Circular economy already a ‘crown jewel’ as businesses urged to grasp opportunity

With work to establish Scotland’s circular economy already underway, businesses are being urged to get involved and ensure they don’t miss out on the opportunities of what will become the new economic reality.

As essential resource supplies come under increasing pressure, the opportunities presented by a circular economy could hardly be clearer.

The prize of helping businesses large and small move to more sustainable practices is huge - it is estimated that across the UK they could equate to a £25 billion opportunity over the next decade, supporting upwards of half a million jobs.

While the shift is a ‘no brainer’ getting there will involve significant work. Earlier this year the Scottish Government published its first Circular Economy Strategy, setting out the commitment to move from a linear “take, make and dispose” economic model to a circular economy where materials and goods are kept in use for as long as possible.

Ministers have identified five priority sectors for action: the built environment; energy infrastructure; textiles; transport and the food system - with Zero Waste Scotland, as the nation's circular economy delivery body, leading on all except transport.

The Scotsman, in partnership with Zero Waste Scotland, gathered a group of experts at the headquarters of Zero Waste Scotland in Stirling - housed, appropriately, in a repurposed army barracks building - to explore the challenges and opportunities of the circular economy.

Ciaran McGuigan, Chief Executive of Zero Waste Scotland, started by highlighting the fact that the circular economy was already adding enough value to Scotland to be considered a ‘crown jewel’ alongside sectors such as whisky and tourism.

“About £4 billion of Scottish GVA comes from circular sectors, there are about 56,000 people working in those sectors,” he said. “So, it's not a single sector, but if it was a sector, it'd be one of Scotland's most significant. You know, we'd be treating it as one of our crown jewels.”

Business barriers

The discussion outlined a number of barriers to accessing the potential of a circular economy, from investment and awareness to creating infrastructure and ensuring regulation kept pace with Europe in post-Brexit Britain.

And the framing of the shift was seen as key, with the term ‘circular economy’ flagged as being potentially damaging to the work being done.

“Every time someone puts a word in front of ‘economy’, it allows others to see it as different, to put it in a box that feels too difficult as it involves change, said Susan Murray, Director of the Edinburgh-based David Hume Institute and a former board member at NatureScot:

“And as soon as you're dealing with change, you get barriers.”

“We're living in a resource-constrained world, it's going to become increasingly competitive, and the cost of those raw materials is going to go up.

“So if we have materials in Scotland that we can use again, why would we not do it? The circular economy is a no-brainer to me.”

Making sure businesses are aware of these opportunities is another challenge that needs to be met.

“That education piece is vital in terms of organizations who are very much starting their sustainability journey and helping them in understanding what those opportunities are,”

said Lauren Ridgley, Project Manager at the Edinburgh Chamber of Commerce who leads on business support sustainability.

Business Benefits

While the barriers are still being brought down, there are already examples - such as lighting company EGG Lighting, bioeconomy business Celtic Renewables and construction supplier Hempspan - of innovative businesses leading the way in reusing and repurposing ‘waste’ products to create sustainable growth and reap the benefits.

“This is an important way of doing business, of organizing ourselves economically,” Charlie Woods, a board member at the Economic Development Association Scotland and a mediator with Core Solutions, said.

“And it goes back to helping companies understand that this is not some special new add-on that you do in order to address environmental issues. This is just a way of doing business better.”

“Some sectors are already quite highly developed,” Stephen Boyd, Scottish Director of the Institute for Public Policy Research (IPPR) Scotland, said. “When I think of most larger manufacturing firms, I think for quite a long time now they've been really operating culturally in the zero waste, reducing resource intensity.

“Increasingly, the hospitality sector, that's becoming really innovative. They said ‘we just don't want to waste anything. We want to use everything in the supply chain’.”

A circular economy also has the benefit of making a country far more resilient to global supply chain shocks. As an example, Charlie pointed out that in the 1970s Earth Overshoot Day - the date on which the global consumption of resources exceeded the capacity to regenerate those resources - generally arrived in December.

In 2026 it came on July 30.

While the long-term benefits seem obvious, the issue of short-term financing to try and reap those rewards is another issue that needs to be addressed.

“This is an opportunity that's here to stay, and I think that's the way we need to approach it,” former Edinburgh West MP and Falkirk East MSP Michelle Thomson.

“From a government perspective, what I saw very clearly in my time in Parliament was how limiting the one-year forecast horizon set by the Treasury was. It really does affect long-term thinking.

“That's an issue UK-wide as well, and I think that is a main restrictor on realising the opportunities.”

In order to fully realise the benefits, a lot of hard work still has to be done, not least to create the physical on-the-ground solutions that will let businesses large and small feed into a system that is essential for the future of the Scottish economy.

“I think there is such an understanding of the importance of materials security to energy security to critical materials underpinning all of our investment objectives that it becomes a common-sense conversation,” said Ciaran.

“The counterpoint to that is therefore there's an expectation that solutions will magically appear because it makes such obvious strategic and operational sense, but the work to actually enable those is really difficult and does require different thinking about investment, risk, connected solutions, missing infrastructure, you know, all of the barriers that are there.”

The Current State of the Circular Economy

Scotland’s circular economy may be in its infancy but is already adding over £4bn in GVA every year, with the Scottish Government pushing for more progress through the adoption of the Circular Economy Strategy for Scotland.

“What we're talking about today is a set of principles and practices that go right across the economy and are about making products and materials last longer and keeping things in use for as long as possible and therefore reducing material consumption,” said Ciaran.

“It's ways of working rather than a particular sector or a particular niche in the economy. It's a model for the economy as a whole— sharing, repairing, leasing, reprocessing, remanufacturing, recycling.”

Zero Waste Scotland have prepared multi-year roadmaps for four economic sectors: energy infrastructure; the built environment, textiles and the food system

And for each one they have established Mission Boards - bringing together academia, trade bodies, public sector organisations, regulators, standards bodies and others to create detailed intervention plans setting out how to deliver systemic change in those sectors.

“It's very hard for an individual business to actually execute on all of those opportunities in a world that is not set up for that,” Ciaran said.

“I think where we're at strategically is starting to focus on the system change actions that we can take in collaboration to deliver real change on the ground and realise what we think is, across the UK, a £25 billion opportunity over the next decade.

“We’re talking about half a million jobs across the UK in the next decade. So for Scotland, there's a significant prize.”