The research methodology utilized in this paper is a literature review [
13]. This was conducted first in order to get the current knowledge and practices in terms of product circularity measurement. The research conducted was based on both academic articles and non-academic organizations contributions. As recently stated by Geissdoerfer et al. [
14]: “the inclusion of non-peer-reviewed articles is appropriate since circular economy is a new area of research, and (…) has not been extensively addressed by peer reviewed articles” contrary to areas of research such as recycling or sustainability. On the one hand, the focus on peer reviewed papers ensures scientific soundness. On the other hand, research works or projects carried out, as well as methods, tools or indicators developed by other organizations (such as the Ellen MacArthur Foundation) involved in the circular economy transition and working closely with businesses could reflect current industrial reality and needs regarding product circularity, and therefore bring additional meaningful insights.
In this light, the following data sources have been examined: Science Direct, Web of Science, SAGE, Springer, Taylor & Francis, Google Scholar, Google, Ellen MacArthur Foundation, Institut de l’Economie Circulaire (French Institute working on the circular economy), ADEME (French Environmental Agency). Keywords included: “circular economy” OR “circularity” AND “indicator” OR “measurement” OR “assessment”. The selection process was as it follows. First, based on scanning titles, abstracts and/or short contents, works—including peer reviewed academic journals, conference papers, research reports, postgraduate dissertations, books, websites and tools—which were considered as non-relevant regarding product-level circularity measurement have been discarded. Then, those which were dealing directly with or getting indirectly connections with product circularity measurement have been looked at extensively and critically.
2.1. Positioning on Circular Economy Definitions: Prerequisite for the Rest of This Article
A good understanding of the main definitions of circular economy proposed by major organizations and academics, and positioning ongoing work in relation to these definitions, are suitable as a first step before analysing the tools, proposing and discussing requirements for not only an efficient but also an effective measurement of products’ circularity in order to support progress towards a more circular economy.
To date, there is no standard definition of the circular economy concept. However, the different definitions of Economy Circular, proposed or established by major organizations and academic researchers, share much in common, tend to formalize and converge towards the same paradigm [
15]. The CIRAIG performed an extensive literature review and inventory of key circular economy definitions [
16]. All circular economy definitions agree that circular economy is definitely opposed to the linear model “make-take-waste”. In addition, circular economy is looking for a better management of resources throughout the lifecycle of systems and it is characterized by closed loops, promoting maintenance, reuse, remanufacturing and recycling.
In this paper, as a basis for analyzing the existing tools, we will refer at the circular economy definition proposed by the Ellen MacArthur Foundation, including five fundamental characteristics (design out waste, build resilience through diversity, work towards energy from renewable sources, think in systems, think in cascades) and four building blocks (circular product design, innovative business model, reverse cycles, enablers and system conditions) [
3]. Particularly, to fit totally with the circular economy paradigm, system thinking is fundamental. Indeed, according to Balanay and Halog [
17], systems thinking is central in circular economy, because designing out wastes and closing the loop needs a holistic understanding and support for broad-based acceptance and success of interventions towards circularity. Moreover, the Ellen MacArthur Foundation butterfly circular economy model is one of the most acknowledged and used in businesses, as well as in academic circles [
18].
2.2. Joint Agreement on the Need to Assess Circular Economy Performance
To follow and successfully achieve the transition towards a more circular economy, it is becoming essential for actors and industrial practitioners—such as engineers, designers, managers—to get suitable methods and tools, including indicators, to measure and quantify this progress [
19,
20]. In fact, the interests of such indicators lie in their ability to summarize and concentrate the great complexity of our dynamic environment, in order to manage a comprehensive amount of meaningful information [
21]. Furthermore, indicators are a way to assess change and could therefore be used as an important tool to support the evolution from a linear economy to a more circular one [
22]. In a report about circular economy and metals recycling, conclusion is made on the necessity, due to the current lack notices in this area, to develop methods and tools that aim at assessing and monitoring overall performance of the circular economy for the environment [
15]. According to Kingfisher, one system cannot get more closed loop unless knowing how closed loop it was in the first place [
12]. In fact, it should be relevant to measure circularity degree of current systems, processes and products to evaluate the remaining distance to achieve a self-sustaining economy, truly circular [
23]. On the other hand, with the current increasing attention about sustainability and sustainable development, it will not be surprising that a quantifiable sustainability rating would one day be required for all the manufactured products via some regulations [
24]. A similar decision leading to a regulatory framework and mandatory rates will also be plausible and conceivable for the circular economy. Indeed, several laws related to circular economy are slowly but surely beginning to emerge, namely in China, in the European Union or more recently in France (Section IV of the Act concerning the Energy Transition to Green Growth aims to promote Circular Economy). Yet, in the European Union, circular economy evaluation systems and their associated methodology are still developing [
25]. Last but not least, in agreement with the European Academies Science Advisory Council (EASAC) [
26], one of the critical questions linked to the circular economy is how we should measure its performance. For the EASAC, indicators are essential for circular economy assessment at all levels.
