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Circular economy

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The Circular economy can be understood as a modern consumption and production system which focuses on extending the life cycle of materials for as long as possible, enhancing a zero-waste mindset. Therefore, giving all current materials worldwide an extended purpose through reusing, remanufacturing, refurbishing, repairing and recycling. It draws away from the traditional linear economy system, which is designed on a “take-make-consume-throw away” model. The circular economy’s target is to reduce all waste to an absolute minimum, by creating extended purpose to a maximum length. (Economy)

“In our current economy, we take materials from the Earth, make products from them, and eventually throw them away as waste – the process is linear. In a circular economy, by contrast, we stop waste being produced in the first place.” – Ellen MacArthur.

In contrast to our current linear economy based system, a circular economy supplies tools and answers to dealing with climate change and biodiversity loss all together, and at the same time handling numerous essential social needs. It allows us to promote abundance, employment and persistence while reducing greenhouse gas toxins. (MacArthur)


To gain a better understanding of the circular economy and what it includes, a diagram known as “the butterfly diagram” has been created, demonstrating the constant flow of processes within the circular economy. It can be broken down into two separate cycles: 1- “The technical cycle” and 2- “the biological cycle”, which in the end completes the full butterfly diagram. In the first cycle (the technical cycle) resources are circulated through sustainable processes, for example: reusing, repairing, remanufacturing and recycling. In the second cycle (the biological cycle) the nutrients from raw extracted materials are restored to the Earth’s soil to restore nature. (Braungart & McDonough)

IMAGE 1: The butterfly diagram (Ellen MacArthur Foundation)


2.1 The butterfly diagram´s biological aspect: 

The Biological aspect of the butterfly diagram illustrates the different steps involved when returning nutrients back to the Earth to help renew nature. In the following paragraphs, the biological cycle (green) will be broken down into smaller concepts and explained. (MacArthur)

2.1.1 Regeneration

In the core of the biological cycle is the idea of regeneration. Which is defined as  building up a natural tolerance or capital towards nature instead of demeaning it. A good example of this could be implementing farming principles which enhances nature to conserve soil structures, resulting in an increased biodiversity. This includes the broader human nutrition structure to focus on returning bio/organic substances back to the soil instead of allowing it to go to waste. As humans we have the obligation not to only harm our environment less, but to seek active improvement through our actions.

2.1.2 Farming

Traditional farming, fishing and foresting methods could be replaced with modern methods which in result affects nature in positive ways. Examples of these results could look like: healthy, nutrient dense soils; decreased air and water pollution; increased amount of carbon stored in the ground. There is a large variety of modern farming methods which can be implemented to enhance regenerative results of the farming industry as a whole. Examples of these methods include: regenerative agriculture, restorative aquaculture, agroecology, agroforestry and conservation agriculture. 

2.1.3 Composting and anaerobic digestion

There are two main methods when it comes to recovering substances which are ingrained into bio-waste, composting and anaerobic digestion. The process of composting involves the microbic disintegration of biological substances in direct touch with oxygen, it usually includes microorganisms like bacteria and fungi. Whereas the process of anaerobic digestion undergoes a similar process, it does so without any oxygen involved. It results in biogas and a fixed debris, which can be used to recover soil nutrition levels back to normal. 

2.1.4 Cascades

This part of the biological cycle is the least energy consuming part so far, as it uses materials which are already in the market. For example, using by-products of food to make something new, using a banana peel to make vegan ketchup, or even using leftover human food and turning it into animal feed. The cascade sector is the most ecological “green” sector and once materials cannot be kept within the cascades, they start moving to the outer loops.


IMAGE 2: Biological Cycle of the Butterfly Diagram (Ellen MacArthur Foundation)



2.2 The butterfly diagram´s technical aspect:

The technical aspect of the butterfly diagram focuses more on products/materials that are more often used than consumed, such as tech equipment. The technical cycle (blue, image can be seen below) works in different loops, each loop suggesting a different process. The inner loops show where value can be captured utmostly and the outer loops show the last resorts. (MacArthur)

2.2.1 Sharing

Sharing is the innermost loop of the technical cycle, where most value can be captured from materials. It is not applicable to all materials in the market, but for those which it is, it can drastically change and enhance the usage of many products.There is a common statistic which states that: “an average power drill is used for just 13 minutes in its entire life”, therefore a good example of sharing could be community tool libraries, where consumers subscribe on a yearly basis to access shared high quality tools, while at the same time creating less unnecessary clutter in their home spaces. 

