Munich Startup: What does “circular economy” actually mean?
Susanne Mitterer: Our global consumption of resources is continuously increasing – at the same time, these available natural resources are limited: we are therefore reaching planetary boundaries. "Circular economy" is a sustainable approach that uses resources as efficiently as possible and minimizes waste. The idea behind this is that products and materials are kept in a closed cycle instead of ending up as waste after a single use: Just as in nature, every waste is also the starting material for something new.
To achieve this, products must be designed from the outset to ensure the longest possible service life, with components that are suitable for later reuse and, where appropriate, can be recycled. The goal is to ensure the responsible use of limited resources that takes ecological, social, and economic aspects into account.
Munich climate neutral by 2035
Munich Startup: Why are you focusing so intensively on this topic?
Susanne Mitterer: The Munich City Council decided in 2019 that Munich should be climate-neutral by 2035. The topic of circularity plays a key role in this. In November 2023, the Circularity Gap Report for Munich. The figures make it clear that we are still at the beginning of a necessary transformation: on average, every Munich resident consumes 32 tons of virgin material per year.
The report estimates that of all the materials used by the local economy annually, 2.41% are recycled materials. We must therefore find ways to use resources not as "single-use" materials, but as reusable materials that can be reused again and again. There are many exciting solutions in the cultural and creative industries, for example, Circular Design Rules of the Institute of Design Research in Vienna. Our industry must therefore, on the one hand, transform itself, but at the same time, it can also make a significant contribution to social transformation.
Munich Startup: How circular is the cultural and creative industries?
Susanne Mitterer: The circularity of the cultural and creative industries requires a very differentiated approach due to the heterogeneity of the sector. In some creative sub-sectors, such as the visual arts and design, there is a growing awareness that raw materials do not necessarily have to be virgin and untouched. This is leading to an increased focus on the reuse of materials and upcycling. At the same time, we are facing a major challenge in the fashion sector, for example. We at the Cultural and Creative Industries Competence Team in Munich have therefore been commissioned by the city council to relaunch the Munich Fashion Award as the "Fair and Sustainable Fashion Award" starting in 2024, recognizing not only the creative quality of fashion designers but also technological sustainability solutions.
Digital products recyclable and circular
In the event industry, exciting pilot projects have been implemented nationwide that implement the topic of ‘circular economy’ for large concerts and events, for example the Tempelhof LaboratoryHere, the organizers, together with the bands at concerts by Die Ärzte and Die Toten Hosen, have consistently implemented the theme “Cradle to Cradle” and are now passing on their experiences and tips to the scene.
Digital media and products, which make up a large part of the cultural and creative industries, are, to a certain extent, circular. Digital content can be reproduced indefinitely, reducing the need for physical resources. Many creative companies rely on collaborative approaches and resource sharing, whether through coworking spaces or shared production equipment. The cultural and creative industries have long been pioneers in this type of "sharing economy."
Munich Startup: Some companies don't manufacture resource-intensive products, or are more positioned as service providers. Does circularity also play a role here?
Susanne Mitterer: We often first look at the carbon footprint: What does a company's carbon footprint look like? Where can resources and energy be saved? But there's also the handprint, the impact: How can we contribute to positive change on a social and economic level? This is precisely where cultural and creative professionals often have great strengths. As a self-employed person, as an entrepreneur, I can consider whether and how my actions inspire others.
Impact and carbon footprint
A concrete example: The young publisher &daughters has set out to rethink publishing. The content of their publishing program encompasses current social and ecological issues of our time. They have received numerous awards for this, and since last year have been winners of the 2023 German Publishers' Prize. In doing so, they contribute to raising awareness and providing inspiration. On the other hand, books as a physical product are less environmentally friendly than one might think: when printed matter is recycled, some harmful substances are left behind. The publishers of &töchter strive to produce their books as sustainably as possible, but only two books are truly "cradle to cradle." In this example, the impact of the books must be weighed against their environmental impact.