2.3. Different Levels of Circular Economy Measurement
Circular economy models and implementations are usually performed at three systemic levels. Circular implementation at macro level fits with city, province, region, nation, meso level fits with eco-industrial parks, while micro level corresponds to single company or consumer. Balanay and Halog [
17] confirmed this classification: circular economy macro-layer referring to society, meso-layer to inter-enterprise and micro-layer to enterprise. Banaité [
25] also analysed and clustered circular economy evaluation systems into three levels: evaluation at micro level for single company or consumer, evaluation at meso level for symbiosis association, and evaluation at macro level for city, province, region or country.
Through their analyses, the EASAC [
26] found out that many available indicators may be appropriate for monitoring progress towards a circular economy. These indicators were grouped into sustainable development, environment, material flow analysis, societal behaviour, organizational behaviour and economic performance. However, product circularity performance was not directly considered in these indicators. Likewise, most circular economy indicators reviewed by Ghisellini et al. [
27] are standing at macro-level (nation level) and meso-level (inter-firm level) but barely at micro-level.
For instance, at a macro level, the Waste & Resources Action Programme (WRAP) [
28] estimated that 19% of the UK economy is circular in 2010. Based on a material flow analysis, this circular score of 19% relates to weight of domestic material input (600 million tonnes) entering the economy compared with the amount of material (115 million tonnes) recycled. On the other hand, China had released its first Circular Economy Evaluation Indicator Systems [
19] that provides two separate sets of indicators: one at a micro-level for the general evaluation of the circular economy on development for both individual region and national-level analysis to provide guidance for future circular economy development planning; and one at meso-level to assess the state of circular economy development at the industrial park level.
According to Geng et al. [
19], although the application of this indicator system may bring certain benefits, problems and challenges still exist, including for example, the lack of indicators for businesses. Additionally, circular economy evaluation at micro level is actually based on cleaner production and green consumption what is not full circular economy approach [
19]. Indicators that claim to be circular economy indicators at micro level do not encompass the whole complexity of circular economy and all possible end-of-life options to close the loop. For instance, the evaluation indicator system of circular economy in iron and steel enterprises that includes 13 indicators grouped into 3 categories (resource input and consumption index, resource flow and recycling index, resource output and management index) is mainly focused on resource efficiency through recycling and therefore does not consider other end-of-life scenarios [
29]. Likewise, the quantitative Evaluation of Circular Economy Based on Waste Input-Output Analysis composed of 14 indicators is mainly focused on waste production/recovery and lacks of systemic consideration [
30].
Huamao and Fengqi [
31] explored circular economy from the viewpoint of the system theory. From this standpoint, an important characteristic of the circular economy is its layers. All the layers of circular economy are “interdependent, interactive and mutually restricted”. Actually, As Huamao and Fengqi pointed out: “the layers of circular economy are to influence and interact with each other, and the higher layers take the lower layers as the basis and guide the development of the latter”. Besides, according to Lieder and Rashid [
18], the circular economy level of discussion is highly granular and rarely touching operational level. Ghisellini et al. [
27] confirmed that current indicators are barely focused on the circularity at the scale of individual products. In addition, a lack of connection between the three layers of circular economy implementation is noticed.
Thus, a more specific or detailed level could be relevant to further focus on the very core and essence of circular economy, which is the circulation and recirculation of products and materials in (open or closed) loops. For instance, such focal point will be helpful for companies—manufacturers and industrials practitioners—willing to manage and improve the circularity of products and components they design, develop, manufacture or sell. That is the reason why the authors suggest a fourth circularity level: a nano level as a more refined level focusing on the circularity of products, components and materials, included in three wider systemic levels, all along the value chain and throughout their entire lifecycle. That nano level—i.e., an operational and product-level including components and materials—could serve as a common denominator within these three levels, and could enable not only to make the links between these levels but also to have a closer look at the effective performance of circular economy implementation.
