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Developing the circular economy

The circular economy is no longer restricted to retail companies. The public health crisis has revealed how important this concept is, on the one hand, in the face of the accelerating insecurity for a large part of society, and, on the other, in the face of an increasing awareness on the preservation of natural resources.

Initiatives are flourishing to change the current way we consume, including within banks. Through its partnership with Ulule, BNP Paribas notably supports the creation of So Good, the first French magazine dedicated exclusively to positive impacts. As a committed, active magazine designed to promote positive impact solutions, So Good addresses the major challenges facing society and, in particular, the circular economy.

We take a look at some of the initiatives detailed in this special edition (in French) from So Good in the domain of the circular economy.

Products and services for our customers and partners

At BNP Paribas Asset Management, support for the circular economy involves the creation of a product, an investment vehicle. An index-tracked ETF fund was launched in May 2019 focused on the circular economy. BNP Paribas Asset Management has been a pioneer in this innovation, which responds to demand from customers who demonstrate a real interest in the ESG sector. It also corresponds to a Group approach, which si increasing the importance of supporting the circular economy.  In response to a quest for meaning in investments, the index of this new ETF has been carefully considered, particularly with the ECPI, the Italian index provider requested on this occasion.

"The whole point is to show our clients that this index is constructed so that we, as managers, invest in companies that are making constant efforts to move from the linear economy of "extracting - manufacturing - consuming - disposing" to the circular economy where sharing, reuse, repair, refurbishment, recycling are at the heart of processes and concerns."

Isabelle Bourcier

Head of quantitative and index management at BNP Paribas Asset Management

To create this new index, BNP Paribas Asset Management has developed a strict methodology with its Sustainability Center and ECPI, to select 50 large cap global stocks in a wide range of areas. Companies are analysed and then chosen from an extra-financial point of view, based on their exposure to the circular economy, the programmes they have implemented, the deadlines set, etc.

This initiative has found its audience and proved its relevance in a world where the environment and the circular economy gradually encompass all strata of society. The fund's AUM now stands at 278 million euros, a great success for this ETF on the circular economy that is a global first. Investors have mainly been retail investors, but the current amount of inflows will allow institutional investors to participate, no longer constrained by the investment ratio.

BNP Paribas Leasing Solutions and 3 Step IT offers to track the life cycle of corporate technology equipment, in order to avoid waste and encourage refurbishing and reuse: to focus on service rather than on the product.

BNP Paribas Real Estate, for its part, uses asset conversion, that is the conversion of entire buildings in order to build from existing materials. Its future headquarters, Metal57, is thus a former Renault workshop.

Other initiatives show the Group's commitment to the circular economy

In France, BNP Paribas  will support seven of the eight winners selected by ADEME and the French Ministry for the Economy and Finance to develop new Contracts with a positive impact on the circular economy. The total support budget is 27.3 million euros.

"It's a bold gamble led by the Ademe to address the challenges of the circular economy through impact contracts! Some remarkable, innovative projects will grow thanks to this pioneering initiative.  They will help to fight against food waste (Linkee and Andes), to provide a response to unfilled needs for medical equipment at solidarity prices (Envie Autonomy), to create a new sector around the collection and recovery of urine as agricultural fertiliser (Toopi Organics), to reduce the ecological impacts of the booming bike sector (Ateliers de l'Audace), to mobilise and raise awareness among an entire generation of children around the ecological challenges at school (Leo Lagrange), to structure a sector for the reuse and recycling of building materials (Articonnex), and more. We are delighted to be part of the adventure and to support the creation of contracts with an environmental impact!"

Maha Keramane

Head of Social Entrepreneurship and Microfinance Europe - CSR - BNP Paribas

Through consumer credit, BNP Paribas Personal Finance can also have an impact on consumption, and thus help develop more efficient, sustainable and profitable models. Its 2020-2025 strategic plan includes a pillar dedicated to disruption, broken down into four streams: financial inclusion, mobility, energy transition and the circular economy.

Since January 2021, BNP Paribas Personal Finance's Circular Economy stream has been working to define its vision, business opportunities and concrete achievements in order to support its regions in disruptive innovations.

