Circulytics® | Method introduction 1

Method
introduction

Executive summary:
How company measurement supports
the transition to a circular economy
Companies around the world are recognising that
a circular economy can tackle global challenges
such as biodiversity loss, climate change,
pollution and supply chain fragility. In order to
transform their operations, companies need the
right data, clear targets to reach, and tools to
track progress over time. The Ellen MacArthur
Foundation’s Circulytics measures the aspects
that enable company-wide transformation, such
as strategic importance of the circular economy
and ability to innovate for the circular economy,
as well as circular economy outcomes, for
example in terms of material flows or the way in
which companies have designed their services.
The purpose of Circulytics is to support
companies’ transition to a circular economy
by, for example:
• Measuring the entire company’s circular
economy performance, not limited to just its
products and material flows.
• Providing an independent assessment, using
indicators that measure current performance,
whilst signposting the objectives that would
deliver full scores.
Circulytics® | Method introduction 2
• Supporting strategy development and target
setting for circular economy adoption. A
company’s Circulytics score is presented in a
scorecard (Exhibit 1), which is confidentially
shared with each company and is designed to
help increase understanding of strengths and
areas for further development.
• Enabling companies to engage with their
stakeholders, such as customers and
financiers, using a well-informed, holistic view
of their circular economy performance
• Providing industry benchmarks. The number
of industries that will receive benchmarking
will increase with time as this requires a
sufficient number of companies completing
the survey per industry to keep the results
anonymised.
Circulytics was developed by the Ellen MacArthur
Foundation in collaboration with more than
30 companies and academic organisations.
The assessment is grounded in circular economy
theory, whilst being informed by company
realities. Circulytics 2.0 was first launched in
2020, as an update to Circulytics 1.0, including
an improved methodology.
 Circulytics® | Method introduction 3

Example Company Ov era ll S co re B

Circulytics Summary

Ena bler S co re A-
Outco m es S co re B-
Date of Submission 28/10/2020
Scoring Date 12/11/2020

... Circulytics will be a core

Score history Further Resources

100%
Enablers Outcomes
Thank you for participating in Circulytics. This scorecard gives an overview of your company's
progress on the journey towards circular economy, by way of two overarching categories
component of our 2025 targets
A 'Enablers' and 'Outcomes', as well as the eleven themes within these categories.

reporting and tracking.

89%
A-
78%
B We encourage you to dive into areas where your company has opportunity for improvement, and
67%
f

hope that the theme level scores help you to prioritise activities.
B-
56%
f

C
44% Due to team capacity constraints, we only provide bespoke analyst commentary to companies
Marianne Richeux
f

C- within the Ellen MacArthur Foundation (EMF) network, but we invite you to explore the following
33%
f

D resources to further your company's progress towards being a circular business. Links to these
22%
f

Zero Waste World Program lead at CHEP/Brambles

D- resources can be found below.
11% f

E
0%
Browse EMF's extensive library of circular economy case studies for inspiration.
28/10/2020

Discover an abundance of resources for the business context in the EMF Learning Hub. We are
constantly working on new content, like hands-on toolkits, podcasts, guidelines, or interactive
webinars, so it is always worth a visit.

Aspiring to commit further? Learn more about the EMF network of organisations that provides a
pre-competitive space to learn, share knowledge, and put ideas into practice. You can apply to
Score breakdown be part of the EMF network by completing the form linked below.
Sc or e

... It’s a great way to have

O veral l
We look forward to seeing your circular achievements and invite you to refresh your assessment
B
after we launch Circulytics 3.0 in October 2021.

Enablers A-
Strategy and planning

Innovation A
B
conversations and communicate
with our customers.
People and skills B
Operations A-
External engagement B-

Outcomes
Products and Materials
B-
C
Resource Links
EMF Case Study Library https://www.ellenmacarthurfoundation.org/case-studies
Tom Giddings
Services

Plant, property and equipment (PPE) assets

B-
A-
EMF Learning Hub
EMF Network Application Form
https://www.ellenmacarthurfoundation.org/explore
https://www.ellenmacarthurfoundation.org/our-story/our-network
Ex-Sustainability Data and Reporting
Water

Energy
B
C-
Manager at DS Smith
Finance N/A

Score chart and industry benchmark*

Score Industry Average (Upstream Materials Producer)
100%
A

... This circularity measurement

89%
A-
78%
B

tool is the most comprehensive tool

67%
B-
56%
C
44%

there is to help businesses lead the

C-
33%
D
22%
D-

transition to a circular economy...

