The idea of the circular economy gained traction in business circles during the 2010s by offering a refreshing, growth-oriented vision for sustainability. Rather than dwelling on limits or reduction, it presented a compelling proposition: waste could be designed out, materials could be kept in use, and companies could tap fresh revenue streams. This optimistic framing struck a chord with executives and policymakers seeking to align environmental progress with competitiveness. 

A decade on, the shine has worn into something more practical. Companies experimenting with circular models have discovered that turning theory into practice is far from simple. The central challenge is practical implementation. For instance, product take-back schemes demand reverse logistics infrastructure that few firms have mastered. Recycling content requires a reliable supply of secondary materials, which can be patchy or expensive. Developing new materials is a multi-year process requiring reliable partnerships and patient capital. And in industries with long-established linear models, market demand may be slow to adapt.  

Worryingly, the share of recycled material feeding back into the global economy is stagnating or even slipping: only 6.9% of the 106 billion tonnes of materials used annually in 2025 came from recycled sources—a 2.2 percentage-point drop since 2015.1 

Companies see the opportunity, and many are delivering it 

Circularity remains central to the sustainability strategy of many companies, especially in manufacturing sectors like fashion, packaging, as well as in construction. Business confidence in circular models is also rising: 75% of executives surveyed in 2025 believe circularity is important today.2 Several sustainability leaders that we spoke to over the past few months indicated that their company is setting company-wide circularity goals, often framed as part of their net-zero or sustainability strategy.  

Many companies have demonstrated that circular models not only reduce environmental impact but can also open new revenue channels and strengthen brand loyalty. Following the introduction of furniture leasing in several European markets in 2019, IKEA introduced a second-hand marketplace in 2024. On this platform customers can sell their pre-owned IKEA furniture to others, thereby helping extend the product lifetime and expanding IKEA’s online revenue3. In consumer electronics, Dell has integrated closed-loop recycled plastics into millions of laptops, demonstrating that high-quality materials can be sourced from old devices. In FY25, the company used over 52 million kg of recycled, renewable or reduced carbon materials in its products, or 17.4% total of total product materials, a 3.3% percentage point increase compared to FY24.4 

Measurement as key to moving beyond individual initiatives 

While progress has been slower than many had hoped, today’s realism shows that companies have learned what works and what doesn’t. Many of those learnings have found their way into operational practices, for instance through targeted procurement of recycled materials and consideration of repairability and recyclability in product design. Next, companies must ensure that these circular practices are applied at scale and deliver the company-wide circularity goals. That requires targets and KPIs. In short, measurement. 

Circularity is notoriously hard to measure. Unlike GHG emissions, there is no single global unit, nor generally accepted accounting rules. Circularity includes a variety of business models (reuse, recycling, remanufacturing), which are not all equal and sometimes mutually exclusive. The waste hierarchy provides a qualitative framework for comparing these different routes, but there is no simple quantitative way to compare, say, a kg of recycled steel with a kg of steel that is reused in a component of a machine. We were therefore not surprised from the sustainability professionals that we spoke to that they struggle to set meaningful targets that provide clear direction for action and can be reported with confidence. 

Some companies have adopted high-level circularity goals, for instance for reducing the product footprint per use cycle or for the amount of revenue from circular products. This provides flexibility and encourages the R&D and product development teams to pursue the circular business models and technological innovations that are most appropriate for the product in question. This approach therefore works well for companies with large, diverse product portfolios. However, it relies on a clear definition of circularity and robust footprint measurement, typically through life-cycle assessments, which need to be rolled out to all product categories. 

The alternative approach involves adopting multiple specific circularity indicators, for instance for certified recycled content, or product reuse rates. These types of metrics are typically easier to measure. But they may prioritise circular business practices at the bottom of the waste hierarchy and close off others that have more potential in the medium term. 

One step back, two steps forward 

There is reason to be optimistic. Compared to a decade ago, many companies are well prepared to scale circular business practices like the use of recycled content and delivery of multi-use solutions, building on the newly gained technological innovation and operational experience. And because adverse economics due to low prices of virgin materials have been a big reason for the slow progress, the circular economy may well expand very rapidly, once market conditions turn in its favour. 

To understand more, contact our Netherlands country manager, Sytze Dijkstra here.