A circular economy approach could reduce emissions from the production of key materials by 40% in 2050.
Aluminium – an infinitely recyclable material – can play a big role in this transition.
Cross-sector collaboration is needed to overcome challenges and make this a reality, however.
As COVID-19 has disrupted lives and economies in an unprecedented manner, societies across the globe are grappling with an immediate need to protect lives and livelihoods, challenging the urgency of the climate agenda. Yet at the same time, some have argued that the pandemic shows how the climate change crisis might affect the global economy. Luiz Awazu Pereira da Silva, deputy general manager of the Bank for International Settlements, has said that the pandemic has intensified the need for policy-makers to co-operate on building more holistic approaches to identifying and managing global risks.
It is not yet fully clear if and how the priorities of policy-makers and business leaders will change, yet the need to lower carbon emissions is likely to remain an urgent priority – especially in light of how vulnerable our society and economies have proven to be to shocks from the natural world. A recent poll conducted in 14 countries found that 71% of adults agree that, in the long term, climate change is as serious a crisis as COVID-19. People do not want to return to ‘how it was’ and are demanding that societies reset in a way that is more secure, inclusive, resilient and safer.
Therefore, governments and businesses that are building global and national recovery plans should take heed and ensure a green recovery. The emphasis on the business sector from an environmental, social and governance (ESG) perspective has grown even stronger over recent years, and did so well before the arrival of COVID-19. This should not change. Whilst business will need to be receptive to these changes, in the long run such changes will eventually make businesses more resilient.
The transition to the low carbon economy may also be beneficial not just for the environment, but for jobs as well. For example, in terms of employment it has been argued that for every $1m of public funds spent on clean energy and energy efficiency generates 7.49 full-time jobs in renewables infrastructure and 7.72 in energy efficiency, compared with only 2.65 for those focused on fossil fuels. So whilst this transition requires a transformation of unprecedented pace and scale it might also prove to be a better return on investment in terms of jobs, resilience, the environment and political capital.
The good news is that this move towards a circular, low carbon economy has already started. From automotive producers to the packaging industry, many international corporations have already committed to reducing their carbon footprint and have started to look for more sustainably produced material. Demand for key raw materials (aluminium, plastic, concrete and steel), is projected to increase by a factor of two to four, according to the Ellen McArthur Foundation; this in turn, may result in CO2 levels reaching 649 billion tonnes by 2100 if no substantial action is taken. But if businesses were to adopt a circular economy model, the amount of CO2 emissions emitted during the production process would be reduced by 40% by 2050.
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