CE100 Catalonia Workshop7th-9th May 2019

Workshop Summary

Time to engage your people • Time to partner with your competitors • Time to show your impact and scale

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INTRODUCTIONThe energy and integrity the CE100 Network brings to Acceleration Workshops continues to impress, and our time spent at La Mola, in Catalonia, was no different.

The openness and engagement of each and every participant was demonstrated throughout the event but was particularly clear during the Open Space. It was fantastic to see so many organisations step up to pitch ideas and share challenges in an effort to solve the linear challenges they face, through partnership.

As the Foundation continues to look at what we can do differently in the future, we also look to the business community, governments and cities, the innovators, and the educators, on how we might all do more. How do we engage our people internally around the circular economy? How do we engage with our competitors and our value chain to accelerate the transition? How do we demonstrate success and point to the circular economic solutions that are becoming our new normal? This is the challenge we must focus on in 2019.

With the end of this workshop, focus now shifts to the Ellen MacArthur Foundation’s Annual Summit taking place on 13th June 2019, in London. This event will look to inform and inspire as we discuss the ability to increase our impact and reach. We look forward to seeing you at the Roundhouse next month!

James George Business Engagement

Joe Murphy CE100 Lead

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WELCOME TO CATALONIAMarta Subirà, Secretary of Environment and Sustainability for the Government of Catalonia, kicked off the CE100 Acceleration Workshop by welcoming the network to La Mola. The Government of Catalonia has been a member of the CE100 since 2014, and has leveraged its strong industrial base and ecosystem of startups to foster circular economy activity in the region. In a powerful call to action to the CE100 network, Ms Subirà encouraged the audience to co-create the circular economy, and hoped to be inspired by the network’s “circular successes” in the coming days.

NEW MEMBERSKimberley Heath, Business Experience Manager at the Ellen MacArthur Foundation, followed up by announcing a number of new organisations that have recently signed up to the CE100:

• Aptar

• Circularise

• Eastman

• Enel

• Estée Lauder Companies

• McDonald’s

• Mitsubishi Chemical

• NatureWorks

• Novo Nordisk

• SaltX Technology

• SC Johnson

• UL

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The first plenary session of the workshop explored business model design, with a focus on Product-as-a-Service (PaaS) models. This session brought together perspectives from six different speakers to answer the question: What role does PaaS play in the transition to a circular economy?

Designing business models: Arnold Tukker from Leiden University emphasised that in order for PaaS models to succeed, they must first and foremost create value for the customer, minimise cost, and improve the competitive advantage of the company. He also highlighted the role policymakers can play in enabling products as a service models.

Consumer demand for PaaS: Milena Leszkowicz from Grover, an online electronics rental company, shared her insights on a new set of consumers that value access over ownership. One challenge that Milena identified was a shift in consumer mindset to recognise underused assets as a ‘waste of money’, something usually associated with simply overpaying at the checkout. In addition, many mainstream consumers don’t recognise that they’re already using PaaS in certain product categories (e.g. car rental) and therefore may be more comfortable with the idea of access over ownership than they think.

How to make PaaS appealing: Sophie Thornander from Philips also discussed the importance of solving a problem for customers or offering added value through PaaS. She shared Philips’ journey with a PaaS model for their hair removal product Lumea which included a Try&Buy pilot for the product (customers could try the product, and if they wished to keep it they would eventually purchase it), alongside a subscription model that offered refurbished Lumeas. Through these pilots, Philips were able to learn from their customers and generate insights that are helping them shape their next generation of products. Their models are not necessarily a ‘clear-cut’ PaaS model, but they have begun to lay down important stepping stones for the business to make progress towards more PaaS offerings.

Financing PaaS: Anna Monticelli from Intesa Sanpaolo shared some of the challenges and opportunities in financing the PaaS model. PaaS models require an entirely new financing structure as the ownership of assets shifts, and bank-client-customer relationships completely evolve. Anna and the team at Intesa have been working internally to move a traditional bank to this new way of doing business, by creating a EUR 5 billion credit plafond, and developing an online course for 50,000 of their employees.

