Circular Economy’s Blind Spot: Chemicals of Concern

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Every year, thousands of industrial chemicals are created and introduced to the market, resulting in waste that contaminates various environmental components.

Many of these chemicals in products remain unregulated, creating a challenge for the circular economy because when products are recycled, their toxic contents are also recycled. Industrial recycling and reuse increase the spread, dilution, and buildup of hazardous substances. These chemicals of concern are found in household items, clothing, and electronics. Additionally, they pose a risk to both human health and the environment.

Addressing climate change involves not only recycling materials but also studying the contents of old products used to make new ones, enabling a true circular transition.

Chemicals of Concern

These chemicals threaten human health and the environment due to their hazardous properties, which can remain in product lifecycles through reuse or recycling. Despite being forbidden andrestricted to use in new products, these chemicals infiltrate the circular economy as they exist within items that are in circulation. During circulation they transform into new hazards or ’legacy chemicals’. The harmful effects of legacy and unknown toxicants usually become detected only after the introduction of new substances. If these legacy materials are cycled many times without the removal of the hazardous chemicals, those substances will remain in the system.

Many of these substances are carcinogenic, mutagenic, reprotoxic, or Persistent, Bioaccumulative and Toxic (PBT). An example of legacy chemicals is Per- and Polyfluoroalkyl Substances (PFAS). PFAS were used in outdoor jackets for their water and oil-repellent properties, as well as in non-stick pan coatings and fire-extinguishing foams. New knowledge about the properties of substances is being developed, making it a possibility that substances that are not yet a cause for concern may be in the future classified as legacy chemicals. This gradually creates new legacy chemicals, of which we are currently beginning to understand.

Policies and Regulations

For decades, chemicals could be used without providing information about them but there has been a growing demand for transparency, technological advancements and new regulations. The European Union (EU) has the highest regulatory standards for dealing with hazardous chemicals.

The EU enforced the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH), and mandated that chemical companies disclose test data. The Extended Producer Responsibility (EPR) schemes enforce the design of more sustainable products onto producers. But this does not guarantee that legal compliance is fully enforced.

In the US, the Toxic Substances Control Act (TSCA) has basic requirements but is more limited in comparison with REACH. However, REACH will take years to compile a comprehensive list of all substances subject to regulation.

Regulatory Challenges

Regulation enforcement is sluggish, law enforcement is lacking, and there is a lack of agreed-upon rules concerning hazardous waste. In other parts of the world, such as Canada, the US and the UK, more regulations are being developed and enforced to address hazardous chemicals. However, there is widespread waste mismanagement and illegal waste disposal practices that affect countries like the Philippines, Ghana, and India.

There is also the existence of policies that allow for high levels of hazardous substances in various types of environments, which is a concern in a circular economy. Large quantities of hazardous chemicals thus enter the EU and other parts of the world through products that are used and later recycled, as well as in globalised material cycles with limited to no law enforcement or regulation.

Many legislators ignore hazardous chemicals in recycled materials because they are focused on reaching recycling goals. This harms the market potential for second-hand materials and increases the supply of materials containing hazardous chemicals, thereby increasing risk exposure. Without stronger chemical legislation and a higher degree of transparency, hazardous chemicals will continue to be recycled.

Corporate Chemical Management

Corporate chemical management is often driven by minimal regulatory compliance, which is an inadequate benchmark for sustainability and the circular economy. But legal compliance alone is not the answer. In sectors like fashion, it is the informed design decisions and access to safer materials that create an avenue for meaningful progress. Companies must create internal chemical standards that go above legal requirements and prioritize leadership engagement across departments. By enforcing internal standards to eliminate toxic chemicals from products and supply chains.

Only the most progressive companies actively pursue sustainable materials and green chemistry to advance the circular economy.

Company Initiatives

The most impressive example is Coop Denmark’s leadership by enforcing chemical standards stricter than legal requirements and actively engaging customers in setting priorities. Coop organised a campaign for tougher regulation in response to public concern toxic chemicals, using scientific evidence to advocate for change and ultimately influencing legislation. This resulted in an increased trust by the public based on Coop’s transparent, consumer-driven approach and the company set a benchmark that other companies followed.

IKEA aims to become circular by offering 100% circular products and using only renewable or recycled materials by 2030. The company is learning how to track legacy chemicals. One of its future commitments is to collaborate with other companies to develop solutions for dealing with chemicals at any stage of their lifecycle.

