Sustainable innovation: new business models for a circular economy

Sustainable innovation: new business models for a circular economy

Sustainability has shifted from a side agenda to a core driver of strategy. Yet for many organizations, the challenge isn’t whether to act, but how.

One of the most powerful answers lies in the circular economy, rethinking how products and services are designed, used, and reused to minimize waste and maximize value.

For executives, this requires more than incremental improvements. It demands sustainable innovation: developing new business models that align profitability with environmental and social impact.

This article explores four priorities for leaders: rethinking products and services, unlocking circular economy opportunities, collaborating for impact, and preparing for the trends that will shape tomorrow’s sustainable leaders.

Table of contents

Rethinking products & services for sustainability

Sustainable innovation starts with design. Companies must shift from linear “take-make-dispose” models to circular ones where products are designed for reuse, repair, and recycling.

Examples include:

  • Product-as-a-service models, where customers pay for outcomes rather than ownership (e.g., mobility-as-a-service)
  • Sustainable packaging innovations, reducing single-use plastics and enabling recyclability
  • Modular design, allowing components to be upgraded without replacing the whole product

Henkel, for instance, worked with SparkOptimus to better understand sustainable consumer habits, helping design products and services that align with shifting expectations. Read the case.

Circular economy opportunities – turning waste into value

The circular economy isn’t just about reducing harm, it’s about creating new value pools. Forward-looking companies are already:

  • Turning by-products into inputs for other industries
  • Building secondary markets for refurbished products
  • Developing closed-loop supply chains that cut costs and emissions simultaneously

Eneco illustrates this approach, embedding circularity into its energy strategy to capture both economic and environmental gains. See the case.

For executives, the circular economy represents not just a responsibility but a competitive opportunity.

Partnering for impact – collaborations in sustainable innovation

No company can drive systemic change alone. Sustainable innovation requires ecosystem collaboration:

  • Cross-industry partnerships to share resources and scale solutions
  • Supplier collaboration to redesign value chains
  • Public-private initiatives to align regulation, innovation, and investment

At PGGM, SparkOptimus supported integrating sustainability into investment strategies, demonstrating how partnerships across industries can accelerate impact. Explore the case.

The lesson? Collaboration multiplies innovation, enabling systemic solutions that go beyond the boundaries of a single company.

The road ahead – trends shaping sustainable market leaders

Looking forward, several trends will define the next wave of sustainable innovation:

  • Regulatory pressure pushing companies toward circularity
  • Consumer demand for sustainable choices driving new products and services
  • Technology enablers (AI, blockchain, IoT) providing transparency and efficiency in circular supply chains
  • Investor expectations tying capital allocation to ESG performance

Executives who anticipate these trends will not only comply but lead-positioning their companies as sustainable market leaders in 2025 and beyond.

👉 Learn how SparkOptimus helps organizations design sustainable business models and circular economy strategies here.

Sustainable innovation isn’t a side project, it’s the future of business. By embracing circular economy principles, companies can:

  • Rethink products and services for reuse, repair, and recycling
  • Unlock value by turning waste into new opportunities
  • Collaborate across ecosystems to scale impact
  • Anticipate the trends shaping tomorrow’s leaders

Executives who seize this opportunity can transform sustainability from a compliance requirement into a strategic engine of growth, resilience, and positive impact.

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Amy Tuk
Associate partner | Practice Lead Sustainability

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