The Key Elements of the circular economy

The Key Elements of the circular economy

Finding a Common Language

The circular economy has seen a significant increase in interest over the past few years and is continuing to gain steady momentum.

With this surge in popularity, many mention the term 'circular economy' or 'circular principles' without really explaining what they mean. On the other hand, if the term is defined, the definition widely varies depending on the problems being addressed, the audience or the lens through which the author views the world.

In an effort to define a common language for the circular economy, Circle Economy Foundation does continuous research on the terms and definitions used in practice and in the literature.

Circle Economy Foundation mapped the various terms and definitions used by over 20 organisations—NGOs, government agencies, academia, consultancies, etc.—and conducted an in-depth literature review. After interpreting this research, eight key elements emerged that defined the majority of terms linked to the circular economy.

Core elements


The core elements of the circular economy relate to direct circular handling of material and energy flows—for example closing loops, extending product lifecycles and increasing usage intensity.


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PRIORITISE REGENERATIVE RESOURCES

Ensure renewable, reusable, non-toxic resources are utilised as materials and energy in an efficient way.


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Business

Vitens is the largest drinking water company in the Netherlands and is pioneering innovative approaches to ensure a sustainable and continued supply of drinking water to the country.

City

The municipality of Venlo, Netherlands has commissioned its new city hall—built by Kraaijvanger—to be built in alignment with cradle-to-cradle principles. By embracing this new approach, Venlo has demonstrated what is possible for the future of the built environment, and through the success of the project has made a requirement for all new construction in the city to be cradle-to-cradle going forward.

NATION

Tunisia’s green economy plan looks at opportunities for, inter alia, organic agriculture and environmental services with the support of energy efficiency options and energy use, renewable water conservation, water reuse and integrated waste treatment management. 

CIRCULAR JOB

The solar panel installer works within the energy sector to promote the use of solar as a renewable energy source. The job contributes to the circular economy by ‘prioritising regenerative resources’, the first strategy of the circular economy.

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Stretch The lifetime

While resources are in-use, maintain, repair and upgrade them to maximise their lifetime and give them a second life through take back strategies when applicable.

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BUSINESS

Royal Philips is a global healthcare company that aims to make the world healthier and more sustainable through innovation. The company is starting to focus on remanufacturing and refurbishing programs for medical imaging equipment.

CITY

ReTuna, the world’s first recycle mall, has been established in Eskilstuna, Sweden. Almost everything sold at ReTuna’s over a dozen stores is repurposed or upcycled. The hub- and showcase of sustainable consumption is also host to a range of classes and trainings to boost the skills of the local population.

Nation

Sweden has introduced economic incentives that incentivise repair, for example reducing vat at point of sale, and offering tax rebates to citizens on repairs. 

CIRCULAR JOB

The appliance technician contributes to the circular economy by extending the lifetime of products. By embodying one of the strategies of the circular economy, ‘to preserve and extend what’s already made’, all repair and maintenance jobs are considered circular.


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USE WASTE AS A RESOURCE

Utilise waste streams as a source of secondary resources and recover waste for reuse and recycling.


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BUSINESS

Renewi, formed from the merger of Shanks and Van Gansewinkel, is a leading waste-to-product business that operates across nine countries. The company focuses on transforming waste materials into a wide range of useful products.

City

The Austin Materials Marketplace facilitates the exchange of waste materials between local companies by providing a platform to connect supply and demand of secondary materials. The platform has successfully transferred almost a million pounds of waste in 2019, facilitating recycling and reuse around Austin.

Nation

In November 2018, the Canadian Council of Ministers of the Environment (CCME) approved in principle the Canada-wide Strategy on Zero Plastic Waste. Ministers agreed that taking action to reduce plastic waste, support improved reuse and value recovery is vital to lowering the amount of plastic released in our environment. Nearly ninety per cent of Canada’s plastic waste is not recycled or recovered. This represents an economic loss of $7.8 billion.


CIRCULAR JOB

The recycling operative’s job consists of sorting through recyclable waste and separating materials to be recovered. This sorting and separating constitutes an essential element in the recycling process, which involves the ‘use waste as a resource’ strategy, and thus presents itself a circular job. Day to day activities of the recycling operative include physical labour and machine handling such as forklift driving.


Enabling elements


The enabling elements of the circular economy support the implementation and uptake of circularity by removing some of these obstacles for core elements—for example, using waste as a resource is difficult to implement because of a lack of knowledge of quantity and quality of waste streams, but can be enabled through the use of a digital platform which exposes waste streams and their characteristics in a certain region.

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RETHINK THE BUSINESS MODEL

Consider opportunities to create greater value and align incentives through business models that build on the interaction between products and services.


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BUSINESS

Mud Jeans has a trailblazing product-as-a-service model by leasing denims to people. This promotes unique customer engagement and provides and incentivises product life-extension.

City

The city of Seoul has focused its circular efforts on the sharing economy through the Seoul Sharing City project. The city-wide initiative promotes and facilitates the sharing of dozens of products, from bikes, to housing, and clothing. 

