It's time to get specific on how circular economy strategies can service just transitions

By Esther Goodwin Brown and Jana Rué Glutting

This article was first published by Materia Rinnovabile - Renewable Matter

As climate change’s impact on people becomes increasingly clear, calls for a ‘just transition’ are growing—but what issues this seemingly self-explanatory term sets out to tackle varies widely due to differences in the social and ecological challenges faced by governments and social partners embracing it. Originally coined by labour unions and environmentalists and largely applied to workers in the context of the energy transition, and later formalised in guidelines from the International Labour Organization (ILO), the meaning of ‘just transition’ has broadened in recent years to include those most affected by—but least responsible for—the climate crisis, including women, communities of colour, and Indigenous people.?

As the energy transition picks up speed—and with it demand for materials to drive it—we must be clear on how circular economy strategies can be used to create a balanced, coordinated and just transition.

Just transitions around the world

Increased attention for the just transition is certainly a positive development: it provides an opportunity for us all to begin to fully comprehend and address contextual and structural constraints that stand in the way of sustainable development. But it also comes with challenges—ensuring that ‘just’ solutions are not just talked about but actually realised through proactive social dialogue and the development of locally-relevant measures.

Europe’s just transition is strongly linked to supporting workers transitioning out of carbon-intensive industries—those working in coal-powered energy, for example—and the concept of ‘social fairness’, while Latin America’s just transition calls for profound systemic change for and by people and nature. In Latin America, it’s often used to advocate for the rights of historically affected communities fighting economic dispossession and environmental degradation from different national and international projects. Such as the Indigenous communities negotiating the distribution of benefit-sharing from wind energy projects in Colombia. In some African countries, the just transition is now aimed at reducing inequalities between countries in the Global North and South by ensuring reparations for the negative social and environmental impacts of export-led industries: such as for the Kayayei, translated as ‘she who carries the burden’, referring to ‘head porters’ in Ghana’s secondhand clothing markets that transport heavy bales of textiles—largely imported from the EU—on their heads.?

The circular economy is a means—social and ecological justice is the end

The World Circular Economy Forum (WCEF) in Brussels in April was awash with calls for a just transition, signalling the global circular economy community’s readiness to change the conversation.? With the next WCEF set to take place in Brazil in 2025, leading up to what is being coined the ‘just transition COP’, now’s the time to get clear on what the circular economy means for just transition.

The circular economy’s link to climate justice can be seen as implicit, given its core aim of providing sustainable access to resources and regenerating living systems. Unfortunately, how this plays out in industrial policy and economics—where circularity has largely taken hold—has often left its justice-related elements lagging behind. In our 2023 report—a collaboration between Circle Economy, the ILO, and the World Bank— we found that out of more than 30,000 academic reports published on the circular economy between 1995 and 2022, only 1.4% focused on its social impact. When looking at circular economy roadmaps and strategies that are emerging around the world, Chatham House and UNIDO recently found that policy areas vital for an inclusive transition—like workers’ rights, consumer rights, trade policy and international governance—were rarely included. Bankwatch has echoed similar findings related to financing in the EU, with circular economy projects receiving little or no attention in 28 Territorial Just Transition Plans reviewed.?

The lack of explicit social measures within circular economy research, funding and policy is a barrier to progress. For circular economy strategies to truly and effectively bring about the systemic transformation it is pegged to, we need evidence of how they can be used as a means to tackle both environmental impacts and entrenched socioeconomic inequalities. This is something we encountered early on in the development of our Circular Jobs Initiative: city stakeholders made it clear they needed to know what a ‘circular city’ would mean for their residents—and these residents’ jobs—before they could get serious about scaling the approach.?

In essence? The circular economy will not contribute to just transitions by default—we must make sure it does so. By getting explicit about what the circular economy offers a just transition in different countries, industries and communities and by identifying which measures are needed to make sure circular strategies are ‘just’ by design.?

This could imply a simple shift in thinking for circular economy practitioners: instead of exploring what is needed for a just transition to the circular economy—where a ‘circularity’ is the end goal—we can consider how circular initiatives can help bring about a broader just transition: towards a system that operates within our planet's safe limits that leaves no one behind. With this framing, the circular economy can be seen as a tool for sustainable development: one that can be leveraged widely to achieve sustainable development goals, provide sustainable livelihoods in countries adapting to new policies and the emergence of new green industries and technologies, or help build resilience to climate change and conflict, for example.?

Circular economy strategies are already serving just transitions

Circular economy strategies are already presenting opportunities for local and national stakeholders looking to boost social and economic development in ways that also tackle environmental issues.?

Italy’s 2018 Taranto Plan, for example, details the city’s shift from a linear, steel manufacturing-based economy to a restorative and regenerative circular economy. The plan emphasised the need for concerted solutions for economic and social transformation, with just transition funds being used to retrain 4,300 workers for green jobs in the clean energy transition and circular business models amongst SMEs, enabled by the EU’s Just Transition Fund.?

Chile’s industry association, ChileAlimentos, has been working with the processed food sector in two main areas to revalorise organic waste while providing accreditation schemes for both formal and informal organic waste workers. ChileAlimentos’ Labour Skills Assessment Center has provided sector-specific certifications since 2006, with recent offerings including certifications in organic waste valorisation and optimisation. The Centre recognises workers' skills and abilities regardless of how they were acquired—including skills learned informally—and provides certification, following the National System for Certification of Labour Skills.

The circular economy has a lot of potential to create alternative livelihoods in regions that have experienced industrial decline, drive local revitalisation and valorise skills and knowledge held in informal economies. This can help to ensure that changes made at the industry, city or national level lead to widely shared economic benefits and minimise environmental impacts.?

Putting the circular economy at the heart of sustainable development

As demand for materials to drive the energy transition grows, circularity is a much-needed tool for ensuring a balanced, coordinated and just transition. This is thrown into sharper focus when put in the context of the words of the former UN Secretary-General, Ban Ki-moon: ‘the challenges associated with preventing, managing and resolving natural resource-induced conflicts may well come to define global peace and security in the 21st century.’

The setting of WCEF and COP in Latin America in 2025 means the rights of workers must and will be centre stage. The challenge we pose to ourselves and other circular economy advocates in the run-up to and aftermath of these milestone events: Make climate justice an explicit aim of your initiatives. In the process, help develop, capture and share examples of the circular economy’s social benefits, as well as the challenges that need to be addressed to unlock them. Use this evidence to, in turn, inform measures that support a just transition, from the inclusion of social conditionalities in national circular economy roadmaps and international trade agreements to educational reform and strengthened social protection for workers in circular sectors. This will be fundamental to the circular economy’s adoption on the broader global stage—as a tool for just transition towards a system that operates within our planet's safe limits and that leaves no one behind.

Learn more about the Circular Jobs Initiative

• Learn more about how we are promoting better evidence of decent work in the circular economy through our Jobs in the circular economy initiative with the International Labour Organization and the Solutions for Youth Employment Programme at the World Bank Group?
• Interested in understanding the socioeconomic impact of circular economy policies? Get in touch with the Circular Jobs Initiative.?
• Feeling curious? Explore our flagship digital map of circular jobs around the world: Circular Jobs Monitor