Sarpi advances sustainability by identifying hazardous waste through knowledge and material tracing, and by maintaining a comprehensive waste database.

Despite these positive examples, there remains a significant lack of transparency from producers and policymakers worldwide, due to business confidentiality, excessive greenwashing practices in companies, and inaccessible information on hazardous chemicals, often resulting from conflicting recycling targets.

Recommendations

· Stronger Transparency and Traceability

Develop information systems and enforce material passports across countries to increase understanding of product composition and enable the effective removal of hazardous chemicals. Strengthen product control and producer responsibility and improve upstream reliability and transparency to productively increase recycling value.

· Develop Supply Chain Management and Data Sharing

Globally adopt a unique substance identifier. Enforce this identifier consistently throughout industrial, regulatory, and research processes to enhance traceability and maintain the integrity of chemical data. There are reports of the use of IMDs and BOM-check databases by the automotive and electronics industries to enhance information management and set a standard for supply chain transparency. Lastly, establish chemical data-sharing structures through collaborative funding.

To empower both consumers and industry, developing standardised barcoding systems with accessible chemical data should be prioritized, with a focus on ensuring the availability and reliability of this information.

· Increase the Quality of Design in Products

Although ‘Safe By Design’ is not applicable for all materials, it should still be prioritised for the product development stage. To effectively cut out legacy chemicals, they must remain banned in new products. While it is not realistic to completely remove hazardous substances from already existing products, they can be contained or decontaminated through solvents. Technologies like CreaSolv use solvents to dissolve the primary polymer and separate legacy substances, which can then be destroyed, while the polymer is recycled.

Disclose chemical content fully to improve product planning, design for recovery, reconditioning, and multiple lifecycles. Continuously evaluate material reuse in the circular economy to stay up to date with new developments and potential legacy chemicals. Consider technical and economic barriers as well as potential unintended consequences.

· Adopt Stronger Actions From Industry Practicioners

Companies must take stronger and bolder actions, such as adopting internal material and chemical standards that are stricter than what the current law dictates. This may push other companies to reevaluate their business choices and pursue better ones. Companies must invest in traceability projects for one high-risk product to track inputs, legacy chemicals, and end-of-life paths. They must put in the work to show consumers that they are fighting greenwashing practices by publishing understandable consumer and chemical information and run awareness that companies that consumers care about.

Businesses must collaborate to create effective tests for chemical removal and improved recycling, and to demand certified secondary materials. Safety training and verified compliance must be mandatory in order for transparency to triumph. Taking these steps push companies to be more accountable and trustworthy, create reliable supply for recycled inputs, and make circular practices financially viable.

· Strengthen Legislation and Policy-Making

Policymakers and legislators must be held accountable and penalised if their policies result in illegal waste disposal or focus only on meeting recycling goals rather than broader environmental responsibilities.

To achieve greater accountability, policymakers must also create policies that increase legal requirements for chemical transparency. Legislators must establish a descriptive regulatory system that is consistent and complete, without inconsistencies or gaps in information. In addition to enforcing clear standards and reducing administrative burdens, this ensures compliance and broad industry participation.

Furthermore, dynamic EPR schemes must be legally binding to reduce and prevent greenwashing, and companies must be held responsible for the full lifecycle management of their products. Finally, policymakers must balance the existing risk and value in material circulation, clearly defining thresholds and evaluating trade-offs between safety and resource use.

· Foster Cooperation Between Civil Society, Businesses, and Government

A partnership between government, industry, and civil society accelerates the adoption of safer alternatives, focuses on the socio-economic factors, and promotes systemic progress on addressing legacy chemicals. Such partnerships facilitate the elimination of toxic substances and promote open communication about environmental policies and standards. Creating studies that focus on the impact of non-toxic circularity on individuals of different genders, income levels, societal and environmental preferences, thereby ensuring fairer and healthier benefits. Consumers must understand that they have the power to make informed choices and demand accountability.

Final Thoughts

Creating a no-waste society where chemicals of concern are contained or excluded from materials in use must be a priority that cannot be compromised. A future where suppliers openly disclose the contents of chemicals and materials, companies commit to high-quality standards and strong waste management compliance, consumers are highly aware of chemical risks, and governments effectively enforce science-based policies and regulations is a future we can all achieve together. Together, we can address legacy hazards, invest in the safe destruction of materials, and make safe materials the standard in a circular economy.