11%
E
0%
Overall Enablers Strategy and Innovation People and Operations External Outcomes Products and Services Plant, property Water Energy Finance
-11% planning skills engagement Materials and equipment
(PPE) assets

* Industry average available when there is data from >10 companies in your industry
Ilham Kadri
CEO of Solvay
EXHIBIT 1: SAMPLE SCORECARD

A company’s Circulytics score is presented in a scorecard. It features: the company’s

overall Circulytics score and score breakdown by category and theme; the score history;
a benchmark based on anonymised and aggregated results for a given industry or
industry group, once available; further resources; and, for companies in the EMF Network
or those with an annual revenue over USD 1 billion, a custom written analyst commentary.
 Circulytics® | Method introduction 4

The method overview:

Circulytics measures the circular economy
performance of a company’s entire operations,
using a comprehensive set of indicators. It measures
this in two categories: Enablers and Outcomes.
Circulytics is structured into two categories: Within the two categories, indicators are grouped into
11 themes. The themes are shown in Exhibit 2.
• The Enablers category features indicators that
look at aspects that facilitate a company-wide • There are five themes in the Enablers category
transformation, from strategic prioritisation of
the circular economy to the development of • There are six themes in the Outcomes category,
systems and assets to support circular operations. but only a subset are relevant for any given
The Enablers category captures the company’s company, depending on the type of company.
potential to become circular in the future.

• The Outcomes category measures actual

circular economy results on a company level,
such as material flows, water flows, energy use,
service and product design, or procurement
and decommissioning of plant, property, and
equipment assets.
 Circulytics® | Method introduction 5

EXHIBIT 2

Companies are measured using a sum of weighted

indicator scores, resulting in an overall alphabetical
score from A to E. The scorecard will provide tailored
insights by theme.

Strategy and planning

People and skills
Innovation

20
Operations
External engagement
ENABLERS

INDICATORS THEMES CATEGORIES OVERALL

SCORE

17
Products & Materials OUTCOMES
Services
Plant, property, and equipment Assets
(each company is Water
assessed using 4-14 Energy
indicators out of 17,
Finance
depending on industry
and type of business)
Tailoring the assessment
to your company:
Circulytics applies to a diverse range of companies. It may
be used by companies in a product manufacturing value
chain as well as service providers, energy providers, and
financial institutions. A pre-assessment stage captures the
characteristics of a company, which then determine which
Circulytics indicators will be used for the assessment.

An overview of how different types of companies are

assessed is shown in Exhibit 3.
 Circulytics® | Method introduction 6

EXHIBIT 3

The Circulytics assessment is tailored to the company based on a set of company

characteristics (e.g. whether the company has material flows, whether it operates in a
water-intensive industry, or whether it is a financial institution). To understand in more
detail which indicators your company will be assessed on, please refer to Appendix 1.
Theme 9. Water is described in more detail in Appendix 4. = Company
INDICATOR DISPLAY LOGIC
BASIC INFORMATION

We first ask you

BASIC INFORMATION + COMPANY CHARACTERISTICS + INFORMATION FOR WEIGHTING
about your company,
to find out how you For company identification and Determine which themes your company Information used for weighting the
will be assessed. statistical analyses will be assessed on in the Outcomes Circulytics indicators, also used for
category. statistical analyses.
ENABLERS

Next comes the

Enablers category,
where indicators will
be universally applied
to all companies. STRATEGY INNOVATION PEOPLE & SKILLS OPERATIONS EXTERNAL
& PLANNING ENGAGEMENT

In the Outcomes
category, the
indicators for energy ENERGY INPUT + ASSETS
consumption and
assets will be asked
to all companies.

