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Circular economy investment has surged since 2018, but high-impact solutions remain underfunded – new report
June 30, 2025
Circular economy investment has surged since 2018, but high-impact solutions remain underfunded – new report

Amsterdam, 30th June 2025 — Businesses engaging the circular economy raised nearly US$164 billion between 2018 and 2023, according to the Circularity Gap Report (CGR®) Finance released today. Investment in circular business models surged by 87% in the latter half of the period (2021–2023) compared to the earlier years (2018–2020), showing growing investor appetite and an increasing business case for the circular economy. Yet most capital is still flowing to more conventional solutions like car repair, resale of electrical goods and recycling, leaving many high-impact innovations underfunded.

The Circularity Gap Report Finance is the first empirical global study that quantifies and explains the global financial streams to circular business models, such as resale and repair, which allows for estimating the ‘gap’ in finance for a circular economy. It was authored by the Amsterdam-based impact organisation Circle Economy in collaboration with KPMG International, with support from the International Finance Corporation (IFC). 

The report highlights that circular economy investments can deliver risk-adjusted returns. Circular business models generate additional revenue, unlock new markets, and deliver greater value from fewer resources. In addition, circularity is emerging as a key strategy for the financial sector to manage resource risks from supply chain disruptions and material scarcity—risks that are now more relevant than ever, considering trade wars and geopolitical instability. 

The sector increasingly recognises these benefits: investment in the circular economy has grown from US$ 10 billion in 2018 to US$ 28 billion in 2023, peaking at US$ 42 billion in 2021. While this upward trend signals a strengthening business case for circularity, the failure to surpass the 2021 peak suggests waning momentum. Banks account for the majority of these investments in the form of debt. Nevertheless, circular investments still represent just 2% of all tracked capital (in the scope of this report), suggesting a vast unrealised potential.

Investments mainly go to conventional applications of circularity, like rental and repair, which have existed for decades. High-impact solutions and innovations in design and production received just 4.7% of all investment, despite their potential to eliminate waste and pollution at the source. 

‘The circular economy isn't just a sustainable solution—it’s an essential tool to manage financial risk,’ said Marvin Nusseck, Finance Lead at Circle Economy. ‘From supply disruptions tied to resource dependence on single countries, to the rising likelihood of taxes on virgin materials, the economics of resource use is shifting. Circular businesses are well-positioned to thrive in this new reality. That’s why investors must rethink how they assess risk and value in circular models—updating their frameworks to reflect the circular economy’s benefits and building resilience as a result.’

The global economy is only 6.9% circular today*, and the circularity gap continues to widen. Redirecting finance from linear to circular activities is crucial to reversing this trend. A more circular economy would enable us to maintain high living standards while reducing environmental pressure and building long-term economic resilience.

Investors and lenders can update valuation and risk assessment methods to reflect the retained value of durable, repairable, leased or reusable products and the reduced reliance on volatile global supply chains.

Financial regulators can accelerate this shift by standardising circular definitions and metrics as well as mandating disclosures related to the circular economy. This includes requiring companies to report natural resource dependencies and incorporating resource risk into financial stress tests—such as the impact of material shortages or ecological collapse.

Policymakers can explore a range of fiscal measures that more effectively recognise the social and environmental cost of resource use and the economic risk this involves. Public institutions can reduce the perceived risk of the circular economy by generating market demand for circular products and services through green public procurement and direct investment in critical circular infrastructure. 

High-impact circular models remain largely underfunded, representing significant untapped potential and a missed opportunity to build a more resilient financial sector. Realising this potential will require targeted policies, updated financial frameworks, and a concerted effort to shift capital toward circular solutions. 

‘The economic case for continued investment in the circular economy is clear. Business leaders, capital providers and investors now understand that in an uncertain geopolitical and economic environment you can’t have long-term growth without putting circular economy strategies at its heart,’ said Arnoud Walrecht, Circular Economy Lead, KPMG Netherlands. 

‘Our findings reveal that the economic case for investment in the Global Circular Economy has been made and is embedded in C Suite thinking and planning. Whether its tackling supply chain blockages or navigating the regulatory environment for higher levels of recycle or reuse models, the business community is facing a new reality. Our findings show that progress is being made, but far more scale and focus is required and we can achieve through collective, international focus on ensuring that higher levels of capital are directed towards circular economy opportunities.’ 

