Steps to Circularity: A Holistic Sustainability Guide for the Middle East

The Middle East is at a crossroads, and well-placed to show leadership on sustainable development. The sustainability landscape remains politically volatile and fragmented across regions. Transitioning to a circular economy isn't just an environmental necessity; it presents an economic opportunity for innovation, new industries, and resource security.

In this exclusive thought piece, I was able to gain some insights from Frédéric Godemel, EVP of Energy Management at Schneider Electric to discuss a critical topic: Steps to Circularity: A Holistic Sustainability Guide for the Middle East.

With over three decades of experience at Schneider Electric, Frédéric had the privilege of navigating the evolving energy landscape across diverse markets including China, the UAE, and France. As EVP of Energy Management, Frédéric leads Schneider Electric's efforts to transform the energy management landscape.

Here, we'll explore how a comprehensive strategy, combining policy, technology and community building, can help us start building another kind of future, a truly sustainable one in the region.

A Shifting Sustainability Landscape

The shifting targets and evolving priorities have hindered consistent progress on key aspects of the energy transition. According to climate think tank Ember, just 5% of the Middle East’s electricity was generated from clean sources last year, which is below the global average of 39%. There have also been breakthroughs with electric vehicles, with a record high of 17.1 million EVs sold globally in 2024. Meanwhile, the UAE and Saudi Arabia are at the forefront of implementing charging infrastructure for this.

While policy plays a role, much of this progress has been catalysed by the private sector. Sustainability is no longer a cost - it’s a catalyst for growth. Gartner’s 2024 research highlights that 69% of CEOs now see sustainability as a business growth opportunity. Reflecting this shift, two-thirds of Fortune’s Global 500 companies have made significant climate commitments across their entire value chains.

However, to meet our sustainability ambitions, we must not lose momentum, and we must now shift our focus to circularity. Disturbingly, global circularity has declined from 9.1% in 2018 to 7.2% in 2023. In the same period, our resource consumption has surged. Humanity used a staggering 500 gigatonnes of resources – 28% of all materials used by humanity since 1900, concentrated in just the last five years. If circularity is the litmus test for environmental progress, the time for bold, business-led action is now. Only by embedding circularity into core strategies can Middle Eastern companies unlock long-term sustainability, resilience, and impact.

From Take-Make-Waste to Circular Value

Circularity is an economic model that aims to eliminate waste, preserve resources, and reuse materials. A stark contrast to the linear ‘take-make-waste’ model that global economies are built upon.

Take the life of a bottle of water for example: oil is drilled from the earth and refined into polyethylene terephthalate take. Then this is moulded into bottles that are filled with water make. Finally, they are consumed once and then discarded waste. Just 12% of the world’s plastic bottles are recycled, and meanwhile, the 88% of remaining bottles are tossed into a landfill, where they can take up to 450 years to decompose.

This unsustainable pattern of consumption significantly contributes to greenhouse gas emissions and biodiversity loss. Transitioning to a circular economy could drastically reduce the materials we use by 70%, creating better resource utilization. So, how exactly can a business become more circular?

Everything Begins at the Design Stage

According to the Schneider Electric Circularity framework, the key consideration for achieving circularity is to adopt Eco-Design which directly impacts our product development and innovation. This means creating products for reliability and longevity, rather than quick disposal. Designing and innovating for circularity enables our products to be used better, used longer and used again.

Building on this foundation, businesses must evolve from a traditional and transactional sales approach to an as-a-service model. To support this shift, companies should consider supplementing sales with rental, repair, and support services. This simultaneously extends product lifecycles, reduces waste and creates new growth opportunities. By offering second-hand tech and trade-in programs, companies can meet demand for affordable, eco-friendly options. This model reduces waste, boosts customer loyalty, and drives long-term profits.

Maximizing Resource Efficiency Through Responsible Sourcing

The first principle is use better, which calls for the responsible sourcing of materials to optimize manufacturing and minimize waste. For instance, sourcing best-in-class materials ensures reduced environmental and social impact throughout the supply chain. Schneider Electric products are currently made with 32% recycled materials with the aim of reaching 50% by the end of 2025. In addition, more than half of our sites recover 99% of waste, demonstrating our commitment to using better.

We are also expanding our smart factory network, with two recent facilities in Monterrey and Shanghai. Both sites utilize machine learning-enabled prototyping, smart planning, and GenAI-driven maintenance to boost productivity while driving down resource consumption. This commitment to sustainability and operational efficiency has been recognized by the World Economic Forum who have designated both factories Lighthouse status.

Circularity demands companies to address sustainability in their total value chains. Sustainable supply chain programs have already been launched in various sectors, such as global healthcare, the semiconductor industry, as well as mining, materials, and minerals. These programs help companies responsibly source materials, reduce emissions, and eliminate waste at every link.

Extending Product Lifecycles to Maximize Value

The second principle is to extend the lifespan of products and use longer. Middle Eastern businesses should anticipate the need for equipment by opting for condition-based repair, digitally enabled maintenance, and equipment modernization. Reparability and circularity services, such as Schneider Electric’s EcoFit, can extend asset life by up to 25%.

In fact, our customer ArcelorMittal reconditioned 13 medium voltage switchgears, avoiding the reprocessing of 26 tonnes of material, saving the equivalent of 170 metric tonnes of CO2. Refurbishing existing equipment instead of discarding it reduces waste and emissions while conserving resources and time.

The third and final principle is to use again. This concept encourages businesses to recirculate products, parts, and materials within the economy; effectively refurbishing and reselling assets that have reached the end of their initial use. Schneider Electric’s Altivar drive sends damaged modules to our repair centres for testing. Once refurbished, products come away with the same warranty as new ones, achieving up to 80% savings on resources, energy, and emissions.

Creating a framework for circular business expansion

Adopting circularity isn’t just about protecting the planet, it’s a strategic business move that drives cost savings, innovation, and growth. For companies in the Middle East, circularity offers a way to stand out, unlock new value streams, and stay competitive in an evolving market.

Global regulations are accelerating this shift. The UAE Circular Economy Policy 2021 - 2031, is among the most comprehensive globally, covering research, procurement, legal frameworks, and incentives. As more governments follow suit, circularity will become a necessity, not a choice.

By taking action now, businesses can stay ahead of regulatory demands, position themselves as sustainability leaders, and gain a lasting competitive edge. In short, circularity isn’t just the right thing to do, it’s the smart thing to do for any future-focused organization.