PLENARY 1 : BUSINESS MODEL DESIGN

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Designing products for PaaS: Dionne Ewen from Royal Ahrend, a Dutch based office furniture company with circular economy principles high in their design priorities, shared their experience on providing furniture as a service model. Typically in B2B transactions, leasing models are quite common, however, when it comes to furniture, the companies really want to purchase and own the furniture in their offices for a long time, even with the very high initial purchasing costs.

Royal Ahrend started to design their products in a modular way, i.e they don’t permanently bind products together. The textiles aren’t glued, the furniture is low-tech, and sensors measure how often their products are used so customers can be advised to switch when necessary. They also expanded their revenue model: with the 2nd or 3rd leasing period the cost is lower for customers. As the PaaS leasing experience started only a few years ago, they haven’t had the products back yet, and need to think about supply chain and reverse logistics. At the moment, the PaaS pilot model is only happening in the Netherlands.

Reverse logistics for PaaS: Vigga Svensson from Continued.Fashion, a white label platform enabling fashion brands to work with circular retail, told us about her own company - Vigga, a circular subscription service for kidswear. In terms of logistics, real people are at the centre, and therefore, she advised that you need to ensure the customer behaves in the way you want them to. Vigga initially thought the way to do this was through more emotional storytelling, however, she discovered that consumers only want a transparent contract with instructions and a penalty!

Pricing was also highlighted as a key area to get right and whilst there is no simple formula, the price of a service needs to be aligned with the value it provides. If this is insufficient to cover the full costs, Vigga advised to consider indirect benefits that could be monetised, e.g. customer use data or by finding opportunities in the extended relationship the brand has with the customer.

The session ended with a lively Q&A session, where the panel of speakers debated whether you should start off with a PaaS model for existing products (for example, no design changes were made to the Lumea product before starting the PaaS pilot), or design new products specifically catered to PaaS models. The panel also discussed the probability of PaaS models leading to a significant demand for turnkey solutions on the reverse logistics and packaging services required, e.g. a fashion retailer offering a subscription model to their clothing will not necessarily want to get involved in the details of how the clothes get back to their company! Finally, the panel opined on whether existing regulatory frameworks were acting as a hurdle for PaaS models; many thought that certain governments (e.g. the Netherlands) were actually doing quite a lot to support and create demand for PaaS models through public procurement.

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LIVE CO.PROJECT MEETINGSTwo groups convened to draw conclusions on their respective co.projects. Other co.project groups will continue to work towards their deliverables in the next few months and might welcome your input. Get in touch with Stella to find out more about ongoing co.projects.

Mass Balance - Led by BASF, the group launched their white paper at this CE100 Acceleration Workshop.

Circular Business Competencies Building - Led by Philips, the group drew conclusions from the first phase, the knowledge gap analysis. The second phase of the co.project - to which any organisation is still welcome to join - will focus on creating tools to address the gaps previously identified.

RevalU-Parts - Led by Circular Economy Solutions, aimed to improve access to finance for circular economy businesses. This co.project group discussed how existing mechanisms can be used to financially evaluate secondary resource inputs and reveal their impacts on the valuation of a circular business. The team is currently looking for another company to join the co.project, ideally, one that owns used parts and applies any circular economy approach, such as repairing, refurbishing or remanufacturing, in the electronics, health-care, consumer goods or agriculture industry.

#BetterThanNew - Led by Michelin, the group planned their co.project launch and communications campaign. The co.project group welcomes additional companies to participate in the campaign to promote remanufacturing.

Water & the Circular Economy - Led by Arup, the conversation expanded by getting input from new organisations such as NextGenWater and Brunel University. The group is still looking for case studies of circular water management practices. Other collaboration opportunities emerged around sludge, and water systems at the city level.

Material Circularity Indicator for biological materials - Led by Granta Design, the group welcomed inputs from new participants during the workshop. Manufacturers producing or using biomaterials, academics, and regions with strong natural material production are still welcome to participate in this co.project.

Supplier Engagement - Led by Orange, the group reviewed the set of questions on the circular economy asked in the Requests for Proposals used by Orange, Teleplan, and the Joint Audit Cooperation members. The co.project will also work on different aspects of supplier engagement in the circular economy such as partnerships and communication.

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CE100 ACCELERATION WORKSHOP 101At CE100 Acceleration Workshops, every session is designed to build on the last, and enable participants to identify partners and start pre-competitive demonstration projects.

