Business models drive circular economies for food systems

Photo: Hamish John Appleby / IWMI

Business models are not usually applied to agricultural and food waste recovery and reuse, but with the right combination of policies and incentives promising models could underpin more robust circular economies and transform rural-urban food and waste systems.


As cities become hungrier and thirstier, farmers are struggling with depleted soils, water shortages and climate uncertainty. At the same time, urban areas are becoming vast sinks for organic waste – and the disposal of this waste in environmentally and socially acceptable ways is inefficient and unsustainable. The way forward is to mimic natural cycles by adopting the model of a circular economy – processing organic food waste, wastewater and human excreta to extract energy, nutrients, organic matter and water for agricultural use.


WLE has identified opportunities for resource recovery and reuse (RRR) across the food, waste and sanitation sectors. Numerous technical and institutional solutions for recovering water, nutrients and energy from domestic waste streams have been compiled in the RRR report series. Recognizing that many of these solutions remain inaccessible to small-scale entrepreneurs and other stakeholders, WLE innovated a business model approach tailored to these groups. This is comprehensively covered in a catalog of over 45 case studies from around the world, each explaining the value proposition and value chain of the business in question and illustrating multiple pathways to partial or full cost recovery.   

Building a circular economy to improve waste management (IWMI)


The business model approach championed by WLE targets entrepreneurs and has been translated into curricula to appeal to a wider spectrum of stakeholders. Twenty-two universities, mostly civil engineering departments, have expressed interest in adopting the RRR curriculum and its business modules, and over 10,000 students have participated in online courses so far. A course on RRR entrepreneurship for fecal sludge management is currently being used in India to train thousands of officials in the business model approach. Public-private partnerships, which can help surmount financing challenges and encourage innovation, have been facilitated in Ghana with impressive results. A wastewater aquaculture project implemented by the TriMark Aquaculture Centre and the Kumasi Metropolitan Assembly won awards at the Sanitation Challenge for Ghana in 2019, while the JVL-YKMA Recycling Plant, which processes organic waste and fecal sludge into compost and briquettes, was selected as a 2021 SEED Low Carbon Award Winner. New innovative models, such as swaps for farmers in Iran willing to trade their freshwater in exchange for larger volumes of wastewater for irrigation from cities, are also being explored.


An enabling environment is critical to successfully apply business models to RRR innovations, particularly in low- to middle-income countries. The business model catalog and RRR series address:

Next steps

Challenges remain – while the waste and sanitation sectors will probably always require subsidies, RRR can provide different degrees of cost recovery which can attract private sector participation and increase the service level of public waste management. These returns on investment would come in the form of socioeconomic benefits from improved sanitation and health and recovered resources for agricultural food production. These returns are fully internalized by governments and citizens, but difficult for a private company to monetize. Innovative finance and regulatory mechanisms are therefore needed, as well as stronger outreach efforts to business schools to explore institutional innovations for closing rural-urban resource loops.  


Resource recovery from waste Business models for fecal sludge management Financing resource recovery and reuse Testing the potential of resource recovery and reuse Training manual for fecal sludge compost Recovering bioenergy in Sub-Saharan Africa Guidelines and regulations for fecal sludge management

SDGs supported

Ensure access to water and sanitation for all Promote inclusive and sustainable economic growth, employment and decent work for all Build resilient infrastructure, promote sustainable industrialization and foster innovation Make cities inclusive, safe, resilient and sustainable Ensure sustainable consumption and production patterns

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