Recycling and Circular Economy Standard — WIA-ENE-023
The Ellen MacArthur Foundation (EMF), founded on the Isle of Wight in 2010 as a non-profit institution, institutionalized the concept of the "Circular Economy" (CE) as an industrial agenda through the 2012 report "Towards the Circular Economy Vol. 1." This standard adopts the dual-loop scaffolding formalized in EMF's "Butterfly Diagram," with the "Technical Cycle" on the left and the "Biological Cycle" on the right. The simulator ENUM tokens EMF_BUTTERFLY, TECHNICAL_CYCLE, BIOLOGICAL_CYCLE, CIRCULAR_ECONOMY, CRADLE_TO_CRADLE, BIO_BASED, and BIODEGRADABLE in WIA-ENE-023 align with the nodes of this scaffolding.
The "three principles" of CE that EMF introduced (formalized in the 2015 "Growth Within" report) are: first, "Design out waste and pollution" — waste and pollution are system-design errors that must be removed at the design stage; second, "Keep products and materials in use" — products and materials must be retained in the economic cycle for as long as possible; third, "Regenerate natural systems" — natural systems must be restored and regenerated. These three principles are reflected directly in the evaluation function of the CIRCULAR_ECONOMY token in the simulator.
The left half of the EMF Butterfly Diagram is the Technical Cycle, which schematizes the product flow of finite-resource materials as a five-stage loop. The five stages run, from the innermost loop outward, as (1) Maintain · Prolong, (2) Reuse · Redistribute, (3) Refurbish · Remanufacture, (4) Recycle, and (5) Cascading. This ordering is the decreasing order of "value retention": the more inward the loop, the higher the fraction of added value that the product or material has retained. The simulator's TECHNICAL_CYCLE token quantifies the entry ratio into each of these five loops.
The first loop, Maintain · Prolong, means maintenance, repair, and use-life extension. Periodic vehicle inspection, parts replacement in home appliances, and laundry and mending in apparel all fall into this loop. The EU Right to Repair Directive (Directive (EU) 2024/1799) supplies the legal scaffolding for the loop, and the French Indice de réparabilité (introduced 2021) supplies a quantitative consumer signal.
The second loop, Reuse · Redistribute, is the flow of transferring a product to a new user without disassembly or remanufacturing. The second-hand market, leasing and sharing economies, and donations and gifting belong here. The third loop, Refurbish · Remanufacture, is the flow in which a product is partially disassembled, inspected, repaired, and reassembled to a "new-equivalent" level. Automotive engine remanufacturing, home appliance refurbishment, and industrial-equipment remanufacturing belong here. The U.S. automotive remanufacturing industry was approximately USD 10 billion in 2020.
The fourth loop, Recycle, is the flow in which a product is shredded, washed, and re-pelletized to recover the material and feed it into new-product manufacturing. The RIC-based plastic recycling, metal recycling, and paper recycling that other chapters of this standard discuss all belong here. The fifth loop, Cascading, is the "downcycling" flow in which the quality of the recovered material does not match its original use and the material is transferred to a use that requires lower quality.
The standard expresses the value-retention hierarchy of the five-stage loop with the following quantitative model. Maintain · Prolong retains value at 90 to 95 percent, Reuse · Redistribute at 70 to 85 percent, Refurbish · Remanufacture at 50 to 70 percent, Recycle at 15 to 35 percent, and Cascading at 5 to 20 percent. These ranges synthesize industry-average data from the 2013 EMF "Towards the Circular Economy Vol. 2" report and the 2014 Accenture "Circular Advantage" report. The EMF_BUTTERFLY token in the simulator computes the entry-ratio distribution across the five loops as a function of the input product's characteristics.
The right half of the Butterfly Diagram is the Biological Cycle, which schematizes the flow of materials of biological origin (wood, cotton, natural rubber, grain residues, biopolymers). The Biological Cycle is a three-stage loop running (1) Biochemical Feedstock, (2) Anaerobic Digestion · Composting, and (3) Biosphere Regeneration, and its core principle is that "the material must be safely returnable to the biosphere." The simulator tokens BIOLOGICAL_CYCLE, BIO_BASED, and BIODEGRADABLE model this loop.
