How a Circular Economy Helps Cut CO₂ Emissions

Achieving a circular economy is essential for achieving net zero.

Circularity helps to minimise waste and pollution while also reducing emissions from the manufacturing and extracting of products.

The circular economy is built upon the five principles: Reduce, Reuse, Repair, Redesign and Recycle.

In practice, it aims to minimise waste. 

When products reach end-of-life, their materials are kept within the economy through recycling and used repeatedly to create further value.

This marks a shift from the traditional linear model based on take–make–consume–throw away, which depends on large volumes of cheap, readily available materials and energy.

The approach also tackles planned obsolescence, where products are designed with limited lifespans, which the European Parliament has called for measures to curb.

Why do we need a circular economy?

Reusing and recycling products slows the use of natural resources, reduces landscape and habitat disruption and helps limit biodiversity loss, as well as cutting GHG emissions.

Designing efficient, sustainable products from the outset reduces energy and resource use, with more than 80% of a product’s environmental impact set during the design phase. 

Packaging is a growing issue: on average, each European generates about 190 kilos of packaging waste a year. 

The aim is to curb excessive packaging and improve design to promote reuse and recycling.

“The circular economy is a win for people, the environment and the country,” says Didier Trebucq, UN Resident Coordinator in Georgia. 

“It offers practical solutions to today’s challenges while opening new opportunities for greener jobs, stronger businesses, cleaner cities and healthier communities.

"Together with the European Union and our partners, the United Nations stands with Georgia on this journey to ensure that everyone has access to a safe, clean environment and a future that is sustainable and inclusive.”

Reducing raw material dependence

Global demand for raw materials is rising while supplies are finite, leaving some EU countries reliant on external sources. 

In 2022, each European consumed 14.9 tonnes of raw materials. 

In 2023, EU trade in raw materials with the rest of the world totalled €165bn (US$192.3bn), resulting in a €29bn (US$33.8bn) deficit. 

Recycling mitigates supply risks such as price volatility, availability and import dependence, particularly for critical raw materials needed for technologies essential to climate goals, including batteries and electric motors.

Creating jobs and saving consumers money

A more circular economy would boost competitiveness, spur innovation and support growth, with up to 700,000 EU jobs by 2030. 

Redesigning materials and products for circular use would drive innovation across sectors. Consumers would gain more durable, higher quality products that improve daily life and save money over the long term.

“Now is the time to double down on specific macro areas that are going to see scale-up and circular economy in action,” wrote Jonquil Hackenberg, CEO of Ellen MacArthur Foundation, on LinkedIn.

Companies excelling in circularity

From networking giant Cisco to IKEA’s retail arm Ingka Group, companies are turning circularity into day-to-day practice.

Cisco has embedded 25 Circular Design Principles across all new products and packaging, trained more than 7,000 staff and uses a gatekeeping tool so launches meet a minimum 75% circularity score; changes such as removing oil-based paint from Catalyst 9000 saved US$9m and cut VOCs and CO₂e.

Ingka designs for repair and reuse, runs furniture buy-back and supplies spare parts to extend product life.

Blenheim Palace’s RFID-enabled reusable cup scheme with Mastercard halved beverage packaging costs and kept 320,000 single-use cups out of landfill.

Data is becoming the engine, with Accenture and AWS building circular data lakes to automate measurement and decisions.

In batteries, CATL and the Ellen MacArthur Foundation are scaling reuse and high-quality recycling, while eBay’s Circular Fashion Fund backs repair, resale and textile recycling.

Together these approaches extend lifecycles, reduce material risk and emissions and prove circular models can drive efficiency and growth.