Shaping Sustainability: From Circular Economy to Personal Impact

In this thought-provoking episode of Sustainability Unveiled, we sit down with Alessia Falsarone, a distinguished leader in sustainable finance and circular economy from The University of Chicago. 

This episode, “Shaping Sustainability: From Circular Economy to Personal Impact," explores how the circular economy model revolutionizes industries and individual behaviors worldwide. Alessia Falsarone’s exemplary achievements, including the 2019 Women’s Venture Fund Honoree Award and the prestigious 2022 NACD Directorship 100™ in Corporate Governance, share her invaluable insights into integrating sustainability into business and financial strategies.

Through our conversation, listeners will gain a deeper understanding of the circular economy’s potential to transform traditional approaches to production and consumption and how individual choices can contribute to a more sustainable world. Prepare to be inspired and challenged as we uncover the intersections of sustainability theory and practice with one of the field’s leading voices.

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Chapters

• 0:00 Circular Economy and Sustainable Finance Interview
• 17:36 Empowering Girls in Energy Sector
• 23:58 Data Collection and Sustainability in Business

Transcript

Speaker 1: 0:00

Welcome to Sustainability Unveiled, where we explore the cutting edges of innovation and sustainability that are shaping our world. Today, we're venturing into the heart of sustainability, with a special focus on the circular economy and its profound impact on both global industries and individual actions. In this episode, shaping sustainability from circular economy to Personal Impact, we're thrilled to have on with us Alicia Fasaroni, a beacon of sustainable finance and circular economy from the University of Chicago. She is not just an academic. She's a bridge between the theoretical foundations of sustainability and their practical applications in business management and financial innovation. Join us as we dive into the transformative world of sustainability with a global thought loop.

Speaker 1: 0:58

Welcome back to another episode of Sustainability Unveiled. I am so excited to have Alicia Falceroni on with us today. She is from the University of Chicago and has a vast experience in the world of sustainability. So before we really get into questions with her, I'm going to turn the mic over to Alicia and give her the floor to give us some backgrounds on where she is now, where she came from, and then we will jump in.

Speaker 2: 1:29

Thank you very much, jessica. It's such a pleasure being here and engaging with your audience today. My career journey, I would say, has always felt as an exploration, as you said, university of Chicago, leading a brand new program, a program that actually launched in 2022 on the circular economy, but I have spent all my career prior to that predominantly in financial services, working from banks to insurance companies, and the last 15 years instead in investments, mainly, though, in international settings. So I think that your audience would probably not be surprised if I say that my Italian accent may give it away already, but I always, interestingly enough, join organizations in new roles and at a time of change, mostly also roles that may have been quite uncomfortable internally for others, sometimes upsetting, in a way, the natural ecosystem of all the beautiful hierarchical pyramids that people still call organizational ladders of leadership right.

Speaker 2: 2:32

So the way I found the reachment, though, and personal success, and I got to circularity has been really never giving up my beginner's mind, so embracing new experiences with a deep sense of curiosity of what can be done different for an organization, but also for its place in society.

Speaker 2: 2:51

One of my early mentors in industry used to say we have to earn the rights to do business with our clients every day and certainly that is very important in my current role as an advocate of the circular economy in a time quite new to me, right A research and innovation setting line of talent, of ideas, and also aligning funding to support for-profit institutions that are rethinking the way they deliver value to all shareholders and stakeholders that they serve, including the planet. So, as an investor, I used to run a sustainable investing platform for a number of years, identifying the companies that are set to succeed and finding, in a way, their competitive edge behind the way they could be better users of natural resources, designers of products that last longer and new business models. So that pretty much had set the way I look at principles of circularity and how almost all of my experience has seen the involvement of consumers in the journey of businesses.

Speaker 1: 4:13

I'm not going to lie. I'm blown away by your experience and how eloquently your philosophy around your profession has evolved as well as just continues to inspire others that are coming up, and I want to touch on the new program that you mentioned at the University of Chicago. What brought on this opportunity for you?

