Businesses stand to benefit when they embrace "circularity as the new engine for growth," advised Hernán J.F. Saenz III '98, visiting senior lecturer at the Cornell SC Johnson College of Business and senior partner at Bain & Co. At the World Economic Forum (WEF) in Davos, Switzerland, on January 22, Saenz presented the paper "Circular Transformation of Industries: Unlocking Economic Value" and moderated a panel discussion with chief strategists and sustainability officers from the German food, beverage, and pharmaceutical company GEA; HP; the British software company Aveva; Trane Technologies; and Siemens.
"Linear supply chains have begun to run their course, as material scarcity is creating resilience issues and limiting growth," said Saenz, a member of both the Cornell Board of Trustees and the SC Johnson College Leadership Council. "In response, circularity is moving to the forefront of global supply chain design."
Circularity refers to business models and practices that minimize waste, maximize product lifecycles, and separate economic growth from resource consumption. Businesses across a wide range of industries, from luxury fashion to rail transport, are adopting these approaches not only to increase sustainability, but to reduce costs, grow revenue, and build resiliency, said Saenz.
More than 70 percent of businesses surveyed expect significant revenue growth from their circularity initiatives in the next three years, according to the paper, which Saenz wrote with colleagues from the World Economic Forum, the University of Cambridge, and Bain & Co. Ninety-five percent expect circularity to be critically important to their business model three years from now, compared to less than 50 percent three years ago.
Read the full story on the Cornell SC Johnson College of Business website.
Alison Fromme is a writer for the Cornell SC Johnson College of Business.
