Circular Economy Network Building: Ellen MacArthur Foundation, Automotive Suppliers, and the Architecture of Reverse Supply Chain Collaboration | CSCC x Pyxera Global Series (2/5)

Speaker A: Welcome to the Supply Chain Revolution podcast. I'm your host, Sheri Hynisch, also called the Supply Chain Queen. And I'm excited to introduce episode two of our partnership with the Circular Supply Chain Coalition. If you tuned into episode one, you would have heard a little bit about their origin story, why coalition building is required to scale reverse supply chains. But episode two is going to talk about the architecture layer. Who's showing up, which networks matter, and why convening conveners or existing, uh, folks in the same space is actually more powerful than starting from scratch or starting from zero. So think about who's showing up, which networks matter, depending on what you're trying to do in sector, industry, location, and then why tapping into those existing conveners can actually be more powerful than starting from zero or starting from scratch. Dive in. Welcome everyone. I'm so stoked to host you today. And before we kick off, if we could have a 30 second intro from each of you. Danielle, starting with you.

Speaker B: Sure. And thanks, Sheri, for having me. Danielle, Holly. I lead the Ellen MacArthur foundation in North America, covering the U.S. and Canada. Uh, the foundation works to accelerate the circular economy. Really nice to be here.

Speaker A: Amazing. And Kellen.

Speaker C: Yeah, thank you, Sheriff. Kellan Mahoney. I'm the executive director of the Suppliers Partnership for the Environment. Uh, so we are an automotive industry leadership forum working with vehicle manufacturers and suppliers to accelerate environmental sustainability through the value chain.

Speaker A: Amazing. And last but not least, John, co founder and also on episode one. Over to you, John.

Speaker B: Yeah.

Speaker D: Hi, Sheri, Good seeing you again. My name is John Holm. I lead, uh, strategic partnerships at Pixera Global, where we're also the lead convener and secretariat for the Circular Supply Chain Coalition. It's great being here.

Speaker A: Welcome back, John. But John, I wanted to kick off with you because in episode one we talked about why the CSCC say that three times had to exist and now we're moving into the network layer or the architecture layer. Is convening conveners so important and what does it mean in practice?

Speaker D: Yeah, it's a really good question. I think there's two lines to really frame. I think the first line is when you look at partnership itself, partnership is really hard. Despite what people say. It's really challenging to look at a greater align on a greater good of a vision, an alignment of what a vision is, and find partners that can actually fill gaps, work in a trusting relationship with you to fill those gaps and create mutual value across the chain. So I think a couple of things that resonate with that question Is that when you're looking at the specific context around local critical mineral procurement and local supply chains, not one entity can do this alone. There's one company, a tech company, that's trying to do that on a loan. But we'll see how that goes. Broadly speaking, I think when you're looking at this space, I think the way to frame the circular supply chain coalition is what we're doing is filling a global gap, really looking across the ecosystem and looking at really all of the reverse supply chain partners in the space and really saying how do we work together and bring those folks together in a really smart and elegant way. And we can only do that by really having a theory of change which is really high level and allow for place based context of local supply chain, local engagement, local community to really take force. And so our work is really to get everyone together on the same page to say, look, you may go in a direction, different direction in one area over here, that's fine. But can we collectively all come together around local critical mineral procurement and work in a common way to really unlock value? And so I think it's really necessary to work with all partners in this space under that alignment.

Speaker A: Yeah. And in practical terms you have speed to trust. So the network matters. But also clearly building through existing ecosystems will. You don't have to start from zero. I think that's what I want people to really understand.

Speaker D: No, you don't. There's actually, I think it's removing the ego of the mission of what you're saying you're doing. I mean, what is the goal? The goal is to localize critical mineral supply chains across the globe, focusing on deep reuse to mitigate supply chain risk for companies and provide competitive advantage around material that has already been extracted, number one. And number two, unlock subsidies, incentives for remanufacturing, friend shoring and local place based investments where communities can have economic opportunity to participate in a way they have not for a long time. So as long as we all as a common group agree on those frames, then we work on servicing, working in a service leadership context to meet those demands and to get into competition. This idea of competition, competition is not going to unlock the value we need. Only through, I would say meaningful collaboration, really, really authentic and sometimes hard partnerships can we actually kind of bring this

Speaker A: vision to life that's not intuitive in the existing economic model that a lot of folks operate in, uh, collaborating. I know we say we do that especially in supplier relationship management. And a lot of supply chain folks who are listening, we say we do it. I don't know if we do it well. So let's double click on partnership in action. Right. So you have Ellen, um, Garthur foundation here. You have SP for the environment. What does the network model look like in action? Like an example of value exchange. You know, how do you define a network partner and who are some of the other companies participating? Maybe we'll start with Kelland.