Some indicators

Renewable
Recirculation Wind
in the Outcomes Material in
OUTCOMES

category depend Solar

on company Circular Biomass
characteristics, Material in Recirculation USER services
like industry or
the way materials MANUFACTURING REVERSE CYCLE/ SERVICES FINANCIAL ENERGY
are used. WASTE MANAGEMENT INSTITUTIONS
 Circulytics® | Method introduction 7

Category: Enablers Category 2: Outcomes

The critical aspects to enable company-wide
transformation.
All themes in the Enablers category are displayed
to all companies.
Theme 1. Strategy and Planning
Have you placed the circular economy at the
heart of your strategy?
Theme 2. Innovation
Are the conditions in place to support the
development of innovative circular products
and services? Are you innovating towards new
circular economy products, systems, or services?
Theme 3. People and Skills
Are you supporting your employees? Have you
employed people to develop the skills required to
transition to a circular business model?
Measuring how circular a company is today.
Each company is assessed with a subset of
the themes in the Outcomes category, based
on relevance.
Theme 6. Products and materials
Are the materials you procure and the products
you design supporting a circular economy?
Theme 7. Services
Are the services you provide supporting
a circular economy?
Theme 8. Plant, property,
and equipment assets
Are you procuring and decommissioning your
plant, property, and equipment assets in ways
that support a circular economy?
The indicators have been chosen as
representative for the company’s progress
towards alignment with the three circular
economy principles: eliminate waste and
pollution; keep products and materials in use;
and regenerate natural systems. To avoid
adding unnecessarily to the reporting burden
of companies, the number of indicators is kept
as low as possible, and the survey is designed
for ease of responding. The scope of Circulytics
is strictly kept within the realm of the circular
economy. Where themes unavoidably touch on
existing non-financial reporting frameworks,
which is the case for the Water theme or the
Products and materials theme, the greatest
viable degree of alignment has been pursued
for indicators and definitions (e.g. with GRI, CDP,
or WBCSD). For the full list of indicators, please
refer to the Circulytics Indicator list.

Theme 4. Operations
Have you invested sufficiently in your digital
systems and plant, property, and equipment
assets to support the change?
Theme 5. External Engagement
Are you promoting your circular economy
initiatives and influencing those in your business
sphere, such as clients or your supply chain?
Theme 9. Water
If you operate in a water-intensive industry,
are you using water in a circular way?
Theme 10. Energy
Are you procuring renewable energy and (if you
are an energy provider) producing renewable
energy to support a circular economy?
Theme 11. Finance
If you are a financial institution, are you
intentionally financing companies and projects
that support a circular economy?

Weighting and scoring approach:
How Circulytics results are calculated
Indicators are scored and then combined using the
following approach to generate an overall score. The
approach is illustrated in Exhibit 4.
From indicator score to theme score
• Indicators in the Enablers category are qualitative
questions. Each indicator has a choice of text
response options. Each response option is assigned
a score between 0-100%, visible at the time of
responding (see Exhibit 5).
• Indicators in the Outcomes category typically
require percentage input from 0-100%. The
maximum possible score for each response
option is visible at the time of responding.
Each indicator is given a weight that represents its
empirical significance in the transition to a circular
economy. The weighted average of all indicator scores
within one theme results in the theme score.
From theme score to category score
Each theme is given a weight that represents its
empirical significance in the transition to a circular
economy, and in the Outcomes category depends
on the type of company that is being assessed
(see Weights in Outcomes category). In the Enablers
category, all companies have the same theme weights.
The weighted average of all relevant themes within one
category gives the category score.
Circulytics® | Method introduction 8
From category score to overall score
Finally, the two categories contribute to the overall
score with equal weight;
With the exception that if a company scores higher in
the Outcomes category than in the Enablers category,
their Outcomes score will be used as the overall score.
This is because we do not want to penalise companies
that have achieved tangible circular economy
outcomes without following the enabling conditions
defined in the Enablers category.
Alphabetical scores in Circulytics
All Circulytics scores are scored from A to E.
The conversion from the numerical score to the
alphabetical score is shown in Appendix 2. Since
Circulytics combines scores from indicators and
themes that are fundamentally different in nature
(e.g. quantifiable material flows and qualitative
responses on strategy alignment), the aim of the
alphabetical scores is to indicatively convey a
company’s progress in the transition to the circular
economy, and avoid creating a false sense of accuracy.
This is why numerical scores are used to only calculate
scores from indicators to overall score, but not used
to communicate company performance.
 Circulytics® | Method introduction 9

EXHIBIT 4: METHOD LOGIC

To get from the indicator scores to an overall score,

a weighted average is applied at each step.

