CIRCULARITYASSESSMENT

OFCOMPANIES

Why do we need a circularity assessment?

• Moving to a circular economy is increasingly recognized as a key objective by companies & governments

• Creating impact in the circular economy requires data and a scientific approach to guide decision making

• Need for a tool to evaluate and rank companies on circularity

Current ESG indicators are insufficient

• Focus on relative rather than absolute performance

• Focus on improvement against current state rather than distance from ideal state

• Focus on policies and intentions rather than performance

• Do not show where impacts are coming from

• Are not linked to changing context, key planetary boundaries, shifting market and technology landscapes

What will the Circularity Assessment do?

The Circularity Assessment is a set of indicators and an automated tool that:

• Is able to comprehensively assess any type of organization on their performance against circular economy objectives

• Provides insights on risks that companies and investors face as a result of not adopting circular principles

• Is conducted on an annual basis to provide a strong informational feedback loop to push organizations to move towards circularity

Public Circularity Index of Companies

We envision the Circularity Assessment to eventually enable the creation of a Public Circularity Index that ranks companies

Company Rating

Leasing, Pty 95

Sharing, GmbH 89

Music, Sh.A. 34

Balloons, Inc. 65

Chairs, Ltd. 24

Materials, ApS 80

Energy, Oy 45

Component Harvest, AG 85

Company Rating

Recycling, LP 55

Upgrade, Ltda 70

Reuse, Plc Ltd 93

Solar BV 70

Algae, S.A. 75

Car Parts, LLC 30

Modular, NV 87

Carpet, AS 61

Refined framework for circularity

Categorization of analysis

Input Risks

Product / Service Design

End-of-Use Value Preservation

Organizational Improvement

Planetary Impacts

Assesses the circularity of the organization’s direct and indirect materials, energy, and labor inputs

Assesses the circularity of design and delivery of the organization’s products and services to society

Assesses the circularity of the organization’s product end-of-use scenarios and production waste flows

Assesses the transparency, leadership, and vision of the organization in adopting circular principles

Assesses the impact of all of the organization’s activities on key planetary boundaries

Input Risks – Key Circularity Principles

Input Risks

Materials and Resources

Materials are from renewable sourcesMaterials are from secondary sources rather than primary sourcesMaterial needs don't compete with other societal needs for materialMaterials are not scarce or criticalMaterials aren't sourced from countries with geo-political riskMaterials are sourced from local sources where possible

Energy

Energy sources do not require critical resourcesEnergy comes from renewable and on-site sourcesEnergy needs don't compete with other societal needsEnergy is recovered and reused where possible

Labor

Job creation is promoted through a dedicated workforceEmployee labor rights are supportedWorker health and safety is prioritizedLabor isn't sourced from countries with geo-political risk

Product / Service Design – Key Circularity Principles

Product / Service Design

Design Characteristics

Products utilize materials, energy, and labor in a smart and efficient manner

Products are designed such that their lifetimes fit their intended use and technological maturity

Products are designed in a modular fashion if appropriate for their typology

Products are biodegradable if appropriate for their typology

Products are recoverable and recyclable if appropriate for their typology

Products are able to be upgraded if appropriate for their typology

Products are able to be easily disassembled and components reused if appropriate for their typology

Products do not use a significant amount of mixed materials and alloys

Products use circular business models if appropriate for their typology

Products do not pose a significant risk or operating hazard for users

Packaging

Packaging material is minimized

Packaging is reusable if appropriate for product typology

Packaging is biodegradable or recycable if appropriate for product typology

Usage

Energy sources do not require critical resourcesEnergy comes from renewable sources

Energy needs don't compete with other societal needs

End-of-Life Value Preservation – Key Circularity Principles

End-of-Life Value Preservation End of life pathways

End-of-life products are mainly upgraded and repairedEnd-of-life products are refurbished and remanufactured as a second priorityWaste flows are mainly recovered and reusedEnd-of-life products and waste flows are recycledEnd-of-life products and waste flows are incinerated for energy recoveryEnd-of-life products and waste flows are disposed or lost as a last resort

Organizational Improvement – Key Circularity Principles

Organizational Improvement

TransparencyCompany is reports to a variety of initatives, is involved in various certification schemesCompany reporting makes references to circular economy thinking

Leadership

Company sets clear targets for achieving circularityCompany engages various stakeholders toward circularityCompany pushes government policies towards circularityCompany has executive level or board level members dedicated to circular thinkingCompany provides incentives for employees to achieve circularity targetsCompany leads supplier and industry initiatives on circular thinking

Planetary Impacts – Key Circularity Principles

Planetary Impacts

Land Company has minimal environmental impact on acidification, land use, toxicity, resource depletion

Atmosphere Company has minimal enviromental impact on climate change, ozone, smogWater Company has minimal environmental impact on eutrophication, toxicity, water depletionSociety Company has minimal environmental impact on human toxicity, particulate matter