Circular Start-ups Prioritize Environmental Metrics Over Social Impact Measurement

Why It Matters

This highlights a critical gap in the circular economy transition, where social equity and well-being are often overlooked in favor of measurable environmental gains. Designers and businesses need to develop robust frameworks for assessing and communicating social impact to ensure a truly holistic and equitable circular economy.

Key Finding

While circular start-ups are making strides in measuring environmental impacts, they often fall short in quantitatively assessing and communicating their social contributions, indicating a need for more comprehensive evaluation methods.

Key Findings

• Three out of six circular start-ups actively measure and certify their environmental and social impacts.
• Life Cycle Assessment (LCA) is the most common environmental assessment method employed.
• Two start-ups hold Benefit Corporation certifications.
• Circular start-ups predominantly use quantitative methods for impact measurement.
• Additional efforts are needed to implement qualitative methods for assessing social benefits (e.g., environmental awareness, employee engagement, work-life balance, consumer health).

Research Evidence

Aim: To investigate the adoption of environmental impact assessment methods, environmental and social certifications, and the integration of social dimensions within circular start-ups.

Method: Multiple case-study explorative approach

Procedure: Researchers analyzed six circular start-ups, examining their use of environmental impact assessment methods, their pursuit of environmental and social certifications, and their approach to integrating social benefits for stakeholders.

Sample Size: 6 circular start-ups

Context: Circular economy start-ups

Design Principle

Holistic impact assessment: Evaluate and design for both environmental and social performance, using a mix of quantitative and qualitative methods.

How to Apply

When designing products or services for the circular economy, actively seek methods to measure and communicate social benefits, such as improved working conditions, community engagement, or enhanced consumer well-being, using both data and narrative.

Limitations

The study focused on a small sample of start-ups, and the findings may not be generalizable to all circular economy businesses. The depth of qualitative social impact assessment varied significantly.

Student Guide (IB Design Technology)

Simple Explanation: Circular businesses are good at tracking environmental stuff like waste, but not so good at tracking how they help people and communities.

Why This Matters: Understanding this helps you design products and services that are truly sustainable, considering both environmental and human well-being.

Critical Thinking: How can designers proactively integrate qualitative social impact assessment into their design process from the outset, rather than treating it as an afterthought?

IA-Ready Paragraph: This research indicates that while circular start-ups are increasingly adopting environmental impact assessments like Life Cycle Assessment, there is a notable gap in the systematic measurement and reporting of social benefits. Future design projects aiming for circularity should therefore prioritize the development and integration of qualitative methods to assess social dimensions, ensuring a more equitable and holistic approach to sustainability.

Project Tips

• When researching a circular design project, look for how the product or service impacts people, not just the planet.
• Consider using surveys or interviews to gather qualitative data on social benefits.

How to Use in IA

• Use this research to justify the inclusion of social impact assessment in your design process, especially if your project aims for circularity.

Examiner Tips

• Demonstrate an awareness of the social dimension of sustainability, not just the environmental aspect, in your design project.

Independent Variable: Type of assessment method used (environmental vs. social, quantitative vs. qualitative), presence of certifications.

Dependent Variable: Degree of integration of social dimension in the circular economy model, reported social benefits.

Controlled Variables: Type of circular start-up, industry sector.

Strengths

• Provides a clear distinction between environmental and social impact assessment in circular businesses.
• Highlights the practical challenges faced by start-ups in measuring social benefits.

Critical Questions

• What specific qualitative methods are most effective for assessing social benefits in a business context?
• How can businesses incentivize the development and adoption of social impact measurement tools?

Extended Essay Application

• An Extended Essay could explore the development of a new framework for assessing the integrated environmental and social performance of circular economy businesses, drawing on the limitations identified in this study.

Source

Exploring environmental and social performances of circular start‐ups: An orientation and certification assessment · Business Strategy and the Environment · 2023 · 10.1002/bse.3620