WEI
GHT
ED A
VER
AGE

37 indicators
Each has a score
11 themes:
Each has a score
2 categories:
Each has a score
OVERALL
and a weight and weight and weight SCORE
(the number of
applied indicators
depends on a
company’s industry
and type of business)
 Circulytics® | Method introduction 10

EXHIBIT 5: EXAMPLE OF ENABLER CATEGORY INDICATOR RESPONSE OPTIONS

The pie chart diagrams represent the indicator scores that are assigned
to each response option.
 Circulytics® | Method introduction 11

Weights in the Enablers category EXHIBIT 6

The path from the Enablers category to the Outcomes category,

Indicator weights: and the weights in the Enablers category.
In the Enablers category, indicators within each theme have equal
weights (e.g. in a theme with four indicators, each indicator has a
weight of 25%), with the exception of Theme 5. External Engagement.
In this theme, indicators on customers and suppliers (Indicators 5a
Enablers
and 5b) are weighted at 30%, indicators on financiers and policy
makers (5c and 5d) at 15% and the indicator on initiatives (5e)
at 10% to better reflect the importance of each of these external
Strategy and planning
stakeholders to companies’ activities.
Basis for all company activities

Indicator scores: 30%

For all indicators in the Enablers category, the score awarded for
each response option follows a linear scale (e.g. for an indicator with
five response options, the responses from worst to best would be
scored as 0%, 25%, 50%, 75%, and 100%). In the Indicator list and the External engagement Innovation
online survey, each response option has a pie chart diagram next to it Circular economy
Circular economy
representing the indicator score, as shown in Exhibit 5. requires systemic solutions are new for
changes most companies

Theme weights: 20% 20%

The weights of themes in the Enablers category are displayed in
Exhibit 6. They are based on:
• What is proven to be important in company transformation, and People & skills Operations
• Consultation with companies during the development phase Key to trigger Enable circular outcomes
transformations

15% 15%

Outcomes

Weights in the Outcomes category
The necessary information for weighting is
gathered in the Company characteristics and
Information for weighting sections in the pre-
assessment stage of the online survey.
Weighting within Indicators:
• In Theme 8. Plant, property and equipment
assets, the total mass of an asset group
determines how much it contributes to the
indicator score. Where the total mass of an
asset group is not known, but the number
of items within the asset group is available,
Circulytics provides an estimated average
mass per item that can be used to calculate
the total mass of each asset group.
• In Theme 11. Finance, the size of each type
of financing activity in USD determines how
much it contributes to the indicator scores (11a
and 11b).
Indicator weights:
In Theme 6. Products and materials, indicator
weights depend on:
• The material mass a company uses. For
example, if the ratio of a company’s material
outflows is 60/40 between materials designed
to be used and materials designed to be
consumed, the indicators corresponding to
these material outflows will also be weighted
60/40.
• Whether or not the company has ownership
(and therefore full responsibility) over material
flows. This will determine which indicators
in the theme are assessed (see Exhibits in
the Indicator list - Theme 6. Products and
materials for detail).
• A company’s place in the value chain. A
consumer goods manufacturer can gain a
higher score for a ‘tighter’ recirculation loop,
while upstream basic material producers can
gain an equally high score for the ‘loosest’
loop.
◦ Recirculation loops from ‘tightest’
to ‘loosest’ are as follows:
◦ Reuse/redistribution
◦ Refurbishment/remanufacture
◦ Recycling
• In Theme 9. Water, the water demand and
water outflow volumes of a company influence
the indicator weights: The demand-to-outflow
ratio will be used to weight the corresponding
indicators referring to demand (9a, 9b) and
outflow (9c, 9d).
• In Theme 10. Energy, if a company produces
energy: the ratio between energy use and
energy production is applied as the weight
ratio of the corresponding indicators
(10a and 10b).
Theme weights:
As a general rule, a weight of 70% is assigned
to the themes that reflect the core business of a
company. The remaining 30% is assigned to the
supporting themes.
Circulytics® | Method introduction 12
The core business is:
• Theme 6. Product and materials for a
manufacturing company without any
service offerings
• Theme 7. Services for a service company
without any material flows
• A mix of Theme 6. Products and materials
and Theme 7. Services for companies that
have material flows as well as services. The
70% is split into 65% and 5%. The focus is on
material flows if the company has ownership
of them, because for most manufacturing
companies, services revenue is a small
proportion of business. If the company
has materials flows, but does not own the
materials (such as a car repair workshop
which does not own the cars it repairs),
the focus is on services.
• Theme 10. Energy (production) for energy
producers
• Theme 11. Finance for financial institutions
The remaining themes are weighted with a
total share of 30%. Equal emphasis is placed on
Theme 8. Plant, property, and equipment assets,
Theme 9. Water, and Theme 10. Energy (use).
Only companies that operate in a water-intensive
industry are assessed with the Water theme.
 Circulytics® | Method introduction 13

Examples: Theme weights

in the Outcomes category
The weights shown in Exhibit 7 are for a company in a water-intensive
industry that has material flows and services.

