In addition, when competitive pressures reassert themselves, there is the risk of a renewed race to the bottom to the unacceptable pre-crisis status quo. Moreover, public sector finances have been stretched and must be consolidated. There is no public sector appetite to engage in the types of banking sector support measures of the past three years.
Financial institutions have a critical role to play, scaling up financing, accelerating the shift towards circular business models, managing related risks and exploring opportunities, such as the redesign and manufacturing process of products and services, digital solutions, waste management models, etc. At the moment though, financial institutions lack awareness of circularity and still need to develop expertise, products and services to harness opportunities.