First circular economy hub in Latin America

Created to boost the implementation of circular business models between different-sized and multisectoral enterprises, the Brazilian Circular Economy Hub (Hub-EC) is the first of its kind in Latin America, based on European models and adapted to the country’s reality. Led by Exchange 4 Change Brasil (E4CB), an organization that guides this paradigm-shift in Brazil, the hub has sixteen member- companies and has structured four working groups aimed at discussing key members’ demands in an integrated format, promoting new partnership models and redesigning value chains. Global companies, such as Nespresso, Electrolux, Gerdau and Tomra are among the member-companies.

The Hub-EC was launched in January 2020 and, since then, E4CB has organized 3 international knowledge exchange webinars, reaching out to an audience of more than 15 different countries. It also has provided tailored made circular assessment to their members and has facilitated round table discussions among the participants and guests. The discussions are meant to influence the circular mindset, identify common areas of interest, and facilitate negotiations to re-design industrial processes and promote new commercial relationships. The four working groups are: New Plastic Film Supply Chains; Reverse Logistics for White Goods; Application of recycled resin in high quality products; and Circular Design. Member-companies will work together to implement pilot projects and validate the circular business advantage.

For the Founder of E4CB and Director of the Hub-EC Beatriz Luz, this kind of hub aimed at bringing companies together to discuss joint solutions is even more important in Latin America, due to the lack of a collaborative culture, no sense of urgency and low governmental support: “In Europe, circular economy is already a number one priority, with dedicated public policies, a number of public-private partnerships already in place and financial incentives towards circular business models. The linear risks are more visible to companies in Europe, which makes it easier for them to collaborate in the region. The political framework in Latin America is different, which makes global companies act differently in those countries to what they do in Europe. However, this sense of urgency is starting to be spread globally and initiatives such as the Brazilian Circular Economy Hub will guide the way, pointing at the risks of keeping the ‘business as usual’”.

The members of the Brazilian Circular Economy Hub are Electrolux; Gerdau; Nespresso; Covestro; Tomra; Plastiweber; RCR Ambiental; Wise; Sinctronics/Fit/Flex (a group of companies); Equipa Group; Cempre; Rhein Advogados; the Brazilian Center for International Relations (CEBRI); the Brazilian Mint; SENAI CETIQT (National Service for Industrial Training); and the Brazilian Institute for Technological Research (IPT).
“Developing circular business models is part of Electrolux’s growth strategy and at our ‘Better Solutions’ program, we aim to provide solutions with positive impact for our society while improving customer experience. It is challenging to spread our global mission for circularity in Latin America, considering that the countries where we work in have quite different realities and levels of evolution.

That is why we see the Brazilian Circular Economy Hub as an important and necessary initiative for reaching that goal and have no doubt that the interaction between different actors and segments promoted by the Hub is crucial for us to move forward”, reports the Electrolux Latin America Sustainability Director João Zeni.

Four working groups were defined in the Brazilian Circular Economy Hub based on common interests among the members, so that the companies can co-create circular solutions for their businesses.

“The transition towards circular economy can only be possible if the value chains are integrated to create solutions at scale. The problem of one sector can be solved by another sector. Companies must be willing to change their processes, help one another, select alternative raw materials, and draw up new logistics strategies. The Hub-EC was created to mediate discussions and identify unusual connections. A company can only adopt the circular mindset by bringing all of its departments on the discussion table and creating new rules and indicators”, explains Beatriz Luz.

The first working group wants to improve the reuse of plastic film, a material that many people do not know that can be recycled. The members are joining forces to increase the volume of material collected, optimize the supply chain, and consolidate circularity, drawing attention to other stakeholders in the value chain.

The second working group is about finding opportunities to scale up the reuse and recycling of used white goods, giving a new value for secondary materials and its transformation into new products. They are studying how to enable reverse logistics so that more materials can be returned to new cycles.

There is also a group working to add value to recycled resin, considering its applicability in products with quality and performance. The materials we recycle would be, then, seen as a seventh resource besides the list of natural resources – water, air, natural gas, coal, oil, and minerals.

Finally, the fourth cluster is based on circular design. The goal is to work with aluminum as a circular material, valuing design and performance. This solution is being applied by companies in Europe, and the Hub-EC wishes to adapt it to the Brazilian economic scenario.