Munich Startup: What does it take to make the positive impact of the industry accessible to others?
Susanne Mitterer: The cultural and creative industries can play a crucial role in supporting the establishment of circular economies in other sectors. When designers are involved early on in product development, they can act as a catalyst for innovative design approaches, for example, in which reuse or secondary use is already considered and designed in the product development process.
The industry can also act as a mediator when it comes to raising awareness, building a bridge between companies and consumers through communication, creative campaigns, and the creation of emotions and images. This makes complex concepts more accessible and highlights the benefits of sustainable business and living.
On Federal level A creative lab is currently underway on the topic of "circular economy" in the cultural and creative industries. Here, new cross-sectoral solutions are being developed with companies and creative professionals.
Circular economy: concrete steps for startups
Munich Startup: What could be the first steps to make your own business model more sustainable and circular?
Susanne Mitterer: The transition to a more sustainable or even circular business model often requires gradual adjustments. Initial steps could, for example, be conducting a life cycle assessment. There are now many checker apps and CO2 calculators available for this purpose. The city of Munich also offers a Munich climate We offer free consultations for companies with up to ten employees. This helps you understand where the greatest leverage lies in your own work – and where you can take the first steps with affordable effort. It's important to look for opportunities and ways to "get started," rather than viewing the issue as a huge mountain.
Things get exciting when, for example, you take a look at your own business model in product design and boldly go against the grain. What happens to a product after use? Can I build it modularly or disassemble it? Am I selling the item itself, or can I just offer the use itself as a leasing or sharing model? Such approaches are currently being widely tested, for example, when fashion is offered for rent instead of purchase. Or when e-bikes are developed so that the individual components can be reconditioned and reused.
The key is not to make everything perfectly circular right away, but to view sustainability as an integral part of your business model.
Sustainability as part of the business model
Munich Startup: Where do you see pitfalls in implementing circular business models?
Susanne Mitterer: There are many challenges to overcome when implementing circular business models. Circular economies often require close collaboration with suppliers, take-back systems, and recycling facilities. The complexity of the supply chain can complicate implementation, especially if it lacks sufficient transparency or flexibility. Or the necessary take-back systems are not available across the board.
And the transition to a circular economy may require higher initial investments. Companies may need to invest in new technologies, recycling infrastructure, or employee training programs and customer marketing campaigns.
A third challenge is us – the customers. As a society, we're used to products and packaging being developed without consideration for the resulting waste. And we must now learn to accept that a book that isn't wrapped in plastic is still valuable. We must be willing to bring products back into the production cycle and not simply throw them away. And we must abandon the habit of thinking that used, recycled items are worth less than new products made from new materials. As creative professionals, as companies, we must therefore also bring our customers along on the path to circularity.
Overall, it comes down to the willingness to prioritize long-term goals over short-term challenges.
Financial incentives are important
Munich Startup: What needs to change in legislation so that startups can better integrate circular economy?
Susanne Mitterer: At the top of the list is certainly the introduction of financial incentives such as tax breaks, subsidies or other financial incentives to motivate startups to act in a circular manner.
In the film industry, as of 1 July 2023 minimum ecological standards published that must be met in order to receive film funding. This is an efficient approach in which film funding agencies, producers, and broadcasters have worked together. This is also creating a new market for companies that can offer innovative solutions to meet these new requirements.
Since many startups operate globally, the development of uniform standards and regulations for the circular economy could also be helpful. Only if the materials used in a product or building are precisely documented during development, and if attention is paid to their subsequent separability, can they be used in a circular manner later on. Currently, these "burdens" are the responsibility of the individual company, even though circular economy creates added value for everyone.
Conscious use of resources must become the norm, not just a praiseworthy exception. So: circularity, not crisis!
The interview "Circle instead of crisis: Why circular economy will play a key role in the future" is the first in a series. We introduce companies in the cultural and creative industries that are pioneers in integrating circular economy concepts into their business models.
