In the last article “Circularity at company level”, we discussed what circularity means for companies and how companies can contribute to the broader Circular Economy while benefiting financially from this innovation.
Methods for pursuing circularity
Methods for pursuing circularity focus on three key areas:
- “Closing the loop” or returning resources back into the system to reduce the need for virgin material extraction (e.g., recycling)
- “Slowing the loop” or prolonging the lifespan of products to reduce consumption (e.g., through repair)
- “Narrowing the loop” or increasing resource efficiency to create with as little impact as possible (e.g., energy efficient machinery)
Indicators
To measure progress toward these goals, companies can establish their own indicators and KPIs for circularity, such as Duni Group, that EFF is a part of, which measures virgin plastic and FSC-certified material usage for its Circular at Scale initiative.
The following graphic shows several of the available tools and systems for measuring different elements of circularity for companies. Some, such as GRI 306 focus on reporting and can be applied universally to any user, whereas others, such as CIRCelligence, which are more tailor-made to the needs of the particular client.
These frameworks use indicators, with a wide range in the quantity of data points, which can be broken down into how they measure closing, slowing, and narrowing loops. Others focus more on the impact of circularity on revenue or overall impact or else on the systems that are in place for implementing circularity. For a few of these frameworks, you can see this breakdown below:
| Closing Loops | Slowing Loops | Narrowing Loops | Other | |
| WBCSD Circular Transition Indicators | % material circularity; % water circularity; % renewable energy; Waste recovery | Actual lifespan | % critical materials | Circular material productivity; % revenue circular; GHG impact of circularity; Land use change |
| EMF Circulytics | % virgin vs used vs renewable materials; Waste recovery; Recirculation % material; Waste water recovery | Uses per life | Water sources; Water resource efficiency before disposal; Renewable energy | Priority for top management; Inclusion in risks assessment; Inclusion in strategy; Targets, plans, tools; Circular Economy principles usage; Stakeholder engagement; Chemical usage; Circular Economy services/revenue; Finance |
| CE & PACE Examples | Recycling rate; Share of secondary resources; Share of renewable energy | Share of scarce resource | & Circularity; Share of sustainable products; # departments with circularity KPIs; Customer attitude; Employee awareness | |
| GRI 306: Waste | Waste management practices; Waste diverted from vs directed to landfill | Waste generation | ||
| Cradle-to-Cradle Certified* | Circular pathways (biological or technical) plans and actions; Use of recycled/renewable materials | Use of materials compatible with cycling | Circularity education; Circularity data transparency; Circularity innovation & design; Product design for easy disassembly |
If you’d like to learn more about any of these (or other) circularity metrics, or if you’re curious about developing your own, feel free to reach out to either EFF’s Environmental Compliance Expert, Diego Perdomo, or EFF’s Sustainability Expert, Marie Gomersall.
Sources:
– “Circularity indicators in practice: Exploring companies’ application and linkages to sustainability” by Emilia Paredes Bassi (2023) as published by Lund University IIIEE
– “Measuring circularity at the corporate level” by Irene Martinetti and Jarkko Havas (2021) as published in the journal Field Actions Science Reports
– “Product design and business model strategies for a circular economy” by Bocken et al. (2015) as published in the Journal of Industrial and Production Engineering
– “How can organisations measure their level of circularity? A review of available tools” by Valls-Val, Ibáñez-Forés, & Bovea (2022) as published in the Journal of Cleaner Production
– World Business Council Circular Transition Indicators
– Duni Group “Becoming Circular at Scale”
– Ellen MacArthur Foundation Circulytics indicators
– EU Circular Economy Monitoring Framework
– Duni Group Boston Consulting Group & Circular Economy CIRCelligence
– Duni Group Circular Economy & PACE
