Waste compensation offers tech firms a practical path to circular business

At the heart of the whitepaper is Closing the Loop’s “One for One” service, a model in which a discarded device is collected and properly recycled in a developing country for every new device sold. The paper presents this approach as cost-effective, brand-enhancing, and socially impactful, offering companies an accessible way to meet sustainability goals, engage employees and customers, and tap into new markets.

SecondaryMarket.news sat down with Hugo Warner, the author of the paper, to better understand the thinking behind the whitepaper, its key findings, and the wider implications for the global tech industry. Later SecondaryMarket.news will publish second interview with Joost de Kluijver, co-founder and CEO of Closing the Loop, discussing this whitepaper.

SecondaryMarket.news: Could you briefly introduce yourself and share a bit about your role and professional background?

Hugo Warner: I’m currently working as a circular economy expert at Sitra, the Finnish Innovation Fund, and I’m also the co-founder of Bioma, a business focused on ecosystem restoration in Portugal. However, I’m speaking here in a personal capacity. My work in the circular economy revolves around finding the pressure points and practical levers that businesses can use to bring circularity into their daily operations. I’ve been fortunate to study the work of Closing the Loop for quite some time and contributed to a parallel research project examining waste compensation in African markets. So, when Closing the Loop approached me about co-authoring this whitepaper, it felt like a natural fit. I was very glad to help.

SecondaryMarket.news: From your perspective, what are the most pressing ambitions tech brands have today when it comes to circularity and sustainability?

Hugo Warner: Tech brands, like most businesses, face a common challenge: they’re interested in circularity, but they struggle to implement it at scale. There’s a general recognition that becoming truly circular requires a rethinking of how products are designed, manufactured, sold, and disposed of. This is not an easy transformation. It affects every part of the value chain and customer relationship. Moreover, companies often find it difficult to make the economics of circularity work. It’s disruptive and involves high upfront costs and organisational change. Yet, despite these hurdles, there is also an increasing awareness that the status quo is unsustainable. We are far from where we need to be in terms of eliminating environmental harm and improving the resource efficiency of the devices and systems we depend on.

That’s why I believe e-waste compensation offers such a promising pathway. It’s a real-world, actionable approach that can help tech companies start integrating circular principles without requiring them to completely reinvent themselves. It builds a business case for circularity and helps create the momentum needed for deeper transformation across the enterprise.

SecondaryMarket.news: In your experience, how open are tech companies to exploring or adopting circular economy practices?

Hugo Warner: Circularity involves a degree of self-disruption that established players are often slow to embrace. For now, many tech companies are primarily adopting circular practices that align with their immediate commercial interests. That means they’re most likely to act when their customers demand sustainability, when regulation forces their hand, or when circular strategies help reduce risk, particularly in the supply chain. However, these pressures are intensifying. Regulatory requirements are getting stricter, customer awareness is growing, and we’re seeing cracks in global supply chains. These are signals that the time for half-measures is passing.

Some forward-looking companies have already begun pointing the way. Fairphone, for example, has shown that it’s possible to build ethical devices from the ground up. Back Market and Kingfisher are also providing business models and success stories that offer alternative visions for how the tech industry might evolve. These are not just niche examples anymore; they’re beginning to act as reference points for what’s possible in the broader sector.

SecondaryMarket.news:  Can you share a summary and the key takeaways from the whitepaper?

Hugo Warner: The whitepaper makes the case that e-waste compensation, specifically Closing the Loop’s One for One model, can offer companies a pragmatic and strategic way to step into the world of circularity. The model involves collecting and recycling one end-of-life device in a developing country for every new device sold. What makes this particularly valuable is its ability to serve a variety of business objectives simultaneously. It allows companies to gain a competitive edge by demonstrating credible sustainability efforts. It helps them provide value to both customers and employees by reframing the conversation around waste, and it offers a more tangible and measurable alternative to abstract offsetting schemes like carbon credits. It also supports both compliance-driven sustainability goals and brand-led initiatives. And perhaps most importantly, it can help manage risk over the long term, particularly in strengthening supply chain resilience.

The paper also explores how companies can build on e-waste compensation to explore broader circular opportunities, especially in the way they position themselves with different types of customers and stakeholders.

SecondaryMarket.news: What unexpected insights came from writing this whitepaper? What surprised you the most?

Hugo Warner: Three things stood out to me. First, I was fascinated by the complexity that sits behind what appears to be a simple service. Closing the Loop’s process is underpinned by serious standards like TCO Certified, which ensures that waste compensation is not just a marketing tactic, but a system with integrity.

Second, I was struck by how quietly this model is being implemented by some of the companies that use it. Even large customers of Closing the Loop often fail to clearly communicate that the devices they sell or distribute are waste compensated. That’s a missed opportunity from a branding perspective, and it’s something I’d encourage companies to explore more actively.