Speaker 2: 4:37

That's another interesting point. Our program started in the fall of 2022. So, after almost a year, though design thinking and brainstorming within the institute and with external partners, I was approached with this opportunity by, actually, one of their external partners that was seeking, you know, new ideas right For would circular economy be the right time to be brought in the marketplace in the US? Would it attract only US businesses or could it be more, you know, attracting a global breed of innovators? And that was, I thought, that it was like a fantastic idea. So we started with the delivery format, thinking about how to reach businesses Although I have to say that businesses were already coming to us through their sustainability teams, their product teams, not to mention their engineering teams at times and mostly we then asked for a way to first upskill individuals and teams on what a circularity transition would mean for their organizations from truly an operational perspective, but also how they could then translate that into more a language that would make their success very visible at the higher levels of their organizations and in departments that were, so to speak, less scientifically trained and so more you know, the business folks within the organization Also, not just how to help them develop a roadmap for adoption internally, but also how they could build these lasting capabilities, including technology that would generate new products but, in some cases, develop a completely separate business unit. So we're talking about new financial opportunities to, in a way, finance a circularity transition within their organization, and for me, that was extremely important because I had spent the past again, as I said, 10, 15 years trying to continue to link and refine the connection between financial performance, operational excellence and also sustainability within businesses. So that sounded to me like closing my own loop of knowledge and understanding of how actually to reach out businesses and ensure that they could do the right thing within their circularity network. So with that, I have to say, jessica, in the first year alone, we have worked with over 80 institutions that they came up with and they really needed absolute help across 18 sectors of the economy, so not necessarily the one that you would think of immediately.

Speaker 2: 7:30

More on the operational sense, and not just in North America, but across 13 countries, and I have to say many, I would say many of them, the majority from Asia and Latin America. Now, when you think of that, it's like, wow, that's surprising. How so? The majority from Asia and Latin America? Now, when you think of that, it's like wow, that's surprising. How so? Because typically these are from countries that are at the intersection of global supply chains and think about the timing of these options Correct and, at the same time, also under pressure from all the environmental risks seen in their own operations and the regulatory oversight that they would get from their own customers. So they needed to get geared up to a better transparency and, at the same time, also make sure that their financial performance and their operating operational excellence would help them transition. So that, for me, was, you know, remarkable, right. So how could I say no to such an opportunity? Those are the businesses that you would want to finance right every day.

Speaker 2: 8:30

Those are the investment opportunities for the next decade and beyond.

Speaker 1: 8:35

Exactly, and you know I love that you, that you're not just focused. Obviously, this program is not just focused in North America, as you mentioned 13 different countries. How difficult is it for you and your team when you are working with these companies, dealing with different regulatory constraints based on the country or even the continent they're located in, and coming up with a cohesive plan that's going to work for each individual company?

Speaker 2: 9:05

with a cohesive plan that's going to work for each individual company. Yeah, so the important aspect of it is making sure that participants actually are able to leverage each other's experience, and I can tell you that there's been a lot of cross-pollination of ideas from one team to the other, one team to the other, without ever infringing any sort of non-compete or any of that. We're talking about completely different sectors of the economy, but seeing how someone is approaching, for example, a use case that requires better analytics at the product level, in an environment where you are doing more work on I don't know other efficiency versus another that is doing more work on I don't know other efficiency versus another that is doing more work on textile and trying to establish a workforce training plan on the other side of the world and, at the same time, evaluate their impact that they are having. Both of these type of businesses are looking to build analytics capabilities and they are both trying to engage with metrics that allow them to prototype their value and the progress that they're making within their respective business. So ideally they are, they can actually work together, and this is what we have done.

