Framing Sustainability Innovation and Entrepreneurship

Business activity currently generates waste and by-products. Unlike natural systems, modern human societies process resources in a linear fashion, creating waste faster than it can be reconstituted into reusable resources. According to the National Academy of Engineering, on average 94 percent of raw materials used in a product ends up as waste; only 6 percent ends up in the final product. Whereas pollution control and prevention focus on minimizing waste, industrial ecology allows for inevitable waste streams since they become useful inputs to other industrial and commercial processes. Continued provision of needed goods and services to growing populations in a finite biosphere becomes at least conceptually possible if all waste generated by business and consumer behavior is taken up by other industrial and commercial processes or safely returned to nature.

Consequently, the field of industrial ecology assumes the industrial system exists as a human-produced ecosystem with distinct material, energy, and information flows similar to any other ecosystem within the biosphere. It therefore must meet the same physical constraints as other ecosystems to survive. As a systems approach to understanding the interaction between industry and the natural world, industrial ecology looks beyond the linear cradle-to-grave viewpoint of design - you source materials, build the product, use the product, and throw it away - and imagines business as a series of energy and material flows in which ideally the wastes of one process serve as the feedstock of another. Accordingly, nature's processes and business activities are seen as interacting systems rather than separate components. They form an industrial web analogous to but separate from the natural web from which they may nonetheless draw inspiration.

Clinton Andrews, a professor of environmental and urban planning, suggested a series of themes for industrial ecology based on natural metaphors: "Nutrients and wastes become raw materials for other processes, and the system runs almost entirely on solar energy. The analogy suggests that a sustainable industrial system would be one in which nearly complete recycling of materials is achieved". Andrews described the present industrial systems as having "primitive metabolisms," which will be "forced by environmental and social constraints to evolve more sophisticated metabolisms.…Inexhaustibility, recycling, and robustness are central themes in the industrial ecology agenda". Theoretically, restructuring industry for compatibility with natural ecosystems' self-regulation and self-renewal would reduce the current human activity that undermines natural systems and creates the growing environmental health problems we face.

In 1977, American geochemist Preston Cloud observed that "materials and energy are the interdependent feedstocks of economic systems, and thermodynamics is their moderator". Cloud's point about thermodynamics anticipates TNS, and he was perhaps the first person to use the term "industrial ecosystem".  Despite earlier analogies between the human economy and natural systems, this correspondence did not gain widespread currency until 1989 when business executive Robert Frosch and Nicholas Gallopoulos first coined the term "industrial ecology" and described it in Scientific American as follows:

In nature an ecological system operates through a web of connections in which organisms live and consume each other and each other's waste. The system has evolved so that the characteristic of communities of living organisms seems to be that nothing that contains available energy or useful material will be lost. There will evolve some organism that will manage to make its living by dealing with any waste product that provides available energy or usable material. Ecologists talk of a food web: an interconnection of uses of both organisms and their wastes. In the industrial context we may think of this as the use of products and waste products. The system structure of a natural ecology and the structure of an industrial system, or an economic system, are extremely similar.

Professor Robert U. Ayres clarified process flows within the natural and industrial systems by naming them the "biological metabolism" and the "industrial metabolism".Ayres coined the term "industrial metabolism" at a conference at the United Nations University in 1987. The proceedings of this conference were published in Robert U. Ayres and Udo Ernst Simonis, eds., Industrial Metabolism (Tokyo: United Nations University Press, 1994). The feedstocks of these systems are known as "biological nutrients" and "industrial nutrients," respectively, when they act in a closed cycle (which is always the case in nature, and rarely the case in industry). In an ideal industrial ecosystem, there would be, as Hardin Tibbs wrote, "no such thing as 'waste' in the sense of something that cannot be absorbed constructively somewhere else in the system". This suggests that "the key to creating industrial ecosystems is to reconceptualize wastes as products".

Others have pointed out that "materials and material products (unlike pure services) are not really consumed. The only thing consumed is their 'utility'". This concept has led to selling the utilization of products rather than the products themselves, thus creating a closed-loop product cycle in which manufacturers maintain ownership of the product. For example, a company could lease the service of floor coverings rather than sell carpeting. The responsibility for creating a system of product reuse, reconditioning, and other forms of product life extension, or waste disposal, then falls on the owner of the product - the manufacturer - not the user.  This product life cycle can be described as being "from cradle back to cradle," rather than from cradle to grave, which is of primary importance in establishing a well-functioning industrial ecosystem. The cradle-to-cradle life cycle became so important to some practitioners that it emerged as an independent concern.

The challenges to establishing a sophisticated industrial ecosystem are many, including identifying appropriate input opportunities for waste products amid ownership, geographic, jurisdictional, informational, operational, regulatory, and economic hurdles. Although industrial ecology could theoretically link industries around the globe, it has also been used at a local scale to mitigate some of these challenges. Several eco-industrial parks are currently in development (Kallundborg, Denmark, is the well-known historical example) where industries are intentionally sited together based on their waste products and input material requirements. If the interdependent system components at the site are functioning properly, the emissions from the industrial park are zero or almost zero. Problems arise when companies change processes, move facilities, or go out of business. This disrupts the ordered and tightly coupled chain of interdependency, much as when a species disappears from a natural ecosystem. Industrial ecology thus provides a broad framework and suggests practical solutions.