Business case

Using bio-based materials such as bioplastics, mushroom-based materials, etc.

Alternative bio-based materials and inputs

The principles of a circular economy concern designing out waste, regenerating ecosystems and keeping items in use. Decoupling the economy from material flows—improving the rate of resource productivity faster than the economic growth rate—is also a consistent guide. By evolving with the growing number of applications of circular economy principles, and consolidating these strategies across thematic areas, Circle Economy’s Key Elements Framework (KE) renders the elements of the circular economy salient and serves as a basis to derive contextual strategies and interventions. 


The Framework consists of:
- Core Elements: Activities directly handling product or material flows; and uniquely,
- Enabling Elements: those that remove obstacles for core actors.


Key elements of the circular economy

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Circle Economy's framework of strategies and activities that define the circular economy

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Based on the work of [Bocken et al. (2016)](https://www.researchgate.net/publication/309699661_Product_design_and_business_model_strategies_for_a_circular_economy), the Four Flows Framework serves as a simple framework for managing resource flows in a circular economy by using less (Narrow), using for longer (Slow), using again (Cycle), and using clean, regenerative materials and energy (Regenerate).

These different principles of circular economy can be applied to our socioeconomic metabolism: we can design stocks like buildings, infrastructure, machinery, and vehicles to be rich resource mines for the future, and design manufactured goods and consumables to be cycled and made regenerative. Furthermore, the focus must also centre on getting more value out of fewer materials. Achieving the aims of a circular economy—minimising material use, regenerating the Earth, and preventing material losses—can be done through these four key strategies mentioned above.

Source: Circle Economy. (2023). *[The circularity gap report 2023](https://www.circularity-gap.world/2023)* (p.22). Amsterdam: Circle Economy. 

Four Flows Framework

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 The Rambutan Program involves a network of local farmers and a dedicated Rambutan team. The team maintains the gardens throughout the year, harvests the fruit, and prepares all raw materials for the extraction of the bioactive ingredients.
For its Rambutan Program, BASF selected two rambutan gardens in the Dong Nai province in Southeast Vietnam with around 200 rambutan trees. When cultivated well, the trees can live for up to 100 years, providing the rural communities from the region with a reliable income stream for years to come. To make this possible, BASF encourages and emphasises organic, sustainable farming practices, and implements measures to ensure organic farming compliance. Thanks to the joint efforts of BASF and partners from the region, both gardens received organic certification in 2017, making them the first certified gardens of their kind in Vietnam. 

BASF designs a socially- and environmentally- responsible supply chain.BY ANNA SPIEWAKGerman chemical company BASF is no stranger to sustainability or respecting local populations and their precious environment.Back in the year 2000—the company began a partnership with a researcher in Morocco and a network of women supplying Argan oil in the country. Through the utilization of several parts of the plant, such as leaves, kernel oil and fruit pulp, BASF launched multiple products obtained from the Argan tree. Additionally, the program allowed significant economic development in the region, leading to the inclusion of more than 1,000 jobs for women in rural areas with enhanced working conditions while supplying BASF efficacious ingredients.Nearly 20 years later, history repeats itself. Building on its sustainable Argan program, BASF Care Creations has designed a new socially- and environmentally-responsible supply chain in cooperation with one of its long-standing partners in Vietnam. While working with this partner, one plant particularly caught the company’s attention—rambutan, also called Nephelium lappaceum, which grows on trees that reach heights 30 to 36 feet. BASF has two rambutan farms in Vietnam and was, in fact, the first company to push the orchard to be certified organic in the Asian country. This planning began in 2015 and the program was launched recently.“From a marketing standpoint, it’s an exotic Asian fruit, which is interesting. We were able to source it reliably, and with it we are able to offer our customers an organic story, a social story and an advocacy story—so everything came together,” said Philip Ludwig, Technical Service Specialist, Personal Care Bioactives, BASF.In Asia, the rambutan fruit, also called “hairy fruit,” is a popular exotic produce. Besides being tasty, rambutan is known for a history of use in traditional health applications in the region. The rinds contain a variety of beneficial compounds featuring antioxidant properties, and the leaves are used as a nutritional supplement by the natives.After deepening its understanding of rambutan, BASF Care Creations utilized the fruit’s byproducts to develop three preservative-free, COSMOS-approved cosmetic ingredients as part of its Clean Beauty theme—two for the skin and one for the hair:Nephydrat is an extract from the rambutan peel (pericarp). The skin’s osmotic barrier, energy barrier, cornified envelope and lipid cement are positively influenced by the ingredient to provide deeper hydration. After 14 days, volunteers saw intensely moisturized skin and a fresher complexion.“If you think about what end consumers are looking for—they’re often looking for good hydration ingredients—so Nephydrat is really great for that aspect of the skin,” said Ludwig.Nephoria—derived from the fruit’s leaf extract—helps rejuvenate the skin by targeting many of its endpoints that retinol also impacts. Nephoria supports natural collagen synthesis, elastic fiber network and reduction of a master negative regulator of collagen homeostasis. All of these increase with age, leading to loss of skin density, firmness and elasticity. In vivo, Nephoria showed younger-looking skin and reduced the appearance of wrinkles.“We don’t use the edible fruit at all. The edible fruit goes into food. But we use byproducts of the fruit or the tree, so the leaf (in Nephoria) serves as a natural, plant-based alternative to retinol,” Ludwig added. “We wanted something that has the same efficacy as retinol while being gentle on the skin.”Rambuvital is an extract from the rambutan seeds. It protects hair from pollution and increases hair vitality and scalp hydration. In vivo, the scalp was significantly more hydrated within a month, and hair appeared visibly healthier and shinier.“The benefits for haircare here are anti-pollution and anti-odor,” said Ludwig, “and anti-odor is a nice claim as there’s not many products looking at anti-odor for hair that are derived from natural ingredients.”Consumers are increasingly concerned about what’s in their cosmetics and whether these ingredients were sourced in a way that’s not harmful to the local community and the environment. BASF’s rambutan program provides brands with an opportunity to tell a story of efficient cosmetic ingredients that are sourced sustainably while ensuring positive social and environmental impacts along the value chain.Aside from upcycling the fruit’s byproducts—so that nothing goes to waste from the fruit—and using them for three beneficial beauty ingredients, the company also contributed to sustainable sourcing. BASF hand-selected farmers based on their commitment to organic farming, as well as their willingness to participate in the upcycling of various rambutan byproducts. The company also contributed to socially responsible trade.“One of the social benefits of this program is that we’re training people on organic farming and teaching them these practices,” said Ludwig. “We provide wages above local practices, in the region, and benefits such as free meals and health and safety insurance. I think in the end, that’s what consumers are asking for and demanding, so this fulfills a market need.”

