The United States Materials Marketplace launched as a pilot project in the summer of 2015 to test the feasibility of a national exchange where traditional and non-traditional industrial waste streams could be matched with new product and revenue opportunities. The Marketplace leverages the expertise and networks of three founding partners: The US Business Council for Sustainable Development (US BCSD), the Corporate Eco Forum (CEF), and the World Business Council for Sustainable Development (WBCSD).
Initial results from phase one of the pilot project, which ran from June to August 2015, include: 23 participating companies, 78 facilities engaged, 150 materials—2.4 million tons total—uploaded to the marketplace, 59 materials being sought, 68 recommended matches and 19 transactions in development, with another 49 possibilities that were still pending action at the close of the pilot. As a result, the project team plans to extend the pilot through March 2016, allowing time to bring potential matches to fruition, incorporate platform improvements, and recruit additional companies to participate. A compelling long-range objective also emerged: to create an expanded United States Materials Marketplace—with hundreds, or thousands, of companies reusing their material flows—to help pave the way to a future “circular economy” in which landfills become obsolete. The Marketplace not only provides a way for companies to align material streams, but also serves an increasingly important convening role. It amplifies the voices of like-minded businesses seeking to understand and reform the regulatory environment and exchange materials across borders and boundaries.
The project builds on two decades of successful regional materials management projects conducted by the US BCSD. The US BCSD, CEF, and WBCSD each seek ways to help their member companies shift from traditional linear waste flow systems to new circular approaches that transcend industries, sectors, and geographies. Such approaches could also be instrumental in helping companies identify “hot spots” in their material flows where reuse is impossible and redesign may be necessary for true circularity to be achieved. Andrew Mangan, founder and Executive Director of the US BCSD, likens the process to opening curtains for the first time. He summarizes the vision of the project team:
Companies participating in the 2015 U.S. Materials Marketplace pilot project include: Alcoa, Armstrong World Industries, BASF, CH2M, Dow Chemical, Essroc, Fairmount Santrol, General Motors, Goodyear, Greif, LafargeHolcim, Nike, Novelis, Procter & Gamble, Swisstrax, Tetra Pak, Veolia, Waste Management, and others. Their sectors include a diverse mix of cement, primary metal manufacturing, chemicals, and consumer products manufacturing. In 2014, these 23 companies accounted for over $600 billion in revenue, operated over 600 facilities in the United States, and employed over 1.7 million people worldwide.
Evolving the successful regional model to create a viable national-level platform presented new challenges, as well as opportunities. Interviews with companies that participated in the first phase of the project revealed a number of challenges to be addressed during the second phase and future expansion. These include personalized support to better understand how the marketplace works and what sorts of materials can be uploaded, help uploading data, assistance to assess the feasibility of potential transactions, and more hands-on facilitation. The goal is to have more than 100 companies participating by the end of 2016. International scale up is also on the horizon, in partnership with the WBCSD and its Global Network of national business councils. Peter Bakker, President and CEO of the WBCSD, says of his organization’s commitment:
The key to this future is the secure cloud-based marketplace software platform, through which project members share materials data, review recommended materials from the project team, negotiate trades, and receive notifications of potential obstacles. The platform also serves as a proving ground for companies to brainstorm new supply chain pathways for reusing ubiquitous materials. Members can even identify opportunities around wasted transportation and logistics space. The US BCSD adapted, refined, and expanded the software during a materials reuse project in Hebei Province, China, as part of the U.S.- China EcoPartnerships program in 2013. Further refinements will be an ongoing and important element of the project.
Like China, other countries are paying attention to the United States Marketplace pilot and expressing interest in establishing their own marketplace systems. The WBCSD’s Global Network of 70 national business councils offers a natural growth path to scale the marketplace system and link it globally within a cooperative structure. This structure would allow participants to maintain national ownership and responsibility for each marketplace while sharing results and outcomes with other co-op countries or sub-regions.
The idea for a pilot project originated at a Corporate Eco Forum event in June 2014 that brought together leading thinkers and actors focused on making circular business processes a reality. Amy O’Meara, Director of the Corporate Eco Forum explains:
The project received a major boost from the early and enthusiastic enlistment of its co-champions, General Motors and Nike. In recent years, GM has generated nearly $1 billion in annual revenue through reuse and recycling of its by-products, resulting in a 10 million metric ton CO2-equivalent emissions reduction. Each year Nike generates natural leather, synthetic leather, and other textile scraps that can be used as smaller product pieces and artistic designs or utilized as filler material for insulation.
Forms of the circular economy have been around at least since the 1970s, under varying names in places as diverse as Kalundborg, Denmark and Midlothian, Texas. These activities have produced many successful outcomes. The principle, also known as “industrial symbiosis” or “by-product synergy”, has grown in popularity around the world recently, provoking action from public and private sectors alike. By taking advantage of and contributing to the Materials Marketplace software platform, participating companies will continue finding opportunities to lower operational costs and waste disposal expenses while reducing energy consumption and GHG emissions. They will also spend less for raw materials, create new business opportunities and jobs, and join a respected collaborative network of diverse like-minded companies that are eager to explore new pathways to more efficient production and environmental protection.
ABOUT THE US BCSD: The US BCSD is an action-oriented and member-led business association that harnesses the power of collaborative projects, platforms and partnerships to develop, deploy and scale solutions to ecosystems, energy, materials and water challenges. US BCSD activities are designed to generate economic returns and address environmental and societal challenges. The US BCSD is one of 70 national councils affiliated with the World Business Council for Sustainable Development.
ABOUT THE WBCSD: The World Business Council for Sustainable Development is a CEO-led organization of forward-thinking companies that galvanizes the global business community to create a sustainable future for business, society and the environment. Its member companies represent a wide variety of business sectors with global impact. They generate combined annual revenue of more than $8.5 trillion, and employ a workforce of 19 million people. The WBCSD applies its respected thought leadership and advocacy to generate constructive solutions and take shared action. Leveraging its strong relationships with stakeholders, the WBCSD helps drive debate and policy change toward sustainable development solutions.
ABOUT THE CORPORATE ECO FORUM: The Corporate Eco Forum (CEF) is an invitation-only membership organization comprised of Fortune and Global 500 companies from 18 industries with combined revenues of over $3 trillion. CEF’s mission is to help accelerate sustainable business innovation by creating a neutral “safe space” for influential business leaders to strategize and exchange best-practice insights. Participants are exclusively top-level executives, including chief sustainability officers, chief financial officers, and chief technology officers, and other VP-level executives with responsibilities affecting the supply chain.