Measuring Circularity: Metrics and Indicators for Evaluating Sustainable Business Practices

Abstract

As businesses worldwide adopt circular economy (CE) principles, there is an increasing need for robust metrics and indicators to evaluate the effectiveness of circular practices. Measuring circularity allows organizations to track resource efficiency, waste reduction, and sustainability performance, providing insights for strategic decision-making. This research examines quantitative and qualitative circularity metrics, evaluates frameworks used across industries, and identifies best practices for measuring business sustainability. Data were collected through surveys of 60 firms implementing circular strategies and interviews with 20 sustainability managers, consultants, and industry experts. Findings indicate that material flow analysis, product lifecycle assessments, resource efficiency ratios, and circularity indicators are essential tools for monitoring circular practices, while challenges include standardization, data availability, and integration with financial performance.