Speaker C: Yeah. Well, thank you, Sherry. Yeah, so for, for our organization, you know, I think it's a, it's a nice fit in that, you know, our scope is the automotive chain, but as John was just alluding to, this is a global problem and it's a system problem. So there's only so much any one company or any one industry can do acting on their own. So as we look at things like the EV battery value chain, as we look at other circular materials where the industry is prioritizing new solutions, it's important that we do that looking at the global context and looking at how we can partner and learn from other industries. So the opportunity to you learn from cscc, their work with other industry segments, their experience in other parts of the globe where we might not be present on the ground today. You know, I think there's a lot of value for us in leveraging that network as we move forward in the work that we're doing for our own sector.

Speaker A: Yeah, that's incredible. And Danielle, through the lens of emf, any insights or key takeaways for folks listening?

Speaker B: I would just double click on what John said, which is that this particular space opens up collaboration in a different way. So the uh, Ellen McCarthy foundation has a large network of mostly global conglomerate companies and we have seen companies, and particularly tech companies come to the table and be eager to and interested in pre competitive collaboration, actually working together on supply chain ease and resiliency in a way that is really unprecedented. I haven't seen it before working with corporates for 25 years or so. So I think we need to follow that fuel and that signal that the space is giving us.

Speaker A: Yeah, I really appreciate both of you sharing that because I think one of the things that some folks struggle with when you talk about convening conveners not to reuse or the unusual collaborators, which also has been evangelized on the podcast, is that there's a clear value prop position. Not only are you accelerating action by tapping into existing communities, existing infrastructure rather than recreating it, but you have trust built in from scratch. I mean this being able to tap into that, you're saving yourself Years. Years. So just what are your thoughts, John, front of mind?

Speaker D: Well, there's three problems that we're solving at the same time, I think. First of all with the cscc, it's important to know it's not a membership organization. So we operate where we invite partners in, but it's invite only and it's more of in a working group format. And also we have, so we have very specific lanes and a very specific theory of change of which we're focusing on. Our two target industries are automotive and technology. They have all the connections in the supply chain, OEMs Automotive over our network. It makes zero sense for me to compete with that. It only makes sense to say how can we add value to that work, provide the data insights that we have. Let's work together instead of being splintered because as you know, companies have, have limited money. Unfortunately, companies, they're starting to change a bit. You're seeing a hesitation now of going, oh, wait a second, it's not circular economy, it's security economy. So when you're looking at also across the cscc, you're trying to build trust with specific stakeholders continuously to ensure that we're all aligned. And you can also, more importantly have the hard conversations. It's when you need to say the have one saying, you know what, I don't agree with that theory of change or that's hurting my brain. Can you change it? Well that's, that's the good stuff that helps you move.

Speaker A: Right. So Kellen, if I can ask you what makes this network and this coalition so valuable for the type of work that you're leading and frankly, what's front of mind for suppliers right now?

Speaker C: Yeah, and I want to follow up on what John was talking about. Trust. I think a lot of this is the trust that we've been able to build through 25 years or so of doing this work within the industry where both vehicle manufacturers and suppliers are coming to the table, you know, as John said, willing to speak candidly about what their challenges are and willing to actually sit down and work toward a solution. So our network includes, you know, large vehicle manufacturers like Ford and General Motors, Honda and Toyota and others, but also their component suppliers, their material suppliers, some of their logistics partners and their end of life recyclers. And I think as I look across that supply chain, what the suppliers really want is fairly simple. You know, they want clarity in terms of what their customers in the industry actually want and prioritize. They want consistency. They want a relatively similar answer to that question across their customer base rather than looking at multiple competing priorities as we're thinking about maximizing carbon footprint or recycled content or recyclability. And they want an open lane of communication to sit down and have a two way dialogue. But as I said before, our scope is really the automotive value chain. And there are so many pieces as we think about something like the battery value chain or even plastics and other parts, where we need input from well beyond our industry. And we need alignment not only uh, at the industry level, but looking at policy conditions, looking at global market conditions. And so I think that's the exciting part of working with groups like CSCC to bring that perspective on where we will continue to do the work that we're doing. But we can do it hopefully so much faster. Right. By leveraging these uh, other resources.