* According to the Circularity Gap Report 2025 by Circle Economy  

About Circle Economy

Circle Economy is driving the transition to a new economy. In this circular economy, we help businesses, cities, and nations leverage business opportunities, reduce costs, create jobs and inspire behavioural change. As a global impact organisation, our international team equips business leaders and policymakers with the insights, strategies, and tools to turn circular ambition into action.

Circle Economy has been at the forefront of the circular economy since 2011. Our annual Circularity Gap Report (CGR®) sets the standard for measuring progress, and we manage the world’s largest circularity database, encompassing data from over 90 nations, 350 cities, and 1,000 businesses. 

About KPMG International 

KPMG is a global organization of independent professional services firms providing Audit, Tax and Advisory services. KPMG is the brand under which the member firms of KPMG International Limited (“KPMG International”) operate and provide professional services. “KPMG” is used to refer to individual member firms within the KPMG organization or to one or more member firms collectively.

KPMG firms operate in 143 countries and territories with more than 273,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. Each KPMG member firm is responsible for its own obligations and liabilities. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.
For more detail about our structure, please visit kpmg.com/governance.

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New brief examines measures for the just transition in construction
June 10, 2025
New brief examines measures for the just transition in construction

The Circular Buildings Coalition (CBC) has published a new briefing highlighting the challenges and necessary actions to ensure a just transition for construction workers in Europe as the industry moves toward further integration circular economy practices. In particular, the report explores how increasing the use of secondary building materials and focusing on renovation, retrofitting and adaptive reuse will impact workers and who need to be involved to:

  • Integrate social standards into EU-wide circular standards and guidelines;
  • Engage in social dialogue for just transition planning;
  • Ensure adequate provision and investment in skills and occupational safety and health.

The construction industry is at the centre of the EU’s commitment to environmental and social sustainability, whereas the circular economy offers practical strategies to fulfil these pledges. The CBC’s earlier report—Four circular building pathways towards 2050outlined the following pathways for a circular built environment in Europe: 

  1. Build nothing new; 
  2. Build with the right materials; 
  3. Build efficiently; 
  4. Build for long-term use.

The CBC’s latest briefing zooms in on the first two pathways and examines their implications for the European construction industry.

Building with the Right Materials will increase demand for workers in secondary material sourcing, urban mining, procurement, and quality assurance. It will also require new expertise in material recovery, testing, certification, and digital tracking systems. The use of secondary materials adds complexity to construction, making quality control, adaptive techniques, and specialised handling more important than ever.

The Build Nothing New strategy prioritises renovation, retrofitting and adaptive reuse over new construction. It will shift the industry toward more labour-intensive projects, requiring workers with diverse and adaptable skills. These types of projects can expose workers to deteriorated structures and hazardous materials such as asbestos. To ensure worker safety, stronger protocols and targeted protections will be necessary.

Several challenges stand in the way of a just transition to circular construction for workers. The industry remains highly fragmented, with long and often opaque subcontracting chains that leave workers vulnerable to risks. Additionally, there is a lack of legally binding circular economy targets, as well as insufficient investment in skills development and training infrastructure. Lastly, circular business models, which are more labour-intensive, continue to struggle against traditional linear approaches that prioritise cost efficiency over sustainability.

To address these challenges, the briefing outlines key measures that governments, social partners, educators and other EU institutions need to consider when shaping policies and implementation strategies. These include integrating social standards into EU-wide circular economy guidelines, fostering social dialogue to ensure just transition planning, and investing in workforce skills and occupational safety and health (OSH).

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Regions Worldwide Join Forces in the Circular Alliance of Regions (CARe)
May 15, 2025
Regions Worldwide Join Forces in the Circular Alliance of Regions (CARe)

On 15 May 2025, Circle Economy joined leading regional networks around the globe to launch the Circular Alliance of Regions (CARe)— a global initiative uniting regional frontrunners in the circular economy. By joining forces, regions from around the world share knowledge, exchange best practices, and collaborate on accelerating the transition to a sustainable, circular society.

CARe brings together a diverse group of regional programmes, networks and alliances that are already using circular strategies to close material loops and lower environmental footprints. As a founding partner, Circle Economy will collaborate with:

Regions play a crucial role in the circular transition. They connect local ecosystems, businesses, governments, and citizens—making them powerful changemakers. Through CARe, regional pioneers can scale their efforts, learn from international peers, and jointly tackle global challenges with local solutions.

CARe aims to expand its reach and impact through a joint declaration of intent. This shared commitment will formalise the alliance and open the door for more regions to join in the coming years. The declaration will highlight common goals, guiding principles, and opportunities for joint actions.

