What are the benefits and challenges of circular economy models for the electronics sector?

1 Benefits of circularity

Circular economy models can bring various benefits to the electronics sector, such as reducing costs, enhancing competitiveness, improving customer satisfaction, and creating positive social and environmental impacts. By optimizing the use of materials and energy, circular models can lower production and operational expenses, and create new revenue streams from selling or leasing refurbished or remanufactured products, or offering repair and maintenance services. Circular models can also help the electronics sector differentiate itself from competitors, and meet the growing demand for more sustainable and durable products from consumers and regulators. Moreover, circular models can contribute to reducing greenhouse gas emissions, resource depletion, pollution, and health hazards associated with electronic waste.

2 Challenges of circularity

However, circular economy models also face significant challenges in the electronics sector, such as technical, regulatory, behavioral, and systemic barriers. Technical challenges include the complexity and diversity of electronic products and components, which make them difficult to disassemble, repair, or recycle. Regulatory challenges include the lack of harmonized standards and policies that support circularity, such as extended producer responsibility, eco-design, or right to repair. Behavioral challenges include the low awareness and willingness of consumers and businesses to adopt circular practices, such as buying second-hand or refurbished products, or returning them for recycling. Systemic challenges include the dominant linear business models and culture that incentivize short-term profits, obsolescence, and consumption.

3 Examples of circularity

Despite these challenges, some electronics companies are already embracing circular economy models and demonstrating their feasibility and value. For example, Fairphone is a social enterprise that produces modular smartphones that are designed to last longer, be repaired easily, and use ethical and recycled materials. Fairphone also offers a circular value proposition that includes a buy-back program, a spare parts shop, and a repair network. Another example is Philips, a global leader in health technology and lighting, that has shifted from selling products to providing services based on performance and outcomes. Philips also applies circular design principles and practices to its products and operations, such as using renewable energy, minimizing waste, and maximizing reuse and recycling.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?