Make production more resource efficient

Current production systems are still using resources inefficiently and generating losses of resources in production processes. Global material productivity needs to be improved far faster than the current trend.

Economic productivity per unit of resources — or more simply, the extent to which we are able to produce economic value while using less resources and materials — has slowly improved over time. However, current production systems are still using resources inefficiently. From 2000 to 2021, the global GDP increased by 79% but global material productivity, which represents how much economic value is produced per unit of material in weight, increased by only 6%. One critical inefficiency is food production: 13% of food is lost in production and retailing processes. That is, more than one in nine food products goes to waste before consumers even have an opportunity to purchase them. We need to reduce our material consumption per capita by more than half by 2050; one key step is to make production and distribution more resource/material efficient.

For the economy to thrive without exceeding the global environmental capacity, it is necessary to accelerate the increase of global material productivity. This will also help industries improve resource security and mitigate supply risks caused by geopolitical shocks in importing countries. Information about material productivity by sector and commodity should be collected to identify sectors where improvement is most needed.

Material productivity can be improved by using more efficient design and production methods and more responsive distribution methods to reduce waste. Setting national targets and investing in new technologies creates opportunities for new innovations. More than 2,200 companies monitor their resource use and productivity for better accountability. Material productivity can also be improved by sharing unneeded byproducts and wastes between companies. This approach is one of “industrial symbiosis,” in which the byproduct from one facility is used in another facility. Similar symbiosis approaches on an individual company level, for example, in which retailers and restaurants provide unused products and foods to others who can utilize them more, are also important.

Shifting to a Circular Economy

Watch a recording of this insightful discussion on how the world can transition from a “take-make-waste” economy to a circular economy – and in the process tackle climate change, protect biodiversity and promote equity.

Tracking progress on global outcomes

Key enablers and barriers to change

1530: Countries with national targets for material productivity

Historical Data Methodology and Challenges:

The number of countries, as determined by OECD, is non-exhaustive. Data has limited geographical and time coverage. No centralized or publicly available data source has been identified. Only the numerical targets are counted.

Target setting can drive countries to take more actions. To increase material productivity and resource productivity, several countries have set numerical targets for improvement in these areas. As of 2019, at least nine countries had such national targets. For example, Austria aims to improve material productivity 4 to 10-fold by 2050, France aims to increase it by 30% from 2010 to 2030, Germany committed to increasing total raw material productivity at the annual rate of 1.5% from 2010 to 2030, and Japan aims to increase its resource productivity to 490,000 JPY per tonne by 2025, which means a 29% increase from 2015. Such goals should be adopted by other countries. The G20 Information Hub collects the information about targets and indicators used for resource efficiency of these countries.

Ultimately, comparing the ambition level of target setting between countries is not so meaningful, as the value of material productivity depends on country-specific industry structure. Comparing a country to its own productivity over time is more important. Moreover, it is critical to not only set targets, but also monitor progress and implementation.

1531: Companies measuring circular economy actions

Historical Data Methodology and Challenges:

The total number of companies was calculated by adding the counts of companies using both the Circulytics and Circular Transition Indicators (CTI). However, since the list of companies reported to both are not publicly disclosed, the companies were counted twice.

For companies that want to measure their material use and promote a circular economy, two major initiatives have developed indicators to do so: Circulytics by the Ellen Macarthur Foundation and Circular Transition Indicators (CTI) by the World Business Council for Sustainable Development.

Companies using these indicators totaled more than 2,200 as of 2022. Additionally, as of January and February 2024, 4,900 companies supported the Task Force on Climate-Related Financial Disclosure and 320 companies supported the Task Force on Nature Related Climate Disclosure, showing good progress. Other voluntary measurement schemes developed by companies are not included here. To understand the situation comprehensively, it is necessary that such measurements are disclosed and a centralized data platform is created to compile the data in a comparable way.

It is crucial to not only measure material productivity, but to also take action. Setting sectoral benchmarks through a government or an industrial organization can also stimulate corporate action and advance the identification of good practices.

1532: Industrial initiatives with symbiosis

Historical Data Methodology and Challenges:

No centralized or publicly available global data source has been identified. Recent data is currently limited to France.

Waste from one industrial facility is not necessarily waste for another facility. If a company utilizes something that other companies produce as waste to replace the use of natural resources, it will improve the resource efficiency of networked companies collectively. This “industrial symbiosis” focuses on the performance of an industrial network rather than that of individual companies.

There have been a variety of different terms used to describe industrial areas and actions with very similar concepts, such as “eco-industrial park” and “eco-town.” There is no centralized or publicly available global data source. However, many related initiatives have been implemented in China, Denmark, Japan, the Netherlands, South Korea, Sweden, the United Kingdom and the United States. France also published recent national data that identified 152 such initiatives as of 2020.

1533: Public and private funds invested in resource efficient technologies

Research and development into new technologies may create innovations that expand the possibility of improving resource efficiency, and in some cases drastically so. This indicator measures the amount of investment in resource efficient technologies.

However, no centralized or publicly available data source has been identified. Challenges of data collection are two-fold: first to collect data of both public and private investments in technologies, and then to make a distinction between resource efficient technologies and other technologies.

Other shift Other shifts needed to transform the system

Global material consumption has more than tripled since 1970, causing increasing environmental impacts throughout the life cycle of materials and products. Decreasing overconsumption, especially in high consuming societies, is critical to ensure that human activities fit within the global capacity of our natural resources.

To keep materials in circulation for as long as possible, it’s just as important to design and produce new products with circular materials as it is to recover parts, recycle or regenerate materials. Closing this material loop is a necessary step toward enabling a circular economy.

More effective monitoring, regulations and laws are needed to minimize environmental and social harms in resource extraction, to tackle issues including deforestation, water pollution, overfishing, ecosystem disruption, worker injuries, child labor and other human rights violations.

The lifetime of products can be extended by a combination of durable product design, support services, and consumers' behavioral changes.

End-of-use products, materials or components need to be sorted, collected and processed to obtain as high a material value as possible, and products should be designed to be easily dismantled for reusable components or recycled.

Make production more resource efficient

Tracking progress on global outcomes

Key enablers and barriers to change

Other shift Other shifts needed to transform the system

Decrease overconsumption

Use recycled, reused and renewable materials and components

Minimize environmental and social harms in resource extraction

Use products longer

Increase the quantity and value of resources recovered at end of use

Tracking progress on global outcomes

1534: Material productivity

1535: Material productivity by sector

2225: Food production lost

Key enablers and barriers to change

1530: Countries with national targets for material productivity

1531: Companies measuring circular economy actions

1532: Industrial initiatives with symbiosis

1533: Public and private funds invested in resource efficient technologies

Other shift Other shifts needed to transform the system

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