Invitation to connect

With CARe now in motion, our next priority is to evolve into a truly impactful and cohesive network. To achieve this, we must refine our collective vision, enhance coordination, and establish robust mechanisms for sharing knowledge. These foundational steps will ensure CARe becomes a powerful catalyst for regional change worldwide. We warmly invite any region that shares our ambition to get in touch and join the alliance.

Contact Krijn Smits at krijn@circle-economy.com for more information.

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Global circularity rate fell to 6.9%—despite growing recycling
May 13, 2025
Global circularity rate fell to 6.9%—despite growing recycling

Key highlights:

  • Nearly 90% of the materials we use end up as waste or emissions and are not or cannot be cycled back into the economy
  • Transitioning to a circular economy can help cut material use, reduce emissions, protect biodiversity, while increasing business resilience and unlocking new growth opportunities.
  • The report introduces 11 circularity indicators to help businesses and policy makers embrace the critical opportunity to reshape policies, redesign systems, and accelerate circular solutions.  

13 May 2025, São Paulo — Only 6.9% of the 106 billion tonnes of materials used annually by the global economy come from recycled sources—a 2.2 percentage point drop since 2015, according to a new report released today by Circle Economy in collaboration with Deloitte Global. The Circularity Gap Report 2025 (CGR®) finds that global material consumption is outpacing population growth and generating more waste than recycling systems can handle—underscoring the need for global circular economy targets, system-level transformation, and multilateral collaboration. 

For the first time, CGR® analyses how materials flowing into, accumulating and flowing out of the global economy are contributing to, or hindering a circular economy—providing a comprehensive assessment of the current state and an initial set of proposed targets to help reduce material consumption and increase global circularity. Leveraging 11 circularity indicators, the analysis helps pinpoint how various levers (e.g., agricultural sustainability and infrastructure development) can be pulled to boost circularity, highlighting a vast wellspring of untapped potential.

Together with the CGR 2025, Circle Economy has launched the CGR® Dashboard —a database unlocking the millions of data points collected since the annual report’s inception, with the aim of democratising circularity data to enable policymakers, business leaders, and changemakers worldwide to make informed decisions.

While the use of recycled materials increased by 200 million tonnes from 2018 to 2021, overall material consumption rose much faster, offsetting these improvements. The report calls for reducing reliance on virgin materials by prioritising recycled content, enhancing resource efficiency throughout operations and value chains, and designing products for longevity through durable design, repairability, and modularity.  

If we were to recycle all recyclable materials—without reducing consumption—global circularity could rise from 6.9% to 25%. However, doing so is unlikely in practice, as some materials remain too difficult or costly to recycle. That is why the report calls for measures that reduce overall material consumption alongside boosting recycling efforts. 

The current recycling system is not only inadequate in addressing the global waste crisis but also inefficient. This represents an opportunity for business leaders across sectors to improve recycling systems and minimise waste generation through circular design principles, invest in infrastructure and technologies to improve waste collection, and explore high-value applications for waste. 

Moreover, most recycled materials come from industrial and demolition waste, while household waste plays a minor role. Just 3.8% of all recycled materials originate from everyday items individual consumers use and discard. 

‘'Our analysis is clear: even in the ideal world, we cannot solve the triple planetary crisis by mere recycling. The much-needed systemic change requires fundamental change. This means unlocking circular potential in stocks like buildings and infrastructure, managing biomass sustainably and stopping sending perfectly renewable materials to landfills. This change doesn’t happen outside ourselves. We all need to make different choices, be bold, and invest to implement circular solutions across value chains,’ said Ivonne Bojoh, CEO of Circle Economy.

The report calls for the establishment of global circular economy targets to lower material use and energy demand alongside increasing recycling rates. This can be achieved by promoting circular design principles, optimising the lifetime of existing products and components, and ensuring the use of recycled materials becomes the norm for businesses in all industries and regions. 

Governments have an opportunity to help shape conditions for circularity through smart policies and multilateral collaboration. By setting a clear vision and supporting circular initiatives, they can create favourable conditions for circularity. This includes shifting tax burdens from labour to material use, reorienting subsidies from linear activities, and funding circular projects.

