Harmonizing Metrics to Measure Circularity A Call to Action 2024

Executive summary Natural resources are the foundation of all economies and societies, making their sustainable management crucial for growth and prosperity. However, the way that these resources have thus far been extracted, transformed, consumed and disposed of has given rise to the triple planetary crisis – climate change, biodiversity loss and pollution.1 To tackle the crisis, the idea of the circular economy is gaining traction among governments, businesses and societies. The circular economy (CE) is a systems transformation approach that promotes the prolonged use of resources at their highest value as a means of reducing extraction and waste, so as to create space for the regeneration of natural systems. However, without universally accepted standards and metrics, there are significant inconsistencies in how CE practices are defined, implemented and evaluated. This holds true across regions, sectors and organizations. These inconsistencies make it difficult to assess the effectiveness of circular initiatives in addressing global challenges and creating economic value, leading to fragmented efforts and undermining the potential to scale successful practices globally. This briefing paper builds on comprehensive reviews of existing metrics conducted by various organizations and integrates insights from an industry survey (with more than 400 companies) and expert interviews. It focuses on high-level challenges pertinent to private and institutional decision-makers, highlighting the complexity of quantitatively measuring progress towards circularity at multiple stages of a product’s life cycle – from design to production, use and reprocessing. The paper identifies the challenges in developing adaptable metrics that capture diverse circular flows, and the difficulties posed by unreliable and incomplete data on material flows, resource utilization and waste generation. It concludes by suggesting key principles for organizations working on harmonizing frameworks for CE metrics, emphasizing the need for global public-private collaboration to reach clear definitions, interoperable impact-driven metrics and robust data collection methods. Only with these principles in place will better benchmarking, transparency and global coordination towards a circular economy continue to advance. This multi-staged approach can help overcome the existing implementation barriers towards a circular economy, fostering economic growth while mitigating environmental impacts.Harmonized metrics are crucial to realizing the potential of the circular economy. To reach harmonization, the public and private sectors around the world must collaborate. Harmonizing Metrics to Measure Circularity: A Call to Action 5