When Nature Serves as Inspiration: Social Circular Economy and Social Enterprises

Life in nature is based on circles and cycles. Seasons, planets, apples, time and human lives all follow in their co-existence the circular patterns and cyclical movements. This has been a well-known fact for the traditional native peoples in different continents. Since the industrial revolution, the Western view, however, has seen life as something linear, as something that starts and ends, like projects that are launched, exist for a while and are then done and dusted.

Such thinking has also dominated our views on nature, namely humans’ right to exploit nature in a linear manner. We have mainly been concerned how we can use this world for short-sighted business- and money-making. However, the take, make and throw away culture has come to an end – we no longer can afford such thinking, and this goes for businesses, people and environment. The time for linear economy is over. Since the resources are limited and year by year exhausted quicker and quicker, we are warned in the yearly reports by World Watch Institute, WWF and other organizations promoting sustainability: “Earth Overshoot Day signifies when people have consumed more from nature than the planet can renew. If the world’s other inhabitants all consumed natural resources like Finns, it would require 3.8 earths, according to WWF Finland. In 2019, on Friday, 5 April Finnish residents used up their share of Earth’s natural resources. Over the past few years, Earth Overshoot Day has fallen in August. This means Finns overdraw on nature’s budget four months earlier than the global average.” Obviously, the situation is grim at the moment and we need a whole new way of thinking our position in and as part of nature.

One solution to this destructive development might well be the concept of circular economy where the take, make and throw away culture has been replaced with more sustainable thinking. Circular economy rests on using only sustainable inputs and renewable resources, using different loops for endless recycling of technical and biological nutrients and minimizing all waste and negative externalities, referring to costs or benefits of an activity which affect other parties that do not choose to incur those consequences. This type of economy designs its products, components and materials for reusing and recycling and safely returning the rest of the materials to the planet. When the above mentioned points are considered already when planning products and services, we can reinvent our thinking and enter a more sustainable phase that can regenerate natural systems .

Below there is presented a detailed outline of circular economy and its functions by Ellen MacArthur Foundation, a pioneer in promoting circular economy.


Figure 1. Outline of CircularEconomy by Ellen MacArthur Foundation.

When the concept of circular economy is further developed into a social circular economy, we are actually combining circular economy strategies with the notion of social enterprise. In this way, social circular economy can at best have a positive impact on people but also on our environment and prosperity. With its sustainable solutions, social circular economy can help us to meet the UN Sustainable Development Goals and make us see how there is no waste in nature; rather all natural systems are interconnected, including social systems.

Social enterprises are called by many names: they are also named social economy enterprises, social businesses, social-purpose businesses, social ventures, purport-driven businesses and mission-driven businesses. Whatever their name, they are characterized by the intent to have social impact as much as making money. They work hard for social good, wanting to make a difference in this world and they tackle social issues and promote the life of the poor and disadvantaged. They also work for the good of communities. Social enterprises that come in all sizes are different from traditional NGOs and charities – they are not depending on grants or continued funding but build in financial sustainability. Usually, they show the following characteristics:

  1. They have a clear social mission
  2. Their income is based on trading goods or services
  3. Majority of their profits are reinvested into their mission or organization
  4. They are not dependent on state
  5. They are transparent by nature and accountable

Social enterprises often work, for example, for the benefit of children and young people, disabled, ex-offenders, homeless and poor, long-term unemployed, people with mental health needs and long-term health conditions, older people, refugees and victims of crime.

How then to showcase the value of social enterprises? The Business Model Canvas (BMC) is a popular, simple yet robust way to showcase how a traditional business generates value and how it delivers it. In case of social enterprises, there is a Social Circular Business Model Canvas (SCBMC) that serves the purpose of social circular thinking by focusing on organizational perspective rather than developing a whole market one. Competition with market dynamics analysis is not its focal point. Rather by adding ‘Unique Advantage,’ as shown below, it allows a useful element of comparison with other models.



Figure 2. Social Circular Business Model Canvas (SCBMC).

At best, social circular economy can serve both shared prosperity, the needs of a fair and equal society and inclusion as well as it can also protect nature and environment for the future generations to come. This requires that our linear ways are replaced with circles and cycles reinvented.


Figure 3. Social Circular Economy model, modified from Seigo Robinson’s
SOCIAL CIRCULAR ECONOMY OPPORTUNITIES FOR PEOPLE, PLANET AND PROFIT (2016).

References:

https://yle.fi/uutiset/osasto/news/finns_use_up_their_annual_share_of_planets_resources/10724410

https://www.socialcirculareconomy.com/circular-economy.html

https://www.ellenmacarthurfoundation.org/

https://www.socialcirculareconomy.com/social-circular-bmc.html

https://www.socialcirculareconomy.com/social-enterprise.html

https://www.socialcirculareconomy.com/social-circular-bmc.html

Robinson, Seigo. (2016) SOCIAL CIRCULAR ECONOMY OPPORTUNITIES FOR PEOPLE, PLANET AND PROFIT.

https://www.socialcirculareconomy.com/uploads/7/3/5/2/73522419/social_circular_economy.pdf

http://www.worldwatch.org/

Written by Senior Lecturer Tiina Wikström

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