The standard makes explicit that within the Biological Cycle, BIO_BASED and BIODEGRADABLE are distinct properties. BIO_BASED is the property of "having been synthesized from biological feedstock"; the ISO 16620 series standardizes the measurement of bio-based content. BIODEGRADABLE is the property of "being degradable by microbial activity and returnable to nature"; ISO 17088:2021, EN 13432:2000, and ASTM D6400-21 supply the threshold criteria for biodegradation level, particle size, and ecotoxicity. Polylactic acid (PLA) is BIO_BASED and is BIODEGRADABLE only in industrial conditions; "green polyethylene" derived from sugarcane is BIO_BASED but not BIODEGRADABLE. The simulator evaluates the four combinations of these two properties separately.
"Cradle to Cradle" (C2C) is the design principle formalized in the eponymous 2002 book by U.S. architect William McDonough and German chemist Michael Braungart, and is the theoretical predecessor of the EMF Butterfly Diagram. The simulator's CRADLE_TO_CRADLE token models this design principle. The core proposition of C2C is "Waste = Food": every material in the Technical Cycle is a "Technical Nutrient" that must persist in infinite recovery, and every material in the Biological Cycle is a "Biological Nutrient" that must return safely to the biosphere.
The C2C certification scheme Cradle to Cradle Certified® is operated by the U.S. non-profit Cradle to Cradle Products Innovation Institute and grades products across five categories (Material Health, Product Circularity, Clean Air & Climate Protection, Water & Soil Stewardship, Social Fairness) at five levels (Bronze, Silver, Gold, Platinum, Diamond). Approximately 1,800 products worldwide held C2C certification as of 2024. The CRADLE_TO_CRADLE_CERTIFICATE token in the simulator maps to this scheme.
EMF launched the "Circular Economy 100" (CE100) program in 2013 as a network in which 100 global enterprises, governments, cities, and universities share circular-economy practice cases. The three flagship industry initiatives that came out of CE100 are the "New Plastics Economy Global Commitment" (2018), "Make Fashion Circular" (2017), and the "Food Initiative" (2019). The New Plastics Economy Global Commitment sets three critical targets for 2025: 100 percent recyclable, reusable, or compostable plastic packaging; an average 26 percent recycled content; and elimination of single-use plastics. As of 2024, more than 1,000 enterprises and governments have endorsed the commitment.
The CE concept developed by EMF was supplemented by economic-impact analyses from global consulting firms. McKinsey & Company's 2015 report "Growth Within: A Circular Economy Vision for a Competitive Europe" estimated that an EU transition to CE could generate EUR 1.8 trillion of additional economic value and 6 million new jobs by 2030. Accenture's 2014 report "Circular Advantage" estimated that USD 4.5 trillion of "resource-cost saving value" in global GDP could be recovered through CE transition by 2030.
The McKinsey analysis was incorporated directly into the policy scaffolding of the EU "Circular Economy Action Plan" (2015, with 2020 revisions), and the same methodology was adopted in Korea's economic-impact estimates for "Resource Circulation Master Plan 2018-2027" and "Resource Circulation Master Plan 2024-2028" published by the Ministry of Environment and the Korea Environment Corporation (KECO).
Two global indicators have stabilized for quantitative measurement of CE-transition progress. The first is the "Circularity Metric" published annually by Circle Economy in its "Circularity Gap Report." This indicator is defined as the share of resources that the global economy extracted and consumed during one year and that re-entered the economic cycle after recovery and recycling steps, and the trend is a steady decline: 9.1 percent in 2018, 8.6 percent in 2020, and 7.2 percent in 2023. That is, the global economy is regressing in the direction of "becoming less circular," because increased primary-resource consumption in emerging economies outpaces efficiency gains in recovery and recycling.
The second indicator is the "Material Circularity Indicator" (MCI), jointly developed by EMF and Granta Design in 2015. The MCI scores product-, firm-, or industry-level circularity on a single number between 0 (purely linear economy) and 1 (purely circular economy). The formula is "(1 − Linear Flow Index) × Utility Factor," combining a linear-flow index and a utility factor. The CIRCULAR_ECONOMY token in the simulator computes the MCI dynamically from the input product's recovery, reuse, durability, and lifetime data.
The standard adopts the EMF CE model as a primary baseline but also reflects critical examinations from the academic literature. The first criticism is the omission of the "rebound effect." Zink and Geyer's 2017 paper "Circular Economy Rebound" argued that CE transition may not reduce primary-resource consumption but may, by lowering the price of recovered materials, instead increase total consumption. The EMF Butterfly Diagram does not explicitly model this rebound effect, so the simulator carries a separate "rebound coefficient" input field to correct for it ex post.
