A Circular Economy Strategy for Scotland

3. Policy Mechanisms

Developing a circular economy requires action across multiple policy areas to deliver systemic change to how we produce, use and consume goods and materials. This section sets out the policy mechanisms we are using to take us there, building on the Circular Economy and Waste Route Map actions.

Delivering change across policy areas is fundamental to the transition to a more circular economy. The policy mechanisms we are using to create a circular economy are:

3.1 Business Support

Priority: Support to business to increase circular practices and business models

Influencing business behaviours, models and practices is vital. A more circular economy is a key mechanism for driving future sustainable economic growth, productivity and competitiveness. Zero Waste Scotland has launched a new Business Information Hub^[5] as a home of guidance, best practice and tools. Zero Waste Scotland’s business support services will continue to provide targeted support, such as accelerator grants, to the business community and work with strategic partners to build capacity including in both SMEs and larger businesses.

Our enterprise agencies - Scottish Enterprise (SE), Highlands and Islands Enterprise (HIE), and South of Scotland Enterprise (SOSE) - will continue to provide targeted support to help companies identify and capitalise on circular economy opportunities.

Circular principles are also at the heart of the National Manufacturing Institute for Scotland (NMIS), which supports start up and scale up activity both within Scotland and across the UK.^[6] Additional collaborative activity such as the ReMake Value Retention Centre will work across industry and academia to maximise product value through circular innovation.^[7]

3.2 Behaviour and Systems Change

Priority: Empower consumers and organisations to adopt circular behaviours

Behaviour change underpins progress across all areas of this strategy and delivery of our Circular Economy and Waste Route Map. Evidence shows that many people want to reduce the carbon impact of the products that they buy but can struggle to move beyond low-impact changes.^[8]

This is in part because behaviour change is dependent upon wider systems change. Systems change often involves an array of different interventions and policies – including regulation of businesses, infrastructure, and communications – with the intent of changing the wider system at all levels. In order to adopt circular economy lifestyles and actions, people must have the capability, opportunity and motivation to act. To enable these changes and address the barriers to action, the Scottish Government takes a systems thinking approach, including the development of priority sector roadmaps and through our Product Stewardship approach, which includes regulatory interventions.

While we all need to make changes, these changes must be supported by an enabling environment. Our Strategic Research Programme for waste and the circular economy will build our evidence base and inform the development of system and behaviour change approaches across policies, for the private, public and charity sectors.^[9]

3.3 Place-based Approaches

Priority: Expand a place-based approach to the circular economy

A place-based approach to the circular economy recognises that the circumstances of communities in Scotland differ from place to place and require local solutions, including consideration of what our urban and rural areas need and how that might differ alongside a recognition of the different types of businesses and social enterprises in these areas. We will build on the place-based approach taken by Zero Waste Scotland, for example through its European-funded programme with regional Chambers of Commerce as well as its work to embed the Place Standard into its activities, and its partnerships with HIE and SOSE.^[10]

We will continue to embed circular economy principles with local transformation programmes such as Project Willow at Grangemouth, an initiative shaping a low-carbon future for one of Scotland’s most important industrial clusters that includes industrial biotechnology, sustainable feedstocks, and closed-loop manufacturing systems.^[11]

3.4 Procurement

Priority: Promote circular purchasing through procurement practices

Procurement is a high-value and high-volume activity within the public sector which spends more than £16 billion each year on buying goods, services and works. We will embed circularity into public sector procurement processes, helping to shift markets and mindsets, and build long term value chains that prioritise reuse, repair, and reduced material consumption, alongside an ongoing focus on human rights.

This includes considering new regulations to require purchasing goods with recycled content, recycled or reused products or future recyclable products informed by commissioned research. We will also develop guidance on enabling a circular approach to elements of facilities management in the public estate, for example lighting where products are retained, reused and remanufactured, extending their lifecycle. This also promotes energy efficiency, reducing both operational and lifecycle carbon.

