Page 40 - CMA Journal (May-June 2025)

Focus Section

In contrast, the circular economy is regenerative and approach focused on circularity can foster innovation
restorative by design. It focuses on eliminating waste and and attract green-oriented foreign investors.
pollution, keeping products and materials in use through
Overall, CBMs offer Pakistani industries a pathway to
restoration, reuse, and recycling, and regenerating reduce environmental impact, meet global sustainability
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natural systems. While the linear model emphasizes
standards, and improve economic resilience in the face of
immediate consumption and short-term profitability, the
climate and market pressures.
circular model promotes long-term value conservation
and resource efficiency.
Research conducted by the Ellen MacArthur Foundation Circular Supply Product Life
Extension
and the World Economic Forum highlights that circular
practices can significantly reduce operational costs,
Replacing traditional inputs Extend product life
optimize supply chains, and create new business with bio based, reasonable through design for reuse
or reoccurred materials repair, refurnish
models—such as product-as-a-service and resource Circular
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recovery. For instance, global brands like Philips and Resource Business Sharing
IKEA have adopted circular principles by reducing raw Recovery Models
material usage and enhancing customer loyalty.
Producing secondary Promote the use of
raw material from underutilized consumer
waste streams Product-Service assets
Systems
Combine a physical product
with a service component
Figure 3: Circular Business Models

Global Relevance and Industrial
Applicability of CBMs
A circular economic model provides a feasible and
valuable concept for how industries can decouple
Figure 2: Circular Vs. Linear
economic growth from environmental degradation. The
Integration of Circular Business Models major circular strategies that industries can adopt
include remanufacturing, recycling of industrial
(CBMs) in Pakistan’s Industrial Context
by-products, reverse logistics, product-as-a-service
Circular Business Models (CBMs) are sustainable models models, and industrial symbiosis—where the waste or
that aim to minimize waste and maximize the reuse, by-products of one industry are used in another sector.
repair, recycling, and regeneration of products and At the international level, notable examples include
materials throughout the value chain. Among the Germany, the Netherlands, and South Korea, which have
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practices used in the Pakistani industrial environment, successfully implemented such models and integrated
the implementation of CBMs is becoming increasingly support measures, policies, and stakeholder
relevant for achieving sustainable economic engagement to improve sustainability in manufacturing
development while addressing resource limitations.
and industrial processes.
As energy costs continue to rise, environmental In Pakistan, however, the circular economy debate is still
degradation worsens, and raw materials become scarcer, in its early stages. Although informal practices such as
CBMs such as Product Life Extension, Resource Recovery, the recycling and repair of electronic goods and auto
and Circular Supply Chains can help industries reduce parts are common, they are not governed by a formal
their dependence on imports, minimize waste, and industrial policy. These practices also lack adequate
streamline operations. 8,9,10 For example, textile and infrastructure, financing, and regulatory support.
manufacturing industries can benefit from recycling and
remanufacturing, while agriculture and food processing Globally, the shift towards circularity is being driven by
industries can adopt waste-to-resource strategies by the design and development of products and systems
generating bioenergy or compost. that prioritize reuse, repair, and recycling. Policy
measures (such as recycling laws in Japan and anti-food
Additionally, improved resource availability for small and waste regulations in France) and private-sector
medium enterprises (SMEs) through shared solutions innovations (like Fairphone and Loop) often complement
and optimized reverse logistics systems can enhance best practices.
their competitiveness. Furthermore, adopting a design

38 ICMA’s Chartered Management Accountant, May-June 2025