The second criticism is the omission of the limits implied by the second law of thermodynamics. Bocken et al.'s 2016 paper "Sustainable Business Model Archetypes" observed that no recovery process can attain a 100 percent recovery rate, and that a degree of entropy increase (quality degradation in an engineering sense) is unavoidable in every cycle. The five-stage value-retention hierarchy in the simulator is the result of quantitatively correcting for this thermodynamic limit.
The third criticism is the omission of the "social dimension." Early EMF reports focused on the environmental and economic dimensions and underanalyzed the social, labour, and equity dimensions. A later report, "Universal Circular Economy Policy Goals" (2019), partially supplemented this gap; the standard supplements it further by holding a "Just Transition" auxiliary panel in the simulator for social-dimension evaluation.
The EU's "Ecodesign for Sustainable Products Regulation" (ESPR, Regulation (EU) 2024/1781) phases in a mandatory "Digital Product Passport" (DPP) for products across the industrial spectrum starting in 2027. The DPP attaches to a product, in QR-code or RFID-tag form, the material composition, producer, repair history, recyclability, carbon footprint, and hazardous-substance information needed to trace the product across its full life cycle. The simulator's DIGITAL_PRODUCT_PASSPORT, ECO_DESIGN, DESIGN_FOR_DISASSEMBLY, LCA, and CARBON_FOOTPRINT tokens model the points where the DPP and the EMF model compose.
The DPP data model is used directly to decide branching among the five EMF loops. Entry to Maintain · Prolong requires the fields "repair-guide URL," "parts-compatibility data," and "reparability index"; entry to Reuse · Redistribute requires "certifiable ownership-transfer history"; entry to Refurbish · Remanufacture requires "per-part ISO 11469 marking" and "remanufacturer qualification"; entry to Recycle requires "material-composition table" and "disassembly instructions."
The simulator receives at the Phase 1 envelope unit the six fields product identifier, material composition, producer identifier, ownership history, repair history, and disposal-time data. These inputs feed an evaluation function that produces the entry-ratio distribution across the five EMF loops, and the results are emitted in three formats. The first output is the "loop-entry probability distribution" expressed as percentages across the six terminals (Maintain · Prolong, Reuse · Redistribute, Refurbish · Remanufacture, Recycle, Cascading, Linear Disposal). The second output is the single MCI score between 0 and 1. The third output is the "Carbon Footprint Delta," the difference in carbon emissions (kgCO2e) between the linear-economy scenario and the circular-economy scenario for the input product.
The chapter composes with the following primary sources: EMF Butterfly Diagram (2013), EMF "Towards the Circular Economy Vol. 1" (2012), EMF "Towards the Circular Economy Vol. 2" (2013), EMF "Growth Within" (2015), EMF "New Plastics Economy Global Commitment" (2018), EMF Circular Economy 100 network, Cradle to Cradle Certified® v4.0 (2021), Cradle to Cradle Products Innovation Institute operating criteria, McKinsey "Growth Within" (2015), Accenture "Circular Advantage" (2014), EU Circular Economy Action Plan (2015, revised 2020), EU Right to Repair Directive (EU) 2024/1799, EU Ecodesign for Sustainable Products Regulation (ESPR) 2024/1781, ISO 16620 bio-based content, ISO 17088:2021 compostable plastics, EN 13432:2000 compostability, and ASTM D6400-21 compostable plastics. [6.99]
The Korean edition supplements the chapter with mappings to the Framework Act on Transition to Circular Economy Society (enacted 2022, in force 2024), the Resource Circulation Framework Act (2018), the Ministry of Environment "Resource Circulation Master Plan 2024-2028" (with a 70-percent recycling-rate target by 2028), the KECO national resource-circulation statistics, the KEITI national circular-economy policy evaluation report, the Korea Resource Productivity Index (KRPI) at 1.7 EUR/kg in 2023, the city-level CE plans of Seoul ("Zero Waste Seoul," 2022), Busan ("Circular Economy Vision 2030," 2023), and Jeju ("Clean Jeju, Resource Circulation Society," 2022), and Korean enterprise case studies including LG Chem's chemical-recycling demonstration (8,400 t/y PET depolymerization in Dangjin, 2022), Lotte Chemical's Project LOOP (target 1,000,000 t/y of R_PET by 2030), SK Geo Centric's Urban Oil Field (220,000 t/y pyrolysis facility in Ulsan, 2025), CJ CheilJedang's PHA biopolymer production, Coca-Cola Korea's 100-percent rPET bottle program, and AmorePacific's refill-station operations.