EXHIBIT 7 EXHIBIT 8

Base weights used for a water-intensive industry Base weights used for a company with services
with material flows and services. but without material flows or water flows.

Outcomes category Theme weight Outcomes category Theme weight

Not relevant
Theme 6. Material flows 65% Theme 6. Material flows 0%
Themes that reflect theme: 0%
the core business of
a company: 70% Themes that reflect
Theme 7. Services 5% Theme 7. Services 70% the core business of
a company: 70%

Theme 8. Plant, property, Theme 8. Plant, property, Supporting

10% 15%
and equipment assets and equipment assets themes: 30%

Supporting
Not relevant
Theme 9. Water 10% themes: 30% Theme 9. Water 0%
theme: 0%

Supporting
Theme 10. Energy 10% Theme 10. Energy 15%
themes: 30%

Not relevant Not relevant

Theme 11. Finance 0% Theme 11. Finance 0%
theme: 0% theme: 0%
 Circulytics® | Method introduction 14

For a purely services-based company without material EXHIBIT 9

flows or water flows, the Outcome weights are shown in
Exhibit 8. Compared with Exhibit 7, the weight of Theme Base weights used for an energy producer
6. Products and materials has been moved to Theme 7. with water flows.
Services, and the weight of Theme 9. Water was re-
distributed to Theme 8. Plant, property and equipment
assets, and Theme 10. Energy. Outcomes category Theme weight

Energy producers will not see Theme 6. Product and

materials, or Theme 7. Services. An energy producer Theme 6. Material flows 0%
with water flows will be assessed with the theme weights
in Exhibit 9. The weight of the core business contributes
70% towards Theme 10. Energy, while the remaining 30%
are divided equally between Theme 10. Energy, Theme Theme 7. Services 0%
8. Plant, property, and equipment assets, and Theme 9.
Water. This adds up to a theme weight of 80% for Theme
10. Energy. The weight ratio between the indicators 10a. Theme 8. Plant, property,
Energy use and 10b. Energy production reflects the ratio 10%
and equipment assets
between total energy used and produced.

Theme 9. Water 10%

Theme 10. Energy 80%

Theme 11. Finance 0%

 Circulytics® | Method introduction 15

Submission and results:

What the process looks like for a company reporter
Sign up EXHIBIT 10
Fees
The Circulytics assessment is completely The company reporter signs up for a
free of charge. Circulytics account, followed by data
collection and submission. The result is
a Circulytics scorecard, which is sent to
Timeline the company reporter.
Circulytics is open for submissions each year from
early October until 31 August. A scheduled period
of updates takes place each September, meaning no
submissions are possible during that month.
Data collection and submission
Annual completion of Circulytics is highly
recommended, to allow tracking of progress against
circular economy targets.

The time it takes to submit a company response

varies between companies. Estimates are given in the
following paragraphs.

Sign-up
Companies can sign up for an account via the sign up
Circulytics results
form on our website. Circulytics requires one company
reporter as the main contact for Circulytics. Once the Example Company
Circulytics Summary
Ov era ll S co re B

identity of the company reporter has been confirmed, Ena bler S co re

Outco m es S co re
A-
B-

an account to access the Circulytics online platform Date of Submission

Scoring Date
28/10/2020
12/11/2020

will be generated. This process typically takes one Score history

Enablers Outcomes
Further Resources
Thank you for participating in Circulytics. This scorecard gives an overview of your company's

week.
100% progress on the journey towards circular economy, by way of two overarching categories
A 'Enablers' and 'Outcomes', as well as the eleven themes within these categories.
89%
A-
78%
B We encourage you to dive into areas where your company has opportunity for improvement, and
67%
f

hope that the theme level scores help you to prioritise activities.
B-
56%
f

C
44%
f Due to team capacity constraints, we only provide bespoke analyst commentary to companies
C- within the Ellen MacArthur Foundation (EMF) network, but we invite you to explore the following
33%
f

The company reporter will receive all email

22%
f
resources to further your company's progress towards being a circular business. Links to these
D- resources can be found below.
11% f

E
0%
Browse EMF's extensive library of circular economy case studies for inspiration.
28/10/2020

communications regarding Circulytics, including login

Discover an abundance of resources for the business context in the EMF Learning Hub. We are
constantly working on new content, like hands-on toolkits, podcasts, guidelines, or interactive
webinars, so it is always worth a visit.

