With the UK aiming to cut its emissions by 81% by 2035 on the road to net zero, businesses of all sizes are coming under pressure to act.

Cutting direct carbon emissions is one part of that, but it’s not the whole story. In fact, at today’s estimates, that approach can only address 55% of emissions globally.

So, how do we complete the picture, and deal with the remaining 45% of global GHG emissions? These are the emissions that are directly related to how products, materials, and food are designed, produced, and used in our current extractive economy.

To address this, the key is to keep materials in longer (or constant) circulation through processes such as reuse, recycling, remanufacturing or composting.

We simply can’t afford to use scarce materials only once. This is why circular strategies are important.

Circularity cuts carbon

By eliminating waste and pollution with a circular approach, you will reduce greenhouse gas emissions across the value chain.

By circulating products and materials, you retain their embodied energy. You don’t start again and produce a whole new spate of carbon.

Circularity also does something else that’s increasingly important in a volatile world. It reduces dependency on critical raw materials, many sourced from unstable regions. This enhances supply chain resilience and minimizes your exposure to geopolitical risks.

Mutual dependencies

Let’s look at some specific examples of how circular strategies and net zero interact:

Lowering your carbon emissions through better resource efficiency

As we’ve pointed out, a significant proportion of global carbon emissions (up to half) comes from the extraction and processing of raw materials. For business, the environmental toll will appear most starkly in Scope 3 emissions (those that occur outside of your organization’s direct control, but are still part of your supply chain). The circular economy reduces this by keeping materials in use for longer, minimizing the need for resource extraction.

Supporting renewable energy adoption

Circular systems often incorporate, and even produce, renewable energy: for example, by turning waste into biogas that can be used for fuel. These kinds of circular solutions can be employed by your business to reduce dependence on fossil fuels, supporting net zero ambitions.

Powering the circular economy with clean energy

A product or process cannot claim to be circular if it is remanufactured or reused by burning large amounts of fossil fuels.

Think, for example, about when a wind turbine reaches the end of its life. The blades of wind turbines are made of fibreglass and covered with epoxy resin, making them currently very difficult to recycle effectively. Current processes are immensely energy intensive. It illustrates why it’s important to consider the whole product cycle, from beginning to end, thinking right from the start about how a product will have to be disposed of.

Why this matters for small businesses

Getting to grips with net zero, the circular economy and how they interconnect is important for a number of reasons.

Firstly, embracing circular economy principles can come with major economic benefits. According to the Waste and Resources Action Programme (WRAP), UK businesses could benefit by up to £23 billion per year through low-cost or no-cost improvements in the efficient use of resources.

Demonstrable action on net zero and circular economy initiatives can also attract new customers and investors. A recent report from Deloitte demonstrated that while some sustainable-branded products may cost more to produce, customers are willing to pay for them. Unilever’s Sustainable Living Brands, for example, are growing 69% faster than the rest of the business.

And, while it is currently only large businesses that are required to report their greenhouse gas emissions, things can change fast. Especially as the EU moves to ensure that circularity and sustainability must be incorporated in all stages of a value chain to achieve a fully circular economy: from design to production and all the way to the consumer. Closer to home, the UK government is actively advancing circular economy initiatives to meet similar objectives.

Acting now can future proof your business against a tightening of regulations.

Finally, with large companies increasingly auditing their downstream suppliers for environmental standards, taking action today can also put you in a strong position to win business.

How standards can help you get started

If you’re looking to develop your own net zero and circular economy strategies, standards are a great place to begin. Developed by experts, they represent the refined wisdom of what ‘good’ looks like when it comes to net zero and the circular economy. Here are some standards to help you get started:

BSI Flex 3030: gives comprehensive guidance for SMEs wanting to start work on their transition to net zero. This standard includes a framework that ensures the transparency, accountability and comparability of your work. Importantly it can help organizations access new supply chains and contracts.

BS ISO 59004:2024: defines what's meant by a circular economy (CE) and gives principles and general guidance on how a CE can be implemented.

BS ISO 59010:2024: gives business-oriented guidance on how to transition towards circular business models and circular value.

BS ISO 59020:2024: gives a structured approach to measuring and assessing circularity performance and sustainability impacts based on standard indicators and complementary methods.

Circular economy principles and net zero goals are no longer optional. They are essential for building resilient, future-proof businesses that benefit both the planet and the bottom line. Get started with standards.

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