Circling Back to Square One: Revisiting Circularity from a Financial Materiality Perspective 

In many ancient civilizations, the circle symbolized perfection, balance, and continuity—an ideal form that stood in contrast to the finite and fragmented. Today, the same symbolism finds new relevance in sustainability, with companies shifting from linear “take-make-dispose” models toward more circular approaches centered on sustained utility and long-term value creation. Building on this timeless concept, ISS-Corporate revisits circular economy through the lens of financial materiality. 

Our analysis suggests that companies demonstrating strong circular economy practices tend to deliver stronger financial performance. This link appears stronger among companies for which the topic is deemed more material. For companies navigating their sustainability journey, these findings may underscore the importance of prioritizing material topics.  

Circularity and Financial Performance 

While circularity is often recognized for its environmental benefits, its link to financial performance is just as evident. This connection illustrates the concept of double materiality, where environmental impacts and financial risks and opportunities are interconnected. Before turning to the analysis, we first outline the key channels through which embedding circularity can enhance financial profitability and business resilience.