By Joost de Kluijver, CEO and Founder
Closing the Loop has been active on electronic waste reduction since ’12, We have a footprint in 10 emerging markets, mainly in sub–Saharan Africa and have collected millions of scrap devices. Today, my company presented at the global WCEF conference, and we were asked: how did we deliver this result, deemed impossible by many?
My answer: by making it commercially attractive to reduce ‘e-waste’.
The co-founder of Closing the Loop is from the African continent. In our team, we have unparalleled knowledge and experience on setting up collection networks in collaboration with local, informal communities.
In our first years, we learned that the biggest challenge for proper e-waste management in the emerging world is the lack of a financing mechanism. Additional funding is needed to cover the high costs of responsible, safe and legal e-waste collection and shipment. To be very clear: in Africa, proper e-waste recycling can not compete with improper recycling, due to the costs of doing things right; legally, with all the correct permits and training.
In Africa, proper e-waste recycling can not compete with improper recycling
Actually, the whole recycling eco-system is missing, as extended producer responsibility (EPR) is not active, as formal collection infrastructure has not been created and as it’s not even possible to recycle the waste locally.
Our contribution: we developed ‘waste-compensation’
As a result, we created a financing mechanism: a commercial service that funds proper e-waste collection in emerging markets. This service is called waste-compensation and it has a completely different starting point that e-waste collection. It now offers – already for 5 years - customers in Europe and the US a pragmatic and appealing tool to get started on more sustainable, or circular procurement of electronics.
When our customers buy a new device, they pay a small fee to make their device waste-neutral. We use that fee to 'compensate' it: we collect and recycle an amount of e-waste that equals the new device. The collection is done in a country that lacks formal waste collection systems. More information on this certified ‘circular service’ can be found here.
We collect and recycle an amount of e-waste that equals the new device
Why is a (new) business model needed for African e-waste reduction?
The reason why currently, electronic waste is handle in a unsafe, polluting way, is because it’s the only way local (informal and under less educated) communities in most African countries can make money out of the waste. People are not looking for ways to pollute, they just want an income.
People are not looking for ways to pollute, they just want an income.
At the same time, we see that most projects that work towards e-waste reduction, aim for long term solutions (e.g. developing legislation, ‘formalizing’ the local sector). Which is great, but we also need solutions that can be implemented (and have an effect) today: you can not start by implementing the end-goal.
That’s why we developed our business model to have a direct impact, today, while contributing to longer term goals.
Users in the EU and US countries pay for the value that waste-compensation delivers: it makes their new devices waste-neutral. That payment is used to fund proper, safe e-waste reduction in countries that lack e-waste management systems.
It makes their new devices waste-neutral
As a result, demand is created for compliant e-waste collection. And that has led to collection networks and over 3 million scrap devices made available for proper recycling, purely demand driven (subsidies were not required).
The service is used by public and private organizations across the globe for their green procurement ambitions. But also the tech industry itself uses it, companies like Samsung and Ingram Micro.
Our view is that it does not help to position e-waste as solely a problem. Companies and even governments do not really like to be associated with problems. A solution works best if everyone benefits, and so it also needs to make business sense.
Companies and even governments do not really like to be associated with problems.
Waste-compensation has funded the collection of phones, batteries and it will also soon become available for screens.
The role of the private sector
I agree with the common view that the private sector is best positioned to contribute to waste reduction, especially in the short term. That’s why we were also founding company of the Circular Electronics Partnership, which brings together the green shapers in Tech.
But we also see that e-waste is discussed mainly in a negative way, as something to be ‘responsible’ for, or that you’re forced to act on. Because of the link with compliance, the topic is often handled by the legal department. And that’s not the business unit that drives innovation and action (no offense...).
The market can be our strongest ally
If we want business to give e-waste reduction their best effort, we need to accept that they are most likely to do this if they see commercial reasons. This may be something NGOs and government do not really appreciate about companies, but we should not see this as a bad thing: we can use this fact in our advantage.
When e-waste reduction gets linked to commercial KPIs, this will create the strongest ally we could ever dream of: the power of the market.
This will create the strongest ally we could ever dream of: the power of the market.
That’s what we contribute to NGO projects such as the one supported by the German government, in Nigeria: we help to kick start it and link it to our local collection networks. But most of all: we help create demand and funding to make proper waste-collection and recycling economically viable, today.
Changing the narrative
By explaining and showing that e-waste reduction delivers commercial value – for the tech industry and its customers – AND value for society, Closing the Loop got the private sector on board. By talking 'their' language of opportunities, value-adding and customer-centric approaches.
Now we've concluded that the private sector has a key role to play towards global e-waste reduction, we need to make sure we give them a role that they excel at.