The Ellen MacArthur Foundation is investigating how the financial sector can (or urgently should) support the transition to a circular economy that has the potential to achieve economic, social and environmental goals. The financial industry plays a central role in this respect, as it provides the capital needed for circular business models and encourages investment in innovation.
In recent years, there has been significant growth in the financing of circular economy activities, as evidenced by the increase in public and private investment funds targeting circular projects. For example, the number of public equity funds investing in the circular economy rose from one in 2018 to ten in 2020. There has also been a significant increase in the area of corporate bonds and private market financing.
A key aspect of the circular economy is its ability to reduce greenhouse gas emissions by optimising the use of resources and minimising waste. The report emphasises that the circular economy not only contributes to achieving climate goals, but also offers economic opportunities, such as creating new jobs and promoting innovation. Successful examples and initiatives from various sectors, such as the fashion, plastics and food industries, illustrate the potential of the circular economy.
In conclusion, the report calls for all players in the financial sector - including investors, banks and governments - to intensify their efforts to accelerate the transformation to a circular economy. This requires close cooperation and the development of new financial instruments and regulatory frameworks that support and promote circular business models.
You can download the report here:
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