Aspiring to commit further? Learn more about the EMF network of organisations that provides a

details for the Circulytics account and, once data has

pre-competitive space to learn, share knowledge, and put ideas into practice. You can apply to
Score breakdown be part of the EMF network by completing the form linked below.
Sc or e
O veral l
We look forward to seeing your circular achievements and invite you to refresh your assessment
B

been submitted via the Circulytics online platform, the

after we launch Circulytics 3.0 in October 2021.

Enablers A-
Strategy and planning B
Innovation A
People and skills B
Operations A-
External engagement B-

Outcomes B- Resource Links

Products and Materials C EMF Case Study Library https://www.ellenmacarthurfoundation.org/case-studies

Services B- EMF Learning Hub https://www.ellenmacarthurfoundation.org/explore

Plant, property and equipment (PPE) assets A- EMF Network Application Form https://www.ellenmacarthurfoundation.org/our-story/our-network
Water B
 Circulytics® | Method introduction 16

Circulytics results in the form of a scorecard Circulytics results

(see Exhibit 10).
The Ellen MacArthur Foundation reviews the renewal
of a company’s Circulytics account for the re-launch of
the updated Circulytics method annually in October. If
an account is not renewed automatically, the company
may need to re-apply.
Data collection
Once a company has been granted an account, the
reporter receives a welcome email with login details
to access the online survey. The welcome email also
contains template files for data collection, which can
facilitate the gathering of data from multiple sources in
the company, for example from colleagues in different
business units.
The data gathering process typically takes between 2
weeks and 3 months, depending on company size and
data availability.
Data submission
Once the data has been gathered offline, it needs to
be submitted to the Circulytics online survey by the
company reporter. The company reporter can find the
login details for the online survey account in the email
with the subject line “Welcome to Circulytics | Login
details and information”.
The Circulytics online survey is hosted on the Qualtrics
platform. It is available in English, Chinese, Spanish,
and Portuguese. Please note: Supporting comments
and reference documents must always be added in
English to be interpreted by our team.
The data submitted via the online survey is used to
automatically generate a scorecard with company,
category, and theme level scores (see Exhibit 1). The
results will be emailed to the company reporter. The
time between submitting the data and receiving the
results is usually 2-4 weeks. The participating company
will also be provided with Ellen MacArthur Foundation
analyst commentary, if they are an Ellen MacArthur
Foundation Network Member, a Partner of the Ellen
MacArthur Foundation, or if they have an annual
revenue that exceeds USD 1 billion.
Use of Circulytics data
To create benchmarks for industries or industry
groups, the submitted information will be anonymised
and aggregated to multi-company averages. The
information will also be used to publish statistical
analyses, where company data will always be
anonymised and aggregated. The Ellen MacArthur
Foundation will not publish individual company
information. Please refer to the Circulytics Terms of
Agreement for details of how the Ellen MacArthur
Foundation uses company data.
Further information
Please refer to our website for further information,
including FAQs and how to sign up for the Circulytics
survey. For any other questions, please get in touch
via circulytics@emf.org.

The survey submission (excluding the time for data

gathering) typically takes around 24-32 hours.
 Circulytics® | Method introduction 17

Appendices

CONTINUE
You will see these,

START
no matter what
Theme 1. Theme 2. Theme 3. Theme 4. Theme 5. Theme 8. Plant, Indicator 10a.
the company Operations
Strategy and Innovation People External property, and Energy

Appendix 1: Company
characteristics are planning & skills engagement equipment assets consumption

characteristics If you respond to 0k. Industry

pre-assessment

END
YES
type with one of the industries
that are financial institutions Theme 11.
Finance

EXHIBIT 11

CONTINUE
Water in Water out

If you respond to 0k. Industry

YES
The first stage of the online survey, where the type with an industry that is
...then we ask you to confirm this
in 0l. Water intensive industry.
potentially water intensive...
characteristics of a company are determined. They Recirculation
Theme 9. Water
influence which Circulytics indicators a company will
be assessed on.

