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4.1 Circular design and sustainable production

This briefing evaluates Europe’s progress towards more sustainable production and products. Product design significantly affects products' climate and environmental impacts, and the circularity of their life cycles. Design influences their potential lifetime by determining a number of factors, including the extent to which they can be reused, repaired and remanufactured; their material consumption for during manufacturing; waste generation; recyclability; and hazardous substance content. Sustainable production aims to reduce emissions, resource use and waste in manufacturing processes.

4.2 Waste generation and material consumption

This briefing analyses the EU economy's resource use to assess its transition to less material-intensive consumption patterns, lowering waste generation as a result. It tries to assess if circular economy strategies such as circular business models are increasingly being taken up, scaling up and having an impact.

4.3 Waste recycling

This briefing assesses Europe’s progress towards turning waste into a resource. It uses reported recycling data for different waste streams as a proxy and assumes that the recycled amounts replace new materials that would otherwise have come from virgin sources. The extent to which recycled materials can contribute to Europe’s material demand is assessed in briefing 4.4 Circular economy financing and strategies .

4.4 Circular use of materials

This briefing covers circular material use in the EU as approximated by the Circular Material Use Rate (CMUR). This measures the extent to which recycled materials are used in the economy , thereby replacing primary raw materials and reducing their extraction. As it is limited to material recirculation, the CMUR figure should always be considered alongside other metrics covering additional circularity objectives, including the minimisation of resource use and the strive for clean material cycles . Moreover, the CMUR only considers the quantity of recycled materials, not the quality of recycling processes (see briefing 4.3 Waste recycling ).

4.5 Circular economy financing and strategies

Moving to a circular economy requires adequate investments as well as strong governance to support fundamental changes from linear to circular business models, practices and behaviours. This briefing aims to assess if adequate funding via both public and private investments is in place to make the transition happen, and if it is supported by national strategies and action plans. Broader governance aspects currently cannot be assessed. All cost information refers to constant prices fixed to 2024 (EUR 2024 ).

4.6 Benefits of a circular economy

This briefing aims to assess how circular economy measures contribute to reducing pressures on the climate, pollution and biodiversity by decreasing the need to extract natural resources. The assessment also addresses the circular economy’s potential to make Europe’s economy more resilient, secure jobs and strengthen Europe’s strategic autonomy with respect to resources.

4.7 Global impacts from EU consumption

This briefing looks at the global impacts associated with EU product and service consumption. These environmental and climate impacts (such as climate change, resource depletion and air pollution) are aggregated into a single score. These impacts might occur within or outside the EU, depending on where production takes place for the products and services consumed within the bloc. The aggregated impact score can be separated into individual impact scores for specific consumption areas like housing, food, household goods and personal mobility.

4.8 Transformative innovation

This thematic briefing examines past trends in innovation performance through the lens of the European Commission's eco-innovation index in Europe and the European innovation scoreboard . Looking ahead and drawing on data from research and development expenditure within the EU, it highlights the increasing momentum towards transformative innovation in EU policy and institutional frameworks. It also emphasises the need for increased investment and greater directionality in research and innovation (R&I) activities.

4.9 Green employment

Green employment is a key enabler for ensuring that a transition to climate neutrality is just. The term green employment can broadly be defined as referring to decent jobs that contribute to preserving or restoring the environment , though there are varying definitions . This briefing considers past trends (assessed based on historic changes to employment) and the outlook for green employment. For the outlook, we consider the transition's likely impacts on employment and whether the policies that have been implemented are sufficient to enable a just transition to climate neutrality.

4.10 Green taxation and other economic instruments

This briefing examines the application of green taxation and other economic instruments, which are set out in EU policies; it assesses their impact where the data allow. Economic instruments — such as carbon pricing — have been deployed under energy and climate policies to achieve policy objectives across various environmental domains. Carbon pricing policies are also addressed in the related briefing on climate governance.

4.11 Justice in sustainability transitions

This briefing identifies EU policies intended to ensure that Europe’s transition towards sustainability is fair. It also reviews how these policies take distributional, procedural and recognitional justice into consideration. Pollution's unequal impact is covered in the briefing on environmental health inequalities , while the asymmetrical impacts from climate change are addressed in the briefing on managing climate risks to society .

4.12 Financing the transition towards sustainable activities

This briefing provides an overview of the EU policy framework on sustainable finance, which seeks to redirect capital flows towards sustainable activities to advance the EU’s green transition. It also evaluates the EU’s progress in addressing green investment needs to achieve sustainability goals. Briefing 2.8 on climate financing covers investments in climate change mitigation. The cost of inaction is covered in briefing 2.6.