2.2.2 Maintaining

The next step to lengthen a product´s lifespan, without sharing it, is maintaining it in a good condition. This ensures high quality products resulting in a longer lifespan overall. This loop in the technical cycle can be applied to everything and is not limited to technical things, a good example can be repairing clothes and upcycling certain items. 

2.2.3 Reusing 

This step ensures that the material is still in its original format and performing  what it has originally been designed for. Industries which are using a lot of reusing principles are the second hand clothing industry and also the packaging industry. 

2.2.4 Redistributing

The next step is to redistribute products by turning them from one intended market to a new one. For example, selling certain types of clothes on a different platform than originally intended. 

2.2.5 Refurbishing

Another way to extend a product´s lifespan is by repairing its value. This includes restoring or replacing product parts, upgrading specifics and enhancing cosmetic aesthetics. This process can be either done by individuals or by specialists. The tech industry serves as a good example, quite a lot of companies buy second hand phones to refurbish them and sell them forward. 

2.2.6 Remanufacturing 

This part plays an important role once a product cannot continue its life within circulation anymore, when it needs more demanding work to regain its sense of value. This step includes re-engineering products to achieve its newer state to be in the same or even better condition than it has been. 

2.2.7 Recycling

This is the last resort of the technical cycle. It is the last method of keeping materials from simply turning into waste. In this step, the value of a product is to some extent lost, as the time and energy invested in creating it cannot be used anymore. It refers to breaking a product down to its most basic components and then turning the broken down components into something completely new. 


IMAGE 3: Technical Cycle of the butterfly diagram (Ellen MacArthur Foundation)


There are 3 core principles that are driving the global transformation from a linear economy to a circular one. These principles have been carefully studied and designed in a way that would lead to a fully circular, green economical system, changing the  current “take make dispose” system to a completely new one. These core principles are: 

3.1 Eliminate waste and pollution

Contrary to the linear model which focused on products’ “end-of-life” waste methods, the circular economy’s first principle is about turning waste and pollution into reusable products for example, packaging. It is about making sense of the core issue that causes excess waste and pollution: wrongful design. To help eliminate waste and pollution, we need to develop new, creative ways to design products for long-lasting to even eternal life spans. Approximately 8/10 of a product’s impact on the environment is determined in the design stage. Facing the issues already in the design stage towards a more circular target, can drastically change the results of issues regarding waste and pollution. By realizing that many pollution issues we face are caused mainly by design flaws, we can start innovating and implementing modern technologies and materials to prevent the issue at its very core. A good example of this is the collective turn against single use plastic cups and bottles, we can observe that more and more people are bringing their own reusable products like water bottles with them on a daily basis. (Taylor)

3.2 Circulate products and materials

Secondly we have a simple concept which needs to be turned into an absolute principle: resources cannot be wasted anymore. We are living on a planet with limited resources, therefore it would make sense to keep materials in circulation for as long as possible, to capture their maximum value. Once again this is where we can break the issue down to the design aspect, where products can be designed in a way in which after initial use they can be reused, repaired and remanufactured. However, making products last longer is only one part of the solution, the other part is somehow using excess materials so they don’t all end up in landfill. This specifically focuses on products with shorter lifespans, for example, food. Waste systems need to be developed in a way that accommodates multiple different waste materials. A good example of this in Finland can be the Pantti system, where bottles and cans are recycled and in turn benefits the consumers with a payback system. (Taylor)

3.3 Regenerate nature and nature’s cycles

Our most essential change towards a more circular economy is inspired by the most common system found in nature: feedback loops that consistently regenerate nature. Instead of focusing on “doing less harm” as focused on in the linear economy, the circular economy instead takes an approach of “doing more good” when it comes to conserving mother nature. In nature waste is not a concept, everything moves in circles and cycles, and the circular economy promotes this same mindset. All natural cycles work circularly, take the elements for example, they function in closed off cycles, with little to zero loss of natural resources throughout the process. (Talyor)