The Troika is an effective and dynamic networking exercise which provides a framework to multiply conversations in a structured and action-oriented way. This exercise allows participants to make useful connections by understanding each other’s challenges and priorities. The newly introduced ‘I, We, It framework’ allows participants to reflect on their circular economy related challenge. This approach enables the participants to analyse their challenge through different perspectives - the individual, the collective, and the systemic levels.

In the Open Space, participants take over the agenda to pitch their collaboration opportunity. Directly aimed at creating impact or accelerating the results of ongoing individual efforts through partnerships, this session sits at the heart of the Acceleration Workshop.

Formed organically, break-out conversations are the chance to flesh out collaboration opportunities previously pitched by diving deeper into the topic and identifying needs and available resources. Successful conversations will turn into formal co.projects which the Foundation will endorse and support going forward.

If you pitched and led an Open Space conversation, contact Stella to follow up.

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NEW CO.PROJECT MEETINGSIndustrial and Urban Symbiosis - Linkoping University The idea of developing an Industrial and Urban Symbiosis good practice portal was discussed to help improve awareness on the strategy and its value.

Nappies don’t have to be a dirty word - gDiapers The session was a chance to review in detail, the - soon to be published - ‘Blueprint for a Localised Circular Solution to Nappies’ and discuss existing structures within 33 London Boroughs, including existing responsibilities, partnerships, and key stakeholders. The group also explored the pros and cons of working with existing waste haulers and concluded that independent hauling in the early stages would be beneficial.

Competitive and fair transition for a circular economy - Sitra The session focused on understanding the social impact of the circular economy. The group agreed that the first step should be to come up with definitions, and then start some social experiments in different environments.

What if our materials could heal themselves? - Cranfield University This session outlined Cranfield and Exeter’s research, looking to better understand the design and sustainability opportunities that self-healing might offer. Several participants offered specific examples from their industries where self-healing could work, discussing how the business case might support this as an exploration.

RECIPSS: Industry examples of the circular economy - KTH University The intent of this meeting was to share knowledge across organisations on some of the circular economy examples coming out of the H2020 research: Resource-efficient Circular Product-Service Systems.

Scream about remanufacturing (#BetterThanNew co.project) - Michelin The co.project team presented their findings and social media infographics, before discussing the hurdles faced from each side, i.e. business, policy, and users. This provoked valuable insights and challenging questions about the possible next steps from the brand and policymaker engagement bodies present in the room. The most prominent topics discussed centred around educating consumers and users on the perception of remanufactured products informing policy to unlock existing barriers, and engaging businesses to share their own stories of existing remanufactured solutions.

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HYDROUSA Project - Brunel University The HYDROUSA and the NextGen projects are funded under the same H2020 call – ‘Water in the context of the circular economy’. Together, they cover the full range of solutions that can enable the transition to a circular economy in the water sector. Working with big water utilities, NextGEN is focusing more on intensive technologies, while HYDROUSA is looking at regenerative and nature-based solutions for recovering water, materials, and energy from non-conventional water sources.

Circular Netherlands - Leiden University The group looked at different opportunities for circularity in the Netherlands, with a focus around plastics and the built environment.

Developing solutions for circular economy competencies - Ellen MacArthur Foundation Building on the findings of the competencies and skills gap analysis from the first phase of the co.project, the core team - now called Working Group - proceeded in three small group discussions. These are the top three prioritised competencies, for which the group is planning to develop solutions: 1. Managing the changing relationships with suppliers (defining this new form of ‘partnership’. What this will look like in practice, e.g. when negotiating circular contracts); 2. Communicating the circular economy more effectively within the different business functions, namely Marketing & Sales, Procurement & Supply Chain, and Product Creation; 3. Assessing the circularity of materials and components. The captured notes of these discussions will help define concrete deliverables of this next phase.

Fibre use composite recycling - Politecnico di Milano The group explored the potential of implementing a stable industry-ready circular route for glass fibre and carbon fibre reinforced composites, perceived by industry as a challenging and high-priority issue. The group learnt more about the FiberEUse project which aims to solve this industrial challenge, and raised specific needs for potential demonstration cases and future activities.