Nation

France is adjusting incentives around waste, and has introduced a law which contains about fifty measures providing for new obligations, prohibitions and tools around different waste streams. For example, polluter pays and prohibitions to control irreversible environmental damage. 


Circular Job

The leasing process manager is responsible for the coordination of the external service partners distributed across market segments. By contributing to the workings of a product as a service model, the leasing process manager contributes to the circular economy through the ‘rethinking the business model’ strategy.

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TEAM UP TO CREATE JOINT VALUE

Work together throughout the supply chain, internally within organisations and with the public sector to increase transparency and create joint value.


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Business

DSM is a multi-national, chemical company that is active in health, nutrition, and materials. The company engages in frequent collaboration internally to develop innovative solutions, and also engages in a variety of partnerships with academia and the public sector.

City

The Circular Cities declaration is a commitment for cities and regions to use the levers at their disposal to transition from a linear to a circular economy. The declaration has been signed by over 30 cities throughout Europe, and brings knowledge experts towards a circular, and more resilient, future.

Nation

The President of Taiwan, Tsai Ing-wen, has developed a policy transformation plan encompassing a variety of pillars—including biotech, green energy and the circular economy. The Netherlands has emerged as a significant partner for Taiwan in reaching these goals, as both countries are of a similar size, lack natural resources, and lack space to deal with waste materials.

Circular JOb

The director of a trade association manages a membership organisation composed of multiple companies within a specific industry. The director can support the circular economy by encouraging greater collaboration, knowledge sharing, and networking between companies. As such, the director can employ the ‘collaborate to create joint value’ strategy in order to contribute to the circular economy.


Account for the systems perspective during the design process, to use the right materials, to design for appropriate lifetime and to design for extended future use.


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Business

Desso is an international designer and producer of circular carpet tiles and broadloom. The company designs its own products and has developed innovative new techniques that allow its products to be collected and recycled or reused.

City

The City of Paris has championed the idea of a 15-minute city within its urban design; whereby everything that residents need can be reached within 15 minutes, either by foot, bike or public transport. This forward thinking approach to urban design rethinks the driver of urban consumption, and cuts the need for fossil fuel powered transportation, while improving the quality of life for its residents.

Nation

China’s sponge cities programme, piloted in 16 cities, and expanded to 30, designed and implemented low-intervention and low-cost infrastructure like permeating pavements that allow water to penetrate the ground and replenish groundwater supply, or rooftop gardens which absorb up to 70% of rainfall.

Circular Job

An architect is responsible for designing buildings and by extension for the materials used during a building’s construction, its energy efficiency during the use phase and the potential for material recovery when it is demolished. An architect can thus contribute to the circular economy by ‘designing for the future’.

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INCORPORATE DIGITAL TECHNOLOGY

Track and optimise resource use and strengthen connections between supply chain actors through digital, online platforms and technologies that provide insights.


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Business

Floow2 is the first online, asset-sharing marketplace for companies. The platform reduces costs and increases product utilisation by matching supply and demand.

City

To reduce water leakage in the county of Miame-Dade, a leak detection technology, Gutermann, has been installed throughout the county—enhancing its ability to pinpoint and quickly resolve leaks. The system reduces leaks to just 10% non-revenue water loss—extending the life of infrastructure, increasing revenues and preventing water from going to waste.

Nation

The Luxembourg data sharing initiative launched by the Ministry of Economy aims to create and provide a regulated framework for circular data about products.

CIRCULAR JOB

The data analyst makes sense of large amounts of information by means varying from simple data aggregation to complex data mining. The data analyst’s occupation involves the ‘incorporate digital technology’ strategy and thus allows for smart systems and technology integration in the circular economy. This job often requires tertiary education in relatively new fields of data science and computer engineering.


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STRENGTHEN & ADVANCE KNOWLEDGE

Develop research, structure knowledge, encourage innovation networks and disseminate findings with integrity.

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Business

Metabolism of Cities is an open source, community-led platform, with the aim to improve the collection, sharing, and analysis of urban metabolism data and tools.

City

The city of Gothenburg has co-launched an online map that compiles and showcases local rent, share, borrow, give, and exchange initiatives. The Smart Map helps residents identify opportunities to practically engage in the circular economy.

Nation

The Philippines Green Jobs Act (PGJA) passed into law in April 2016, contains specific clauses that promote skills for green jobs, sustainable growth and resilience against climate change through means such as identifying skills needs;  maintaining a database of green occupations; formulating training regulations; skills assessment and certification; curriculum development; the implementation of training programmes; and fiscal incentives to encourage enterprises to provide training.

Circular Job

The teacher transfers knowledge and skills to the (future) workforce so as to equip citizens with the skills for all circular economy strategies. The teacher’s occupation communicates the latest research about the circular economy, teaches new mindsets, and creates an environment to strengthen and advance knowledge for the circular transition. This job often requires a tertiary education and accompanying additional certifications.

for more information about this framework
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The full framework documentation is available here.