Circular Economy initiatives for large businesses: closing the Circularity Gap
As climate pressures rise, resource extraction accelerates, and waste volumes soar, the global economy is at a critical crossroads. The circular economy provides a resilient, regenerative alternative to the traditional linear model of “take, make, dispose.” But to move the needle on climate change, resource use, and waste reduction, large businesses must drive circular transformation at scale.’
This article explores what circular economy initiatives look like for large enterprises, why they matter, and how businesses can practically embed circular thinking across their operations. With the global circularity rate falling from 9.1% in 2018 to just 6.9% in 2025, the need for urgent action is more pressing than ever (Circularity Gap Report 2024).
Here is what we’ll cover:
- What are Circular Economy initiatives?
- The Circularity Gap: A worldwide challenge
- Why Circular Economy initiatives matter for large businesses
- Types of Circular Economy initiatives in practice
- Sector-based examples of Circular Economy initiatives
- Challenges to scaling circular initiatives
- Practical steps to get started
- Looking ahead
- FAQs
- Partnering with Reconomy
What are Circular Economy initiatives?
Circular economy initiatives are practical steps businesses take to reduce resource use, extend product life, and eliminate waste. These include:
- Encouraging the design of products for durability, reuse, and recyclability
- Building closed-loop systems for waste and material recovery
- Meeting policy requirements like Extended Producer Responsibility (EPR)
- Using digital platforms to track resources and optimise flows
From recycling and reuse to climate-focused redesign, these initiatives help businesses reduce their impact on the environment and unlock new economic value.
New to circularity? Reconomy’s free Circular Economy Glossary is a great place to start.
Explore our Circular Economy GlossaryThe Circularity Gap: A global challenge
According to the Circularity Gap Report, only 6.9% of the 100+ billion tonnes of materials entering the economy each year are reused. The remaining 93% is wasted, lost, or locked into long-term infrastructure.
This trend is moving in the wrong direction. Global circularity was 9.1% in 2018, 8.6% in 2020, and now sits at 6.9% in 2025.
To put this in perspective:
- Humanity extracts around 500 billion tonnes of virgin materials annually.
- Over 90% of these materials are either wasted or remain in long-term stock.
- Climate consequences include emissions, biodiversity loss, and water stress.
This is not sustainable. To reverse the trend, businesses must rethink how they design, make, distribute, and recover products.
Large businesses have the influence, scale, and infrastructure to reverse this trend. The circular economy enables them to reduce dependency on finite resources through areas like design, align with ESG targets, and drive profitable innovation.
Learn more about The Circularity Gap.Why Circular Economy initiatives matter for large businesses
The shift to a circular economy isn’t just about environmental responsibility; it’s becoming a core driver of competitive advantage. For large organisations, the stakes are higher: higher material costs, greater public scrutiny, more complex supply chains, and a heavier regulatory burden.
Circularity is no longer a “nice-to-have” – it’s a commercial and environmental necessity. Key drivers include:
1) Sustainability as a strategic imperative
Customers, regulators, and investors are demanding more accountability and action. Businesses that integrate circular practices can better align with environmental, social, and governance (ESG) targets and sustainability frameworks, such as the Science-Based Targets initiative (SBTi), CDP, and the EU Green Deal.
2) Resource risk and resilience
Circular models reduce reliance on virgin materials, protect against supply chain disruption, and unlock alternative resource streams.
3) Cost efficiency
Minimising waste reduces disposal fees, supports byproduct monetisation, and streamlines operations.
4) Regulatory readiness
New climate and waste policies, such as EPR laws and the upcoming EU Corporate Sustainability Reporting Directive (CSRD), are enforcing circular principles through policy. Companies need systems in place to remain compliant to support the environment. Reconomy’s Comply Loop helps businesses meet evolving regulations with confidence.
Explore Reconomy’s Comply Loop.
5) Customer expectation
Consumers increasingly expect products to be ethical, sustainable, and recyclable. Circular models meet these demands.
Types of Circular Economy initiatives in practice
Circular economy strategies are not theoretical concepts; they’re practical, measurable interventions that businesses can apply across the value chain to encourage sustainable change and principles. From designing better products to optimising material flows and managing regulatory risk, these initiatives help businesses transition from waste-intensive processes to regenerative, circular systems.
Below are key categories of initiatives with examples of how they can be applied in practice.
Product design and lifecycle extension
- Designing products for disassembly and reuse
- Using recycled or bio-based inputs
- Offering repair, refurbishment, or leasing models
Need help building circular product models? Reconomy’s Re-use Loop provides comprehensive reverse logistics and returns management services. Discover how we can help.
Waste and resource management
- Creating closed-loop recycling systems for challenging streams like plastics.
- AI-powered waste tracking
- Supply chain collaboration for maximum resource recovery
Our Recycle Loop diverts 98.5% of waste from landfill across thousands of customer sites.
Compliance and EPR
- Meeting packaging and plastics policy obligations (EPR, DRS).
- Use new digital compliance tools.
- Conduct Life Cycle Assessments (LCAs) to understand environmental impact and inform circular strategies.
Reverse logistics
- Managing returns in retail, electronics, and other high-volume sectors
- Efficient collection and redistribution of returned products
- Optimising transportation and logistics to reduce emissions
With over 200 million product returns managed annually, Reconomy’s Re-use Loop serves as a platform that turns returns into circular value.
Sector-based examples of Circular Economy initiatives
Large businesses across multiple sectors are already demonstrating the value of a transition to circular practices. Below are examples aligned to Reconomy’s key industries:
1. Retail & fashion
- Patagonia operates a circular economy programme called Worn Wear, which allows customers to return used clothing for repair or resale to support the brand’s mission for sustainable change and reduce textile waste.
