The Next Economy
Is It Time for a New Type of CEO – the Circular Economy Officer?

As more and more companies look to adopt closed-loop business models, the question of whether to create dedicated circular economy roles internally is beginning to bite. Such roles are still thin on the ground, but it’s notable that those businesses that have already adopted them are demonstrating real leadership on this agenda.

Veolia and BT are two such companies. Dr Forbes McDougall is Veolia’s head of circular economy for the UK and Ireland – he says the position, created just over a year ago, made “perfect sense” for the company: “It supports our Resourcing the World strategy, which is focusing our efforts on delivering circular value to our customers across our core skills in energy, waste and water,” he explains.

However, Dr McDougall doesn’t think that a dedicated CE role is strictly necessary in all cases.

“The real need is to embed closed-loop thinking throughout a company and develop a culture that supports the aims of a circular economy. Depending on the potential impact on a specific business, it is necessary to understand the risks and opportunities, and use these to embed the principles rather than create new roles.”

Matt Polaine, former circular economy research lead at BT, says a key remit of any circular economy role should be to understand materials flows in both directions — upstream and downstream of the value chain. Such a function requires the ability to tap into different skill sets: design, procurement, compliance, product innovation, and insurance/risk expertise to name a few.

Because of this, Polaine believes the skills of an industrial engineer stand out from the rest. “This mindset has to understand the materials, the way the product is manufactured, used, the user interface/service design, and the end-of-life aspect. They are also clear about aesthetics, the beauty of the product and experience in use. For the circular economy to flourish, the customer experience must work very well and promote advocacy.”

Customer and stakeholder advocacy should lie at the heart of any circular remit, according to circular economy expert Simon Duddy — along with “organisational coach, innovation catalyst, change agent, synthesiser.”

He adds: “The cross-functional nature of the role suggests supply chain management expertise is an advantage when implementation is required — as they already interact with a broad range of stakeholders.”

Depending on what perspective you’re coming from, he says, other disciplines could prove useful, for example: human resources (organizational development); sales and marketing (customer focus); finance (business case). And then there’s the challenge of how to unlock innovation.

“Senior business transformation professionals can manage complexity but tend not to appreciate uncertainty. In some ways, it is better to recruit an entrepreneurial outsider,” Duddy reflects. “Ultimately there is no right answer here. It depends on the scope of change and nature or maturity of the business.”

McDougall echoes this: “No business can possibly source all the innovation they need internally. The evolution of the circular economy needs new ideas at every stage and businesses need structured pipelines that will help manage the time and finance required to bring these new ideas to life.”

Polaine points out the value of external consultants.

“Application of the circular economy requires the breaking down of silos within large businesses,” he says. “While internal dedicated circular economy expertise can build these internal relationships and understand the cultural challenges, it is likely that for marketplace advantage there may be a number of intellectual property rights and commercially sensitive strategies that require an extra level of trust management with external expertise.”

Thinking externally, especially in relation to society, is arguably even more critical if you are a public sector organisation. Peterborough has ambitions to become the UK’s first circular city by 2025 — it’s a vision being strategically led by various partners including Peterborough City Council.

The council’s circular economy lead, Cécile Faraud, says her role calls for a slightly different approach.

“In the private sector, you need to be familiar with the company’s core activities and its implications in terms of supply and value chains, as well as the economic impact of current procedures. In the public sector, the drive is to understand the bigger picture and liaise on efforts from a diverse range of sectors, private through to academics, charities, communities, and so on.”

Adaptability, she adds, is key — together with patience, diplomacy, perseverance and political intelligence.

“A circular economy officer needs to be adaptable in interactions with different audiences. An ability to inspire and motivate people by addressing their specific interests or beliefs will engage them with the concept. You need to demonstrate high-level thinking with pragmatic outputs.”

In time, as circularity starts to be embedded within corporate strategies, Polaine hopes these dedicated roles will rise up the ranks to occupy positions of seniority. But he advises patience.

“This evolution will happen in small steps and will take a lifetime. Don’t expect to win over all the people all of the time. Fear and risk are powerful adversaries in large corporations where business as usual is about known risks.

“Have a roadmap, but be sure that only incremental changes may be possible on large commercial decisions. Also aim for support of pilots where failure can be recognized as a learning process, and the financial hit is a fair price to pay for this learning.”