Third, I was surprised by the extent to which the waste compensation model could be transferred to other product categories. There’s clear potential in sectors like textiles, automotive, and large household appliances. I see waste compensation as a versatile and scalable approach that’s only just begun to show its full range.

If I were to continue researching this theme, I’d love to explore how companies can use behavioural science to make waste compensation a natural entry point to their broader sustainability journey. The potential for anchoring more systemic change through a relatively simple act is, to me, quite exciting.

SecondaryMarket.news: What about e-waste compensation makes you excited about it in the context of integrating circular practices into business strategy?

Hugo Warner: The fact that so few companies are using waste compensation in their messaging means there is enormous untapped potential. If you're a tech brand that wants to differentiate itself, this is an easy and effective way to do so. It’s cost-effective, credible, and deeply tangible. That should be an exciting prospect for any brand operating in a crowded and increasingly sustainability-conscious marketplace.

SecondaryMarket.news: Consumer electronics brands are now under growing pressure from regulators and the public. How does e-waste compensation help companies stay ahead of new sustainability rules like the EU CSRD or UK SDS?

Hugo Warner: E-waste compensation won’t solve all compliance challenges, but it does offer a proactive, low-cost way to support both climate-related and non-climate ESG reporting. It’s simple to implement, doesn’t require major operational changes, and shows clear intent to take responsibility for environmental impact. That makes it a very practical tool in the face of evolving regulation.

It also fits neatly with voluntary standards such as TCO Certified, which is increasingly pushing companies to raise their product take-back rates. In many cases, this has become a kind of unofficial licence to operate in certain sectors. Waste compensation gives companies a way to anticipate and meet those rising expectations with minimal friction.

SecondaryMarket.news: In the whitepaper, you mention that waste compensation is often an easier decision for consumers than reuse or deposit return schemes. Why is that?

Hugo Warner: The main reason is that waste compensation involves very little effort from the consumer. Sometimes they just tick a box during purchase; other times it’s already bundled into the price. There’s no need to ship a device back or change how they consume. It’s a low-friction, high-impact solution.

That’s not to say other circular practices like reuse or repair are unimportant: far from it. But those solutions typically require more from the user. Waste compensation complements them by offering a simple on-ramp to sustainable behaviour.

SecondaryMarket.news: You mention that waste compensation can help brands amplify their existing circularity efforts. How so?

Hugo Warner: Sustainability reporting often feels abstract or technical to the average person. Waste compensation cuts through that. It’s directly linked to the product, it’s easy to understand, and it’s grounded in a real story often one involving social and environmental benefit in underserved communities.

That storytelling opportunity is golden. Brands can use it to start a broader conversation with their customers. It becomes a way to say: “Here’s something meaningful we’re already doing and here’s how it fits into our bigger sustainability picture.”

SecondaryMarket.news: You also write that waste compensation can unlock new customer segments. Who are these people, and how does the model appeal to them?

Hugo Warner: There’s a group of consumers who are deeply environmentally conscious but often left out of the traditional eco-marketing playbook. They keep their devices for as long as possible. They prefer second-hand markets. They’re sceptical of “green” branding and want transparency, not fluff.

These consumers are often overlooked, but they represent a significant portion of the market. Waste compensation, especially when applied to refurbished devices or subscription-based models, could resonate with this group. It’s practical, measurable, and doesn’t require them to buy into a lifestyle they don’t relate to. That makes it a powerful tool for reaching people who might otherwise remain disengaged.

SecondaryMarket.news: Looking ahead, how might e-waste compensation evolve as a gateway to deeper circular transformation?

Hugo Warner: Closing the Loop is very clear-eyed about where their model fits. They recognise that we’re still in a highly linear market, and that e-waste volumes will continue to grow. Waste compensation is not a magic bullet, but it is an effective and scalable response to that reality.

Looking forward, I can see several ways this model could evolve. It might act as a precursor or complement to extended producer responsibility schemes, easing companies into more demanding circular obligations. As more devices are collected, material recovery can become more efficient, which in turn strengthens the bargaining position of the countries involved in processing this waste. That could lead to better global equity in how e-waste is handled and create new options for supply chain diversification and resilience.

Perhaps most importantly, e-waste compensation could become a cornerstone of a more human-centred, commercially viable circular economy, one that starts with action, not theory.

Download the whole paper here: https://www.closingtheloop.eu/blog/circularity-for-tech

Learn more about the One for One service here (https://www.closingtheloop.eu/our-service), and stay tuned for the second take on waste compensation with Closing the Loop's co-founder and CEO Joost de Kluijver, coming out soon