Currently, humanity is transgressing planetary boundaries at an accelerating pace. Resource extraction and processing are major drivers of climate change, biodiversity loss, land degradation and water stress. The International Resource Panel estimates that global resource use is increasing by over 2% annually and could rise by nearly 60% between 2020 and 2060 without corrective action. Resource use is also unequal, as high-income countries use six times more materials per capita and cause ten times more climate impacts per capita than low-income countries. Staying within ecological limits requires not only greater efficiency, but also absolute reductions in material use and consumption, supported by systemic change.
The circular economy (CE) is widely promoted as a way to reduce resource use and pressures on natural systems. The recently published ISO standard on CE states that circularity should aim to minimise the inflow of virgin resources and keep resource flows as closed as possible. Strategies such as reuse, repair, remanufacturing and recycling are also increasingly embedded in European policy. Circular business models are seen as key elements in a transition to a more circular society.
However, CE strategies are not yet linked to any binding targets for sustainable resource use. Unlike European Union (EU) climate policy, the CE lacks clear and measurable targets for the scale and speed of resource-use reductions. This risks rebound effects, fragmented policy implementation and, ultimately, missing the full potential of the CE to contribute to sustainability goals.
To address this resource challenge, CE policies need to go beyond efficiency and address rebound effects, while considering more progressive strategies such as “exnovation” to phase out the least sustainable products. The EU climate policy approach offers relevant learning lessons for CE, particularly regarding the role that mandatory targets have played to promote more systemic change to reach climate objectives.
This new report reviews the literature and policy landscape on linking planetary boundaries to resource-use targets for the CE. It examines EU policy developments, emerging international proposals and implications for circular business models, and calls for EU targets to stimulate a wider discussion on how to make the CE truly sustainable.
