Sustainable investment in the circular economy for businesses and startups

DNHN - Ms. Nguyen Phuong Linh, Director of the Institute for Sustainable Development Management. (MSD) emphasized that the circular economy is not a "soon to bloom" trend, but will become a methodical investment orientation of both large corporations.

Nguyen Phuong Linh - Director of the Management Research Institute for Sustainable Development (MSD) stated that since appearing in Vietnam in 2016 through a workshop organized by the Vietnam Federation of Trade and Industry (VCCI), the circular economy has rapidly become a strong trend, being incorporated into the Law on Environmental Protection in 2020 and the Resolution of the 13th National Congress of the Communist Party of Vietnam.

The business community has also actively responded to the circular economy model through the formation of numerous circular economy organizations and alliances, as well as the implementation of circular solutions in many important fields, such as agriculture, waste management, industrial park operation, energy, and retail. According to data from the Central Institute of Economic Management (CIEM), 60-70 percent of Vietnamese businesses are aware of it. regarding the circular economy.

Ms. Nguyen Phuong Linh emphasized, despite the increasing popularity of this concept, that not everyone understands the nature of the circular economy. Ms. Linh, through her work with the business community, identified three common misconceptions about the circular economy.

First, the circular economy encompasses more than just recycling. Recycling only addresses the end of a product's life cycle after disposal, whereas a circular economy necessitates supply chain-wide changes. Investing in the circular economy is strategic, working from the bottom up, as opposed to recycling alone.

Enterprises have implemented numerous solutions in the value chain to achieve the circular economy, based on the principle of extending the product life cycle to maximize value and reduce environmental impact. Even though extending product lifecycles can sometimes result in decreased sales, it is essential for the new generation of consumers that the product is of high quality and sustainable. Additionally, extending the product's life cycle generates economic opportunities and improves customer interaction through repair, maintenance, and product maintenance services.

Second, the circular economy is not exclusive to large corporations. The circular economy model will resolve the conflict between corporate profits and environmental concerns. Numerous businesses have successfully implemented circular economy solutions and created significant economic value, as demonstrated by empirical evidence. Ecotech Vina, for instance, has helped Samsung Vietnam save tens of millions of dollars annually by reusing plastic trays in the factory. Other companies in Nam Cau Kien industrial park reduce expenses by recycling production byproducts.

Investing in the circular economy not only provides businesses with value and a sustainable business model but also presents small businesses and startups with an opportunity to earn a return that is proportional to the environmental value.

The circular economy is not merely a fad. Whether the circular economy is a temporary fad depends on the business community, which includes both large corporations and a significant number of small businesses and startups.

Establishing a model of a circular economy requires a lengthy transition from thought to action. Individual consumer behavior must be altered through sustained propaganda, education, and incentives if disposable cups are to be replaced.

Ms. Nguyen Phuong Linh asserted that investing in the circular economy is a strategic and sustainable investment for businesses due to the exceptional environmental and economic benefits that the circular economy provides. To promote this trend, Ms. Linh urged the business and startup community to invest methodically in the circular economy and develop a long-term strategy to make it a dominant market trend, thereby helping to protect the environment and build a sustainable economy for the nation.

Thanh Ha