In this thought-provoking Q&A, Celli Lloyd, UK Country Launcher at Axa Climate’s The Climate School shares how businesses can close the loop and embrace waste-free models through the circular economy, and navigate the evolving regulatory landscape to drive real sustainability progress.
Walk us through your professional journey and how you landed your current position at The Climate School.
I worked for several years in Australia as a chemistry teacher before moving to Finland to finish a Masters focused on sustainability education and online learning. Afterwards, I worked in London as a sustainable transport consultant exploring large-scale behaviour changes. Returning to working for universities for a couple of years on adapting their courses and teaching for online education, I realised I wanted to return to the sustainability space. I found AXA Climate School—my Venn diagram of sustainability, education, and online learning. There, my role has been to launch the Climate School into English-speaking countries.
Can you elaborate on The Climate School’s mission, goals, and the impact it has on driving positive change in the sustainability landscape?
The urgency of the climate change situation calls for immediate and coherent action within companies. Although CSR teams currently have a great deal of training, they still face issues due to the lack of awareness among business and support teams.
So how can organisations infuse this urgency into the business lines and launch the transition movement throughout all levels of the organisation? The Climate School, launched in May 2021, answers this need. The objective of the Climate School is to create a uniform level of understanding of the issues, a common vocabulary for all teams to facilitate cross-functional collaboration and provide the initial levers to launch the transition to action.
Who is the target audience for The Climate School’s initiatives? Can you share some specific examples of companies that have benefited from its guidance?
The Climate School is for everyone. We are designed for any company or organisation, and we have tailor made solutions for public organisations as well. The Climate School is generally deployed by CSR or HR departments in charge of training. We are typically deployed to raise awareness and engage all employees on the subjects of climate, biodiversity, sustainable transition, and to help those CSR and HR leaders take action at the level of their profession and their company.
[Training] has been deployed in over 160 organisations worldwide, including Accor, Orange, Schneider Electric, KPMG, HCLT, Henkel and Heineken. Currently, over 6 million employees have access to our resources.
For many, the circular economy is considered the ‘next big thing’ on the ESG and decarbonisation organisational journey, how would you define a circular economy, and why do you think that is?
A circular economy is an economic model designed to minimise waste and maintain the value of products, materials, and resources for as long as possible. It aims to move away from the traditional linear model of ‘take, make, dispose’ and promote a system where products are designed for longevity, materials are reused or recycled, and waste is minimised.
Moving towards a circular economy is key not only to tackling natural resource depletion and limiting pollution but also, and more and more, it’s an important tool to fight against climate change. According to the International Resource Panel, half of the world’s greenhouse gas emissions come from the extraction and processing of materials, fuels, and food. If we reduce these extractions from the very beginning, which is one of the main pillars of a circular economy, we will manage to reduce these emissions. That’s why decarbonisation and going circular goes hand in hand.
But that’s not all. Achieving net zero must involve a more circular economy, for another specific reason. Without it, we risk not having enough critical metals to manufacture what will allow us to decarbonise the economy: electric vehicles, wind turbines, solar panels, etc.
What are the top benefits for businesses that incorporate circular economy practices into their business?
Moving towards circularity is essential to decarbonise one’s activities and the whole economy. But sustainability is not the only good motivation to act from a company point of view.
It’s also a matter of security regarding critical material supply.
Since resources are limited, it’s going to be increasingly difficult to obtain certain resources over the medium and long term. Since 1970, global material extraction has more than tripled, and we have gone from extracting 27 billion tons to more than 90 billion in 2020. And the OECD estimates that material extraction could double by 2060. Looking at metals, some are already under so much pressure that specialists fear shortages in the medium term, especially for copper, lithium, and cobalt.
For example, electric vehicles, which we need to decarbonise transportation, require copper and lithium for their batteries. However, almost 90% of currently known copper resources may have been extracted by 2050, according to researchers. This is why we need to bring out another model and to leave the linear economy behind.
There are also other benefits for companies. For example, adopting a circular economy helps differentiate your offers from your competitors thanks to the innovation that the circular approach will generate. A good example is the Dutch multinational company Signify, which sells some customers a lighting service rather than bulbs—it’s a typical circular business model. So circular is a way to innovate and then benefit from these innovation gains.
Where should businesses begin with circular economy?