Speaker 2: 10:19

We. We have make sure that they can work together and they have period on, you know time, in which they can define pillars of a circularity strategy within each one of their groups and their companies and basically exchange ideas. Ideally, technically, they are being able to identify fit and, at the same time, also better define their purpose, right. So that has been for us, a experimentation, right on learning, and I think experiential learning is probably the most important aspect of dealing with teams that are not co-located Right, even if you're not undertaking a program like this one, even if you're not undertaking a program like this one, but every single company or organization that is dealing with a transition of sorts that requires a mindset shift, connecting, you know, sustainability characteristics to their own business and to their own products and to their own identity, defining the pillars of what it means to transition and also prototype progress that tells you that they have to all be, in a way, on the journey together and they have very, very similar journeys.

Speaker 1: 11:37

I think you know, just taking in everything that you just said, there being the participants being able to leverage each other and leverage the experiences that each one has gone through, each company or organization has gone through, and really promoting that level of transparency within organizations as well as the program, when, as you know, transparency was not widely adopted in the past.

Speaker 2: 12:05

No, and it still is. We are in transition, right. It's still not. You know what people think of as first thing part of their job every day, right?

Speaker 1: 12:15

Exactly so how do you deal with the external or the stakeholders board members that might be a part of this organization? How was it, how are you able to get their buy in when it came to, you know, helping a specific organization or multiple organizations work together to really define their circularity program and and make short term goals as well as long-term goals? Because, obviously, if you're talking about board members, you're talking about the financial investment and that's what they're concerned about, as well as you know other variables within the organization.

Speaker 2: 12:54

Yeah, I think, as I said before right, whatever role you take, right, whether it's me as in a boardroom, whether it's me, as you know, a practitioner in an academic setting, whether it's me as an investor in an innovation agency, like I'm part of the UK Innovation Network I think that it all starts with a mindset change. Right, that touches nearly every aspect of our business, and you touched before on transparency. So what I've seen in the boardroom both of public and private companies, is that there is a nearly insatiable desire right to know every detail that led to management support. That particular business decision, particularly when it comes to areas surrounding sustainability and Circularly, is part of a sustainability strategy of many, many businesses, an increasing number, especially the ones that are moving more toward renewable and they are making their net zero plan part of their long-term goals. So, when it comes to it so when I say mindset change, it's exactly what you said, right Most boards and most companies, when they announce their strategic plans right to shareholders and to the world, they do it in a relatively short, for a relatively short period of time, thinking about three-year time. Right, many have a five-year time, but increasingly so is a three-year time and then they give. Most of them give guidance right to their investors every year how are they doing right and what key performance indicators they may use for their plans. Well, I say that the reason why, then, within a board contest, people are asking a lot more questions to substantiate a strategic plan is the whole reputational risk associated with bringing yourself out there as a sustainability champion across virtually every sector of the economy, and if you want to be an innovation champion, it has nothing to do with sustainability.

Speaker 2: 14:56

Also, there is a lot of, you know, in a way, headwinds.

Speaker 2: 15:01

You may have the tailwind of the consumer right, the tailwind of operational efficiencies, the tailwind of artificial intelligence. Nevertheless, the headwind is how do you make sure your decisions are transparent, are fact-based, and that you are measuring performance according to data that is repeatable, data that is trustworthy, data that you know can be presented to the public, and that's why, essentially, there's you know, it's not that in a board, you want to agree or disagree on certain things right, you just want to make sure that the company's strategy and its position in the marketplace, no matter the subject we're talking to, whether sustainability, whether innovation or any other discussion is for the long-term viability of the company. The long-term viability is a lot more stakeholders than just shareholders. It's the employees of the company, it's the customers of the companies, it's the partners and it's also the marketplace. Meaning to be a viable company, you need to have competitors as well. I have to make sure that those competitors, in a way, are learning for each other and are making better products and delivering better value right for their consumers.

