Circular Economy


According to the Glossary of the European Union Lex, circular economy is a system that maintains the value of products, materials, and resources in the economy for as long as possible, while minimizing the generation of waste. This is a system where products are reused, repaired, remanufactured or recycled. Circular economies also contribute to other features, including green recovery, climate change mitigation, energy savings, biodiversity protection, and global efforts towards sustainable development. 

Since 2015, the European Commission has been working on an ambitious action plan to accelerate the EU’s transition towards a circular economy. Among other measures, the EU’s legislation on waste entered into force in 2018, establishing clear recycling targets and a long-term plan for modern waste management. It included targets for the recycling of municipal and packaging waste; combining strategies to reduce landfill to a maximum limit with measures to reduce food waste and marine litter. 

In 2020 the Commission adopted a New Circular Economy Action Plan for the EU, in which it identified seven key value chains with high potential for circularity: 

  • electronics and ICT, 
  • batteries and vehicles, 
  • packaging,  
  • plastics,  
  • textiles, 
  • construction and buildings, 
  • food, water and nutrients; 

The objectives of this plan are to ensure less waste; adapt circular economy strategies to the possibilities of citizens, regions, and cities; and enable Europe to lead global efforts on circular economy. 

The circular economy principles have put the focus not only on the extraction of raw materials, but also on the end of life phase of the products. One of the goals is to reduce the impact of an item’s final moments by facilitating the recovery of materials for secondary use or as raw material. 

The companies aiming to implement circular business models should consider the end of life phase; some questions to consider about their products include: can it be used by a second user? Can it be repaired or refurbished and used again by a new customer? Can its parts or components be used as replacement parts for other products? Can the parts or components be taken apart more easily? Can the components be recycled or composted easily? Can the product’s parts be recycled using processes that have a low environmental impact? These questions speak to decisions on the design, manufacturing, etc., to ensure the great potential of recovery of the materials.  

In the EU, the textiles and clothing sector is economically significant and can play a prominent role in the circular economy. It comprises more than 160,000 companies and employs 1.5 million people, generating a turnover of EUR 162 billion in 2019 (Euratex, 2020).  

All in all, the notion of circular economy implies new business models based on these strategies: Reuse, Reduce, Recycle, Upcycling. 

Both fashion and food are considered key value chains in the New Circular Economy Action Plan of the EU. There are targets to reduce food waste with the EU Farm-to-Fork Strategy, and to reuse packaging instead of single-use one, as well as reusing tableware and cutlery in food services.  

For the fashion industry, the EU plan also aims to provide customers with easy access to reuse and repair services, and to boost the collection, sorting, reusing, and recycling of textiles (European Commission 2020). 

Numerous textile companies are profiting from food waste to develop new textiles with functional or sustainable properties: from coffee grounds to textiles like SINGTEX ®, from pineapple leaves to Piñatex®, from abacá banana plants to Bananatex ®, from waste citrus fruit peels to Orange Fiber ®, to name only a few examples. 

There are several new business models based on a circular economy, both in the fashion and in the food industry: second hand, rental, packaging-free, sharing practices to avoid waste, etc. 

There is an interesting initiative to increase the potential of jeans to be remade and recycled after use: The Jeans Redesign, by the Ellen MacArthur Foundation. It was launched in 2019, and from 2021 on, there have been jeans in the market redesigned in a more circular way based on durability, material health, recyclability and traceability. More than 70 brands and organisations have joined this initiative, including Bershka, C&A, Cross Textiles, Esprit, Ganni, Gap, H&M, Guess, hnst, Lee, JC Penney, Massimo Dutti, Monki, Primark, Tommy Hilfiger, etc 

The second-hand market of fashion is growing. To name only a few examples: Vestiaire Collective, The Real Real, Rebelle, Thrift+, House of Vintage.   

There is also room for fashion rental initiatives, with examples like Rent the Runway, Tulerie, Nuuly, Banana Republic Style Passport, Fashion to Figure, Gwynnie Bee, Vince Unfold, Pantala, etc. 

Some fashion brands have internalised the second-hand sales at their stores. This is the case of COS (Re.sell), and Nudie Jeans. They also offer the repair of their jeans. 

In the food sector, initiatives the App Too Good to Go connects food retailers or cafes, restaurants, hotels, etc. with customers, to reduce food waste by selling fresh products than they haven’t sold in time at a low price. Until now, more than 8.3 million people have rescued food from waste with this app. 

SKFK is a Spanish fashion brand that aims to be an active part of the change. They base their activity on the circular economy principles, bringing together a unique design inspired by art and culture, and a timeless, comfortable and functional style, which ultimately drives customers towards a conscious and responsible consumption. They have clear targets on reducing CO2, and they are certified by FairTrade. They also offer a rental service to their customers, as well as information on the 5 fields of action of circular economy for each product on their website. 

MUD jeans makes, rents and recycles organic jeans.