For me, the first step must be to get the whole organisation on board with the path towards the circular. This must involve training for all departments of the organisation, ensuring that everyone understands why circular is necessary, what it means, the preconceived ideas to avoid, the concepts to know (eco-design, reuse, etc.), and the good practices to follow.
In parallel, to deploy a circular strategy approach in your company you have to identify the strategic opportunities for your business. The benefits must be clear and convincing for your management to follow you, as it’s their support will give your initiative the greatest chance of success. Circularity implies organisational changes that impact offers, production, purchasing and distribution processes, jobs, and business models. To be accepted, these changes must be legitimised internally.
In your opinion, what challenges and barriers might organisations encounter when implementing circular economy principles? How can these obstacles be addressed to expedite the transition to a circular economy?
When we speak about a circular economy, people immediately think of recycling. Certainly, recycling is part of a circular mindset, but it’s not the entire response. You need to think in terms of resource flows—where do they come from and how to reintegrate them into your value chains by retaining them for as long as possible, minimising losses throughout. So circularity implies organisational changes that impact offers, production, purchasing, distribution processes, jobs etc.
To succeed in your circularity journey, you need to rethink your entire business model, invest in changing your processes, convince management, train employees to change the way they work and finally change the way you communicate so that your customers understand this new way of consuming.
What emerging trends and technological advancements are shaping the future of the sustainability space in the years to come?
R&D departments will be called upon to make a major contribution. The first step is to work on materials and supplies to improve the ecological performance of the product—so called eco-design. But the most important trend is not about products, it’s about business models. To move towards a circular model, organisations cannot simply recycle better or improve their existing offers, they must also stop the logic of ‘always producing more’ because only that will allow a significant reduction of environmental impacts.
But for this to be possible for you, it has to be profitable. And to do that, you have to rethink your business models. The key here is to act on the use of your products and services. For example, extend the useful life of products, encourage the sharing of your products, or selling the use of a product, rather than selling the product itself.
This last option is called the functional economy: you, the company, remain the owner of the product you produce, but you create value on the features it offers. In the Netherlands, for example, a brand called Bundles installs washing machines in private homes. The machine and installation are free, but customers pay to use the machine—depending on the number of washes per month, they pay a corresponding fee.
Maintenance and repairs are also the company’s responsibility, so it’s in the interest of the company to help customers use the machines well, so they last as long as possible, which is good for the environment.
What were your main takeaways from COP28, do you feel as though the decisions made are a step in the right direction to address climate change and achieve the goals of the Paris Agreement?
Under pressure from the Gulf countries, island states, the EU, the US, and developing countries a second version emerged from the initial draft, demonstrating a strong support for the IPCC’s recommendations. Overall, the ambition is significantly heightened regarding renewable energy and energy efficiency, marked by the explicit mention of exiting of all fossil fuels, a first in the discourse.
However, there is still no clear ‘exit strategy’, which might be linked to limited expectations placed on Carbon Capture and Storage (CCS), and it opens the door to potential risks and deviations from climate objectives. Circular was also discussed as a means to curb climate change, while also addressing sustainability goals more generally. However, the focus was more on decarbonisation.
Looking to 2024, how do you see the role of regulations such as the CSRD and CSDDD impacting the sustainability space in the coming years?
Corporate Sustainability Reporting Directive (CSRD) and Corporate Sustainability Due Diligence Directive (CSDDD) will have a profound impact on companies by enhancing transparency and harmonising reporting standards across the European Union, necessitating more detailed reporting on environmental, social, and governance (ESG) matters, and encouraging a strategic focus on sustainability.
Organisations will likely need to re-evaluate and strengthen their sustainability strategies, placing a greater emphasis on risk management and proactive measures to address ESG challenges. In that regard, training everyone on sustainability within organisations will be essential because every department, every employee, will have a role to play.
Let’s be clear, tackling climate change and biodiversity loss (which is sometimes forgotten) is a big, big challenge. But while it’s tough, it’s also exciting. It’s ‘the’ challenge of the next decades, for companies, States and citizens.
What does the next 12 months look like for The Climate School?
The Climate School is set to launch a host of new courses, with a wide range of modules, from understanding the subject of water crises to how to change your business activities as a ‘sales rep’ to make them more sustainable. In addition to our e-learning platform, in 2024 we will be offering complementary training courses to support the transformation of certain professions in companies.
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