This chapter aims to present the principal assumptions of the circular economy (CE), which advocates for the rational exploitation of natural resources and emphasises the significance of a closed and continuous cycle in their utilisation, supporting the concept of sustainable and enduring development. Furthermore, the discussions are designed to underscore the necessity of creating consumption patterns and utilising production functions that, as an essential element of management optimisation, advocate for the closure of the material and energy cycles in anthropogenic processes. This chapter strives to portray CE as an initiative that seeks to completely decouple global economic growth from finite resource consumption.

This study employs a descriptive research design, incorporating a literature survey followed by logical (epistemological) reasoning and a systemic approach. The continuous effort to increase the production capacity of the economy, aiming to enhance social well-being, exerts significant pressure on the environment. The traditional linear production process involves the unsustainable use of natural resources and generates substantial amounts of waste. This model poses a serious risk of depleting natural materials and precipitating climate change disasters, potentially leading to the collapse of economic and social systems. CE advocates a transition from extractive economies, characterised by excessive and wasteful consumption, to economic models founded on resource efficiency, reuse, sharing, and closed loops. This transition can be facilitated by implementing circular business models that offer solutions to extend the product lifecycle, including repairing and improving products, recovering raw materials from by-products, and recycling end-of-life products, or activities encouraging sharing.