Waste leakage and particularly plastic pollution is an alarming global problem, but the solutions must be delivered locally. Circular Action Hub connects global sources of finance with ambitious and scalable local projects to support and accelerate circular waste management action via performance-based payments for an inclusive circular economy.
The Hub is the world’s first online marketplace for circular economy-related projects. One of the main features of the platform is the Circular Credits Mechanism – an innovative system of performance-based payments for environmental services of circularity.
Circular Action Hub was originally created to host projects from the 3R Initiative founded by BVRio, Verra, Nestlé, Danone, Tetra Pak and others. BVRio is now expanding the Hub to promote a wider range of projects (large, small, greenfield, existing) with various funding needs (direct sponsorship, impact investment, performance-based payments), waste materials (plastics, beverage cartons, metals, glass, tyres, e-waste, etc.), and activities (waste collection and recovery, recycling, capacity building, technology development).
Recognising that there is a huge diversity of circumstances, technologies, and approaches that can be used by projects in different parts of the world, the Hub does not assume that a ‘one size fits all’ approach can be defined at the outset. Instead, it adopts a ‘learning-by-doing’ approach and strives for continuous improvement of its requirements based on the experience learned with participating projects.
“BVRio is proud to launch the Hub. We see it as an important piece of the circular economy ecosystem, connecting and supporting a wide range of actors that play important roles in this space. In particular, we are glad to have designed an inclusive system that removes barriers to entry and gives access to smaller initiatives, such as the waste picker cooperatives that operate all over the world”, said Mauricio Moura Costa, CEO of BVRio.
The idea is based on the Reverse Logistics Credit System that BVRio piloted in Brazil a few years ago. In 2013, BVRio signed a collaboration agreement with the National Association of Catadores to develop a system to support the remuneration of Catadores (waste pickers) for the environmental services derived from the reverse logistics and recycling that they provide to companies, the government and society as a whole. The Reverse Logistics Credits system was created to assist companies in meeting their obligations under the law while rewarding Catadores for their role. Los Créditos de Logística Inversa son certificados que confirman que los servicios de logística inversa han sido proporcionados para garantizar que un cierto monto de residuos ha sido desechado responsablemente. These credits were issued and sold by cooperatives of Catadores and purchased by producers and/or importers who need to comply with the solid waste legislation. Through the purchase of credits, companies effectively subcontracted cooperatives of Catadores to provide reverse logistics services.
For the companies, the credits were an efficient and cost-effective solution to legal compliance. For the Catadores, the sale of credits provided an additional source of revenue, adding value to their activities and resulting in an important social impact.
Environmentally, the additional value generated by the sale of credits made it worthwhile for Catadores to collect waste materials with lower raw material value, widening the range of products collected beyond the current high value products, such as aluminum cans.
BVRio hopes that Circular Action Hub becomes an effective and socially-inclusive circular economy tool that supports local projects through direct performance-based payments for the environmental services of collection, sorting and appropriate destination of waste materials that today pollute our environment.