‘What’s up’: single use plastics - Eastman The group raised the need to gather a set of existing tools used to address single use plastics challenges based on real-world application case studies. The intent would be to write a paper focusing on case studies, useful resources, successes, and remaining challenges to accelerate the transition to a circular economy for plastics.

Material Circularity Indicator for biomaterials - Granta Design The co.project welcomed six new participants, bringing the overall team to around thirty people. The session started with a presentation of the rationale behind the original Material Circularity Indicator methodology. The need for the co.project was briefly covered before the team moved on to explore the current thinking around how biological material flows could be included in the methodology to close a long acknowledged gap. The session explored various product scenarios and there appeared to be general consensus on the approach under development. The co.project meets virtually most Thursdays at 4pm (UK time) and welcomes further participants who may want to provide input or test the methodology as it evolves.

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PLENARY 2 : PROCUREMENT AND VALUE CHAIN ENGAGEMENTThe second plenary session of the workshop took a look at how corporations are redesigning existing procurement systems to engage and challenge their supply chains to support their efforts to meet circular economy goals.

Speakers from a range of industries presented transferable learnings from experimentation in this area which spanned behaviour change, stakeholder engagement efforts, and technical change through development of frameworks and measurement systems.

We first heard from Andrea Laterza at Enel, the largest private player in renewable energy. Enel has launched a circular economy initiative for supplier engagement with a technical framework at its core. Based on the Environmental Product Declaration (validated by a third party) the project aims to quantify, assess, and validate environmental KPIs derived from the manufacturing cycle of a product.

We then heard from Anna Berglind at H&M about the importance of behaviour change and their work to engage their supply chain. H&M’s major goal is to use 100% recycled or other sustainably sourced material by 2030. To achieve this, they set up their own circular score which is divided into three areas: circularity of product design and construction, raw material use, and a supplier rating.

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For the latter, H&M invited long-standing partners and suppliers to an introduction presentation of the supplier circularity tool, explained how to engage with it, and emphasised the opportunities it represented for them. This supplier circularity tool, SCAT, has a number of elements ranging from material and components, chemical management through to transportation, product lifespan maximisation, and business model innovations.

The plenary then turned to three co.project stories. While each co.project was different in nature, they shared a common approach, taking a systemic perspective on understanding what needs to be shifted and redesigned in each value chain.

The first co.project story we heard about was Project Ceres, an initiative to replace all conventional plastics bags, in a Catalonian test city of 12,000 habitants with compostable bags to be used in the compostable food waste stream. Project Ceres is a demonstration of a pre-competitive, private-public collaboration. Key to its success was the ability to engage key stakeholders from bioplastic producers such as BASF and NOVAMONT, to big brands, retailers, franchisers, and local shops. This was all made possible as a result of support from local government.

This second co.project story was less successful, but shared some important learnings when piloting in this multi-stakeholder context. Kim Graham-Nye of gDiapers highlighted the fact that having a solution, a circular product (100% regenerative and compostable nappies) is not enough. Systemic solutions are highly contextual and engaging all stakeholders is critical to success.

To finish the plenary, we were given a view from the suppliers’ side. Andreas Kicherer at BASF illustrated the power of a pre-competitive approach to redefining the rules of the game on chemicals by drawing on the Mass Balance co.project, pitched at a CE100 workshop a year ago.

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TOOLBOX // CO.PROJECTSToolBox: How to apply systemic design for a circular economy Namahn, a Brussels based human-centred design consultancy, shared their system design toolkit with an enthusiastic and diverse group. The toolkit merges systems thinking and design thinking into a practical series of steps, allowing organisations to address and find solutions to complex and urgent issues. After talking through the rationale and methodology of the toolkit, which breaks issues down into seven distinct steps, participants were given a flavour of the methodology by working through a selection of the steps, and exploring opportunities to implement circular economy solutions.

ToolBox: How to be more persuasive and influence more effectively Transitioning to a circular economy means people have to make decisions to do things differently. Persuading internal or external stakeholders to take certain actions does not only require logical reasoning. To influence effectively, it is also crucial to understand the mindset and unconscious drivers of people’s decision making. By considering certain categories of personality traits, you can adapt your communication style in a way that best meets the needs of your audience.

