Circular approaches bring market differentiation and competitive advantage
Denisa Rášová is one of the leading figures in the field of circular economy in Slovakia. After studying at the University of Economics in Bratislava and an internship at the Austrian Ecological Institute, she decided to focus on a topic that combines innovation, sustainability and the business environment. As the director of Circular Slovakia, she leads a national platform that helps accelerate Slovakia’s transition to a green economy.
In this interview, we will talk to her about her professional journey, the challenges she faces in promoting the principles of the circular economy, but also about specific solutions that can help companies and institutions on the path to sustainability.
What do you think are the biggest environmental challenges we face today?
I consider human limitations and inertia to be the greatest environmental challenge .
We have already crossed six of the nine planetary boundaries, and the pressure on the remaining boundary processes, in addition to ozone depletion, is increasing, meaning we are at risk of large-scale or irreversible environmental change. Yet we continue in our old patterns.
Environmental challenges also bring new opportunities, and from my perspective, they need to be viewed that way.
What does the circular economy actually mean and what are its basic principles? How does it differ from the traditional linear economic model?
Let me illustrate this with an example. Imagine that we go hiking on a majestic mountain. We have worked hard to climb it and invested our time, energy and money on the way up. When we reach the top, we want to stay there as long as possible and enjoy the views. But compared to the ascent, we spend only a short moment there. We try to get down as quickly as possible and look for the most beautiful paths. This example reflects our traditional approach to production and consumption, and at the same time the life cycle of a product and its value. The climb symbolizes all the resources and work before the product is launched on the market; at the top of the hill, the product has the highest value because it is in the hands of the consumer. The way down, on the other hand, offers a glimpse of how quickly the product loses value when the consumer no longer needs it, it becomes obsolete or breaks down.
In a circular economy, we strive to maintain the value of products and resources for as long as possible and at the highest level, and to avoid waste and pollution. Design plays an important role, as it determines up to 80% of what happens to a product at the end of its life . If I design and manufacture an office chair from several materials and glue all the parts together, it will be almost impossible to repair it. Its life cycle will probably end in a landfill or incinerator. The key approaches in a circular economy are reuse, renewal, repair, renovation, upcycling and, last but not least, recycling.
What led you to become interested in the circular economy?
A sense of responsibility for the environment in which I live encoded within me . I simply tried to “do less harm” and reduce my own environmental footprint. I thought, like many, that recycling was the path to sustainability. That is why I mainly dealt with waste management and the recycling economy. But that is not enough, I understood that less is more and waste should be prevented in the first place. My sense of responsibility is connected to the need to bring value to this world, not just to get out of bed and live to live. During college, I encountered the concept of the circular economy and since then it has been the domain that I live by in both my personal and professional life.
What are the main challenges you as an organization face in promoting the circular economy in Slovakia? Why is it important for Slovakia to move to that model?
Any association or initiative that does not step out of its safe bubble will never be able to implement changes at a societal level. Circularity is about starting this transformation, which is why we organized the first Circular Summit in Slovakia in early 2024 and brought it to the attention of a wide professional and lay public. Promotion via social networks also brought a lot of hate . Interactions, although often negative, were based on a misunderstanding of the message of our initiative. However, the engagement of haters helped the posts go viral and reach a wide lay public. The biggest “thorn in the side” was the use of English terms, the fact that our association is a non-profit organization, which many immediately put between ” Soroš ” and “American elements”. The term circular associated a parallel with sawing wood or circular saws. This confirmed to us that the topic should be brought regularly and clearly to the mainstream media and talked about in an engaging way for all target groups.
How can small and medium-sized enterprises in Slovakia benefit from this transition to a different value creation model? ( value-chain )
Circular approaches bring market differentiation and competitive advantage. They satisfy a group of customers who are reducing their lifestyle footprint. At the same time, customer retention and loyalty increase by, for example, allowing access to products instead of selling them directly. Imagine renting a shared bike, the communication and interaction with the service provider is repeated as opposed to a one-time purchase.
You increase control over your own business by focusing on resources that have already been in circulation and are more available locally. Thanks to this, you have a better overview of the supply-consumer chain, reducing your dependence from fluctuating prices of primary raw materials, transportation prices and last but not least, you increase transparency and data collection, for example for reporting and communication purposes.
For businesses that have embarked on this path, the availability of support services is also increasing and access to financing is becoming easier. Legislation and regulatory measures will also increasingly favor sustainable products and services. Last but not least, sustainable and transparent business attracts new talent, and employees are increasingly paying attention to the impacts of their employers’ business.
What are the biggest obstacles to wider adoption of the circular economy? Do you think the coronavirus pandemic has affected our perception of the importance of sustainable development?
The easiest way is to start a business based on a circular business model. Otherwise, the path is more challenging. If the business model is linear, the company must make a radical change to be considered circular. Let me give you an example. My business is built on selling new books. To make it a circular business, I would have to stop selling new books and only buy back books that I have read, or completely dematerialize and switch to selling e- books . However, the reality is somewhere in the middle, even a linear business can have elements of circularity , but it is necessary to start step by step. I can sell new books, and at the same time buy and sell second-hand. If the pilot proves successful, its share of sales can grow and maybe in a few years I will offer exclusively bought back and digital literature.
