Circular economy: Rethinking waste in business operations

The circular economy approach is an alternative production and consumption model that extends the lifecycle of products and materials. Photo: Shutterstock

To grasp what sustainability is about, we need to first acknowledge what sustainability is not. Sustainability is not putting a label on a product to make it look environmentally friendly. It is not a buzzword to be used and abused for competitive advantage. It should neither be a mechanism which disheartens genuine initiatives with endless red-taping, policies and penalties, instead of focusing on encouraging incentives. In a profit-driven competitive market, the healthy relationship that our ancestors had with our planet and the people made them prosperous in a different sense than that which is perhaps understood today.

If we look back in time, agricultural civilisations practised sustainable living by respecting natural cycles without ecological disruptions (Caradonna, 2022).  Similarly, hunting and gathering communities were mindful of land exploitation, and practised seasonal migration to allow ecosystems to regenerate.Harvesting allowed natural recovery and the extraction of resources was in contained harmony with the capacity to regenerate resources sustainably.  Entwined through cultural beliefs, these practices embodied the practical philosophy that humans were a part of, not detached from, the natural world (Caradonna, 2022). This shared sense of belonging also encouraged a communal and collective responsibility towards resource management. This ecological wisdom was fostered from one generation to the next as people shared their knowledge, observations and experience. In addition, many societies held rituals honouring the earth and promoting reciprocity, taking only what was needed and giving back to the land.

This collective approach fostered a value system where the well-being of the community was directly related to the health of the environment (Musikanski et al., 2021). The meaning of the economy for pre-industrial societies also prioritised meeting basic needs while striking a balance between production and consumption. By-products from one process were intentionally used as inputs for other processes – a cyclical course echoing today’s circular economy model. Through their practices, these communities humbly acknowledged and respected the need for a continuity of availability of resources (Musikanski et al., 2021). These systems were, of course, far from perfect, yet one cannot deny the holistic thinking in these knowledge systems, which serves as a striking reminder that sustainability is both an ancient wisdom and a contemporary necessity.

The circular economy model

The circular economy approach is an alternative production and consumption model that extends the lifecycle of products and materials. At its heart, this approach values eliminating waste and pollution by creating long-lasting and recyclable products, keeping products and materials in use for as long as possible, and restoring natural systems by ensuring that materials safely return to nature (Lazarevic, Brandão and Finnveden, 2020). With this move towards circular economy models, EU directives and local measures aim to encourage businesses and the community to embed sustainable practices in their day-to-day operations.

The revised Waste Framework Directive, targets food waste and textile waste reduction. It aims for a 10% reduction by 2030 in the manufacturing industry, and a 30% reduction among retail, hospitality and households by 2030. It will also become mandatory to separate textile waste collection by 2025, demanding that firms partner with recycling schemes. The Landfill Directive requires treated waste to be landfilled and bans hazardous materials, liquids, or untreated biowaste.  The Industrial Emissions Directive promotes the Best Available Techniques (BAT) to minimise pollution. It proposes regular audits and reporting of emissions data. The EU Circular Economy Action Plan proposes stricter targets for recycling plastics and textiles, mentioning the right-to-repair obligations for electronics and appliances, and digital product passports to state materials and recyclability.

How do these regulations impact businesses in Malta?

Current waste separation regulations, require the use of white bags for organic waste, grey bags for recyclables and transparent black bags for residual waste, adhering to collection schedules. Within the Long-Term Waste Management Plan (2021-2030), the Maltese community is expected to participate in regional waste schemes, conduct pre-demolition audits for construction works (from 2026) and submit demolition waste audits for large projects. The Extended Producer Responsibility (EPR), requires producers of packaging, electronics and batteries to register with authorised Producer Responsibility Organisations (PROs) and meet recycling targets. Other sectors impacted by the EPR, include textiles, tyres, fishing gear, waste oils, end-of-life vehicles, and construction and demolition waste . The Beverage Container Refund Scheme (BCRS) addresses the disposal of beverage containers. While some of these policies are already in effect, others are still making their way through the implementation process.

Relating to policy implementation timelines, the omnibus package proposal, released in February 2025, has, however, reduced reporting and due diligence requirements, also postponing the phasing-in of obligations. The new approach, including changes in EPR, highlights the entities bound by compliance responsibilities. In addition, financial liabilities will move away from flat rates, depending on factors such as the recycled content in packaging. This proposal also removes the minimum cap on sanctions for non-compliance with sustainability directives, and companies will only be required to assess direct business partners instead of the whole supply chain. This means that while larger businesses will still be required to comply with EPR and sustainability reporting, SMEs shall expect less due diligence, reduced reporting requirements, and extended compliance deadlines, lowering regulatory pressure. While all businesses need to be vigilant for new defined obligations as this proposal is finalised and shifted into law, the omnibus proposal aims to alleviate compliance burdens particularly for SMEs while staying loyal to the core values of sustainability and circular economy. 

Key challenges

In pre-industrial societies, sustainable practices flowed naturally. In today’s context, there are challenges and barriers which need to be overcome. Due to various reasons and circumstances, the current economic models and social systems seem to have detached humans from the essence of sustainable practices, be it the environment, human connection or the possibility of prosperity and holistic wellbeing, often disguising the making-quick-money-dream, at all costs, a definition of success. At a point where there’s a drive towards sustainable practices, this must be done through what’s left of the planet, what’s left of the people, and what’s allowed for prosperity. If we had to look at Malta, perhaps the impact is intensified due to the limited resources and land. The attempt to feel one with nature in an ever-increasing urbanised island, the attempt to connect and collaborate in a densely populated island, combined with the daily struggle for people to make ends meet, let alone prosper, makes the concept of sustainability in today’s context almost a futile attempt – which should not be. Another challenge is that due to a lack of current alternatives, sustainable practices still tend to be more expensive, which makes it more difficult for businesses to remain competitive and consumers to fulfil their needs without breaking the bank. While in its essence, the concept of sustainability advocates for a communal approach, collaboration and fostering connections, at present, sustainability seems feasible for a privileged few.  

Conclusion

Doing sustainability entails more than paperwork and reports. Sustainability is as meaningful as we make it. It is as impactful as we manage to let it be. It is about a sense of awakening to challenge unhealthy systems. This, however, requires an informed, conscious, and responsible choice—a choice through which we commit to the hope for a better life, beyond and against all that holds us back from being in touch with what makes us whole—the planet, the people, and prosperity.

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