructure, objects or molecules as a service over their full service life are key actors. By designing objects for maximal use-value and function and minimal risks, liabilities and maintenance costs they reap long-term profitability.

What is the impact of Systems performance design teams?

Multi-disciplinary systems design teams innovate novel solutions for complex problems which deliver an integrated performance of a quality superior to the separate objects, products and services they replace. Systems performance solutions are designed to deliver fail-safe, fool-proof and competitive results.

What is the role of fleet managers as performance providers?

Fleet managers produce, sell and maintain the performance of complex systems, infrastructure and objects or molecules as a service. Maximising use-value and function over the full-service life while minimising costs and liabilities of operation and maintenance guarantees long-term profitability.

What is the role of various users?

A caring attitude and stewardship of users prevents hazard of use and abuse. Users profiting from flexibility in use and known costs per service unit are the main beneficiaries of the performance economy; but their carelessness and abuse are its biggest obstacle.

What is the role of public Performance Procurement Manager?

By buying the desired performance of infrastructure, technical systems and objects instead of buying the hardware, public procurement managers reduce their capital expenditure and give industrial actors strong incentives to innovate efficient system solutions that profit the environment and their balance sheet.

What role play Private Finance Initiatives in the Performance economy?

Explore how by financing performance economy solutions, private investors, banks, insurance companies, and leasing companies interested in stable long-term investments encourage the activities of actors of the performance economy, create new investment opportunities for themselves and reduce the risks of their investments.

Meet the Leaders

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Enrollment Information

  • Once you have enrolled, you will be given access to our Learning Management System.
  • The course is entirely online and self-paced. We estimate that the total effort required to be 3 hours.
  • You will be guided through the original content of the course with dynamic, rich, enjoyable, narrated, and easy-to-understand content. The course is divided into easily navigated sections focusing at each stage on the learning objectives to be achieved. Each section is followed by non-graded “knowledge check questions”, to help you ensure that you have successfully assimilated the content. You can go back and view the content as often as you like.
  • When you reach the end of the course, you will be awarded the Certificate of Completion.

What you will gain

  • Access to one Circular Economy course, with free access to the content for one year.
  • A digitally enabled, verifiable, and shareable certificate acknowledging your achievement.
  • One-year free membership in the Circular Economy Alliance Community, including access to Circular Economy Alliance members, resources, and events.
  • Special access to Circular Economy related events, research, resources, and news.

Please note:

  • In many EU countries, the cost of certification can be covered by personal or corporate “training accounts”. Please inquire within your organization or with the appropriate institution within your country for more information.

Policy

Circular Economy Alliance Code of Conduct and Code of Ethics

The Circular Economy Alliance platform, services, and products are designed to appeal to and be used by people from a wide variety of different backgrounds, countries, religions, and cultural norms. These diversity and inclusiveness are core values of the CEA, and we encourage our Community to embrace it and share it. That said, this geographic and cultural diversity can make effective communications and general policy definition a bit challenging.

That said, CEA is committed to advancing the transition to a just and inclusive Circular Economy which aims to decouple economic growth from resource use, eliminate waste by design, and tackle climate change. To achieve its mission and vision of a socially fair Circular Economy, CEA has adopted the principles of Corporate Social Responsibility and endeavours to promote the common good while creating value for all stakeholders. With this in mind, the Code of Conduct has been developed to ensure all activity on the platform and within the CEA community is mutually respectful. The Code of Ethics sets out the guiding ethical principles relative to all professional activities of the certified members of the Circular Economy Alliance, informs the actions of our partner network, and defines the conduct of CEA staff and persons acting on behalf of the Company.

The purpose of our Code of Conduct & Code of Ethics is to ensure that the Circular Economy Alliance platform (the Platform), products and services are inclusive and that we, our members, and our community uphold the principles and values linked to Circular Economy, social responsibility, sustainable development and all relevant domains, to ensure that people and the planet are not harmed in the name of profit, and that we all conduct ourselves with mutual respect.

Code of Conduct

The CEA Code of Conduct reflects the ethics and values of the Platform, product, services, and community. It has been prepared with members of the CEA community (the Community), content contributors, instructional designers, and administrators based on established best practices. With the involvement of our stakeholders, we will continue to update the Code of Conduct as we add new products, services, and activities and as we receive feedback from our learners and community members.

