Stepping Towards the Circular Economy: The Government

The majority of our previous blog articles have pointed out the different ways that businesses can put their best foot forward and take actions towards building the circular economy, such as how they can collaborate with other companies to take advantage of industrial symbiosis or how they can use and reuse all the materials of their product. However, it’s not all up to the businesses to make the change. Governments should be the front-runners of such initiatives, as the actions businesses and individuals can take are either limited or liberated by the policies governments have in place. As they are the ones with the big say in how fast and how well we transition to a circular economy, here is a breakdown of the three major areas in which governments can push towards this goal.

Government Legislation

Laws and regulations rule everything – it would be hard to find something, especially in the economic and corporate world – that there isn’t a rule for.  Thus, the biggest way governments can shape the circular economy is by shaping regulations accordingly. But it’s not just about making big policy statements such as determining to cut greenhouse gas emissions by 20% by 2020, because the majority of the blockage comes from regulations that you wouldn’t initially expect, such as policies on market competition. Thus, governments are called on to clear the path by adapting existing regulations alongside crafting new ones. In addition, governments should seek to identify and eradicate any hurdles that stand in the way unnecessarily for businesses and entrepreneurs to implement circular practices.


Another great way to stimulate the adoption of circular practices is through financial means. This can be done via the readjustment of taxes and subsidies. For instance, economic incentives can be given to support things such as corporate and consumer recycling, the adoption of green products, and separation of waste. On the other side, taxes can be used to discourage landfills, the dumping of waste, and materials leaving the economy. Furthermore, governments should invest in circular initiatives and encourage circular revenue models.


Actions speak louder than words. Thus, governments should also develop policies that influence and shape not only the behavior of industries and citizens but also themselves, in the form of concrete proposals. Governments should be the ones who take the first step and stimulate the market by becoming a customer of circular products themselves. Such an example is set by the Dutch government, which pledged to purchase 10% circular products by the year 2020.

What are the ways you think our government should help us in the fight towards a circular economy? Let’s discuss it in the comments.

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