David Rakowski, partner, Deloitte UK, global leader for Circularity, said: “Business leaders who look beyond compliance to proactively embrace a circularity mindset can help their organisations unlock new value and market opportunities, reduce costs, and build long-term supply chain resilience. This year’s CGR offers leaders actionable insights to help them decide where to focus their circular efforts, make meaningful progress toward their sustainability goals, and build a resilient global economy that honours our planet's limits.”

Strong regional and international collaboration—across both the private and public sectors—will be key in successfully tackling resource use and reduction.

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Circle Economy Becomes Founding Member of the Dutch Association for the Circular Economy
March 20, 2025
Circle Economy Becomes Founding Member of the Dutch Association for the Circular Economy

During the Dutch Week of the Circular Economy, 48 companies and umbrella organisations, including Circle Economy, joined forces to launch the Dutch Association for the Circular Economy (NVCE). Backed by more than 1,700 companies, the NVCE aims to position circularity as a key solution to geopolitical, economic, and social challenges.

The NVCE unites organisations involved in reuse, recycling, lifespan extension, and the sharing economy. Currently, circular businesses in the Netherlands face significant barriers, such as double VAT on reused products and high costs for secondary materials. The NVCE seeks to bring these challenges to the attention of the national government and advocate for policies that make circular business models the norm.

By putting circular entrepreneurship on the political agenda, making targeted policy recommendations, and acting as a key discussion partner in legislative matters, the NVCE ensures fair opportunities for entrepreneurs while reducing the Netherlands’ reliance on scarce raw materials.

'We are going to have to help each other!' said State Secretary for Public Transport and the Environment, Chris Jansen, during his visit to the NVCE formation meeting at the Port of Rotterdam.

Steven van Eijck, Special Government Representative for the Circular Economy, added: 'Bringing together circular frontrunners is essential, and that’s exactly what the NVCE does.'

‘Circle Economy is a global organisation, yet we remain dedicated to our home country. In our early days, we guided both national and local governments in the Netherlands in designing their first circular economy strategies. We know that collaboration is key to accelerating the much-needed transition. That’s why we are proud to join the NVCE, and believe we can achieve even more together’, said Ivonne Bojoh, CEO of Circle Economy.

About the NVCE: A strong voice for the circular economy

The Dutch Association for the Circular Economy (NVCE) represents 48 entrepreneurs and umbrella organisations, collectively supporting over 1,700 companies leading the transition to a circular economy. The NVCE works towards a future where raw materials are used efficiently, waste is minimised, and reuse and recycling become standard practice. By consolidating practical experiences and making targeted recommendations to policymakers, the NVCE builds influence in national politics and helps establish circular entrepreneurship as the norm. This effort strengthens the Netherlands’ economic resilience and reduces its reliance on scarce raw materials.

Meet the founding members of NVCE: www.nvce.nl

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Ivonne Bojoh: circularity is not yet a requirement—that's why it is a strategic opportunity
February 11, 2025
Ivonne Bojoh: circularity is not yet a requirement—that's why it is a strategic opportunity

Ivonne Bojoh, CEO of Circle Economy, shares her insights on circular economy’s benefits for businesses 

Circle Economy has been at the forefront of the circular transition since 2011. Why is this transition more critical now than ever before?

The world faces a triple crisis—climate change, biodiversity loss, and pollution. The circular economy is one of the most effective solutions to address these issues. Our 

Circularity Gap Report 2021 shows that 70% of global emissions are tied to material use and handling. By applying circular economy strategies, we can cut excessive material consumption and thereby reduce carbon emissions. Moreover, the Circularity Gap Report 2023 highlighted that embracing circularity can help reverse the overshoot of five planetary boundaries, including those related to water and soil health. Time and again, our analysis demonstrates that a circular economy offers a holistic, effective approach to tackling multiple global crises simultaneously.

Beyond its environmental benefits, the circular economy is simply a smarter, cleaner, and more efficient system. At the dawn of the 20th century, oil overtook coal because it was a more efficient and less polluting energy source. Today, we have found an even better alternative—renewable energy—which is poised to render oil obsolete. However, unlike the past, we no longer have the luxury of time to let this transition unfold gradually. To combat the pressing crises we face, we must accelerate both the energy and circular transitions. 

Can you reflect on the Netherlands' role in the global circular transition?

The Netherlands has been a pioneer in embracing circularity. We worked with many local governments leading the transformation, from Amsterdam to Groningen, and are currently working on the Circularity Gap Report Friesland, together with Circulair Friesland. We take pride in guiding the City of Amsterdam on its circular economy journey, which earned it a spot as a finalist for the prestigious Earthshot Prize in 2022. Beyond visionary policymakers, entrepreneurs across these cities and regions are also driving the shift toward the circular economy.

