SDGs in focus: tackling waste and shifting to a circular economy

The world’s current model of production and consumption has been shown to be unsustainable across a number of metrics. Here, we review the consequences of our current linear economic model, particularly in the rapidly growing area of e-waste. We also consider the need to shift to a circular economy, in our efforts to achieve the United Nations Sustainable Development Goals (SDGs), in particular SDG 12: Responsible consumption and production.

What are the United Nations Sustainable Development Goals?

The United Nations Sustainable Development Goals (SDGs) are a collection of 17 interconnected goals, which collectively form a blueprint for peace and prosperity for people and the planet, now and into the future. The goals, which must be achieved by 2030, cover areas such as ending poverty and improving health, reducing inequality, tackling climate change and preserving our oceans and forests.

Unsustainable production and consumption habits

There are currently eight billion people on planet earth, and this is expected to increase to 9.7 billion by 2050, and could peak at 10.4 billion at the end of the century¹. At the same time, growing prosperity in emerging economies will lead to better quality of living, but also increased consumption – currently, the material footprint per capita in high-income countries is 10 times the level of low-income countries².

As demand continues to increase, the world is running out of natural resources. Earth Overshoot Day, the point in a given year when humanity's demand for ecological resources exceeds what the planet can generate in that year, has fallen progressively earlier since the 1970s. In 2023, Earth Overshoot Day was 2 August. Similarly, we have already breached six of the nine ‘planetary boundaries’, which together define a safe, healthy planet across land, sea and air³. These are climate change, biosphere integrity, land system change, freshwater change, biogeochemical flows, and novel entities.

The mountain of waste

Another by-product of our unsustainable consumption patterns is that of excess waste. We currently produce two billion tonnes of municipal solid waste every year, at least 33% of which is not managed in an environmentally friendly way⁴. Again, we can expect these annual waste numbers to increase in the near future, in line with growing populations and income levels – the World Bank estimates that annual waste production will top a staggering 3.4 billion tonnes by 2050⁵.

The environmental impacts are clear. Mismanaged waste is filling landfill sites and finding its way into oceans, or leeching into nearby soils and groundwater, destroying local ecosystems. Decomposing waste also produces methane, a potent greenhouse gas. There are clear consequences for humans – not least, from contaminated local water sources or crops. Further in this article, we explore one particularly concerning type of waste – electronic waste (or e-waste).

Figure 1: Solid waste generation is projected to rise across all regions

Source: World Bank, What a Waste 2.0 report, September 2018.

The shift to a circular economy

The global economy is currently only 7.2% circular, down from 8.2% in 2020, and 9.1% in 2018⁶, driven by rising material extraction and use. This means that only 7.2% of all materials used across the global economy have been recycled – or, 93% of resources are wasted, lost or otherwise remain unavailable for reuse at the end of their useful life.

Tackling the issue of unsustainable production and consumption requires a shift away from our current ‘take-make-waste’ model, and the embracing of a circular economy, where economic growth is decoupled from natural resource use. A circular economy involves reducing, reusing and recycling waste wherever possible – cutting the need for virgin materials, while reducing the amount of waste that is mismanaged or ends up in landfill. Research suggests that moving to such an economic model could fulfil people’s needs with 70% of the materials we currently use, while remaining within the planet’s safe limits⁷.

This shift would go a long way to achieving the aims of SDG 12: Ensure sustainable consumption and production patterns, and specifically, a number of its sub-targets, such as 12.2 (by 2030, achieve the sustainable management and efficient use of natural resources) and 12.5 (by 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse).

The solutions in practice

Encouragingly, investors can play a part in addressing the circular economy challenge, by supporting the wide variety of innovative companies providing solutions to reduce waste and reuse materials across industries. Examples of such companies can be found all the way along the waste collection and recycling process.

Investors can support companies facilitating the efficient collection of waste, especially in lower-income economies where collection rates are lower. Companies can also partner with others to reuse this waste. For example, a US-based waste collection company has partnered with a global soft drinks brand, to collect and recycle plastic waste. This reduces the amount of mismanaged waste, and will aid the drinks company in hitting its targets for the minimum recycled content of its packaging. Another impactful company in this area pioneered ‘reverse vending machines’. Found in many European supermarkets, these allow consumers to return used plastic containers, such as drink bottles, in a convenient location. These machines play an essential role in the growing area of deposit return schemes, where consumers exchange the container for the return of a deposit (included in the original purchase cost of the drink).

“Investors can support companies facilitating the efficient collection of waste, especially in lower-income economies where collection rates are lower.”

There are also opportunities in the sorting of waste, by supporting companies providing the technology to efficiently separate waste into different materials. The company behind the reverse vending machines also produces advanced scanning technologies, which can identify types of plastic, shapes and colours, the presence of contaminants and specific hazardous or valuable materials, as a stream of mixed waste moves along a conveyor belt. Mechanical levers or jets of compressed air are then used to separate the materials, after which they can be recycled.

While this technology can make the recycling of all materials more efficient, there are particular benefits when it comes to e-waste. These include ensuring that hazardous materials, such as brominated flame retardants, are disposed of correctly, instead of being buried in landfill, while valuable materials such as gold, copper and lithium are recovered.

Finally, investors can support innovative technologies allowing the reuse waste. For example, one impactful company collects mixed solid waste that would otherwise have been incinerated or sent to landfill. Through a chemical process, the organic matter in the waste is broken down into its component parts, which combine with residual plastics to form a composite thermoplastic material. 

This material can be substituted for oil-based resins in the manufacturing of a huge range of plastic products, not only helping to prevent plastic waste going to landfill, but also reducing the reliance on fossil fuels for new plastic materials.

The SDG Reckoning report – an update on progress towards the SDGs

When it comes to achieving the SDGs, the world’s ambition is not currently being met by its actions. In the annual SDG Reckoning report, published by our parent company M&G plc, we assess the progress towards each of the 17 SDGs, both from a general perspective and through an impact investing lens.

Read the report

Please note that, while we support the UN SDGs, we are not associated with the UN and our funds are not endorsed by them.

¹UN, ‘World Population Prospects 2022’, (un.org), 2022.
²UN Statistics Division, ‘Responsible consumption and production’, (unstats.un.org), 2023.
³Stockholm Resilience Centre, ‘All planetary boundaries mapped out for the first time, six of nine crossed’, (stockholmresilience.org), September 2023.
⁴World Bank, ‘What a Waste 2.0 report’, (worldbank.org), September 2018.
⁵World Bank, ‘What a Waste 2.0 report’, (worldbank.org), September 2018.
⁶CGRi, ‘Global Circularity Gap Report 2023’, (circularity-gap.world), January 2023.
⁷CGRi, ‘Global Circularity Gap Report 2023’, (circularity-gap.world), January 2023.
⁸UN Statistics Division, ‘Responsible consumption and production’, (unstats.un.org), 2022.