ToolBox: How to lead yourself and others using creative problem solving methods The session had the objectives of helping the participants with:

• Getting unstuck

• Generating creative new ways forward

• Developing their coaching skills to support others with problem solving

The Toolbox focused specifically on how to achieve results in the context of amorphous and complex challenges which require extensive collaboration. We operate by making a number of assumptions and it is important to figure out if they are helping us or restricting us. We each selected a professional challenge and worked through an exercise toolkit in pairs, helping us sharpen our focus, and our decision making process.

ToolBox: How to lead change – why blindness to context kills your best initiatives This session illustrated the importance of accounting for context to explain, and maybe avoid, unhelpful behavioural manifestations that hinder system change. The room was split into different spaces representing the top, middle, and bottom layers of an organisation, and a task was given for the top to orchestrate, resulting in surprising patterns of behaviors and insights.

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ToolBox: How to apply systems thinking to support a system change for a circular economy

The transition from a linear to a circular economy entails a radical system change, requiring us to break free of current mindsets and approaches. Thinking in terms of ‘cause and effect’ will not be sufficient to truly change the system and will instead lead us down the path of incremental improvement to the current system. In this session, participants were introduced to the theory of systems change and provided with a framework for conducting a system analysis.

Co.project: Project WearEver The session began with a discussion around the importance of establishing an empirical baseline on apparel use and an industry-accepted means of measuring against that baseline. The discussion then broadened out to the ways in which apparel use could be extended - the business models, consumer education, and promotion, product design, etc. The discussion also touched on the implications of extending product use and the consequences, both intended and unintended, of this.

Co.project: Circular Business Model Design The Circular Business Model Design co.project, led by PA Consulting, has developed a practical guide and toolkit to help businesses design successful circular business models by identifying circular opportunities, designing the path to the future business and operating model, and offering research based guidance on how to capture sufficient financial value from circular models.

With active participation by representatives from a broad range of organisations in the room, the focus was on applying a value led approach to overcome the challenges faced by organisations when shifting to circular business models - including the unfavourable cost comparison between circular and existing linear business models, sales cannibalisation, collaboration challenges, and quality concerns. CE100 members are encouraged to play an active role in the next six months by reviewing and validating the guide, piloting the guide through a series of challenge sessions, and sharing examples and stories of transitioning to circular business models.

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Governments & Cities breakfast

The Government and Cities meeting at CE100 workshops is a recurring session. The purpose of this meeting is to dive deep into policy topics, share insights, and discuss challenges amongst the governmental members of the CE100 network. This time, the topic of EU legislation and funding schemes for circular economy policy initiatives was one of the key points of discussion during the members’ roundtable updates. The group also took some time to explore the Foundation’s Circular Economy in Cities resource suite, which includes a range of new frameworks relevant to urban stakeholders and policymakers. Finally, the group received an update on the Systemic Initiatives (Plastics, Food, and Fashion) and ideas and interests around further government engagement were discussed in the group.

Universities breakfast

Our university network team welcomed four new universities to the CE100 in Catalonia: KTH Sweden, Leiden University, Politecnico di Milano, and Linkoping University. All were invited to join on the basis of their track record in circular economy research which is clearly beneficial to our wider membership.

The universities breakfast was an opportunity for all university members to get to know one another. We discussed the expanding applied research space for the circular economy, and this highlighted the important and invaluable contributions that academia brings to all of our questions and discussions.

The Ellen MacArthur Foundation was launched in 2010 with the aim of accelerating the transition to the circular economy. Since its creation, the charity has emerged as a global thought leader, putting the circular economy on the agenda of decision-makers around the world. The charity’s work focuses on seven key areas:

Learning Developing the vision, skills and mindsets needed to transition to a circular economy

Business Catalysing circular innovation and creating the conditions for it to reach scale

Institutions, Governments and Cities Creating the enabling conditions for a circular economy to thrive

Insight and Analysis Providing robust evidence about the benefits and implications of the transition

Systemic Initiatives Transforming key material flows to scale the circular economy globally

Communications Engaging a global audience around the circular economy

Circular Design Embedding circular economy principles in the design of products, services and systems

For more information, visit the website Join our CE100 LinkedIn group