Renewable
Wind
If you respond to 0k. Industry
Solar

END
YES
type with an industry that is ...then we ask you to confirm
potentially an energy producer... Biomass
this in 0m. Energy producer.
Theme 10.
Energy reduction

CONTINUE
YES
If your company ...you can indicate this in
provides services… 0n. Service provider Circular
services
Theme 7. Services

END
YES
If your company does not deal ...you can indicate this in
with any material flows... 0o. Material flows

CONTINUE
Recirculation Material in

YES
If your company deals ...you will see the indicators
with material flows... on processing waste

6b, 6c

CONTINUE
YES
If you own any of these ...you can indicate this in
material flows... 0p. Ownership
Material in Recirculation
6a, 6d, 6e, 6f*

Please indicate in 0q. whether

END
you deal with materials designed ...this will determine whether
to be used, materials designed to Qs with * above are displayed
be consumed, or both...
 Circulytics® | Method introduction 18

Appendix 2: Circulytics
alphabetical scores
Circulytics results are communicated as alphabetical scores. Each
alphabetical score spans a range of numerical scores, which are used
to calculate theme, category and overall scores from indicators.

EXHIBIT 12

The numerical to alphabetical score conversion in Circulytics.

Numerical score Numerical score Alphabetical

Lower limit Upper limit score

88.89 100 A

77.78 88.89 A-

66.67 77.78 B

55.56 66.67 B-

44.44 55.56 C

33.33 44.44 C-

22.22 33.33 D

11.11 22.22 D-

0 11.11 E

Appendix 3: Circulytics 2020 and 2021 updates
Changes introduced in latest
update on October 4, 2021
• The assessment scope must now be specified
by the company in the Scope question at the
beginning of the survey. Scope options are
aligned with the GHG protocol. Customising
scope is possible, but such submissions
with a custom scope will be excluded from
Circulytics benchmarking and you will not
be able to disclose your score with a custom
scope.
• Circular economy can be an important lever
to achieve broader company ESG goals.
From October 2021, along with the scorecard,
every company will receive a table that maps
relevant Circulytics indicators to SDG targets,
to help link the company’s circular economy
performance with established ESG efforts in
the company.
• A spreadsheet, which serves as a template
for easier offline data collection, will be sent
to the company reporter along with their
Circulytics account details, to help with
collecting data across your organisation
before submitting via the online survey
platform.
Circulytics® | Method introduction 19
• A number of indicators in the Enablers • The Outcomes category was split into six
category have been updated to be more themes: Theme 6. Products and materials;
descriptive and intuitive, with specific Theme 7. Services; Theme 8. Plant, property,
response options to select from. The focus and equipment assets; Theme 9. Water;
of these updates are Theme 2. Innovation, Theme 10. Energy; and Theme 11. Finance.
Theme 3. People and skills, and Theme 4.
Operations. • The theme on water was added to Circultyics
to capture the circularity of water flows
• In Theme 6. Products and Materials, two in certain water-intensive industries (see
materials inflow indicators were combined Industry list).
into one indicator, to make responding easier.
• The indicators in the other themes in the
• Theme 8. Plant, Property, and Equipment Outcomes category were updated to be
Assets was simplified to better balance the more descriptive and intuitive, with specific
reporting burden while still capturing relevant response options to select from.
data.
• Circulytics was made available in English,
Chinese, Spanish, and Portuguese.
Changes introduced in previous
update in October 2020
• The industry classification list was updated to
the Circulytics Industry list, for ease of use.
• The scale translating numerical scores to
alphabetical scores was modified to follow a
linear scale that better reflects conventional
scoring scales