Speaker 1: 16:18

Yeah, definitely, and, as a consumer, that is something obviously that we look at in terms of what can we do, you know, in our own lives to help promote a, you know, more circular world, more sustainable world, more energy efficient world that we live in. For example, we have solar on our home and it has been really a godsend to us because we are obviously giving, we are not utilizing the and we don't have a strain on the energy grid like we would before. But it's also teaching our kids and, you know, in our pre-conversation, you and I talked about the importance of really making a connection between personal what you do in your personal life as well as your professional life. So how do you bridge that gap with your daughter and bringing your professional life into your world in a positive, positive way, where you can show her that her actions really are they can make a difference.

Speaker 2: 17:15

Well, I say that's hard right. Honestly, jessica, I don't think I ever really tried to balance, you know, my professional goals or my personal life. Nevertheless, our daughter has, has, has been a a gem of interest questions, uh, you know, and and light in a way. So I don't know if I share with you outside of the podcast, but I participated in a project for K-12 girls looking to learn more about the various professions, for example, in the energy space, but also in the renewable space, and how to make a better sense of why women are not participating in the workforce or gaining more skills to be, to basically aspire to have a better representation in the energy field. So when I got the booklet at home and this is a couple of years ago we intended to donate a few to the local libraries and to her school. Ago, we intended to donate a few to the local libraries and to her school, but she never. You know, she had seen all the drafts but she didn't really know what to expect, and so when she was flipping through the page of the book was like, wow, you know, I feel so inspired. Mom, you know, you're doing great, you're doing excellent. I want to learn a lot more. So that to say that you know, balancing professional and personal life comes in small batches of choices that we make every day.

Speaker 2: 18:49

As you said, right, the choice of a solar panel probably came also with, you know, a lot of discussion right at home about, hey, what's the cost and how does it make it work, and everything.

Speaker 2: 18:59

And then goes into the educational piece right, okay, that teaches our children the importance of natural resources that we have around and the fact that, yes, we can actually all contribute in our decisions every day to make our planet better for their generation, our generation and future generations. But I also feel that I learned that I needed a home at least to spell out our values and that we needed to have, as a family, values that our children could actually possibly relate to and know that they are so important. And we did it actually during COVID. Believe it or not, covid was, as I was stressed, a terrible time for all of us. It also taught us a lot about patience, about respect, about what it meant to love each other, and that we needed to leave none of them neither patient, neither respect, neither love out of the equation every day. This is like the perfect trifecta to our life, you know, at home and when we go to work or to school, and so, every day, supporting each other for us is continuing to spell out our values.

Speaker 1: 20:12

Which is just. It's very similar to our family motto during COVID we were all together. We got into a house that we were building, thankfully right before everything shut down. Otherwise we would have been in a very, very tiny apartment with two children and two adults working from home going to school, which would have been an interesting experience, but we wouldn't have gone.

Speaker 1: 20:31

We would have gotten through it. You know, because that's what you do. So I'm not sure if you knew this either, but in my previous life I was a teacher. So the work that you did with the book and delivering that and teaching you know about the different opportunities and energy and really exposing girls and, you know, trying to increase the diversity in that field, that is near and dear to my heart as a former educator, because I love to see when individuals a former educator, because I love to see when individuals, especially girls, get opportunities and are exposed to opportunities that they might not have been exposed to in the past, so that is something at least.

Speaker 1: 21:11

I have a son and a daughter, but that is something that we really do preach at home too is, you know, making sure that they have opportunities and experiences. And one of the one of the goals that Sarah and I have as owners of Annie Leader is to eventually establish some type of program for children or partner with organizations where we we can offer camps or courses where kids can can gain the experience at an at an earlier age and they don't have to wait till high school or college to really get a feel for how this might be a profession for me.

Speaker 2: 21:50

Yes, I agree, that's a great. That would be great. I'm fully supportive.

Speaker 1: 21:56

Thank you Appreciate that. So how have? How have you seen? You know you talked about your different career goals now, or your different career places that you've worked in, your, in your professional career. When you were your daughter's age, do you remember what you wanted to be?