Methods, tools and indicators to assess product circularity, developed by researchers and organizations for companies, at that nano level, will be analysed in further details in the following sub-section.
2.4. Existing Indicators, Methods and Tools to Measure Product Circularity
According to a report from European Environmental Agency (EEA) published in 2016 [
32], there is at present no recognized way of measuring how effective the European Union, a country or even a company is in making the transition to a circular economy, nor are there holistic monitoring tools for supporting such a process. In the same way, only a small number of published studies design or discuss circular economy indicators, therefore calling for additional research [
27]. Likewise, in agreement with the Ellen MacArthur Foundation, there are no official or recognized indicators, methods and tools to measure company performance in the shift from a linear economic model to a more circular one and neither tools to support and follow that transition [
33]. Indeed, circular economy indicators are at an initial stage of development [
34]. Existing indicators and assessments have not the capacity to capture the entire circular economy performance of products [
35]. Chinese researchers also acknowledge that current indicators were not designed considering systemic aspects, closed-loops or feedback features that characterize circular economy paradigm [
19].
Franklin-Johnson and her colleagues, within their work published in 2016 “Resource Duration as a managerial indicator for Circular Economy performance”, provide a novel indicator for environmental evaluation performance linked to circular economy, on the basis of which circular economy central point is value creation through materials retention in a loop of high added value [
35]. The longevity indicator called “Resource Duration” measures material retention based on the amount of time a resource is kept in use, regarding three following aspects: initial lifetime; durability earned through reuse or refurbishing; durability gained thanks to recycling. This non-monetary indicator is only focused on environmental efficiency of resources and could therefore be used as a local or complementary indicator, rather than a global one which could embrace the whole circular economy paradigm.
On the other hand, Amaya [
36] contributes to provide a framework for designers willing to quantify environmental benefits offered by closed-loop strategies for industrial products, considering both remanufacturing and product-service-system (PSS) solutions. The objective was to provide easy to use methods and tools for designers to allow them quantifying the environmental benefits related to the use of a closed loop strategy. Amaya’s model has been developed to assess from an environmental point of view the data of the operations and activities around products’ lifecycle with final non-classic disposal scenarios (e.g., remanufacturing as end-of-life scenario or multiple uses by service offers system as a business strategy). Nevertheless, economic dimensions are neither tested nor considered in the case studies developed. With only environmental arguments but without any cost considerations, companies are not likely to enter in a remanufacturing or PSS business model.
Starting from these observations, academic and organizations—like the European Commission or the Ellen MacArthur Foundation—are well aware of this lack of circularity indicators for products and are willing to fill these gaps by initiating projects that aim at measuring the circularity of products and the transition towards this circularity. For instance, the Ellen MacArthur Foundation decided to launch the “Circularity Indicators Project” in May 2015. According to the Ellen MacArthur Foundation, the benefits of proper circularity indicators could be significant: from decision-making tool for industrial practitioners, to internal reporting, through rating or evaluation of companies. For instance, managers, designers and engineers could take into account circularity as one of the indicators for design decisions. In addition, such indicators could compare different products, or facilitate the setting of product circularity targets. However, recent models developed to achieve circularity measurement of industrial products present notable limits. Indeed, in 2015, the CIRAIG [
16] reviewed and pointed out the limitations of two frameworks aiming at measuring circularity: the Material Circularity Indicator (MCI) [
33] and the Circle Assessment (CA) [
11]. In this paper, the MCI will be analyzed, tested and critiqued. Yet the CA is out of the scope of this paper since, according to email exchange with Shyamm Ramkumar—knowledge and innovation manager at Circle Economy to get access to the online survey—the CA is not a tool that is used for analyzing products throughout the whole value chain, but rather organizations [
10,
11]. In our study, in addition to the MCI, two other tools—that have been identified as particularly conceived for product circularity evaluation—will also be reviewed, experienced and critically examined: the Circular Economy Toolkit (CET) [
37] and the Circular Economy Indicator Prototype (CEIP) [
20]. A more detailed description of these three tools is elaborated in the next section.