Driving Tech Circularity Forward: a View of Europe’s Plans in 2023

This blog provides recommendations for a “Right to Repair” done right. It includes insights from Cisco’s supply chain team, experienced engineers, and business experts focusing on simplifying repair, automating processes and accelerating value for our customers.

Following the 27th session of the Conference of the Parties (COP27) to the United Nations Framework Convention on Climate Change (UNFCCC), UN Secretary-General António Guterres urged more action to address the climate crisis. Against the major global challenges brought forward by climate change, circular economy has the potential to help nations and industry achieve their climate goals.

According to the 2023 Circularity Gap Report, the global economy is now only 7.2% circular.  A paper from the Ellen MacArthur Foundation, further shows that transitioning to renewable energy can only address about 55% of the world’s greenhouse gas (GHG) emissions. The remaining 45% are directly linked to the production of goods and the management of land, which is why better adoption of a circular economy can contribute to completing the picture of emissions reduction by transforming the way we make and use products.

The European Union (EU) has ambitious circularity plans for the technology sector. Building upon the European Commission´s Green Deal and its future Industrial Plan, in 2023 EU decision makers and other stakeholders will be looking at key circular economy policy and regulatory initiatives addressing, among others, ecodesign for sustainable products, including the Digital Product Passport (DPP); packaging and plastics sustainability; securing the sourcing and access to critical raw materials; microplastics pollution; environmental claims; and promoting repair and reuse (the “right to repair”).

The EU’s Circular Economy Agenda: “Right to Repair”

The European Commission will be soon releasing a legislative proposal on the “Right to Repair”. The overall goal of the initiative is to extend the time during which consumers use products before discarding them. While the scope of the proposal remains to be seen, we believe it should recognize and consider existing practices that businesses have put in place, focusing the scope on consumables and common failures that consumers and small businesses experience.

At Cisco, with our team of supply chain professionals, experienced engineers, and business experts, we are focused on simplifying repair, automating redundant processes and accelerating value for our customers. Based on years of expertise in the field, below are our recommendations for a “Right to Repair” initiative that ensures repair is done right:

• Exclude business-to-business (B2B) transactions from the scope as B2B companies usually already have commercial repair arrangements with their customers that ensure sustainability whilst meeting their specific operational needs.
• Recognize that repair is one of many tools to incentivize a shift towards a more circular economy. In some cases, replacement with a new or refurbished product might be more suitable and durable.
• Put customer safety, intellectual property (IP), cybersecurity, and privacy at the heart of the initiative, recognizing that not all repairs can be carried out safely and successfully by customers themselves or even by many independent providers.
• Acknowledge the importance of existing, professional, manufacturer-led repair networks that provide customers with convenient access to safe and effective repair options, while protecting IP and trade secrets. This also allows us to perform reverse logistics and disposal services for customers, leveraging our existing capabilities to reuse, refurbish, or recycle the returned products as needed.
• Ensure consistency with existing and upcoming product-specific global and EU legislation and standards that promote repair.

Cisco’s Circular Journey & Impact

Cisco works to extend the life span of our products and reduce material waste.

We are evolving to a regenerative, circular model in which we reduce the resources we consume and the waste we generate. With this approach, we prioritize materials with recycled content; design products for resource efficiency; and facilitate repair, remanufacturing, and recycling to extend product life.

Customer data security is also critical part of the circular economy. We have continued to focus on security capabilities and the removal of residual customer data from products returned to us to support repair and reuse.

Examples of Cisco´s circular economy focus areas, initiatives, goals and impact

Applying Circular Design thinking

We  have a goal for our fiscal year (FY) 2025 for 100% of new products and packaging to incorporate Circular Design Principles. In FY 2021, we launched a design evaluation methodology to help us track progress toward our circular design goals. We are taking steps to further embed the evaluation process into the product development lifecycle.

One of Cisco’s circular design focus areas is packaging and accessories, and we are taking a close look at what accessories we can remove from standard configurations, and reducing our use of virgin plastics wherever possible. Recent innovations and some examples of their impact in our FY 2022 include:

• The packaging for the Catalyst IR8140 Heavy Duty Router is the first solution at Cisco to use a fiber-flute material in place of the foam cushioning typically required for heavier products. This and other packaging changes led to 37,273 pounds of foam reduced across Cisco products.
• With the aim of decreasing overall material use, we also reduced the use of corrugate in our packaging. This was achieved through several initiatives, including the shipment of products in multi-pack packaging and the removal of unused accessories and their associated packaging, leading to > 700,000 pounds of corrugate reduced, equivalent to > 1million pizza boxes.

Furthermore, we also recently set a new goal that by our FY 2025, 50% of the plastic used in our products (by weight) will be made of recycled content (excluding plastics contained in commodity components sourced from suppliers (e.g., plastic screws, fans, and cables).

Embedding circularity from sale through product reuse

Cisco has an important role to play in how our customers are meeting their own sustainability goals. Customers are increasingly looking at ways to extend the lifecycle of their equipment.

In FY 2022, Cisco Capital launched Cisco Green Pay, a circular IT payment solution that makes it easier for customers to build a sustainable technology strategy to reach their environmental, social, and governance (ESG) goals.

Moreover, Cisco’s customer base is supported by a vast partner ecosystem worldwide, and we are focused on empowering this community to advance sustainability conversations with our customers. In FY 2022, we launched the Environmental Sustainability Specialization (ESS), a new business specialization available to all Cisco partners. The specialization recognizes partners for supporting Cisco’s sustainability initiatives and equips them to educate customers, promote product takeback, assist in customers’ move to circular business models, and further their own sustainability practices.

Cisco is striving to enable all of our stakeholders to participate in the circular economy. We look forward to continuing our collaboration with decision makers, customers, partners and other stakeholders by supporting them in their circular economy journey.

Cisco’s purpose

Cisco’s purpose is to Power and Inclusive Future for All, including helping ensure a sustainable and regenerative future for our planet. Sustainability and circular economy transformation are an integral part of our company´s purpose. Cisco is leveraging our scale and innovation to help ensure that our increasingly digital future is sustainable, inclusive, and resilient.

We are embedding sustainability and circular economy principles across our business. Our holistic approach extends from how we design, build, and deliver products, to how we value the assets we have and turn them into new products. We also apply Cisco technology to support our partners, customers and other stakeholders in their circular transformations.

At Cisco we believe that embracing a circular economy is a key step forward that can help complete the picture of emissions reduction. We can help stakeholders with circular economy plans and goals. And, as described further below, we encourage EU decision makers and other stakeholders to recognize and consider existing circular business practices in the context of the EU´s circularity plans for the technology sector.

Additional information on our circular economy journey and our impact is available in our 2022 Purpose Report and related supplemental information, which are located in our ESG Reporting Hub.

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