Businesses are challenged to mobilize because circularity is intertwined with business model, product and service innovation. Many businesses find it painful to question their “business-as- usual ” and are often deterred by unclear return on investment or benefits. However, the key is a change in mindset at the management level that opens the door to transformation.
From my perspective, the pandemic had only an indirect and minimal impact on sustainability. I rather justify the changes with efficiency and our convenience. We started working from home more, but more because of comfort and lower transportation costs. E- commerce has expanded , which, in addition to all its benefits, I consider a modern problem in terms of excessive consumption and reverse logistics. People began to move more to the countryside and think about self-sufficiency, but many did so only at a declarative level. Again, I am referring to human convenience and inertia. However, this would require a deeper impact analysis.
What specific solutions and initiatives does the Circular Slovakia platform bring to individuals and companies?
Circular Slovakia focuses mainly on networking and raising awareness and knowledge about the issue. We bring various educational and networking formats, such as circular breakfasts, visits to places of good practice, professional webinars , workshops. In addition, we organized the already mentioned first Circular Summit. We publish articles, brochures and communicate on the topic to both professional and lay audiences.
Circular Slovakia’s greatest strength is its 75-member base, which consists mainly of representatives of the business sector, but also of the public, non-profit and academic communities. These are the bearers of expertise and our effort, but also the biggest challenge, is to find a way to utilize their expertise and network these diverse entities. Therefore, we are looking for new formats that will support this aspect of cooperation, such as peer2peer consultations. Experts from among the members will help other members, for example, in how to communicate without greenwashing , fairly and transparently, or how to purchase circular products and services internally.
We are also bringing new educational formats for entrepreneurs, preparing the Circular Academy, which we will launch next year.
What would you say to citizens who want to contribute to the circular economy, what should they change in their daily lives? What impact does consumer behavior have on sustainability and what should consumers change?
Change starts in my head. As soon as I start to consider the environment I live in, which provides us with irreplaceable ecosystem services for free, I start to question all my behavioral patterns. Do I really need new shoes? Do I really need to buy grapes from South Africa? The journey to sustainability is one big cleanup, accompanied by a liberating feeling of excess. I am currently working on reducing my digital footprint, deleting unused apps, cleaning up my cloud storage, unsubscribing from newsletters I don’t read, and limiting my use of AI for personal purposes to the bare minimum. It has given me time to focus on other more meaningful activities, but also greater data security.
How is the concept of a circular economy manifested in Slovak cities like Košice? What challenges do cities face in transitioning to a circular economy? What role do city governments play in supporting the circular economy and what steps should they take?
Local governments have an irreplaceable role in the transformation, they concentrate an increasingly large part of the population and must respond to the worsening impacts of climate change. Whether a city or a company, the first step is to aggregate as much data as possible in the area of material flows, recycling economy and waste management. It is necessary to analyze the key sectors and players in a given region, ongoing initiatives and policies. All interested parties should be seated at one table and discuss what a circular city should look like. On this basis, it is necessary to prepare a strategy, an action plan with clear and feasible goals in line with those at the national and EU level, allocate a budget and start implementing it through pilot projects. At the same time, communication should not be underestimated.
Do you see differences in the approach to the circular economy between larger and smaller Slovak cities?
Definitely yes. A member of Circular Slovakia, the city of Bratislava is the only municipality in Slovakia to have developed a strategy for transitioning to a circular economy. The city is behind unique projects such as KOLO – a reuse center or giving a second life to Christmas trees. It collects trees, transforms them together with partners into wood chips, which are then used as an additive for libraries at the IKEA Industry plant in Malacky. 150 such libraries (filled with books from KOLO) were donated to organizations that care for children, seniors, or homeless people. Others are sold in the department store. The city of Bratislava, together with the city’s collection company, OLO, and residents, turned some of the collected Christmas trees into mulch and distributed them to people at a public event in Lamača to use with trees on their own land.
What are your recommendations for improving cooperation between the public and private sectors in cities?
Compared to other countries, we know little about cooperation. This is mainly due to cultural and historical specifics. I mentioned above what steps cities should take in the transformation. It is important to involve the private and non-profit sectors in the creation of urban strategies, test pilot projects and then scale them up, as the city of Bratislava did with its partners around Christmas trees.
How do you see the future of the circular economy in Slovakia in the coming decades and what should be the priority?
First of all, it is necessary to build on the existing Circular Economy Roadmap and prepare a follow-up legally binding document with targets and a budget. The roadmap states that Slovakia should be a fully circular country by 2040. But that is very optimistic to say in my opinion, as we often have problems achieving the targets we have set in the EU in the area of waste management.
I agree with Professor Jacqueline’s opinion. Cramer , former Dutch Minister of the Environment and member of the Economic Council of the City of Amsterdam, who says that the transition to a circular economy is an iterative process that will take at least two decades. It is a continuous transformational change and an organized process that requires the involvement of national governments as policymakers, and to put these policies into practice, we need to involve all stakeholders in the implementation. The circular economy must become the agenda of the day at the political level, otherwise the transformational changes at the level of the whole society will not happen.