November 25, 2021

Turning Point

The Expert Panel on the Circular Economy in Canada


Humanity’s current level of consumption is exceeding Earth’s ability to sustain it. In the current “take-make-use-waste” linear economy, raw materials are extracted to produce goods that are used and then discarded as waste. Though much of what we discard still holds value, just a small portion of materials is cycled back into the economy. The vast majority ends up in landfills, incinerated, or is released into the environment. While non-renewable resources are being depleted and renewable resources are being extracted faster than they can be replaced, demand for products and materials continues to rise.

The impacts of these consumption habits include land degradation, pollution, biodiversity loss, and the emission of greenhouse gases, as well as economic and social impacts, including the disproportionate exposure of marginalized communities to pollution.

Increasingly, the circular economy (CE) is being considered as an alternative to the dominant linear economic model. The CE conserves material resources, reduces energy and water use, and generates less waste and pollution, ultimately reducing the impacts of extracting resources while still meeting the material needs of a growing global population.

Environment and Climate Change Canada asked the CCA to examine the potential economic, environmental, and social impacts of advancing a circular economy in Canada.

Turning Point explores what a circular economy is, how it works, and what it could mean for Canada. It examines the opportunities and challenges Canada will face in planning a circular economy transition. Included in the report is an estimate of the current circularity of the Canadian economy and four scenarios that illustrate what the Canadian economy could look like in 2040 (the interactive SankeySim model for Canada that was developed by the Panel can be accessed here).

The Sponsor:

Environment and Climate Change Canada

The Question:

What are the potential opportunities and challenges for a circular economy in Canada?

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Implementing a CE in Canada would help the federal government to achieve its greenhouse gas reduction commitments and meet sustainable development goals, while remaining economically competitive. Since the economy can never be perfectly circular, the CE is best seen as an aspirational direction in which to move. At the same time, the journey towards a CE involves transformative systemic change. As a result, coordination among businesses, governments, and civil society will be key. Further, Canada’s economic, environmental, social, geographical, and jurisdictional features require a distinct approach to the CE. Additional data on material flows and social impacts will also help track progress towards the CE and inform effective decision-making in this area.

Report Findings

The Current State of the CE in Canada

  • Canadian industry has sectoral strengths and existing initiatives that can be built on to advance the CE.
  • Steps towards a CE have been initiated at multiple levels of government, and NGOs, universities, and colleges are supporting a transition.

Challenges to implementing the CE in Canada

  • Businesses find it challenging to adopt circular strategies due to linear supply chains, economic incentives favouring linear practices, and a lack of practical information.
  • Aligning policies and regulations to support a CE is challenging, especially given Canada’s jurisdictional complexity.
  • A cultural shift is necessary to promote circular behavior among consumers, but accessibility also impedes the adoption of circular practices.

Opportunities for a CE in Canada

  • Circular business models and strategies provide economic benefits such as new revenue streams, reduced supply chain risks, and improved brand reputation.
  • A CE would help Canada to achieve existing policy goals, such as reducing greenhouse gas emissions and meeting the sustainable development goals, and would create economic, environmental, and social benefits.
  • Societal benefits such as increased equity and well-being could be achieved through a just transition towards a CE, and net effects on employment are likely to be positive or neutral.

Levers for Change Towards a CE

  • While governments use many levers to advance the CE, including procurement, tax policy, data collection, and roadmaps, policy coordination between government levels and departments is essential for the success of CE initiatives.
  • Businesses can advance the CE through circular strategies, investments, standards and certifications, and company-wide and inter-firm commitments.
  • Civil society will need to be engaged to advance the transition; individual behavioural change has a limited ability to drive the CE.

Expert Panel

The Expert Panel on the Circular Economy in Canada