Speaker A: Absolutely. And you know, you've made some really great points around looking for cross pollination of other industries to learn like what's working, what's innovative, but also systems thinking deployed at scale and circular economy thinking deployed. And so Danielle, it's amazing that EMF is here because well known, you know, for advancing circular economy, but also moving into a new space, not plastics or single use plastics, but critical minerals as Kellen and John have alluded to. So how does this partnership help bring circular economy principles into a more complex industrial supply chain space?

Speaker B: Yes, well, um, the decision for the foundation to move into critical minerals actually was a, a pretty easy one because there's just, we look for focal areas like plastics, like fashion and textiles, where there's a clear systems change play that we need and there's uh, a um, intersecting economic and environmental imperative. And that has never been more true as it relates to critical minerals. Right. This is a $770 billion market in the next couple of years. And the E waste in particular is the fastest growing waste stream. And there are just critical minerals resident in that E waste. And what is different and the opportunity, I think for circular economy with critical minerals is that we need circular economy. We need secondary markets for critical minerals to feed the current demand. Right. We can't do it with extraction alone. And those dynamics have led to some of what we were talking about before with companies collaborating in new ways because they have to, to meet their business growth and their business demand. And the foundation works at a fairly high of set the vision, provide the research and thought leadership and start the implementation level. But what CSCC brings us and uh, why we're so excited about the partnership is because there's kind of a regional local on the Ground implementation on the procurement side and that is something that we know needs to be um, unlocked in order to get the systems change that we need. So for us it's just a matter of when and how quickly can we move versus if we, we should. And the last thing that I'll say is I think the point that John made earlier is so important on the, where circular economy has lived in the past has been within companies anyway has been within the sustainability realm and those budgets which are small and in some cases getting smaller right now and this is a business side problem with business sized budgets that should be associated with it. And I think that argument there, that foundation is so positive and strong and we're getting, we're getting a lot of inbound interest in IT from companies. Right? We're not having to pound the pavement to say hey, pay attention to circular economy. It's an important thing. They're, they're there, they're at the table because it's so important to them already.

Speaker A: Yeah, absolutely. And, and also high value material flows can accelerate a lot of cooperation within sector data sharing which I know comes up quite a bit avoiding duplication like when these networks of networks collaborate. How do you make it real for true collaboration to produce the outcomes that clearly CFCC is, is creating? And John, maybe we'll start with you.

Speaker D: So I want to go back to the point that you made on your point on, on ah, specialty chemicals in the business case. I think it's important for folks to know here that when you're looking at circular economy more as security economy and framing it, it's around materials with commoditized value have business value. Much of the discussion we see is the dilution of circular economy in the name itself. So when you're framing that further into your question, the network of networks, there's a couple of lines when you're looking at security economy or circular economy in this lens. Yes, data is the root of all things. Where can I get data? Because data is hidden, companies don't want to share it. So with the CSCC we have the Buyers Consortium. Those are companies like Cummins that come and actually solve problems upstream and downstream of how they can procure materials and, or solve a reverse supply chain problem as well as the um, operator ecosystems, the reverse supply chain partners that provide the data provide the resource to those members in a working group fashion. So you're sharing already that information live. Uh, where's the, so how are we doing something to where we can unlock large scale funding and be the group that actually captures that cash flow and gets a share of it, and not just a share of it, gets a transparent understanding of where that money is flowing into and that they can participate in it. So I think those are the lines at least we're bringing to the table from our many years of doing large scale partnerships that we're seeing as a common through line for this.

Speaker A: Absolutely. And Kellen, Danielle, do you want to speak or add on to clarity of roles, maybe something around data because that's a hot topic right now, or how do all these players each know their role and activate in that way where you're driving shared outcomes?

Speaker B: One of the things for us has been, uh, I guess there's collaboration with the conveners and the convening and the convener and is this collaboration of what we would call kind of our networks and the big companies that need to drive some of these solutions forward. And I think in both cases, but particularly with the conveners just having real alignment on the ultimate mission and vision and knowing that the financial, the financial undergirding, the structures, all of that can be sorted with honesty, where there's uh, a clear North Star that everyone shares. And so the time spent, sometimes it's a couple of days, sometimes it can be a year to make sure that you're really aligned on that North Star feels like time very well spent because everything else can fall into place. And as John said before, right? Then you can have the easy and the hard conversations around how we all exist in this space. Um, I think on this particular topic, everyone is relatively early days, right? I mean it is really a place where we are all learning and understanding what the real opportunity is and what implementation looks like on the ground and what mistakes we're making. And so I think looking for folks and partners that really have that understanding and the orientation and are listening and learning feels critical, which sounds a little woo woo, but it is, it is really grounding.

