An Exciting Outlook for Circle Economy's Finance Programme

January 31, 2017

We recently had the pleasure to hear about yet another business engaging in the circular economy. This particular story was about the transition from a linear to a circular economy; a manufacturer rethinking its product from design to maintenance; a business driving 'product-as-a-service' innovation; the concept of a circular bicycle crystallising; and an entrepreneur demonstrating steadfast commitment to the circular economy. It was inspiring, but also revealed how challenging it can be for businesses to finance the transition.This story of Isla Bike's Imagine Project, and many more like it, make it rewarding to look back at our Circle Finance Programme's accomplishments and exciting to look ahead to the future.2016 was a great year, starting with the publication of our 'Money makes the World go Round' report and culminating in the publication of our report series 3 Essential Steps to Financing Circular Business Models. It involved fruitful collaborations with - among others - researchers at the Sustainable Finance Lab, Dutch government representatives and financial stakeholders such as our strategic partner ABN AMRO. Most importantly, it also involved close collaboration with businesses - small and large - and brought to life many inspiring stories, for example the case studies on Bundles and Dutch aWEARness.2017 promises to be equally rewarding and exciting! Here are some of the things we look forward to working on with you!Finding Solutions for Businesses and EntrepreneursFrom startup accelerators to multinationals, we see a growing appetite for the circular economy and will continue to deliver workshops to support capacity building. The circular economy relies on business model innovation and we will work closely with our members, strategic partners and clients to develop innovative financial solutions and advance circularity. Informed decision-making also relies on robust financial modelling and we will seek partnerships with financiers and businesses to grow our expertise.

We are hearing a lot of talk about investment opportunities in the circular economy. However, to walk the walk, we need to understand the technical aspects of financing; how do current financing mechanisms work? how can we tweak them to finance circular businesses? how should this reflect the growing importance of shifting ownership and increasing value chain collaboration? - Aglaia Fischer, Project Manager Circle Finance Programme at Circle Economy, Researcher at Sustainable Finance Lab,  PhD Candidate at Wageningen University

Advancing Circular Investments Within Financial InstitutionsFinancial stakeholders are starting to tune-in to the circular economy and we will support this trend by continuing to clarify the circular economy landscape and examining linear risk. We will work with investors to identify, track and monitor circular opportunities and their ability to contribute to widely-recognised targets such as the SDGs. We also aim to better understand investment needs and the mechanisms at play, and investigate how valuechain investing can be deployed.

Investors and companies are increasingly facing pressures to achieve resilient financial returns, meet stringent sustainability targets, and create positive societal benefits. Circular investments have the potential to achieve all of these. By building a strong evidence base, we hope to increase the adoption of circular thinking throughout the investment community. - Shyaam Ramkumar, Knowledge and Innovation Manager at Circle Economy

Activating levers in the financial systemThe growing separation of the financial realm from the real economy has lead to increased inequality and has strained our current economic and ecological systems. We need to look beyond our resources and materials to scale practical solutions. Together with our academic partners and financial innovators we will continue to engage in research to understand what levers need to be activated. This research will take us in exciting directions, such as examining the role of crowd equity to align financial ownership with circularity, defining the role of alternative currencies to stimulate circular behaviour and outlining the potential of financial technologies (i.e. blockchain) to provide a facilitating infrastructure.

If we don’t factor the fundamentals of the financial system into the equation, we will never reach a truly circular economy. - Elisa Achterberg, Project Manager Circle Finance Programme at Circle Economy, Researcher at Sustainable Finance Lab

Interested in joining us on this journey?

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