The lack of a commonly accepted and inclusive definition and circularity measurement methodology hampers the transition to a more circular economy. It obstructs the development and access to dedicated or non-dedicated finance, credit risk assessment, and the transferability and replicability of projects and investments across regions and jurisdictions.

To overcome this, the Expert Group on Circular Economy Financing proposes a sectoragnostic circular economy categorisation system that defines categories of activities substantially contributing to a circular economy. A set of minimum criteria needs to be met by activities to be considered as substantially contributing to a circular economy. A methodological guidance with an indicative list of typical investments/projects for each circular economy category is also included.

This categorisation system is intended as a contribution to the future work of the Sustainable Finance Platform on the EU taxonomy of activities substantially contributing to the circular economy objective.