Within the next decade, the way most companies operate their business will look very different from how they do so today. With up to 60% of the world’s ecosystem significantly altered by unsustainable practices, leaders are facing pressure to rethink their current approaches to producing goods on a massive scale. Using endless amounts of the Earth’s finite resources – for a product to be discarded once they reach the end of their lifespan – is quickly becoming taboo. The result? The fight to support a circular economy over a linear economy is becoming more important than ever.
We’ve become rightly uncomfortable with a status quo in which everything from electrical goods, vehicles and household goods to plastics and fibers in circulation today are largely nonbiodegradable, inorganic and contribute to the torrent of waste sent to landfill. And we’re becoming increasingly enamored with a solution: a circular economy.
According to the World Economic Forum, nearly 80% of business leaders believe that circularity is very important to their organization – which is up from 36% three years ago. With these kinds of findings, we can assume that the circular economy will replace existing linear business models to become the only economy within the next decade.
What is the difference between circular economies and linear economies?
The linear economy business model – in which we take resources, make a product and waste both unneeded materials from production and the product itself once its useful life has ended – is one we have followed for centuries. Fittingly, it’s known as the take-make-waste economy.
The key difference between circular and linear economies is their approach to a product’s lifecycle. A linear economy is focused on profitability, whereas a circular economy is focused on sustainability.
Linear economy definition: Take-make dispose
A leader in promoting circularity, the Ellen MacArthur Foundation defines the linear economy as a system in which finite resources are extracted to design products that are generally used only briefly and then discarded. Linear by nature, products and materials are destined to move in a single direction, from raw material to waste.
Today, global industries still largely rely on this linear system. At its peak in 2016, linear practices generated 242 million tons of plastic waste alone, the equivalent to 12% of all solid waste.
Circular economy definition: A shift in how we create, consume and regenerate
The circular economy challenges the “take-make-waste” approach of a linear economy by encouraging businesses to shift toward innovative, sustainable methods of creating products and systems. By using a circular economy model, businesses can eliminate waste and pollution, keep products and materials in use and regenerate natural systems.
Why is a linear economy model not sustainable?
Not only is the linear system hugely wasteful, but it also degrades our natural environment, contributing to biodiversity loss and accelerating global warming. Landfill waste accounts for approximately 11% of global methane emissions.
Indeed, reports say that a large proportion of environmental damage is down to the mismanagement of waste. At least 33% is thought to be handled improperly, either dumped or burned, when it could actually be recycled. Even as companies scale back their carbon emissions, high levels of toxic greenhouse gases such as methane, ammonia, carbon dioxide and nitrous oxide are emitted from landfills, growing to 2.38 billion tons of carbon-equivalent emissions per year by 2050.
Three principles of the circular economy
The circular economy reframes how businesses use natural resources and encourages them to keep products and materials in circulation for as long as possible. It’s widely considered an effective way to build a sustainable future and prevent pollution.
Ensuring that all materials are refurbished, repurposed, maintained or remanufactured could prevent further waste from heading to landfill, being dumped in the sea or being burned. It requires companies to rethink how they develop their products and, ultimately, shift how they do business. Those leading the way in embracing sustainable design trends, like the Ellen MacArthur Foundation, have established three main principles of the circular economy, which are:
- Eliminate waste and pollution: To eliminate waste, we must end the design of disposable products altogether and instead develop sustainable products from the ground up, from plastic bottle caps and smartphones to industrial buildings. One company making progress in food packaging is Amcor Rigid Packaging, a leading container manufacturer. The global packaging brand makes an estimated 68 billion containers, preforms and closures each year, but has recently reduced its environmental impact as its output grows. Using virtual twins, they’ve engineered strong, protective plastic bottles that weigh less and uses less plastic. As a result, they’ve saved 400 metric tons of resin last year due to decreasing the weight of its bottles by 35% to 50%.
- Circulate products and materials: Making the best use of all existing materials means companies will need to find innovative ways of using them in a continuous cycle, whether through recycling, repurposing, refurbishment or repair. Metsä Board, a Finnish paperboard company, has a reputation as a forerunner in sustainability. All wood fiber it uses comes from sustainably managed, certified or controlled northern forests and is 100% traceable.
- Regenerate nature: Planting and replenishing trees, boosting marine biodiversity, reclaiming natural habitats, rewilding spaces for nature and growing produce in a renewable system are just some of the ways that we can revive our natural ecosystems. Because there is no waste in nature, businesses are increasingly looking into how they can mimic natural ecosystems – also known as biomimicry – and design their products from bio-based, compostable and circular materials such as vegetable-based leathers. Reshaping our food industry also plays a crucial role in regenerating nature – a third of all human-caused greenhouse gas emissions are linked to food.
“A circular economy for food mimics natural systems of regeneration so that waste does not exist but is instead feedstock for another cycle.”
Ellen Macarthur Foundation
Linear economy vs circular economy examples
The linear economy extracts resources to make products that end up as waste soon after. Products end up being underused, creating a polluting system with significant environmental impacts and resource depletion. This one-way process uses single-use items, preventing reuse or recycling and increasing landfill waste. Some real-world examples of the linear economy include:
- Single-use plastics: Items like plastic bottles, bags and packaging are made for one-time use. These plastics take centuries to break down in landfills or the ocean.
