Policy shift and game-changing tech will enable sustainable and circular economy at scale

26 MARCH 2021

Policy shift and game-changing tech will enable sustainable and circular economy at scale

While consumer demand for sustainable goods is an important driver for change, regulation and policy change are essential if the world is to side-step a climate catastrophe and bend traditional linear economic models towards a circular economy and sustainable future. Until recently it wasn’t clear how even the most motivated of governments could achieve such a goal. But, as demonstrated at a recent series of UNECE-hosted events, recent technological and data advances could change all that.

To date, consumer demand has been the driving force towards a rise in the availability of so-called eco-, ‘green’ or fair-trade goods. As more customers seek out assurances about the environmental impact and ethical credentials of their favourite products, markets have shifted – but it’s not enough. Consumer demand alone will not bring the radical and scalable change we so urgently need to address climate change and shift to a more sustainable, circular economic model. For that, policy and regulatory framework changes are required, say experts.

“It's important to recognize that, as a citizen and a consumer you're within the system - you can only play the cards that you've been dealt,” said Jocelyn Bleriot, Executive Lead Institutions, Governments and Cities, at the Ellen Macarthur Foundation. “Let's help consumers make the right choices. But let's also work at making sure the wrong choices cannot be made because they're not available in the first place - and that is a policy play.” “Making circular economy solutions happen at scale is the product of an enabling policy and regulation landscape,” added Mr Bleriot.

Developing a policy and regulation landscape that could underpin scalable change towards a more sustainable, circular economy might have appeared insurmountable only a few short years ago. Afterall, value chains from most products are a tangled international web of manufacturers and suppliers. But it is now possible to map processes that transform raw materials to finished shop-ready goods, thanks to a series of technological and data-capture innovations.

At three separate events at this year’s UNECE Forum, industry representatives, policy makers and campaigners tackled different aspects of this challenge, including how their innovations are being applied as part of a UNECE and UN/CEFACT project: ‘Enhancing Transparency and Traceability of Sustainable Value Chains in Garment and Footwear’, implemented in collaboration with the International Trade Centre and funding from the European Union.

That project has brought over 250 stakeholders from the sector together to develop a workable toolbox of guidance for industry, as well as policy recommendations for governments, that harness information technology solutions for increased transparency and traceability of the garment and footwear sector – an industry with notoriously opaque and globalised value chains.

One of these solutions is blockchain. No longer just for cryptocurrencies, blockchain has a myriad of possible applications. Its ability to consolidate detailed and specific ledger information allows verifiable tracking and tracing of any product from its origins through every stage of production and shipment to journey’s end: the point of purchase.

“Blockchain can be seen as a form of software and hardware protocol that allows you to perform productions in a decentralised way [yet delivering] a single, verifiable and immutable source of truth,” said Eva Oberholzer, Chief Growth Officer, Member of the Management Board at the Cardano Foundation in Switzerland.

While the blockchain can’t be changed, it could of course be misleading. What if there was a warehouse accident and cotton from one supplier were accidently mixed with cotton from elsewhere? Or what if an unscrupulous company was seeking to falsely claim their t-shirts were made from organic cotton? Well, there’s a technical solution for that, too.

“The system must also use methods that anchor that information to the product itself,” said Michela Puddu, co-founder and CEO of Haelixa Ltd. “We found a way to turn the product itself into the carrier of the information about its own origin and the integrity [….] based on the use of DNA markers.”

As part of a UNECE-led cotton blockchain pilot, markers are sprayed on raw cotton at source carrying a unique producer identification that cannot be manipulated or removed on the cotton’s long winding journey production journey. Just like every person has a unique DNA, this technology enables every product to be given a unique series of identifying markers. With this technology, a t-shirt marked ‘organic’ could only use raw materials from organic, pesticide-free cotton fields.

“Blockchain […] must come together in a symphony of technologies to enable the identity of the object to be known, for it to be tracked and traced across the various events in its supply chain,” said Leanne Kemp, Founder and CEO, Everledger, stressing the speed at recent technological advances.

That symphony effect is currently being put to the test as part of the UNECE’s cotton pilot project, with companies throughout the supply chain taking part. The results of that pilot are expected in the coming weeks as preparations are made for the launch of a Call to Action in April 2021.

The Call to Action will be a significant step forward, as it invites collaboration across all actors in the garment and footwear industry to take action for traceability and transparency in their industry using an agreed set of measures, proposed by UNECE and aligned with international commitments towards the 2030 Development Agenda. It’s also an opportunity for governments to take up the challenge and adopt UNECE policy recommendations, building back better post-pandemic and cementing commitments towards a sustainable future and the globally agreed Sustainable Development Goals (SDGs).

“No one company, country or stakeholder can achieve a circular economy on their own,” Brendan Edgerton, Director of Circular Economy at the World Business Council for Sustainable Development in Geneva, Switzerland. “It’s going to be critical that we invest time and resources in investing in collaboration – it’s no longer a ‘nice to have’, it’s no longer a side project. Deep collaboration is needed across sectors to achieve the SDGs.”

Paola Migliorini, Deputy Head of Unit European Commission, DG Environment, Sustainable Production, Products and Consumption also highlighted the importance of collaboration adding, based on the experience of the Commission, the value of leadership by example.

“If there is no authority or company CEO that leads by example, then it remains words,” said Ms Migliorini. “You need to have a high level of leadership [towards a circular economy] and at the Commission, it was at the highest level - and it still is.”

Links to the events: https://embassies.gov.il/UnGeneva/NewsAndEvents/Events/Pages/20210315-Blockchain-COVID19-Recovery-SDGs.aspx https://www.youtube.com/watch?v=XY_UnfAjALw https://www.youtube.com/watch?v=P1oalMl6e1A

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