A proud Finnish economy which has developed and published the “world’s first National Roadmap to a Circular Economy (2016-2025)”, has forecasted that the implementation of this roadmap will add a minimum of three billion euros to the Finnish economy by 2030. This roadmap is meant to be seen as a tool to assist in more complex world issues such as: developing sustainability, fighting global warming, preserving nature and enhancing the environment. This tool is designed in a way to solve these complex issues whilst promoting economic growth and jobs. A limited, yet well developed population of 5.5 million citizens, as in Finland, makes it easier for partners to collaborate, since the network is so narrowed down. This allows the Finnish economy to try out practical experiments related to creating a circular economy, which are meant to benefit both on a societal and economical level. A lot of Finnish companies can be viewed as “pioneers” in this industry, as many digital solution-based companies are creating solutions for renewable energy, nutrient recycling, contaminated land rehabilitation, etc. During the 2018 World Economic Forum in Davos, Finnish company “Sitra” won the public sector category of The Circulars. (Finland Toolbox)

“Sitra is Finland’s fund for the future”. Sitra is a Finnish based company, fighting for all things sustainable. They are pioneering sustainable well being and their main focus is on the future changes that need to be made. Sitra is also the main company responsible for developing the Circular Economy Roadmap and have presented “the circular economy road map process in a nutshell” in the following nine steps: (Jarvinen & Sinervo) 

4.1 Preparation and prerequisites:

  • Preconditions need to be defined through proper project planning and role delegation, with enough resources available.

4.2 Partners and cooperation:

  • Core, committed stakeholders need to be determined beforehand and their core needs.

4.3 The circumstantial vision:

  • Knowledge needs to be expanded about the present situation of the circular economy in the specified area, it will help create a foundation for the steps to follow. 

4.4 Vision and objectives:

  • An inspirational vision for the road map needs to be created alongside SMART goals.

4.5 Focal points:

  • Focal points need to be derived from the vision and objectives, from which measurement indicators need to be defined. 

4.6 Action plan: 

  • Clear action steps need to be determined to lead the vision to reaching the roadmap´s goal. 

4.7 Collect and distribute:

  • Use stakeholder feedback to start collecting bits and pieces to form the road map. Inspire individual action that enhances the circular economy.

4.8 Execution and exertion: 

  • A clear management system needs to be decided in which individuals need to show commitment to show results, communication is key.

4.9 Assessment and review:

  • Continual projects need to be assessed, ongoing actions need to be reviewed and updates need to be decided, ensuring maximum impact. 


In conclusion, the circular economy is happening, whether we are ready for it or not. Multiple different fields of speciality are needed to accommodate this change and therefore it opens up endless working opportunities. Changing from our well imprinted “take-make-consumer-throw away” linear mindset to a “reduce all waste to an absolute minimum”,  circular one, will need a sense of collective commitment globally. There are already so many tools and resources out there ready for us to make use of, it is time for us to jump head first. 



Economy.2023.  Circular economy: definition, importance and benefits. Read on 2.9.2023. https://www.europarl.europa.eu/news/en/headlines/economy/20151201STO05603/circular-economy-definition-importance-and-benefits 

Finland Promotion Board. 2023. Circular Economy. Read on 6.9.2023. https://toolbox.finland.fi/circular-economy/ 

Järvinen,L & Sinervo, R. 2020. How to create a national circular economy roadmap. Read on 6.9.2023. https://www.sitra.fi/en/publications/how-to-create-a-national-circular-economy-road-map/#who 

Lehtinen, A. 2020.A guide to help any country create a national circular economy road map. Read on 1.9.2023. https://www.sitra.fi/en/news/a-guide-to-help-any-country-create-a-national-circular-economy-road-map/ 

Macarthur, E, Foundation. 2020. What is a circular economy? Read on 1.9.2023. https://ellenmacarthurfoundation.org/topics/circular-economy-introduction/overview 

MacArthur, E, Foundation. 2020. The butterfly diagram: visualising the circular economy. Read on 2.9.2023. 


MacArthur, E, Foundation.2020. The vision for a circular economy for plastic. Watched on 3.9.2023. 


Taylor, L. 2020. Three Core principles of the circular economy. Read on 3.9.2023. https://planetark.org/newsroom/news/three-core-principles-of-the-circular-economy 

The Finnish innovation fund. 2023. Sitra is Finland’s fund for the future. Read on 6.9.2023.


  • Maria Jussila

    Such a good, comprehensive and interesting essay to read! I learned a lot from the essay for example about the Finlands roadmap to a circular economy and it adding a minimum of three billion euros to the Finnish economy by 2030. So thank you!

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