Measuring Circularity Across Sectors: Introducing the Circular Performance Index

Measuring Circularity Across Sectors: Introducing the Circular Performance Index Jo˜ao Zambujal-Oliveira October 2025 1. Context and Motivation 1. The transition from linear to circular business models is key to sustainability and competitiveness. It also supports European environmental goals. Yet, organizations struggle to measure their circular maturity. They often find it difficult to assess the economic, environmental, and social impact of circular actions. 2. This project introduces the Circular Performance Index. It combines key performance indicators across four dimensions: financial, operational, environmental, and social. It can evaluate circular economy projects in sectors such as Agribusiness & Farming, Energy, Smart Mobility, and Waste Management. 3. There is growing agreement on the need to measure circular progress. The World Business Council for Sustainable Development (WBCSD) created the Circular Transition Indicators (CTI)1to support companies in this task (Walker et al., 2023). Several EU countries, including Italy, have proposed a unified “circularity index” for comparing results. Researchers have also developed the Circularity Product Indicator (CPI) to track material and energy flows in industry (Angioletti et al., 2017). 2. Research Objectives 1. To develop a comprehensive framework for evaluating circular business performance. This framework will enable the design of a quantitative Circular Performance Index (CPI). 2. To apply the framework to selected case studies in different industries. The analysis will compare sector-specific and cross-sectoral indicators of circularity. 1https://www.wbcsd.org/actions/circular-transition-indicators/ 1 3. Research Questions 1. Which indicators and framework best measure circular business performance across sectors? 2. How can a Circular Performance Index be designed, validated, and applied to benchmark circular initiatives for decision-making? 4. Methodology Phase 1 – Conceptual Framework ·Review literature on circular business models, EU policies and circularity metrics (Sehnem et al., 2019). ·Define potential indicators across financial, operational, environmental, and social dimensions (Nika et al., 2021). Deliverable: Literature review and preliminary indicator map. Phase 2 – Circular Performance Index Design ·Select indicators using Principal Component Analysis and Analytic Hierarchy Process (Zambujal-Oliveira et al., 2025; Zambujal-Oliveira & Amaral, 2023). ·Apply a design thinking approach to make the Circular Performance Index practical and aligned with organization needs (Geissdoerfer et al., 2017). Deliverable: Draft Circular Performance Index framework with weighted indicators. Phase 3 – Case Study Application ·Apply the Circular Performance Index to selected companies in Agribusiness & Farming, Energy, Smart Mobility, and Waste Management (Cavicchi et al., 2022). ·Compare sector-specific and cross-sectoral performance (Br¨andstr¨om et al., 2024). Deliverable: Case study reports with comparative Circular Performance Index results. Phase 4 – Validation & Refinement ·Validate Circular Performance Index with expert panel review and sensitivity analysis (Saisana & Saltelli, 2008). 2 ·Refine the framework for consistency across industries (Carmona Aparicio et al., 2025; Colasante et al., 2022). Deliverable: Validated and refined Circular Performance Index framework. Phase 5 – Visualization & Policy Alignment ·Develop a dashboard prototype for Circular Performance Index visualization (Keena et al., 2023). ·Align Circular Performance Index results with EU strategies and corporate reporting standards (GRI, ISO) (Opferkuch et al., 2021). Deliverable: Circular Performance Index dashboard prototype and policy recommendations report. 5. Expected Outcomes ·A Circular Performance Index for cross-sector benchmarking. ·Insights into sectoral and cross-sectoral circular maturity. ·Practical guidance for corporate strategy and policymaking. 6. Impact ·Academic: Advances research on circular performance measurement. ·Professional: Provides companies with a practical tool for benchmarking circularity. ·Policy: Supports evidence-based policymaking for circular economy initiatives. References Angioletti, C. M., Despeisse, M., & Rocca, R. (2017). Product circularity assessment methodology. In IFIP International Conference on Advances in Production Management Systems (pp. 411–418). Br¨andstr¨om, J., Jazairy, A., & Roos Lindgreen, E. (2024). Barriers to adopting circular business models: A cross-sectoral analysis. Business Strategy and the Environment, 33(5), 4331–4350. Brown, T., et al. (2008). Design thinking. 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