Can the circular economy win over big business?

This could be a big year for the circular economy. In autumn, the European Commission is due to adopt the Circular Economy Act (CEA), aimed at supporting the EU in its stated aim to become a world leader in circularity by 2030. There is a clear environmental imperative behind the legislation, but also a geopolitical one. Europe imports the vast majority of all its critical raw materials; for example, 100% of its heavy rare earth metals come from China and 71% of its platinum from South Africa. The bloc is seeking to reduce its dependency on imports of key commodities, energy and materials, and as a result achieve greater self-sufficiency. Circular products are one route to achieving that. Circular ambitions Whether the EU’s aim is achievable, or not, brings into sharp relief the current state of the circular economy. According to the European Environment Agency, in 2024, secondary recovered materials made up 12% of total material use across Europe. This was only 1.5% higher than in 2010. But, by some estimates, the global circular economy is already worth around $700 billion and could reach several trillion within the next decade. This rate of growth would take considerable support from national governments, starting with something akin to the CEA, which aims to double the EU’s circularity rate to 24% and create a single market for secondary raw materials. The hope is that this will stoke demand from businesses to adopt more circular practices. Carsten Wachholz, business-policy engagement lead at the Ellen MacArthur Foundation, described the forthcoming act as “a critical opportunity to turn circular solutions from a niche proposition into a mainstream market choice,” adding that by harmonising rules across the single market the EU can allow the circular economy to “scale across borders”. From there the argument runs that rules created in Europe will be copied in other markets, shaping global supply chains and standards elsewhere. “The EU can work towards shared int