The circular economy: landscape, dimensions and definitions

At the dawn of the first industrial revolution, in the eighteenth century, humanity had triggered the development of a new economic system, strongly embedded in and conditioned by both social and ecological relations. We might suggest that this economy was anchored in a wider network of socio-ecological relations. At the dawn of a socio-ecological crisis, in the early twenty-first century, humanity has fine-tuned a globalised market economy that is not only totally embedding social and ecological systems, but our environment and our societies are now consumed by a wider, world-wide network of economically driven transactions. Moreover, economic growth is fundamentally coupled with resource consumption, resulting in overwhelmingly negative societal and environmental impacts. This ‘great transformation,’ as Karl Polanyi (1944) would have defined it, is what the Circular Economy (CE) agenda appears to challenge and encourages a revision of. Extant scholarship often defines CE as an “industrial economy that is restorative by intention and design” (EMF, 2012, p. 14) that “utilizes ecosystem cycles in economic cycles by respecting their natural reproduction rates” (Korhonen et al., 2018, p. 39). Practitioners, instead, look at CE as a strategic business and political response to issues of social and environmental unsustainability (D’Amato et al., 2019; Geissdoerfer et al., 2017; Kirchherr et al., 2017). In both approaches, CE emerges as a conceptual framework, a ‘worldview’ and collective narrative essential to tackle both societal and environmental challenges, by transforming the twenty-first century market and consumption-driven economies (Korhonen et al., 2018; Skene, 2018).

Redesigning a now-globalised market economy entails profound social and ecological changes as well as transforming political systems and institutional regimes, and disrupting the status-quo by evoking an agenda for socio-ecological transitions, beyond the incremental changes of business strategies and practices (Fischer & Pascucci, 2017; Schulz et al., 2019) or modest, policy incentives (Morseletto, 2020; Webster, 2021). Business activities in a globalised market economy are possible after all, only when a number of forces, in the form of social norms, political processes and institutions, are in place to define the rules of the game (North, 1991). Together, these forces and tensions shape how an economy functions at any point in time. Fundamentally, any future-proof globalised market economy needs to maintain these economic forces and tensions ‘within’ the boundaries of socio-ecological systems, the planetary cycles that support life on planet Earth, and the social conditions to ensure a just and safe space for humanity (Leach et al., 2013; Raworth, 2017; Rockstrom et al., 2009). Accordingly, new distributive, regenerative and restorative processes and rules need to emerge as the core of any new future-proof economy.

Over the years, particular ways in which a global market economy operates within these boundaries have timidly emerged, within and between countries and economies (Raworth, 2017). They have been informed by initiatives like the Sustainable Development Goals, for example, or the UN Global Compact, or taken the form of ‘sustainability-driven,’ ‘one planet’ strategies or ‘just’ socio-economic activity, referencing constructs such as ‘Triple Bottom Line’ evaluations or socio-economic and eco-environmental lifecycle analyses. While these initiatives and strategies indicate a step in the right direction, they have often been limited to incremental change, with still limited global impact. Instead, a socio-ecological transformation into a global CE would require novel and more disruptive frameworks to emerge (Schulz et al., 2019; Termeer & Metze, 2019), operating as a transition mechanism to enable both practitioners and scholars to mobilise ideas and practices in this arena. According to this view, CE can be seen as an emerging interdisciplinary and multifaceted field of practice and inquiry (Borrello et al., 2020b), creating the potential to change frames and perspectives on how we organise production, consumption and exchange of resources, goods and services and how we can create a more participative and distributive economy at all scales (Raworth, 2017; Webster, 2021). This is only possible through the adoption of a holistic system approach, acknowledging the role of complexity, adaptability and resilience. Despite the ambitious radical agenda of some of the CE pioneers and founding fellows, and after almost a decade of sustained effort, whilst CE is structuring as a field of inquiry and practice, a number of critical tensions and ambiguities appear to be emerging in this arena. Recently, Borrello and colleagues (2020) have unearthed and discussed these tensions, particularly looking at how scholars and practitioners position themselves in their understanding of circularity and CE. They propose to unify a CE agenda through three key insights (Borrello et al., 2020): first, to understand CE as gathering principles of other schools of thought and elaborate them in a narrative able to inspire policy actions. Second, interpreting CE as field of practice evoking a socio-technical transition into multiple regimes in which societal and material needs are fulfilled by innovative industrial systems. Finally, looking at CE as a contribution to the environmental and economic dimensions of sustainability by means of an eco-effective approach to industrial systems, above and beyond eco-efficiency. From a similar perspective, other scholars have pointed at the ambivalence of the CE agenda: on one hand, it suggests an acceleration towards a more disruptive and radical change process, indeed a transformation of the current economy towards a socio-ecologically embedded reality. On the other hand, the key successes of the CE agenda are in the field of scalable and implementable solutions, triggering and stimulating incremental changes and innovation, mostly led by businesses. The latter is supporting the idea of looking at CE as a toolbox rather than a worldview, or conceptual framework, therefore far away from the idea of designing an economy inspired by living systems and to create a distributive, eco-effective ‘nutrient economy’ through circularity (Webster, 2021).

In the following sections of this introduction, we discuss these perspectives in further detail, using them to explain how this book and its contents contribute to a unified articulation of a contemporary CE. We start by looking into the CE as a source of inspiring narratives and worldviews, stimulating thought-leaders to rethink ‘the way we make things,’ to quote Cradle-to-Cradle founding fathers William McDonough and Michael Braungart. We then move into discussing CE as an expanding field of practice, involving particularly businesses and corporate leaders. In the third section, we look into how CE has been seen as an opportunity to creatively combine and couple means and ends in companies looking for change, innovation and a more sustainable future – economically, socially and environmentally. Our final considerations refer to the unresolved tensions and ambiguities in this emerging field as well as future developments and agendas.

Circular economy as an inspiring narrative stimulating reconceptualisation

Our first perspective comprehends CE as an inspiring and influential narrative. This perspective builds upon rapidly elevating concerns around the compatibility between an ever-growing globalised market economy and ensuring fair and just socio-ecological conditions – a situation that will sooner or later lead to a chain of fundamental crises and eventually systemic collapse. The debate around the climate emergency is only the latest in this growing chain of crises.

Now the building blocks of CE, as a narrative capable of mobilising key economic and political actors to tackle the twenty-first century grand challenges, can be traced back to influential views. These include that presented in ‘The Limits to Growth’ (Meadows et al., 1972); the role of natural capital for supporting sustainable development (Costanza & Daly, 1992) and the emergence of the debate on the relationship between natural capital and other forms of capital (e.g. manufactured and technological) (Neumayer, 2003). It is within these debates that the framing of planetary ecosystems endangered by anthropic activities, the very notion of planetary boundaries, has gained prominence (Rockstrom et al., 2009), and where the more critical concept of the Anthropocene has also emerged (Gowdy & Krall, 2013; Lewis & Maslin, 2015). All these approaches converge on one simple aspect: through unprecedented socio-technological development and waves of agrarian and industrial revolutions, humanity has reached the capacity to operate at a geological scale and therefore influence the Earth’s natural processes, such as the...