Circular economy can be defined as that economic system that exploits and reuses its resources with the aim of extending their life cycle as long as possible. It mainly consists of reusing a product that has completed its life cycle by reintroducing it back into the economic cycle.

Thus, the circular economy becomes key to saving natural resources as it strongly encourages the use of sustainable raw materials, relies on the reuse and recycling of waste and products that have outlived their usefulness, and is at the root of renewable energy.

Every year, human activity takes more than twice the toll on Earth 's natural resources than nature's ability to regenerate: deforestation, soil depletion, overfishing, pollution in the processes of extracting nonrenewable raw materials are just a few among a thousand examples.

The sustainability goal to be achieved through resource conservation and the circular economy is a return to a balance between what the Earth provides us with, and what we consume each year.

Investors play a key role by supporting both entrepreneurs who approach natural resource-related economic activities responsibly and Society who integrate circularity into their business model, i.e., integrating issues related to recyclability and reparability of their products, precision manufacturing while avoiding waste, energy transition, and who are careful to reduce the use of nonrenewable raw materials in their production process.

Sustainable fund managers use different management strategies:
The Approach by Exclusion: many funds have approached the issue by excluding sectors and activities that are not responsibly managed-for example, forestry and fisheries-related activities. Sometimes they have banned energy and raw material extraction, or furs.
Thematic approach: there are specialized funds dedicated to the circular economy and sustainable natural resources. They act in the primary (agriculture, aquaculture), secondary (industry, automation and recycling) and tertiary (service models, recycling and electric vehicle use, etc.) sectors.
The Normative Approach: funds make particular reference to the Convention on Biodiversity reviewed annually by the 196 signatory parties gathered in the COP ; many criteria used, e.g., adherence of Society in Portfolio to sustainable sector labels (fisheries, agroforestry, etc.).
Best practices - impact investing: the most advanced "impact" funds use the UN or GIIN criteria i.e., all-encompassing impact evaluation standards, covering all extra-financial aspects, to measure the quality of Society where they invest.

We have currently identified 90 criteria to qualify fund action with respect tocircular economy andresponsible use of natural resources. We find here a prevalence of strategies assessing ESG Impact and Screening carried out by Society management with an ESG Risk however present for important issues such as assessing possible greenwashing and other controversies.

At the Impact level, many Society have strongly focused on water and energy issues, and this is a good step forward.
At the Screening level, we can see that the bulk of mutual funds use mostly exclusionary strategies (fur, nonrenewable energy, commodities).

The circular economy being a theme that involves all business sectors, our ranking takes into account both thematic funds closely related to nature and thematic funds dedicated to the efficient use of resources in industry and commerce.

the Circular Economy is a strategic sector for Europe, as the continent is not particularly rich in raw materials, and Europe promotes initiatives aimed at ensuring the availability of the natural resources needed by the European economy. It also mandates curbing damage to the environment resulting from its economic activities.

The European Union requires sustainable funds to measure:

• Emissions to water:
  Tons of water emissions generated by Society investees per million invested, expressed as a weighted average.
• Share of hazardous waste:
  Tons of hazardous waste generated by Society investees per million invested, expressed as a weighted average.

In addition, the European Union advises sustainable funds to quantify:

• Water use and recycling:
  The average amount of water consumed and purified by Society investees (in cubic meters) per million euros of revenue of Society investees.
• Investment in companies without water management policies.:
  The share of investments in Society investees without water management policies.
• Exposure to areas of high water stress:
  The share of investments in Society investees with sites located in high water stress areas without a water management policy.
• Non-recycled waste ratio:
  Tons of non-recycled waste per million invested.

• Waste generation in operations:
  The share of real estate not equipped with waste sorting facilities and not covered by a waste recovery or recycling contract.
• Consumption of raw materials for new construction and major renovation:
  The Share of raw building materials (excluding recovered, recycled, and organically sourced) in the total weight of building materials used in new construction and major renovation.