The Netherlands boasts a high circularity rate and a robust policy framework that supports circular innovation. The Circularity Gap Report Netherlands measured the country’s circularity at 24% in 2020. Initiatives like the Dutch National Circular Economy Programme and strong public-private partnerships have provided a strong basis for circular innovation. 

However, like many affluent nations, the Netherlands grapples with unsustainable consumption habits—buying and wasting more than necessary. Our recent reports have shed light on these challenges. For example, used clothing exports from the Netherlands totalled more than €193 million in 2022. This is the highest export value in the five years, indicating a strong overconsumption trend. An average Dutch consumer now buys 46 new clothing items and disposes of 40 (!) each year. These striking numbers underscore the need for both the country and its residents to intensify their efforts toward sustainable and circular consumption. 

Many businesses and governments understand the sustainability case for circularity, but the economic benefits remain underexplored. How does Circle Economy bridge this gap?

There's a common misconception that sustainability comes at a cost. In reality, circular strategies drive efficiency, reduce costs, and open new revenue streams. For instance, models like product-as-a-service (PaaS) and resale schemes allow businesses to tap into new markets and foster stronger connections with clients. 

At Circle Economy, we analyse material flows to identify business opportunities, expose inefficiencies, and provide actionable insights, forming a solid basis for informed decision-making. Beyond optimising operations, we emphasise the importance of resilience and future-proofing. With evolving legislation and true pricing on the horizon, along with the undeniable impacts of our current linear economy, resource-intensive businesses have both an opportunity and an imperative to change. 

Can you share some success stories?

Swapfiets is a prime example of a successful international business built on the PaaS model. Starting as a Dutch enterprise, Swapfiets now offers its circular services in eight countries. They have redefined mobility by shifting ownership to service and maintenance models, thus extending the lifecycle of their products and ensuring that resources are used optimally. 

Additionally, Decathlon, traditionally a linear retail giant, has recently adopted circular business models like resale, tapping into new markets and catering to customers interested in trying new sports without the commitment of purchasing new and expensive equipment. 

IKEA has also taken steps toward circularity with its buy-back program, offering second-hand furniture alongside new products. These initiatives illustrate how businesses can successfully integrate circular models, proving that sustainability and profitability can go hand in hand. 

There is no shortage of talks about the circular economy; what we need is to create impact at scale. But how? 

It's essential to reshape the narrative and view the circular economy as a powerful risk mitigation tool. Challenges like raw material shortages, supply disruptions, and geopolitical risks can be effectively mitigated through circular strategies—by shortening supply chains, doing more with less and sourcing (recycled) materials locally. 

So, the circular economy is not merely about ticking compliance boxes; it's about ensuring a company's long-term viability and resilience. When companies start to see investment in sustainability as a driver of competitive advantage, the shift from mere compliance to proactiveness becomes inevitable.

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Circle Economy welcomes four new Board Members
December 9, 2024
Circle Economy welcomes four new Board Members

Circle Economy is proud to announce the appointment of four sustainability leaders to our Supervisory Board. Each new member brings a unique perspective and a shared commitment to accelerating the transition to a circular economy. Their expertise and experience will be instrumental in advancing our mission to double global circularity by 2032. 

’We are honoured to have been approached by so many distinguished experts who are keen to join our Supervisory Board. Selecting just four of them to complement our existing non-executive Board was a challenging task. Gordana, Marcus, Nancy, and Sisse bring a wealth of perspectives and experiences, and I am excited to collaborate with them as we continue to support global transformation towards 17% global circularity.’ — Ivonne Bojoh, CEO of Circle Economy 

Meet the new Supervisory Board members! 

Dr. Gordana Kierans

Dr. Gordana Kierans has dedicated her career to empowering changemakers, CEOs, and government officials to embrace the circular transition. With an extensive consulting and coaching background across diverse cultural and economic contexts, Dr. Kierans brings a much-needed global perspective to our Board.

Prof. Nancy Bocken

Professor Nancy Bocken is a renowned academic and entrepreneur specialising in sustainable business and circular economy practices. She teaches at Maastricht University and co-founded HOMIE, a sustainable business venture. As a strategic sustainability advisor to various organisations, she bridges the gap between cutting-edge research and real-world application.

