The finance sector has a critical role to play as a market enabler for businesses to transition to circularity and for circular markets to achieve scale.
The ACE Hub's 2020 Circularity in Australian Business report found that the main perceived barrier to implementing circular economy principles was 'financial issues or not having the capital required'. According to The Ellen MacArthur Foundation, the last 18 months have seen a significant increase in the creation of dept and equity instruments related to the circular economy, including public equity funds, corporate bonds and private market funds.
The circular economy presents a significant opportunity here in Australia, with a recent report by KPMG estimating that it represents a potential $210 billion increase in present value by 2048. In order to realise this opportunity financial institutions are working hard to build knowledge and ecosystems, develop financing solutions and work closely and deeply with business to support the innovation of sustainable business models.