NEWSLETTER by Alessia Falsarone. The author acknowledges the team at The University of Chicago Circular Economy and Sustainable Business Management Program and all participants of the innovation knowledge hub for their insights and collaboration.

The State of our Times appears bright when we consider the numerous initiatives focused on the circular economy. However, the overall picture is not so optimistic when we take into account the balance of materials consumption, human development, and environmental challenges facing our world. While private market investors are increasingly directing their capital towards circular businesses across different regions, there is a need for larger pools of financing from both the public and private sectors. These funds should support a transition towards more sustainable consumption and production patterns while also prioritizing human development, regardless of geographical location. The successful implementation of a circularity transition depends on the interconnectedness of our global socio-economic systems.

Are we prepared to contribute our part?


| The Science of Impact

The state of global circularity is deteriorating. In 2023 the global circularity rate declined to 7.2% vs. 9.8% five years earlier when the measurement exercise was launched by the Circle Economy Foundation. However, according to the Circularity Gap Report 2024 (CGR), if we solely focus on measuring the progress of circularity within public and private sector initiatives, it would have become a significant global trend over the past 5 years.

So, where does the disconnect come from? The study highlights one key takeaway: the unrestricted consumption of resources continues to hinder human development.

For the first time since its launch, the CGR places people at the center of public and private sector transition plans. Specifically, how the circular transition can support wellbeing through the provision of decent work, safeguarding social mobility and financial security, elevating job quality and safety.

The CGR calls attention to the fact that while materials are vital for human development – i.e. to build up crucial infrastructure and fulfill human needs for nutrition, shelter and mobility, for example – the development pattern we are used to experience in the Global North is fundamentally flawed.

By comparing a human development index (HDI) vs. the material footprint across three country profiles, it helps us visualize the state of our times in terms of its environmental perils, its social imbalances and its economic hurdles while also drawing key connections across countries.

  • Grow Countries (middle income): Grow countries have a growing per capita material footprint and HDI score. Large volumes of domestically extracted resources are exported, fueling the high consumption rates in Shift countries.
  • Shift Countries (higher income): Shift countries are characterized by high levels of consumption and consequently high HDI scores. High volumes of goods are imported from Build and Grow countries.
  • Build Countries (lower income): Build countries have a modest per capita material footprint and low Human Development Index. Due to a largely informal waste sector, material cycling is largely underreported.


| Circularity Roadmaps Explained

To move from circularity theory and metrics to action in the sphere of both human development and material consumption, policymakers, investors and business leaders will need to focus on solutions that have the same starting point in mind.

Here is the starting point that the CGR presents this year for a structural transformation of both consumption and production to occur.



One clear direction for the private and public sectors to focus their investments and financing efforts seems to emerge: dismantling all incentives that support material consumption must be accompanied by the reorganization of taxation schemes and pricing power in favor of more affordable circular technology innovation. Additionally, trade negotiations and supply chain mechanisms aimed at limiting inflation can shape not only the flow of materials but also that of global capital.


| Investing in the Circular Economy

What happens when circularity becomes a mega trend in reality? Investors will likely see an increase in spin-offs and carve-outs of valuable circular businesses on strong commercial and financial tailwinds. More importantly, the circular economy today does already represent a significant commercial opportunity without the need for any new policy or regulatory intervention, as Jamie Butterworth from Circularity Capital recently discussed with Infrastructure Investor.

M&A bankers and global businesses are already ready to either monetize early investments in circular products and/or build out circular platforms powered by digitization. An example of that is the IT asset disposition (ITAD) market segment, which has experienced CAGR rates in excess of 9%. Research and Markets forecasts annual spending on ITAD services to reach $34 billion annually by 2030 on the back of increased demand to eliminate e-waste. A notable transaction in the space is the acquisition of Sage Sustainable Electronics by Closed Loop Partners in November 2023. The company offers sustainable solutions for businesses by reusing and recovering IT assets, refurbishing and recycling nearly 1 million devices annually. According to the EPA’s Electronic Environmental Benefits Calculator, Sage mitigated approximately 300 million pounds of carbon emissions annually by giving 58% of devices a second life in 2022 alone.

Mitigating climate risk is indeed emerging as the ultimate litmus test for circular businesses.


| You don’t want to miss this week

From Cordovilla (Spain) to Bangkok (Thailand), and Düsseldorf (Germany), this week offers new opportunities to connect with fellow circularity practitioners, and stir our world towards a more sustainable economic transition.

Discover, grow and leave your mark!

January 31st–February 1st: FOODRUS Workshops Spain: Reduciendo el desperdicio alimentario. (Cordovilla, Spain)*. The EU Horizon 2020 project FOODRUS aims at building resilient local food systems by developing circular solutions to limit food loss and waste along the agri-food value chain. As part of this focus, FOODRUS will be hosting three workshops in Spain. covering a variety of topics including national regulations and strategies for preventing food loss/waste. The event will also feature the food waste and loss strategies undertaken by the region of Catalonia as a case study. Registration is available here.

Note (*): The online Open Doors programme on January 31st will be held in English.

February 3rd: Sustainable Gastronomical Experience in UNESCO Locales (Bangkok, Thailand). Part of the UNESCO World Heritage and Sustainable Tourism program, the seminar will help connect tourism businesses in ASEAN waterway cities, emphasizing UNESCO’s role in promoting sustainable and inclusive tourism. The event will explore sustainable solutions in the food and travel industry, the role of culinary experts, and the emerging challenges in local gastronomical tourism. Distinguished speakers include: Dr.Chuwit Mitrchob, Deputy Director General of the Designated Areas for Sustainable Tourism Administration (DASTA), Pareena Prayukvong, Sean Too (Sentinel Solution Thailand), as well as Chef Pol Kimsan.

February 6th–7th: Circular Economy: Reverse Thinking (Düsseldorf, Germany)*. There is still time to sign-up for the Circular Economy conference organized by the team at Handelsblatt (both in person and virtual). Built around the motto of ‘reverse thinking’, industry leaders, public officials and scientists will re-imagine how to adapt a variety of business models to circularity principles. In particular, Carsten Knobel, Chairman and CEO of German manufacturer Henkel, will engage on a keynote discussion (How to shape the path to a sustainable future together). It will be followed by a conversation between Frank K., the CEO of Swiss Steel and Torsten Heinemann, Global Head of Group Innovation and Sustainability at Covestro, on how to recognize and address competitiveness barriers and opportunities in circular economy models.

(*) Note: The conference will be held in German.


Off to another impactful week!


| brief bio

Alessia Falsarone is executive in residence, practitioner faculty at the University of Chicago, where she leads the Circular Economy and Sustainable Business program. The article is based on the author’s newsletter A Week of Circularity from the innovation knowledge hub.

All opinions expressed are those of the author and/or quoted sources. is an independent and neutral platform dedicated to generating debate around ESG investing topics.