Wednesday, 25 Nov 2020
BUSINESS
18/11/2020 07:04 PM

KUALA LUMPUR, Nov 18  -- Malaysia Productivity Corporation (MPC) will support and encourage companies’ transformation into circular economy business models.

Director general Datuk Abdul Latif Abu Seman said although the business models are just emerging in the Malaysian context, their practicality and relevancy would entice local companies to adopt them.

“More efforts are consolidated in ensuring the companies are aware of the opportunity to turn the inefficiencies along the current linear value chain to generate revenue and identify the most promising circular business models,” he said in a statement today.

He said companies should tap into the opportunity in these trying times due to the unprecedented pandemic as it would further enhance productivity towards sustainable economic growth.

Abdul Latif said companies are encouraged to understand customers’ needs and shift their focuses from selling product features and functions to business value propositions.

“A popular business model in the circular economy is where customers pay for a service instead of a product,” he said.

Meanwhile, University Malaya, Faculty of Business and Accountancy, professor of supply chain Prof Dr Suhaiza Hanim Mohamad Zailani said the circular economy could be translated into higher revenue for companies towards sustainable growth.

However, she noted, overpopulation and growing demand for goods have increased the volume of wastes as well as air, soil and water pollution that gave high negative impacts on human and ecosystem.

“Therefore, it is essential to conduct new academic research and develop more sustainable economic models and strategies,” she said.

She said the supply gap could be closed through sustainable consumption and production in industrial ecosystems that may result in a continual use of resources.

“This can be achieved through longā€lasting design, proactive maintenance, recycling, repairing, refurbishment, and remanufacturing.

“The more efficient use and reuse of resources will lower the overall resource inputs, energy, emissions and waste leakage that could reduce negative environmental impacts without jeopardising growth and prosperity,” she said.

She said this would balance between the economy, environment, and society in a long run.

Nevertheless, she cautioned that the situation will worsen when there is a lack of sustainable practices in industrial activities.

“Shorter lifespan products are produced which have caused inefficient utilisation of resources while recycling rates of many raw materials are still far too low,” she added.

-- BERNAMA

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