Vietnam

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 BASF 

<p>The cosmetics industry is constantly seeking for products with environmental consciousness and social engagements without compromising on performance. Plant based and other natural raw materials are favored by consumers who seek natural and sustainable solutions.&nbsp;That's why in 2019, BASF launched three new active ingredients derived from its Rambutan Program, a socially and environmentally responsible supply chain for sustainable bioactives production that was launched in 2014. Working in close cooperation with partners in Vietnam, BASF sources the ingredients, which are extracted from the rambutan tree (Nephelium lappaceum), from the first organically certified rambutan gardens in Vietnam.&nbsp;</p>

Rambutan Program: BASF launches bioactives from responsible beauty program

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This collection features a selection of inspiring examples of the circular economy, compiled in the context of the Switch to Circular Economy Value Chains programme (SWITCH).

Launched in 2020, SWITCH is a five-year initiative that assists EU multinational companies and their suppliers from developing countries to switch to more circular economy approaches and practices in three selected value chains: [Plastic Packaging](https://knowledge-hub.circle-lab.com/switchtocircular/search?collections=832%3D0&framework_elements__5=111), [Textile & Garments](https://knowledge-hub.circle-lab.com/switchtocircular/search?collections=832%3D0&framework_elements__5=99), and ICT and Electronics.

The overall objective of SWITCH is to support the “transformation towards a circular economy”, and to contribute to sustainable growth, low carbon and climate resilient development, decent jobs creation, and a safer, healthier and pollution-free environment.

SWITCH is co-funded by the European Union and the Government of Finland, and implemented by UNIDO, in collaboration with Chatham House, Circle Economy, and the European Investment Bank.
Learn more at www.switchtocircular.eu

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Switch to Circular Economy Value Chains

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Minimise waste through diversion: Instead of sending waste to landfill, it is redirected into other industrial processes for handling, treatment, recycling, recovery, or reuse in various forms. 

Minimise waste through design: At the outset of a process of project, plan and design such that there is zero waste or minimal waste during production, use, and at end of life. 

Minimise Waste (SDG12)

Producing basic and specialty chemicals, inks, agricultural chemical such as fertilisers and pesticides, plastics including packaging, and rubber

Chemical and Plastic

Working together with stakeholders and parties in other unrelated industries to implement circular economy strategies and opportunities

Cross-industry projects, pilots

Installing sensors to gather data from products and services to identify, enable and/or implement circular strategies (eg. effective resource use & logistics planning, circular business models & design)

Sensors, monitoring systems

Impacts

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Industries

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Security Matters Limited is a company focused on digitizing physical objects on the blockchain to enable a circular and closed loop economy.

Security Matters

<p>Security Matters, Ltd and BASF sign a binding joint development agreement to develop solutions for plastics traceability and circularity. BASF plastic additives business leverages on its expertise as a global market leader. Proprietary technology from Security Matters improves the traceability and sorting of plastics in the value chain.</p>