- Electronics and e-waste: Devices like smartphones and laptops are often designed to break easily or become outdated quickly.
- Disposable packaging: Food containers and online shopping parcels add to waste. This pattern matches what is seen in the previous examples.
On the other hand, the circular economy model focuses on keeping materials in continuous use. In this model, circular economy principles are followed and every resource is reused or regenerated rather than discarded. The circular economy helps reduce environmental impact by lessening biodiversity loss, waste and pollution, while helping support economic growth. Some real-world examples of the circular economy include:
- Recycling facilities: These spaces help turn metals, glass, paper and plastics into new products. It can involve advanced techniques like chemical recycling and material recovery.
- Design for disassembly: A practice in which products or buildings can be dismantled and repurposed at the end of their lifecycle. Design for disassembly promotes a circular economy by reducing environmental impact while maximizing resource efficiency.
- Industrial symbiosis networks: Businesses work together so that the waste or by-products from one company can become valuable resources or inputs for another. This approach minimizes overall resource consumption.
- Incorporate sustainable materials at the design-stage: Trends like fast fashion do not consider the life-span of an article of clothing, contributing to overconsumption and waste. When you utilize circular economy principles at the design-stage, it influences how long the product lasts, how it can be repaired and how it will be used at the end of life.
- Waste-to-energy (WTE) plants: Waste-to-energy facilities convert non-recyclable waste streams into electricity and heat, providing an alternative to landfills.
Circular economy benefits
Shifting from a linear economy to a circular economy provides many benefits to businesses, societies and our planet. They include:
- Minimizing the impact of climate change: The circular economy is recognized by policymakers as an integral part of their sustainability plans to protect our natural world and build a carbon-neutral economy.
- Helping people live longer, healthier lives: A circular economy approach within the food sector alone is predicted to save 290,000 lives lost to outdoor air pollution by 2050.
- Creating new business opportunities: Shifting from linear economy production methods to reuse, repair and remanufacturing could create a net increase of 6 million jobs by 2030. Additionally, moving toward a circular economy could provide an opportunity for the 15 million people worldwide known as “waste pickers” – who salvage recyclable or reusable materials from garbage – to enter the formal workforce, offering safer, more secure employment.
Final thoughts
Today, the circular economy is becoming less of a trend and more of a standard for companies worldwide, as political backing and growing societal pressure grow. Of course, changes of such magnitude don’t happen overnight. It’s estimated that only about 6.9% of the global economy is currently circular, and most businesses still rely heavily on new materials. Yet the transition away from the linear economy is happening, and policy interventions, technological innovation and sustainable-focused investment will continue to accelerate the scaling up of circular economy principles across global supply chains. It’s only a matter of time.
More frequently asked questions about circular economy vs. linear economy
1. Reduce: The most effective way to reduce waste is to prevent it from forming in the first place. When you reduce greenhouse gas emissions, you prevent pollution because there is less need to extract new raw materials. To reduce, you can buy used items because they produce fewer emissions than new materials.
2. Reuse: Reusing products allows them to be used to their fullest extent and saves money. The environment will also be sustained for future generations. To reuse, repurpose items such as old clothing, cloth grocery bags and containers to prevent waste.
3. Recycle: Recycling is the process of collecting and processing materials that would be thrown out as trash and turning them into new products. Products should only be recycled if they can’t be reduced or reused. Recycling reduces the need to extract resources for new products and saves energy.
4. Recover: This is the process of extracting valuable resources from waste through recovery methods. This could be material recovery by taking usable materials like metals, paper or plastic from waste reprocessing or energy recovery, converting non-recyclable waste into electricity, heat or fuel. There is also organic recovery, like transforming biodegradable waste into compost or fertilizer.
5. Redesign: Rethinking and revamping production and consumption systems for enhanced sustainability. It is often referred to as “eco-design” or “circular design” aiming to eliminate waste and pollution by design rather than managing it afterwards.
The circular economy revolves around resource efficiency and responsible practices. At its core, it helps reduce waste and material use and improve recycling. The seven pillars that make up the circular economy are:
1. Design: Creating durable, eco-friendly products through environmentally conscious design principles.
2. Reuse: Using materials and products continuously to extend their lifespan which minimizes waste.
3. Repair: Repairing products to lengthen their usability and lowering the risk of throwing them out too early.
4. Sharing: Collaborating or sharing products helping to optimize resource utilization.
5. Upgrading: Improving and updating products to make sure they stay relevant and functional for a long period.
6. Recycling: Recycling materials to make waste valuable resources and minimize the impact on the environment.
7. Resource Efficiency: Using resources efficiently and responsibly to reduce waste generation and consumption.
The disadvantages of a linear economy and linear practices include:
Depletion of natural resources
Generates waste
Short product lifecycles
Supply chain instabilities
High emissions of greenhouse gases
Biodiversity loss
RELATED RESOURCES
- Circularity in action
- What is the circular economy?
- Practical steps for building a circular economy
- Can business executives be mindful leaders on sustainability?
- Understanding biodiversity loss
- The Bioeconomy: Building a sustainable future through biodiversity and business
*** Originally published on November 7, 2023 and updated on June 24, 2026.
Patrick is a Senior Communications Manager on the Corporate Publishing team here at Dassault Systèmes. An experienced journalist, marketer, speechwriter and storyteller, Patrick's words have appeared on pages and stages around the world.