With 90% of Personal Finance customers coming from commercial partnerships, many different economic sectors are screened. These screenings may concern mobility, home equipment and renovation, smartphones or food. It is essential to take an interest in customer motivation. The customer becomes a central player in a system where the relationship no longer ends at acquisition, but extends to use throughout the life cycle of a product.

"The circular economy is not just a matter of sustainable development. It is also linked to the financial trade-offs for consumers, when many of them have suffered an accelerated drop in their incomes since the onset of the public health crisis, and others are wondering how they should use their savings."

Cécile Gauffriau

Stream Leader Circular Economy at BNP Paribas Personal Finance

Three levers make it possible to insert the circular economy into consumption:

  • Affordability : economic concern is an inescapable driver. Even the luxury sector is concerned. With rental or sharing, access to products can become more affordable. It can even lead to social inclusion.
  • Environmental impact : the importance of this concern is growing in trade-offs. The consumer's ability to act directly from their shopping cart against waste or planned obsolescence becomes a way of re-establishing value for consumption that is a tug-of-war between the consumer's desire to have things and their desire to do good for the planet.
  • Customer experience : the circular economy represents an opportunity to switch to another way of consuming and to offer new customer pathways that will only have an impact if problems in those pathways are eliminated or if they are seamless.
At its launch, the Circular Economy Stream rolled out the "Let's Be Circular!" sharing community within the Group, and relies on the 'On the Way' podcast to convey the messages from commercial partners.

The story of BNP Paribas and Ulule

In the summer of 2013, the paths of BNP Paribas and Ulule met with a common desire to encourage the emergence of new entrepreneurial projects.

By supporting Ulule, BNP Paribas contributes to a good understanding of crowdfunding and the role it can play in creating impactful, innovative, communal and creative projects.

Since 2013, BNP Paribas has been working alongside Ulule through a number of initiatives that all share a common denominator - supporting entrepreneurship and the development of a more inclusive and sustainable economy. These include 1 clic for 1 project, the Ulule Tour, the launch of a financing system that combines crowdfunding and bank loans, the call for #Lancezvous projects, etc.

Since the end of 2018, BNP Paribas has strengthened its partnership with Ulule through two levers:

  • The Act For Impact programme carried out by BDDF Engagement (since end of 2018)
  • Support for So Good, the first magazine dedicated to positive impact (since 2020)

The aim of the #ActForImpact programme is to identify entrepreneurs who innovate to serve the general interest, help them launch their projects and support their growth. In order to accelerate the movement and increase the visibility of these impact entrepreneurs in France, Act For Impact’s plan on Ulule enables:

  • to assist and label impact project leaders and to offer banking support for SSE's
  • to reward the best impact projects with a 2000 € endowment
  • to illustrate and to communicate BNP Paribas' commitments to the Ulule community and the general public
  • to engage BNP Paribas employees and customers

The second pillar of the Ulule partnership is BNP Paribas' support for the creation and launch of the new So Good magazine, led by Ulule and So Press.

So Good is a quarterly paper magazine sold in kiosks in more than 12,000 outlets. As a committed, active magazine designed to promote positive impact solutions, So Good aims to tell the stories of people, who are brave and bold, famous or unkown, but all working toward a more fair, inclusive, and sustainable model.  Supporting So Good magazine means supporting the first French media dedicated to impact entrepreneurship.

Alongside So Press and Ulule, BNP Paribas helps to make impact entrepreneurs, the heroes of a modern, innovative, sustainable and inclusive economy.

For BNP Paribas, supporting So Good is a way to extend  #ActForImpact on the Ulule system and promote our #PositiveBanking strategy.

As part of this partnership, BNP Paribas has chosen to produce, with the support of Ulule and So Press, a special edition (in French) to promote the circular economy and explain the role that the bank can play. Released at the end of December, this special edition dedicated to BNP Paribas employees, customers and partners, presents the initiatives of various business lines within the Group.

see the special edition of sogood on bnp paribas' commitment to the circular economy (in french)

Photo credit: Balazs

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