We cannot foresee all eventualities and align with all local regulations, so the Code of Conduct should indicate the nature of interactions and the social dynamic we would like to see on this Platform and within the Community. In the event of an issue not covered by this Code of Conduct, the CEA team will decide whether a behavior is acceptable or not, in a manner that is as fair and transparent as possible, while respecting the confidentiality of all involved.

This Code of Conduct applies to all activities on the Talent Learning Management Platform, the Circular Economy Alliance website, its social media pages (Instagram, Facebook, LinkedIn, YouTube, Discord, etc.), including comments, forum posts, and private messages.

Certified Alumni, members of the Community, as well as candidates for Circular Economy certification are encouraged to adopt the following guidelines for conduct:

  • Contribute to maintaining a safe, supportive, and orderly online learning environment that is conducive to learning and to show respect and dignity to other persons and to property.
  • Contact or communicate with CEA administrators and other personnel in a respectful, positive manner.
  • Behave and communicate on and off the Platform in accordance with the principles of Circular Economy, social responsibility, and inclusiveness.
  • Help ensure all CEA members and personnel have a positive experience in all interactions with you.
  • Appropriate behavior we encourage is as follows: communicating and interacting with respect; demonstrating empathy and sensitivity; giving constructive feedback; acting in accordance with the principles of inclusiveness, that is, showing respect for other norms, cultures, life preferences; promoting the values and principles of Circular Economy, social responsibility, and sustainable development.
  • Maintain behavior free from all forms of bullying, harassment, and discrimination.
  • Other forms of inappropriate behavior that will not be tolerated include dangerous, inciteful, or hateful speech; harassment or intimidation; threats of violence; intentional disruption of online discussion, webinars, conference, or other events; retaliation; influencing or encouraging any of the above.
  • We are a learning community, united around the principles of Circular Economy. As such, we encourage experimentation, a growth mindset, and tolerance for failures, mistakes, or lack of understanding.
  • Despite our shared values, disagreements and misunderstandings are bound to occur in a community as diverse as the Community. In the event, have a calm discussion, ask for clarification, and don’t assume that someone is intentionally being offensive.
  • Please get in touch with the site administrators to report any conduct, posts, activity or content that you do not believe is in accordance with this Code of Conduct. We encourage the Community members to report any incidents that violate the Code of Conduct. The CEA team will respond in a timely manner, and the member who violated the Code of Conduct will be contacted directly. Please use the Contact Us link to report any breaches.
  • Please protect your own and other people’s privacy. Please be mindful not to post or otherwise share your own or other people’s personal information publicly online.
  • Unless otherwise stated, all content posted on the Talent Learning Management System is private and is not searchable online.
  • Unless otherwise stated, all content posted on the Community platform is publicly visible and searchable online.
  • If you delete your CEA Community account, you can request that your Community posts and private messages be removed or anonymized.
  • The website administrators may delete activity, comments, posts, and equivalent that do not adhere to the CEA Code of Conduct.
  • In the event of a breach of the Code of Conduct, we either issue a warning, announce an account suspension or, in the event of a grievous violation, we may announce account expulsion and removal from the platform and the Community.
  • If you are part of the Community, we share the same principles. Let’s share the responsibility for creating a positive dynamic on the Platform.

Code of Ethics 

Certified Alumni, members of the Community, as well as candidates for Circular Economy certification are strongly encouraged to uphold the highest standards of ethical norms in line with Circular Economy principles and values:

  • Act with transparency, honesty, integrity, and make the interests of society and the environment a priority, avoid any known conflicts of interest, and aim to create value for all stakeholders.
  • Promote the circularity and sustainability of the systems regulating economic life according to the principles of “people, planet and prosperity”.
  • Act with respect for others and the environment and practice their professional activities in an inclusive and non-discriminatory manner that upholds the values of equity, equality and tolerance.
  • Exercise their leadership and decision-making skills in the pursuit of establishing a culture of equity, diversity, and inclusion in the workplace and in society.
  • Act in a way that furthers the integrity of the discipline of Circular Economy and its representatives.

The code of conduct is regularly reviewed to reflect necessary adaptations that emerge from input received through our CEA members’ reporting or by changes to the prevailing regulatory framework.

Effective as of: 1 March 2022

Last revised: 28 February 2022

More detailed information can me found in the General Terms and Conditions and the Certifications Terms and Conditions.

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