Appendix 4: Water guidelines
A short introduction: Water and
the circular economy
Water could be the perfect example of a circular
material, as it has circulated on the planet for
billions of years. Yet the ways in which we use the
water resources of our surrounding ecosystems
are often not compatible with natural cycles.
When applying the circular economy lens to
company water usage, the emerging topics
are familiar from current issues around water
distribution and pollution. Examples of these
water topics can be grouped under the three
circular economy principles:
Eliminate waste and pollution –
water pollution prevention, nutrient
valorisation, etc.
Keep products and materials in use –
water reuse, internal recycling, water
cascading, leakage reduction, etc.
Regenerate natural systems –
allowing natural systems to regenerate
themselves through balanced water
withdrawal and discharge, recharging
of local aquifers, water use reduction
targets, etc.
Water in Circulytics
Circulytics indicators are relevant to companies in
industries that are typically water-intensive (see
Circulytics Industry list) and only if the companies
deal with large quantities of water.
In line with the circular economy principles,
the water indicators in Circulytics cover key
Circulytics® | Method introduction 20
EXHIBIT 13
Types of water flows into, within, and out of a company. Water demand is the volume
that indicators 9a and 9b refer to. Indicators 9c and 9d refer to water outflow.
INTERNAL The red circles represent
RECIRCULATION Circulytics indicators used for
scoring of Theme 9. Water.
The grey circles represent
Circulytics questions that ask
PROCESS for the volume of water flows.
& OPERATIONS This information is used
for weighting the scoring
Circulytics indicators
(red circles).
9a 9b 0x.1 OUTFLOW
SOURCING 9c
e.g. withdrawal, e.g. discharge,
WATER
cascading, 9d cascading,
DEMAND
evaporation,
precipitation,
spillage
harvesting
0x.2
COMPANY
water topics from a company-level perspective.
Against the background of many existing and
What it means in practice
often mandatory company water reporting tools, You will first be asked if your company is water-
Circulytics keeps the scope strictly within the intensive in the section ‘Company characteristics’
realm of the circular economy. Where existing (see Indicator list). If this is the case, you will be
indicators are used in other methods related to asked to fill in “water demand volume” and “water
circular economy, definitions have been aligned to outflow volume” in the ‘Information for weighting’
the greatest viable degree (e.g. reduction targets, section. If you deal with material flows, you
avoiding withdrawal from water-stressed areas, will be asked about “material inflow mass” and
discharge to replenish local aquifers). New metrics “material outflow mass”. Likewise, in the following
have been introduced where we believe these Circulytics indicators, the Outcomes category will
aspects are core to using water in a way that is cover material in/outflows and water demand/
aligned with circular economy, and would not be outflows, which refer to and will be weighted with
captured otherwise (e.g. internal recirculation the material mass and water volume allocated in
and nutrient valorisation). the up front general section.
 Circulytics® | Method introduction 21

Water flows: Water inflow to the company, which subsequently becomes part of
Water demand and outflow relating to manufacturing and other a physical product during manufacturing processes, and leaves the
business processes as well as operations are in scope in Circulytics, company as part of a material outflow, should be accounted for under
as shown in Exhibit 14. water demand volume and material outflow mass. The water outflow
indicators explicitly do not apply to water incorporated in physical
EXHIBIT 14 products.

Both process and operations water is in scope for Circulytics. An EXHIBIT 14

example of operations water is coolant, where the water is sourced and
(after optional internal recirculation) eventually leaves the company
infrastructure, not as part of a product.
An example of process water is water that comes in contact with a
product but is not incorporated in the finished product, e.g. water in pulp
in paper manufacture or water in dyeing processes.
An example of water inflow that becomes incorporated into the product
is water inflow for manufacturing of beverages. This counts towards the
water demand volume, and the water demand indicators apply. However,
this water leaves the company as part of the product and should be
accounted for under material outflow mass, and therefore the material
outflow indicators apply.

MATERIALS
INFLOW

PROCESSES
& OPERATIONS PROCESSES

WATER WATER WATER

INFLOW OUTFLOW WATER MATERIALS
DEMAND OUTFLOW
DEMAND

COMPANY WATER COMPANY

INFLOW

Water flows may become part of, or become separate from, material
streams during manufacturing processes, as described
in Exhibit 14.
 Circulytics® | Method introduction 22

Material flows:
The water is integrated in another material inflow or outflow, so the
material inflow/outflow indicators apply, see Exhibit 15. The mass of the
material flow includes the water content. Please count the water content
within a material stream towards the mass of products and materials.

EXHIBIT 15

An example of water integrated in material flows is the water content in

wood. This counts towards the total mass of materials designed for use.
Water content in agricultural produce like tomatoes procured by the
company to manufacture food products counts towards the total mass
of materials designed to be consumed.

PROCESSES
MATERIALS WATER MATERIALS
INFLOW DEMAND OUTFLOW

COMPANY

Out of scope:
Natural precipitation is excluded from the scope of Circulytics as long
as it is not actively captured, e.g. through a collection system on a
building roof.
Circulytics® | Method introduction 23