Speaker A: It's accurate. Like there's a lack of leadership, there's a lack of courage, there's a lack of conviction. Um, and I love, I love anchoring on common shared vision because it can be that easy, but it's also really hard and uh, it's intuitive. I mean we know we have a lack of leadership right now in this space. And so what you're building and what's working, it's incredible for people listening because we need great examples of greatness right now. Kellen, any, any thoughts from you on data sharing or you know, that speed to trust, like you mentioned in your, in your opening.

Speaker C: Yeah. Uh, Well, I would 100% agree with Danielle where we have seen collaboration fall apart. It's often been that lack of shared principles, that lack of shared understanding. Right. So I think all of us coming into that, this collaboration with that shared North Star and understanding our roles is critical to the success of this for us. We have a lot of industry specific data. We have done a lot of work in developing industry specific guidelines and, you know, looking at things like design for recycling systems, design for collection and safe handling. Um, and so I think that's the space where we intend to continue to play is what we can do on behalf of the industry. But there's a lot of our own vision is very tightly scoped in terms of environmental impacts. There's a lot of things that we by design don't want to do. And then so I think that's the opportunity here. As we look at on the ground projects in other parts of the world where it doesn't make sense for us to reinvest in building a team there. It doesn't make sense for us to reinvest in building a network in some of these places. But there may be very significant impacts. So the opportunity to connect into this network, I think is meaningful for us there. Um, and the same is true. John talked about some of the work that they're doing on the policy side. That's a critical input to the decision making for our members, but it's also not a place where that's not necessarily our role in the network. And so again, to learn from and leverage those policy insights, to then invest in new circular technology and systems is a critical opportunity again for some of that shared learning.

Speaker A: That's incredible. I, I have a lightning question for each of you before we wrap up this episode. And so this is off script, but I wanted to know what's the biggest myth that this episode will bust? Don't all jump in.

Speaker D: Myth that network partners actually can collaborate. That there's actually a group of folks that actually want to collaborate with other network members and not be enemies, but actually really work closely together in a, In a competitive. In a, In a, in a friendly lens. Let's.

Speaker A: I love it. Kellen. Danielle.

Speaker C: Yeah. I'm going to go back to something John was saying earlier about defining circularity. And you know, I think a myth or a challenge when we talk about circularity is that people tend to zero right in on recycling. Recycling is the ultimate solution. But if we're not talking about resale and repurpose and repair. Then I think we're missing a big part of the conversation, particularly as we think about high value products like a battery. Right. So I know this coalition I think is well aligned around that. But as we talk to people, I think that that's often missed in terms of what this really means in practice.

Speaker A: Amazing. And Danielle, your myth buster for this episode.

Speaker B: Mine is a version of that, which is that the myth that circular economy is about purely environmental impact, as we've heard in our conversation today, that it's a core economic strategy. We also need to preserve our earth and the resources on our earth for everyone's well being. But that is not a tree hu plugging initiative. It is really something that is fundamental to the way that we need to build our systems.

Speaker A: How can folks engage with each of you, your organizations, the coalition, how can they plug in, learn more, connect and

Speaker B: hopefully join Ellen McArthur foundation.org we'll make

Speaker A: sure we drop all the links.

Speaker C: Yeah, same here. So I encourage folks to check out our website, supplierspartnership.org and the majority of the work that we do, we make publicly and freely available so that anybody in the value chain can benefit from it. And so definitely, you know, check out the resources available on EV battery recycling, safe handling or anything else in this space. Uh, I'd encourage folks to start there

Speaker A: and John to plug into cscc.

Speaker D: Yeah, but I'm going to do a quick plug for these two organizations because they are partners, uh, to join the CSCC. Rather simple. You can join or go to www.circularsupplychain.org or you can actually contact me directly and just email me and I'd be happy to take it and have a conversation.

Speaker A: Amazing. And we'll share all these links. Click the links and you can learn more about what each of these wonderful leaders are doing with the Circular Supply Chain Coalition. Thank you all so much for joining. It's been an absolute pleasure to host you today.

Speaker C: Thank you, Sherry.

Speaker B: Thank you, Sherry.

Speaker D: Thank you, Sherry.