Shuddha Sangama

Research · Circular economy

Cost to Earth

Measuring what production leaves behind, and what consumption sends back to the planet.

Original work by Dhareshwar Gudanmath Mallinathan · First published on SSRN, December 2024

Read the paper on SSRN

Where it started

In Bengaluru in 1992, Dhareshwar's grandmother collected empty milk packets and returned them to the dairy. On a 5 or 10 rupee packet she got 5 or 10 paise back, about 1% of the price. Cost to Earth asks a simple question: why don't we do this for every product we make?

The problem

Most products are made in one country and thrown away in another. Sustainability is usually measured where things are made, so the waste left where they are sold goes uncounted. A recycling logo on the pack is not a plan. No country should become the dumping ground for someone else's packaging.

Key ideas

  1. eBOM: what's left at end of life

    Every product has a bill of materials (BOM). The parts that can still be pulled out when the product is done form the eBOM.

  2. Three paths: Decompose, Recycle, Reuse

    Every eBOM part ends up in one of three places: back into the same supply chain (reuse), into another one (recycle), or into the ground or water (decompose).

  3. Circularity Score, measured where it's made

    The share of a new production run made from recycled or reused material instead of virgin material, on a scale of 0 to 100.

  4. Cost to Earth, measured where it's sold

    The share of a product's volume that must decompose, multiplied by how many generations it takes (one generation = 75 years).

  5. One Sustainability Score

    Put both scores together and companies can be ranked in a Sustainability Magic Quadrant, beyond CO2 headlines alone.

A worked example

The same 500 ml drink in three containers:

Plastic bottle

Circularity Score 90
Cost to Earth 2% × 3.33 generations

Glass bottle

Circularity Score 99.7
Cost to Earth 1% × 13.33 generations

Aluminium can

Circularity Score 90
Cost to Earth under 1% × 3.33 generations

Glass recovers the most material, but what's left of it takes so long to break down that it still costs the earth the most. A high recycling rate alone doesn't tell the whole story.

Getting there, in three stages

  1. Segregate. Mark every part as extractable or not, assign each one a path, and score each product per plant.
  2. Measure. Add incentives for returns, calculate Cost to Earth, and benchmark within each industry.
  3. Close the loop. Set yearly targets, fund recycling and reuse, and rank manufacturers publicly.

Who it serves

Shoppers get a clear number to choose by. Countries get a plan for every part a product leaves behind. Manufacturers get one standard way to measure themselves. The model works out of data most manufacturers already hold, and it maps to the UN Sustainable Development Goals, especially responsible consumption and production (SDG 12) and life on land (SDG 15).

What professors have said

[Two or three short quotes from professors, with their name, university and permission.]

The video series

Part 1 · BOM, the building block
Part 2 · Air, water and land pollution
Part 3 · Sustainability through supply chain

Working paper (preprint, not yet peer reviewed). Cite as: Gudanmath Mallinathan, D. (2024). Cost to Earth: BOM Sustainability Model. SSRN. ssrn.com/abstract=5077638