Speaker 2: 22:14

Yeah, no, I just remember I wanted to explore and I think, as I said earlier on, right like I, you know, I've always been inspired by the regenerative nature of our world, and mainly that was driven by the fact that I grew up in Italy, in the middle of a beautiful countryside where nature is nourished, cherished, and it's part of both educational orientation you know, school age and daily living on individuals.

Speaker 2: 22:44

And so, quite honestly, I struggled as a parent and you know, putting your kids in the educational system that is completely different from the one I had and trying to make sense of it, but still giving an opportunity right for the new and the old to come together and, you know, continue to build something. And so my career shaped, you know as really shaped around again, as I said, almost as a calling right, joining organizations, always in new roles, but pretty much always people to grow. What else is out there? What else is out there? What else is, you know, beyond the top of the mountain, right, that was something, and probably is you know, beyond the top of the mountain, right, that was something, and probably it's like you know, when you spend long days looking around and all you see is beautiful countryside and mountains full of snow. You wonder what's behind that. And that's what led to a lot of my international, you know, upbringing and establishing myself, you know, both in the US and Asia.

Speaker 1: 23:40

So yeah, Well, and then, as you know, this industry is constantly changing so there's always new opportunities to you know, to grow, to learn new technologies, to incorporate those new technologies, you know, in your sustainability program, in the model of circularity. Earlier in the conversation you mentioned the importance of data collection, valid data collection, being able to repeat the data. So what advice do you have for the maybe more smaller businesses, smaller organizations, who don't have necessarily the financial means to implement a data system, that they really do need to gather this information?

Speaker 2: 24:24

Yeah Well, the first one is do not wait for the perfect day. When you can, that's for sure, because most challenges I've found with the smaller and middle enterprises are they are part of nowadays global supply chains, so eventually their businesses are going and their clients are going that direction where you know they may be competing with each other at a time where you know the vast majority of products are actually over 70% almost of international trade relies on these global, what they call global value chains. Right, where you are connected, you connect the raw material, you use your parts and other components with all the servicers that can possibly have access and deliver that around the globe. So in a way, it's very much a challenge surrounding the viability and the reliance of each participant in that web of trade relationships. So, if there is no opportunity to start early on the data collection side on your own, probably there is an opportunity to work with your bigger actors in the supply chain, and I'll give you the example of Lenovo. Not too long ago, probably at the very beginning of our program, I had the opportunity to speak with the chief sustainability officer of Lenovo, asking them about their own value chain, and now they were able actually to ensure the delivery of the final product would take place, especially given the difficulties during COVID and the like in the entire consumer electronics business. Right, and all she said is you know that she agreed 100% that the value chain needed to be more inclusive and more transparent and for them to have small and needle enterprises continue to be part of that diverse operational effort and their portfolio. They needed to help them get on board with either data collection or sustainability or transparency, and so the larger stakeholders in all of these are the companies that actually are placing the procurement order, and those are again I just give the example of Lenovo, top of my mind but they are increasingly working with small and middle enterprises.

Speaker 2: 26:46

So what I see is, instead of much smaller, right, a micro business, still, you can start collecting your data. Start from your shelves. Right, start, you know, looking at all sort of products that you are bringing in. Start looking at you know what's written in the label of your products. Is this something that you relate to? Is this something you want to build a brand on? Is this something that actually is aligned with your mission or not?

Speaker 2: 27:14

And I understand there's a lot of commercial anxieties and a lot of litigation fears right that have continued, in my opinion, to slow down progress right in building more transparent and cohesive efforts, even at the local community level. But I really believe that data everybody can produce data. As a matter of fact, every day we produce data, you know each one of us. So, for small businesses, and especially for diverse business owners, to me they're so important in value chains across, for example, the US. The importance is how to make sure that you're clearly identifying and you are tracking data that is related to the value that you're bringing by, whether to your community, whether you're a consumer, whether you're larger procurement touch points right, because that's what then will help you get on board with larger sustainability efforts of companies.