- H&M has committed to using only recycled or sustainably sourced materials by 2030 and runs in-store clothing take-back schemes across many markets.
2. Construction
- Skanska UK reuses demolition materials and integrates recycled content into new builds, supported by waste mapping and digital monitoring tools.
- Taylor Wimpey, one of the UK’s largest housebuilders, introduced enhanced resource recovery systems across their construction sites, alongside Reconomy. Through smart waste management, digital tracking, and improved segregation practices, they’ve diverted significant volumes of waste from landfills while improving operational efficiency. Read more about this case study here.
3. Manufacturing
- Philips runs a Circular Lighting programme where lighting systems are leased instead of sold, allowing components from products to be reused or refurbished.
- Unilever is designing packaging of products to be 100% reusable, recyclable, or compostable by 2025.
- Apple has pioneered several circular economy initiatives, including its in-house disassembly robot “Daisy” which can deconstruct 23 models of products like their iPhones to recover valuable materials. The company now uses 100% recycled aluminium in many of its products and is targeting a closed-loop supply chain. An incredibly positive change for the environment from a worldwide brand.
4. Logistics & e-commerce
- Zalando, a major European e-commerce platform, offers a resale service and has introduced circular packaging that can be reused multiple times.
- IKEA has invested in reverse logistics and refurbishment hubs to support furniture return and resale programmes across Europe.
Reconomy works with over 23,000 businesses across 150+ countries.
Challenges to scaling circular initiatives
Despite the benefits, many large businesses face barriers such as:
- Fragmented waste and material data
- Siloed business functions
- Evolving climate regulations
Success often depends on embedding circularity across departments and incentivising it at the leadership level. Transparency, collaboration, and access to quality data are key to positive impact.
Reconomy helps simplify this transition through integrated services that span resources, products, and compliance.
How to get started with Circular Economy initiatives
Whether you’re launching your first initiative or scaling a mature programme, here are practical steps:
- Audit material flows: Understand where resources enter, leak, or go to waste.
- Set circular goals: Align your business targets with ESG, climate, and sustainability standards.
- Involve the whole business: Whether that’s procurement, logistics, or finance, all teams need a chance to circularity embedded to encourage cross-functional impact.
- Invest in technology: Digital dashboards, data platforms, and AI help track and improve resource performance.
- Partner smartly: From reverse logistics to waste tracking, partners like Reconomy help you move faster.
Looking ahead: Circularity is the future of business
The circular economy isn’t just a sustainability framework; its principles offer a blueprint for long-term business success. Its principles offer a path to:
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- Future-proofed operations
- Reduce climate impact
- More stable supply chains
- Enhanced brand reputation
- Cut waste and resource costs
- Comply with policy shifts
- Deliver sustainable innovation in products and packaging
Let’s build a world where resources are valued, waste is minimised, and economic growth is sustainable.
FAQs: Circular Economy initiatives
It’s a practical business action that reduces waste and keeps materials in use. Examples include take-back schemes, closed-loop recycling, and designing for reuse.
It refers to the difference between today’s linear resource consumption and a fully circular economy. As of 2024, only 6.9% of materials are reused globally (Circularity Gap Report 2024).
All sectors benefit from embedding circular economy principles, but high-impact areas include construction, retail, logistics, and manufacturing, industries with large material flows and waste footprints.
Not necessarily. Many lead to cost savings, improved efficiency, and reduced compliance risk over time.
Begin by mapping your material use, setting sustainability goals, building internal teams, and exploring partnerships with experienced service providers. This is a great start to embedding circular economy principles into your organisation.
Partner with Reconomy to #CloseTheGap
Reconomy is the tech-enabled, people-powered engine of the circular economy. Through our Recycle, Comply, and Re-use Loops, we deliver integrated services to embed circular economy principles by:
- Recovering materials and reduce waste
- Meeting complex climate and policy requirements
- Designing scalable, sustainable products and services
Let’s think circular together.
- Contact us today
- Learn more about the circular economy
Reconomy's 10-Point Framework to enable the Circular Economy
To support systemic change, Reconomy has developed a 10-point regulatory framework. These principles are designed to simplify waste systems, drive investment, and scale up sustainable practices:
Explore our full framework for enabling circular economy reform.
Download the frameworkFurther reading and resources
Wanting to learn more? Explore further reading and resources available from Reconomy.
Sources and references
Circularity Gap Report 2024, Circle Economy Foundation
Statistic: Global circularity rate of 6.9% in 2025 (down from 9.1% in 2018 and 8.6% in 2020)
https://www.circularity-gap.world/2024
Ellen MacArthur Foundation – Circular Economy in Detail
Statistic: Global resource extraction and waste data (500 billion tonnes annually, over 90% wasted or locked in long-term use)
https://ellenmacarthurfoundation.org/
European Commission – Corporate Sustainability Reporting Directive (CSRD)
Legislative reference for ESG and circularity reporting obligations.
https://finance.ec.europa.eu/csrd
European Parliament & Council – Extended Producer Responsibility (EPR) Legislation Overview
Policy context for packaging, electronics, and textiles compliance.
https://environment.ec.europa.eu/topics/waste-and-recycling/extended-producer-responsibility_en
Science Based Targets Initiative (SBTi)
Reference for corporate carbon and resource reduction targets.
https://sciencebasedtargets.org/
CDP (Carbon Disclosure Project)
ESG reporting framework referenced under “Sustainability as Strategy.”