Circular Economy Models Urged to Prioritise People Over Profit

Circular economies are widely promoted as a solution to waste and pollution, but their real impact depends on how well they serve communities.

Research led by Charles Darwin University shows that circular economy models, designed to keep materials and resources in use for as long as possible, can go beyond environmental protection. When applied effectively, they can create jobs, strengthen local economies and improve public health.

Despite growing global interest in circular systems, researchers say little attention has been paid to how these models contribute to community development.

The study, led by senior lecturer Dr Michael Odei Erdiaw-Kwasie and researcher Dr Matthew Abunyewah, examined how circular economy initiatives interact with four key community development goals: resilience, social inclusion, empowerment and social equity.

Their findings highlight three major challenges.

First, the cost of investing in circular infrastructure remains high. Many local governments, particularly those with limited budgets, struggle to fund such initiatives despite their long-term benefits, including job creation, reduced waste management costs and cleaner environments.

Second, some circular business models risk excluding local communities. Large corporations often control data, revenue streams and repair services, limiting opportunities for small businesses and reducing community participation.

Third, the study found that new circular initiatives often fail when they do not align with existing community practices. When programs overlook how people already reuse or repair materials, adoption rates drop, resources are wasted and livelihoods may be negatively affected.

“Many have expressed concerns about the absence of societal development goals and the need to scale up social and environmental activities as corporate circular economy actions intensify,” Dr Erdiaw-Kwasie said.

“To achieve sustainable outcomes, circular strategies must incorporate social processes and structures,” he added.

The research points to practical examples where circular approaches have successfully supported communities. In Vietnam, textile manufacturer Saitex has integrated waste reduction, water conservation and renewable energy into its operations while creating employment opportunities for thousands of people with disabilities.

Through its initiative Rekut, part of a broader social inclusion programme, the company repurposes approximately 600,000 pieces of surplus fabric into products such as bags, cushion covers and face masks.

According to the researchers, inclusive workplaces not only create jobs but also drive innovation by bringing together diverse perspectives and skills, resulting in more effective and adaptable circular solutions.

The study recommends that policymakers and practitioners rethink how circular economy strategies are implemented. This includes aligning environmental goals with community development priorities and investing in local skills and small businesses to ensure communities can actively participate in and manage circular systems.

“Besides enhancing well-being, increasing social inclusion, fostering community empowerment and promoting social equity, circular economies possess significant potential to accelerate the development of communities,” Dr Abunyewah said.