Speaker 1: 28:10

And just start. You know that's a big theme, that when we do our webinars and we talk to subject matter experts or thought leaders, just start, because there's never going to be a perfect time to start. But if you have some data, you can build on that data. And you know that as a consumer and even as a stakeholder as a consumer, as somebody who you know is in this industry, it is so nice to see when companies put all, pull it, put it all out there, you know, are fully transparent. I don't expect a company to be perfect. I don't think that's realistic. I think that's the case for most of us. But to see growth and goals and for companies to say, okay, we thought we were making more progress in our reduction of our, you know, overall carbon footprint. Obviously we're not there yet, but these are the steps that we are taking to get us to where we think we can be, and then even beyond that, I agree, I agree with you.

Speaker 2: 29:06

In fact, in my days as an investor, I would always tell companies in our engagement efforts.

Speaker 2: 29:11

I would love to hear a company that says we set this goal but we have not met it. But we have not met it. So now, if you say that, in financial performance, right, your, your, your shares drop, and we just need to read the headline these days, right, there are companies that are putting up incredible revenues, yet they may be saying something for which expectations go lower and therefore share price goes lower, right. The other hand, in the sustainability world, right where we're you know, the general public has been in a way, and regulators as well we're questioning, right, ft, environmental commitments. I love to see companies coming out saying you know, we have to review and maybe revise downward that and review our initial hypothesis, because, as we are going, we're putting a lot of effort and we're finding out what we didn't know before and therefore we're going to need probably five extra years or 10 extra years. And this is what we're doing and this is what we learned, because I think that's where we could see real progress.

Speaker 1: 30:12

I couldn't agree with you more there, because you know, if you don't dive into the data and look at the data and see where changes can be made, then you're kind of just turning a blind eye, which is not going to serve your organization or really any of your stakeholders in the long run or even the short term run. Well, I would love to continue this conversation because it has been so pleasant, but before we sign off of this episode, I'd love to hear what your plans are at the University of Chicago with this program. What do you see happening for the remainder of this year and some goals that you guys have on your team moving forward?

Speaker 2: 30:53

I think you know, whether it's in academic context, as a practitioner, I think that the collaboration that is envisioned, of all institutions I've been dealing with, quite frankly, is how can we shape better sustainability adoption in a way that it's clear, right that the future is collaborative, is sustainable, is increasingly digital and is quite diverse, quite diverse. And so, since that's sort of the end of the train we are all on right now, and it's a fast speed train really, I continue to think that you know, whether it is a program, whether it is a innovation ecosystem that you know we can play, in most cases, to play already, the role of, you know, being a training ground for sustainable innovation, and I think a portfolio of sustainable innovation products, processes, businesses is the one that will bring more jobs, create more revenue and help, broadly speaking, the economy do better.

Speaker 1: 32:00

I think that's a perfect way to end our conversation. Thank you so much for such wonderful insights on circular practices, circular business models and just being able to bridge the gap between different countries and working together. I hope this is not the last time that we get to sit down and have a conversation together. We would love to have you back on again at some point in the future. But again, thank you, and we really appreciate you being on with us.

Speaker 2: 32:32

That was a pleasure. Thank you so much. Have a wonderful afternoon you too, Jessica. Thanks you too, Jessica.

Speaker 1: 32:41

Thanks. In the next 60 seconds, ask yourself how can I contribute to a brighter, more sustainable future, not just personally but professionally? Let's embark on this journey together and shape the landscape of sustainable leadership for tomorrow. Take the first step now and make a commitment to lead with sustainability in mind. That's all for this episode of Sustainability Unveiled. Join us next time as we continue exploring the forefront of sustainable business practices. Until then, stay informed, stay sustainable.