Towards circular economy through design

Through circular design, companies are able to ensure their competitiveness and build a sustainable future that the planet can cope with.

Facts about circular economy



Finland’s circular economy goal is to reduce the use of virgin raw materials and double the circular economy rate of materials by 2035. Source: MInistry of the Environment, 2021

Design phase

80 %

Up to 80 % of the environmental impact of a product is determined during its design phase. Source: EU Commission bulletin 2022


40 %

The manufacturing industry spends around 40 % of its budget on materials. Source: EU Circular Economy Action Plan 2020


70 %

A total of 70 % of global CO2 emissions are caused by material acquisition and processing, as well as product manufacturing and use. Source: Circular Economy: Circularity Gap Report, 2022

Our lives are shaped by design solutions

‘Human beings don’t have a pollution problem; they have a design problem,’ said the creators of the Cradle to Cradle framework, William McDonough and Michael Braungart. This illustrates the essence and the greatest potential of circular economy: there is a need for better design at both systemic and product levels.

Design solutions permeate and shape our daily lives. Everything from clothes to vehicles, packaging, detergents, food, furniture and various types of services are results of design. Similarly, design is utilised in system-level solutions, such as in supply chains and business models of companies, urban infrastructure, various sectors ranging from industry to fashion, construction, electronics and agriculture.

What is circular economy?

Our current economy is largely linear, meaning that natural resources are turned into products that are discarded as waste after use. The consumption of natural resources and the generation of emissions surged to unprecedented levels during the industrialisation era.

The linear model of take-make-dispose has harmed the Earth’s ecological ability to cope, depleted biodiversity and accelerated global warming. But the planet’s resources are finite.

Circular economy offers an alternative with which we can build a sustainable future within the limits of the Earth. Design in all its forms plays an integral part in creating an economic system that is based on circular economy.

What does circular economy mean for businesses?

Going forward, circular economy will be the only economic and operating model to be promoted at EU level under the twin green and digital transition. For companies, this will mean significant changes in their market environment, because operations will need to be redesigned according to the circular economy principles.

  • product and services
  • production 
  • revenue models
  • customer relationship  
  • customer experience 

The EU’s Sustainable Product Policy initiative proposes that all products sold within the EU must be repairable and recyclable, spare parts must be available and the use of harmful chemicals must be minimised. The EU taxonomy classification, which links the price of money to the sustainability criteria, is already in effect.

Additionally, the EU has for example a digital product passport on its implementation agenda, which gathers information on the sustainability, raw materials and product safety.

At the same time, customers are seeking ways to reduce their environmental footprint associated with consumption. All of this means tremendous potential for businesses to create new forms of value.

Images on the page: Solar Foods, & Solar Foods, Solein

Circular design, kiertotalousperusteinen muotoilu, auttaa yrityksiä luomaan kestävää tulevaisuutta.

If a company wants to ensure its success in the future, the only way is to adopt the circular economy toolkit now.

Through circular design, companies are able to ensure their competitiveness and build a sustainable future that the planet can cope with.

Circular economy principles as basis for design

This applies to the design of an individual product, production process, supply chain, and even an entire city district. In nature, there is no waste, as everything serves as raw material in an endless cycle. Therefore, the production of waste and emissions can be seen as a design flaw in linear economy.

Design is based on several lifecycles of a product (cf. the natural cycle) instead of just a single lifecycle. Similarly, product design solutions – materials, chemicals and product characteristics – aim to achieve, in principle, an endless, safe and healthy cycle of products and materials without increasing the environmental load.

In design, the focus extends from an individual product to an entire business ecosystem. A better understanding of natural processes and the way they can be promoted through design is required. All companies depend on the vitality of nature and the opportunities it offers.  Examples of these opportunities include water and pollinators: cotton cannot be grown without water, and the cotton plant can only reproduce and produce new crops through pollination. 

Durat, photo: Christian Jakowleff

Aiming for decoupling

Decoupling refers to a situation in which a company’s production increases, but the emissions, virgin raw ingredients and use of natural resources are reduced through circular economy models. To put it simply: considerably more can be achieved more smartly and for less.

Why should design thinking be incorporated into business development?

Design thinking can be used to understand complex systems and causal relationships from a “bird’s-eye view”, as well as to zoom in on the smallest details. All these different perspectives are needed so that companies can build a vibrant future through their solutions. We do not need any more solutions based on linear thinking that are just slightly less bad.

Right now, as new markets are still forming, this is an excellent opportunity to create a winning and sustainable business model for the future.

Design thinking enables us to build product and service concepts that are attractive, effective and relevant to the users, in accordance with circular economy. It is easy to recommend meaningful experiences to other users who are seeking new and more sustainable forms of consumption. Design thinking is exceptionally fruitful precisely because the desirability of an idea is the starting point for its development.

Durat showroom, photo by Paavo Lehtonen

Here is how to start moving towards circular economy

Circular economy is the responsibility of a company’s management. At the same time, changes for moving towards circular economy will ensure a company’s competitiveness. That is why this transition must be on the management team’s agenda. To get started, do the following:

Hold a steering group meeting and ensure that you share the same vision of circular economy as a facilitator of sustainable growth.


  • Strategy, company culture and business model: What are the objectives of your current strategy? How do the strategy and the current business model help mitigate climate change, adapt to it and slow down the loss of biodiversity? The company strategy should be compared with Finland’s circular economy objectives. Will the current company culture enable a transition towards circular economy? And can your current business model promote the transition?

  • Operations: What does the value chain of the entire company look like from the acquisition of raw materials to the end user? Have the operations been designed based on the “take, make use and discard” model or are you already trying to keep products and materials in circulation with the help of a network of partners
  • RDI and design: What is your decision-making based on at the moment? A good way to test this is to turn the three main principles of circular economy into questions and compare them with your existing RDI work and design process. How can we design waste and emissions away? How do we maintain the high quality of materials in circulation? How can we strengthen natural ecosystems through design?
  • Customer interface, brand and marketing communications: What are the cornerstones of your brand? Does an interface with circular economy already exist? On what grounds do customers choose your company? How could aspects of circular economy increase the attractiveness of your company?
  • Staff competence and internal organisation: What are your strengths and weaknesses in terms of circular economy? Does your current expertise facilitate a transition from selling a product to providing services, for example? Do your team configurations and departments fit into the circular economy model?

A good rule of thumb is that if you already know how to achieve a goal when setting it, then the goal is not sufficiently big or inspiring. In addition to a major goal, create a path, i.e. a strategy or a roadmap, towards this goal. What needs to change in the above areas to allow you to have a winning strategy in use once the foundations of the economy have been aligned with the principles of circular economy?

Which measures could be quickly and easily implemented? And which measures – such as circular economy design guidelines that steer the design process – will have the greatest impact on your journey towards circular economy?

Pure Waste Textiles Oy, environmental impact of the product

Keep in mind that nature has resolved countless challenges as a result of its 3.8 billion years of research, development and innovation. The circular economy winners will be those who challenge their design process by continuously learning and aligning their process to resemble the natural ones.

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