Sisse Norman Canguilhem

With 18 years of leadership in international policy, sustainability, and corporate affairs, Sisse Norman Canguilhem brings unmatched expertise in advancing global sustainable policies. A former Deputy Director of the Danish Ministry of Foreign Affairs, she contributed to Denmark's international climate policy both bilaterally and at multilateral level at COP, the World Economic Forum and other high-profile events.

Dr. Marcus Gover

As an accomplished sustainability leader, Marcus Gover offers over two decades of board-level experience in both commercial and non-profit sectors. His expertise spans climate action, food systems, clothing, and plastic pollution. Now a consultant and non-executive director, Marcus brings exceptional strategic, commercial, and technical leadership to Circle Economy.

‘With the addition of four new Supervisory Board members, we aim to infuse our work with renewed energy. Their diverse international and interdisciplinary expertise will help ensure that the circular economy gains recognition at all levels —from academia to business to government. A heartfelt thank you and a warm welcome to these exceptional individuals joining our team!’ — Robert-Jan van Ogtrop, Founder of Circle Economy & Chairman of the Supervisory Board

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Just 0.3% of materials used by the global textile industry come from recycled sources, with almost no textile-to-textile recycling
November 28, 2024
Just 0.3% of materials used by the global textile industry come from recycled sources, with almost no textile-to-textile recycling
  • Synthetic fabrics, such as polyester, account for 63% of the materials used in clothing production, with 30% of all clothing produced discarded before ever being worn.
  • The textile industry now accounts for 3.5% of carbon emissions and water scarcity, along with other negative impacts. 
  • Embracing circular economy principles could reduce the environmental footprint of the textile industry by up to 50%.

28th of November 2024, Amsterdam—The global textile industry, including fashion and home textiles, consumes 3.25 billion tonnes of resources each year to produce increasingly short-lived items. Only 0.3% of these materials come from recycled sources, primarily plastic bottles. The use of recycled textiles in production remains minimal, while oil-derived synthetic fibres like polyester are gaining ground, now accounting for 70% of the materials used to make our clothes. 

These are the main findings from the newly released Circularity Gap Report Textiles by impact organisation Circle Economy and the H&M Foundation. The report calls for urgent action to diminish the industry’s environmental impact by embracing circular economy principles such as reuse, recycling, and slow fashion.

One of the primary barriers to circular textiles is the overproduction of cheap, low-quality, primarily synthetic garments, with mass-market brands now releasing up to 24 collections per year. The textile industry has become one of the biggest consumers of resources, leading to environmental damage worldwide. The report estimates that the sector contributes nearly 3.5% of global greenhouse gas (GHG) emissions linked to climate change, 5% to nutrient overload that disrupts marine and freshwater ecosystems, and accounts for 3.5% of water scarcity. 

Two countries—China and the United States—play a significant role in these environmental impacts, with China being the largest textile producer and the US the largest consumer. Remarkably, the environmental impact per person in the US is five to eight times higher than the global average, driven by heavy textile consumption.

Hilde van Duijn, Managing Director of Circle Economy Foundation said that ‘The textile and fashion industry can considerably reduce its environmental footprint through circular practices. However, this transition will impact the livelihoods of the 140 million workers employed in textile supply chains. Ensuring a just transition for these workers should be a top priority for both governments and businesses.’

Embracing circular economy solutions across the textile value chain can help mitigate climate change and water scarcity, preserve biodiversity and human health and reduce air pollution, among other positive impacts. The report outlines strategies to triple the textile industry’s circularity and reduce its environmental impacts by up to 50%. 

These strategies include boosting garment durability through the smart use of synthetic fibres while ramping up textile recycling. Producing natural fibres sustainably is crucial, as traditional farming methods for materials like cotton and wool can exacerbate environmental damage through excessive water, land, pesticide, and energy use. Ultimately, it finds that a circular textile industry is impossible without a dramatic cut in consumption. The average European today consumes a staggering 26 kilograms of textiles each year, and discards 12 kilograms. Embracing slow fashion, which favours quality over quantity, and supporting businesses in adopting rental or sharing models is key to reducing overproduction, while more efficient manufacturing methods can drastically reduce pre-consumer waste. 

Christiane Dolva, Head of Innovation, Research & Demonstration at the H&M Foundation said that ‘We supported this report to provide the textile industry with actionable insights. The report highlights the most impactful circularity efforts. While not a complete solution, the circular economy is a powerful tool for driving meaningful change. We hope these insights will support industry-wide transformation, benefiting both people and the planet.’   

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