Digital Technologies Drive the Global Circular Economy

At an online event held on 13 June 2025, a new study was presented demonstrating how digital technologies are significantly advancing the transformation towards a circular economy. The study "Digitalization of Circular Business Models – digital solutions enabling the transition towards circular economy" was developed as part of the Digitalization for Circular Economy (D4CE) Initiative. It was conducted by researchers from the UN Environment Programme, One Planet Network, and the Wuppertal Institute.

At the core of the analysis are ten case studies from different regions and sectors. They illustrate that digital solutions such as the Internet of Things (IoT), Artificial Intelligence (AI) and Digital Product Passports (DPP) play a key role in enabling transparency across supply chains, closing material loops, and establishing new, sustainable business models. The case studies presented provide the proof of concept that these goals can be achieved.

Key findings at a glance:

• The establishment of a digitally enabled Circular Economy is especially important for complex products and value creation chains to make them more sustainable and to secure supplies. Digital Solutions must be interoperable and have to function worldwide.
• The circular economy is market-ready: In Europe, around 27 million refurbished smartphones sold by the end of 2024 – a clear sign of growing consumer acceptance of reuse – and refurbishment of digital technologies.
• Regulation, security of supply and sustainability are the main drivers. From 2027, the EU will require digital product passports for numerous sectors – a milestone for data-based sustainability.

The study is intended as both a strategic guide and a call to action for businesses, policymakers, and innovators.

"Digital technologies are not an end in themselves, but they are the key to realising a functioning circular economy," emphasises Dr. Holger Berg, co-author of the study and Vice-Director of the Circular Economy Research Division at the Wuppertal Institute, adding: "Now is the time for bold decisions – in both business and politics."