Circularity Industry Insights

Circular Economy as a Resilience Factor in German (DE)

How German companies assess geopolitical risks and the role of circularity 

Global geopolitical tensions, volatile commodity markets, and increasing resource dependencies are reshaping how companies think about resilience and sovereignty. 

In Deloitte’s latest study, 1,000 decision-makers across Germany were surveyed on the impact of geopolitical developments on their value chains and the role circular economy can play in strengthening resilience. 

The findings show that circularity is increasingly seen not only as an environmental objective, but as a strategic lever for competitiveness, supply security, and industrial resilience. 

Geopolitical risks are becoming a strategic business issue

Around 61% of surveyed companies see their value chains at least partially threatened by geopolitical tensions - almost 30% even strongly or very strongly. 

Core areas of the value chain are particularly affected: production, logistics, and raw material supply are increasingly challenged by import dependencies, unstable energy conditions, trade restrictions, and volatile supplier relationships. 

Circular economy is emerging as a resilience strategy 

Nearly 50% of companies already view circular economy as either a central or complementary strategic opportunity to strengthen resilience against geopolitical disruption.

Companies identify the greatest opportunities in take-back and recycling models, more regionalized value creation, and the increased use of secondary raw materials. New business models, greater material transparency, and circular product design are also seen as important levers for transformation. 

The most important enablers for successful implementation are considered to be economically viable solutions, growing market and customer demand, and technological innovation.

There is still a significant implementation gap

Despite the acknowledged strategic importance,implementation remains limited. Only around 10% of companies have already implemented comprehensive measures. More than 30% are still in analysis or evaluation phases, while almost one third have not yet planned concrete actions.

From Circularity Ambition to Industrial Scale

The combined findings of Deloitte’s Circularity Industry Insights show that companies are moving beyond isolated pilot initiatives toward broader strategic integration. Circularity is increasingly becoming a business resilience issue — linked not only to sustainability targets, but also to competitiveness, resource security, and long-term value creation.

Circular Industry Insights 

Circular Economy shows strong potential across industries

While 68% of companies say the circular economy has high or very high potential for their industry, most are still stuck in the pilot stage. This is one of the clearest findings from Deloitte’s recent study, which surveyed globally operating companies in the electronics, automotive, chemicals, industrial products, life sciences, and consumer goods sectors about the status of circular business models in global organisations.

_{Fig. 1: Where the business value is: Cost, resilience, and growth}

The execution gap: High potential, low integration

Despite strong business cases, circularity is still far from being embedded in the strategy or operations of most companies. While ambition is high, the current level of maturity of over 60% of companies is at the initial or moderate stage.

_{Fig. 2: How would you rate the current maturity of circular economy in your company?}

Data gaps and poor traceability are the most frequently cited obstacles, with many companies struggling to establish a reliable digital infrastructure. Regulatory complexity and planning uncertainty create hesitation, as shifting requirements make long-term investments risky. Limitations in infrastructure for collection and recycling systems hinder scalability and delay progress. Economic barriers persist, with an unclear return on investment and low willingness to pay preventing circular models from competing with efficient linear ones. Strategic misalignment and limited leadership commitment mean that circularity often remains a compliance issue rather than a growth driver. Barriers vary by industry, but systemic challenges such as data readiness and regulatory clarity affect all sectors. Interviews reveal that even advanced industries face bottlenecks such as harmonising standards and securing high-quality recyclate.

As several interviewees noted: “There is currently a gap between actions and targets.”

Circularity: A strategic shift is needed, not recycling 2.0

In order to embrace circularity, companies must move beyond incremental recycling efforts and redesign how value is created, delivered, and recovered across the entire value chain. This shift begins with the principle of extending product lifetimes to preserve resources and reduce waste. Modularity and repairability will play a critical role in making this possible by enabling products to stay in use for longer and supporting new service-based models that transform the delivery of value. These design choices must be complemented by reverse logistics and take-back systems to keep valuable materials in circulation and close loops effectively.

As these systems mature, scaling up material recovery will make processes more cost-efficient and reduce dependency on scarce resources, creating a foundation for competitive advantage. Reducing reliance on virgin materials will further strengthen resilience and mitigate exposure to volatile commodity markets, which is a growing concern for many industries. To achieve this transformation, circularity must be embedded into design, operations and business models, rather than being treated as a compliance exercise. Companies that embrace this integrated approach will meet regulatory expectations and position themselves to be competitive and resilient in a world with limited resources.

What drives progress: Data & partnerships

_{Fig. 3: Network solutions. Circular solutions demand cross-industry collaboration and active networks}

All of the companies interviewed emphasised that circularity can only be scaled up through collaboration within ecosystems:

• Joint take-back and recovery systems
• Shared reverse logistics
• Harmonised design and recycling standards
• Cross-industry material partnerships

Digital capabilities are equally important. The fact that only 6% say they meet today’s data requirements for circularity reveals the scale of the digitalisation challenge.

Why circularity will shape strategy in the next 5–10 years

Although only slightly more than half of companies expect circularity to have strong influence on strategy within the next three years, most anticipate a significant impact within the next five to ten years. This shift is being driven by an increasing number of regulations that provide clear guidelines and create certainty for investments. Technological advances in sorting and recycling will make circular solutions more efficient and scalable. The use of lower-cost recycled materials is expected to improve competitiveness and strengthen the business case for circular models. Rising customer expectations for circular products will encourage companies to incorporate circularity into their designs and portfolio decisions.

At the same time, the cost of virgin materials is increasing the need for resource efficiency and alternative sourcing strategies. Circularity is also becoming a critical lever for Scope 3 decar-bonisation, linking material loops directly to climate targets. Material-intensive industries already view circularity as essential for long-term resilience, regarding it as a strategic priority rather than a compliance exercise.

How leaders should act now

Based on the insights from 27 global companies, five priorities have emerged:

• Elevate circularity to a strategic priority by integration into product, portfolio, and procurement decisions.
• Strengthen data and traceability by investing in digital foundations and lifecycle visibility.
• Scale proven circular loops first by focusing on ROI-positive resource efficiencies.
• Invest in partnerships, not pilots by collaborating across value chains to unlock economics.
• Leverage global frameworks, such as the Global Circularity Protocol, for comparability and clear KPIs.

_{Fig. 4: Playbook: How to drive circular economy in your company}

The study's findings are clear: the circular economy is quickly becoming a business imperative. Companies that transform their strategy, data, and partnerships now will lead the next wave of resilient, efficient, and future-proof value creation.

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