ASEAN’s circular economy: Turning ambition into action

The ASEAN region is at a pivotal moment as it embraces the circular economy.

The region’s abundant natural resources and dynamic markets place it in a unique position to lead the global shift towards sustainability.

However, turning this ambition into action requires businesses to overcome significant challenges and explore financial innovation.

At the ASEAN Conference 2024 held in Singapore, more than 500 industry leaders from both private and public sectors gathered to discuss the practicalities of circular economy adoption in the region.

Moderated by Lee Weilin, Partner and Head of Sustainability Practice at legal firm Rajah & Tann Singapore LLP, the “Circular Economy” panel offered insights for businesses looking to achieve sustainability goals.

Breaking down barriers

A circular economy – designed to minimise waste and regenerate resources – offers great promise for sustainable growth. Yet, ASEAN businesses face distinct hurdles when adopting these principles.

Yukiko Tsukamoto, Partner at consulting firm Bain & Company, said that transitioning from linear to circular models requires businesses to rethink everything from their supply chains to product lifecycles. For many companies, especially those not originally built for circularity, this transition can be challenging.

Consumer behaviour, too, adds complexity as expressed preferences for sustainable products may not translate into actual sustainable purchases.

Eric Lim, Chief Sustainability Officer at UOB, explained the reason behind this gap: “Consumers care about sustainability, but they expect companies to take the lead in driving environmental change.”

“The future competition is no longer about charging more for sustainable options. It’s about offering excellent products at competitive prices while ensuring sustainability is baked in.”

Eric Lim, Chief Sustainability Officer, UOB

Often, businesses that fail to integrate sustainability into their core operations risk being excluded from global supply chains.

Sustainability is not an option, but essential for future competitiveness, says Mr Eric Lim, Head of Group Corporate Sustainability Office, participating as a panelist during the Circular Economy panel discussion.

Sustainability credentials are increasingly a prerequisite for procurement, especially in industries prioritising ESG (environmental, social, and governance) compliance. Infrastructure limitations also remain a challenge in ASEAN, particularly in countries where recycling systems are underdeveloped.

Companies aiming to adopt sustainable practices, like using recyclable packaging, often face hurdles due to fragmented systems across the region. Furthermore, the perception of sustainability as a costly endeavour continues to deter adoption.

However, Betul Genc, Senior Vice President and Head of ASEAN from staffing solutions company The Adecco Group believes that the biggest barrier may not be resources or infrastructure, but organisational mindset.

“Circularity requires stepping out of comfort zones. The greatest challenge lies in embracing change and seeing it as an opportunity rather than a disruption.”

Betul Genc, SVP and Head of ASEAN, The Adecco Group

Banking on sustainability

Financial institutions have emerged as key enablers of circularity, helping businesses overcome these financial and operational hurdles.

Lim shared UOB’s role in financing transformation across ASEAN’s value chains.

“UOB’s approach focuses on embedding sustainability into existing economic systems. By providing solutions like green trade finance, the bank facilitates the integration of circular principles into regional supply chains.”

Eric Lim, Chief Sustainability Officer, UOB

Recognising that many businesses struggle with where to begin, UOB developed tools such as the Sustainability Compass to guide companies through their first steps.

The tool helps companies to identify areas for immediate improvement and to assess their current sustainability performance—providing actionable insights for meaningful progress.

Additionally, UOB promotes ecosystem collaboration, linking businesses with renewable energy and sustainable transport solutions to de-risk and scale up their efforts.

For Lim, sustainability is not an option, it is essential for future competitiveness. He emphasised that businesses that are unwilling to adapt will risk becoming irrelevant in a low-carbon economy.

Pathways to action

To align ambition with action, businesses must adopt a multi-faceted approach. Clear internal and external communication of sustainability goals is essential.

Tsukamoto emphasised that simpler messaging may help bridge the gap between consumer intent and purchasing behaviour. Companies that successfully build trust around their sustainability practices stand to gain significant market share, particularly among younger consumers.

Investment in human capital also plays a vital role in advancing circular economy principles.

Genc advocated for reskilling and upskilling workforces to meet the demands of a rapidly evolving business landscape.

Implementing purpose-driven strategies will not only prepare employees for the future but will also enhance retention and engagement by connecting individual roles with broader sustainability goals.

Finally, collaboration is key. Businesses should form cross-industry and value chain partnerships to share resources and scale their impact. Lim shared that these incremental steps, such as reducing material usage, can lead to transformative results and economic resilience.

"Keep it simple—start by reducing resource use. Cutting down on materials, energy, or water directly translates into cost savings and drives sustainability.”

Eric Lim, Chief Sustainability Officer, UOB

Building a greener, more connected ASEAN

ASEAN’s journey towards a circular economy requires bold steps, strategic collaboration, and an unwavering commitment to sustainability. While challenges remain, the potential rewards—for businesses, consumers, and the environment—are immense.

Key agreements at ASEAN Conference 2024 set the stage for deeper regional collaboration. A landmark Memorandum of Understanding (MoU) was signed between the Singapore Business Federation, UOB, Rajah & Tann, and RSM Singapore, uniting their expertise to support Singapore businesses expanding across ASEAN.

The collaboration focuses on:

• Strategic platform: Leverage the ASEAN Conference as a launchpad for Singapore businesses seeking cross-border growth.
• Business mission: Partner in facilitating market exploration for Singapore companies through mission trips in ASEAN.
• Knowledge sharing: Provide businesses with in-market insights to navigate ASEAN’s evolving economic landscape.

UOB also inked two MoUs with Lingang Group, a state-owned enterprise specialising in industrial park development, and Invest Johor, Johor’s one-stop investment agency, strengthening cross-border opportunities.

A connected, sustainable ASEAN is shaping the future of business—where circular economies drive innovation, and collaboration opens new frontiers for growth. UOB stands ready to be your trusted partner in regional expansion and sustainable success.

About ASEAN Conference 2024

Beyond sustainability, the conference explored emerging trends, including the ASEAN Economic Community and the Johor-Singapore Special Economic Zone (JS-SEZ). For the first time, regional breakout sessions provided in-depth insights into Indonesia, Malaysia, and Thailand, led by government promotion agencies.

Discussions covered Indonesia’s advancements in digital transformation and sustainability, Malaysia’s investment landscape and business opportunities, and Thailand’s green investments initiatives – each crucial in shaping ASEAN’s economic future.

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