Research

Stay in the loop: the role of indicators in supporting decisions for circular economy strategies aiming at extending products life

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Abstract

Circular economy proposes an innovative “circular” model towards increased sustainability. The central tenet of circular economy is to move away from linear practices (“take-make-use-dispose” approaches) towards the continuous “cycling” of products, materials and resources. Circular economy can be achieved by adopting practices that include solutions for a) intensified use of products (e.g. product pooling and sharing); b) circular product design (dematerialised products; designed for longevity, reparability and recycling); c) material and resource “cycling”, and more. Along with radical transformation of business models and value chains, product design is of the essence to effectively support circular economy transitions. The EEA report “Circular by design” from 2017 on products in the circular economy highlights that designing products using clean materials or increasing use of modular design is “a prerequisite for circularity”. Design stage, therefore, is crucial in “initiating” circular shifts; however, the strategies that aim at extending life cycles of products that are currently on the market are as significant. The European Commission made a resolution on a longer lifetime for products (2016/2272(INI)) stressing the urge for extended producer responsibility to tackle the issues of durability, reparability and recyclability of tangible consumer goods. This article aims to provide an insight on how the sustainability related performance indicators can support decision making for circular economy strategies aiming at extending life time of existing products, components and materials (through service, repair and recycling) taking a cross business process view. The article provides an example of indicators and their application to a hypothetical case study. We follow the indicator selection procedure, with the help of which the set of relevant indicators is selected for the CE initiative assessment. By taking a case example, we demonstrate i) the importance of operating with indicators across business processes; and ii) the importance of a dynamic indicator set (as opposed to the ‘prescribed’ indicators). Based on the final performance indicator set relevant for the case, the decision can be made to either implement the strategy, select/combine with another or avoid the implementation altogether.