On the 6th December 2021, we hosted virtually Tom Szaky, CEO and founder of TerraCycle / Loop, as the keynote for CIRCULÉIRE's 2021 Public Circular Economy Lecture. During this one-hour fireside chat, Tom was interviewed by Dr Geraldine Brennan, CIRCULÉIRE Lead and Head of Circular Economy at Irish Manufacturing Research (IMR) to explore some of the challenges TerraCycle has encountered on their twenty-year journey to eliminate waste and learn from their vast experience.
Creation of TerraCycle
TerraCycle can collect and recycle “almost any form of waste,” but what were the motivations that inspired Tom to create the company that operates now in 21 countries? As he told CIRCULÉIRE, something sparked him in his first year of university.
“I was told the purpose of business is to maximize profit to shareholders. I didn’t like this answer. I see profit more as an indicator of health. But it is not the purpose. I believe we don’t live on this planet to be healthy; we live in it to make it better. And if we are healthy, we will do that for a long time, and if we are not, for less time”.
Tom’s deep fascination with waste brought him to reflect on the business behind this sector.
“Waste is a very big problem, so it is very purposeful to solve it. This field, with so many anomalies, is the best playground for innovation. We live in a materialistic world where our status is equal to how much stuff we have. But it’s interesting that everything we own will legally be the property of a garbage company one day”.
Tom also shared his realization that it would be tough to eliminate the idea of waste if TerraCycle were a product company, so they restarted their business.
“Even if we make our product out of garbage, which was the case of the liquefied worm poop packaged in reused soda bottles, the product would be the business’ hero. We would always look for the best materials in the garbage to use it so dirty diapers and cigarettes would still never be recycled. We wanted to eliminate the idea of waste”, he explained.
Consumer Journeys
Years ago, reuse used to be the way society worked: from fixing shoes and clothes to bottles of glass from the milkman all over the world. Why has disposability become the way we deal with products nowadays? According to Tom, the benefits must be acknowledged.
“Disposability is unbelievably convenient and affordable. And it gives you range. In the milkman model, how many types of milk could you order? Maybe one or two. But now you go to the supermarket, and you can see such a variety. Range, affordability, and convenience are things we advocated for. It’s important to not just vilify the disposability, although we know the issues, but to honour those benefits because that’s what you have to compete with on reuse”, he said.
And as TerraCycle’s CEO observed, as consumers, if we thought more about how powerful our decisions are, we would understand better how we can collaborate to a world more sustainable and circular.
“We are all citizens, so we are voting mostly blind for the future with our purchase, which I think is way more important than the political vote. The brands and the retailers are all here to serve our desires. Let’s think about the baby food industry, for example. Most of it is being sold in pouches because is more convenient. If I am brand A and you are brand B and I decide to move back to the glass jars, but consumers don’t buy it because the pouches from brand B are more convenient, then I will disappear. So, it’s important that we open our eyes to the way we purchase and influence organizations to do as much as they possibly can to make choices available”.
According to a report from the Institute for European Environmental Policy, if everyone in the world wanted to consume in the same way as Europeans by 2050, we would need a number of natural resources equivalent to three Earths.
“There is this long-going conversation about responsibility, and everybody loves to point to everyone else that is not oneself. I think we can all agree that we are in an urgent crisis from an environmental stand of point. We are in the middle of the explosion: climate change, species reduction, deforestation, the waste crisis… So, we don’t have the luxury of time. If we had it, maybe we could have this conversation. We all must do whatever we can”, urged Tom.
Business Journeys
In 20 years of existence, TerraCycle has worked with lots of companies and organizations to help them in their circular economy and sustainability journey. That experience brought valuable lessons Tom shared with CIRCULÉIRE and the participants of our Annual Lecture.
“Besides the public opinion and legislation, for example, there is a big incentive for companies and stakeholders to go green, which is: make people prefer your products, or brand, over the competition. And if this incentive is your recycling program, then that may help the brand strategy. Because the bigger the recycling program is, the more money is needed and the way you deploy more money is showing how it is a good investment”.
As the CEO added, manufacturing industries usually develop momentum through the recycling path where they soon learn that they can do the job themselves. But the journey tends to it always start with the financial driver.
“They hire us, and they now are paying, voluntarily for something they were not putting any dollar investment before into the end of the life of the product. And that starts to create motivation inside of the organization to think about how to solve this financial opportunity. Instead of paying for a recycling program to take care of their waste, they can design new methods of consumption, like reusables, for example. Instead of relying on waste management, they can change the landscape themselves”.
Enabling and encouraging businesses to tackle their waste themselves does not confront TerraCycle’s business. As Szaky reflected, TerraCycle’s first question is –“Can you design your product so it can be managed through local recycling programmes where you don’t need us?”.
TerraCycle is always evolving – enter LOOP & Diagnostics
TerraCycle has three major divisions with an emerging one, as Tom announced. The first one, waste management asks the main question: “Is the object recyclable?”. The second focuses on helping companies to integrate waste back into their products whether they are made from unique materials like polycarbonate, triton, Methacrylate Butadiene Styrene (MBS); or traditional materials like aluminium, Polyethylene Terephthalate (PET), High Density Poly Ethylene (HDPE) sourced from unique places like the bottom of oceans or rivers or even aboriginal communities in the cities. The third division is Loop.
“Loop is shifting from disposable consumption to reuse-based consumption. Perhaps this is the best thing to do: collect recyclable materials and reuse them in the new products or packages. This is circular economy. Some examples of this process are the reusable stainless steel that contains the ice cream you can buy on the supermarkets or coffee cups from fast-food franchises that can be reused”.
And for the next year, they plan to lunch a diagnostic division that concentrates on the thesis that certain waste trims carry diagnosable samples.
“Your air conditioning filter while is there to filter mold and mild on your air can also give you information. Is anybody thinking of analyzing that to understand what your air is like? Or instead of recycling your kid’s diaper, you will be able to send it to us to analyze your kids’ gut health, for example, among other possibilities”.
In Summary…
Tom wrapped up CIRCULÉIRE’s 2021 Public Lecture with the followingtake-aways - which according to him, can be implemented by anyone, professionally or personally:
Consumption is the ‘Elephant in the Room’: “Spend some time addressing the white elephant in the room. The only solution to sustainability will be a reduction in consumption. And it’s hard to address it because our entire system is tied up in “we are better if we buy more”, individually or from a country level in the tax revenue and the size of the economy, for example.”
Embed Circularity/Sustainability into Core Strategy: “The most important thing I’ve learned in implementing and scaling sustainability concepts is to make sure that concept reinforces the organization’s core purpose of being. The more it reinforces it, the more security you develop that will scale without the right actors needed to be there. If the stakeholders say, ‘We will do this because it’s the right thing to do’, that’s a bad sign and they haven’t figured out other reason to do it other than moral or ethical imperative. And that will depend on that stakeholder being there and will probably not scale.”
Prioritise Understanding Drivers of Behaviour & Solving Pain Points: “Accept motivations and the way people and organizations are as the way chess pieces in a chessboard move. Like I mentioned, consumers are self-oriented in their decision-making. If you know the way the pieces move, you have more chances of winning instead of hoping for them to move in the way you’d like them to move.”
About CIRCULÉIRE
CIRCULÉIRE is a public-private partnership co-created by Irish Manufacturing Research (IMR) and three strategic partners: the Department of the Environment, Climate and Communications (DECC), the Environmental Protection Agency (EPA) and EIT Climate-KIC. Together with industry partners CIRCULÉIRE aims to assist manufacturers and their supply chains to switch from linear to circular business models.
Read more about CIRCULÉIRE here.
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