The Scottish Government has developed and maintains a suite of online Sustainable Procurement Tools to support the Scottish public sector to adjust to more resource-efficient and sustainable procurement practice. The Tools contain Circular Procurement and Supply eLearning, guidance on how to minimise waste and make best use of resources through procurement, as well as a suite of procurement case studies from across the public sector.

Zero Waste Scotland will also continue to develop and promote circular procurement guidance for both the public and private sector (Circular Procurement | Zero Waste Scotland).

3.5 Due Diligence

Priority: Uphold the UN Guiding principles on Business and Human Rights

The Scottish Government is committed to the UN Guiding principles on Business and Human Rights. The principles make clear that businesses have a responsibility to ensure their activities do not have adverse impacts on human rights. Our human rights due diligence guidance sets out recommendations on how the Scottish Government, and its executive agencies and non-departmental public bodies, should undertake appropriate due diligence on companies, including their human rights record, before entering into an investment relationship with them.

In terms of Procurement , the Scottish Procurement Policy Handbook provides guidance on the rules and policies that apply to the procurement activities of public bodies in Scotland, including with regards to human rights and climate change.

We expect companies that are awarded public contracts to: maintain high standards of business and professional conduct, respect human rights, adopt clear corporate policies on human rights appropriate to their business and the public contract, and take action which prevents, mitigates and, where appropriate, remediates actual or potential human rights abuses.

Public bodies have a legal obligation to exclude companies from a public procurement exercise if they have been convicted of any offence under part 1 of the Human Trafficking and Exploitation (Scotland) Act 2015 or under any provision referred to in the Schedule to that Act. Public bodies may also exclude a company which has breached any obligations in the fields of environmental, social or labour law.

We also engage with the UK Government on reserved issues, including opportunities for proportionate due diligence measures which can be a key mechanism for improving supply chain sustainability. The UK Government is currently undertaking a review of its approach to Responsible Business Conduct, and the Scottish Government will engage with it on this. We will also continue to work with the UK Government on its development of a National Baseline Assessment on the UN Guiding Principles on Business and Human Rights, which will inform the UK Government’s approach to business and human rights abuses at home and abroad.

3.6 Skills and Education

Priority: Increase uptake of circular practices through improved skills and education

Skills and education are vital to increasing the uptake of circular practices. This is part of a wider shift needed for Scotland’s just transition to a net zero, nature positive, circular economy that brings with it the opportunity for new and innovative green jobs.

We will work across government and with relevant stakeholders to ensure circular skills are embedded within the programme of reform for our education and skills system.

The themes associated with the Circular Economy Strategy have important links to Learning for Sustainability (LfS), which is an entitlement for all learners within Curriculum for Excellence. LfS enables learners, educators, settings and their wider communities to build a socially just and equitable society.

Our work on STEM education is central to our ambition to build a dynamic, skilled, and inclusive Scotland, where science and technology empower individuals and communities to thrive. STEM education and training is crucial to supporting circular practices.

Education Scotland is leading a systematic review of the Scottish curriculum to ensure that it remains up-to-date and relevant for children and young people and LfS, Science and Technologies are part of the curriculum review process. The timeline for curriculum and qualifications reforms is set out in the Scottish Government publication Curriculum, Qualifications and Assessment Reform – Progress to Date and Next Steps, published in June 2025.

It has been estimated that the circular economy employs 56,000 FTE workers in Scotland. To grow and maximise these, we need a greater understanding of the landscape in relation to provision of training, and gaps that may exist in terms of available training. As part of the monitoring and indicator framework, Zero Waste Scotland have published a Circular Jobs Tracker which gives greater insight into the opportunities available and being realised.^[12]

3.7 Circular Economy Data

Priority: Improve circular economy data availability, quality, and granularity

Robust, transparent, and accessible data is essential to enable and scale the circular economy, and to monitor our progress. The packaging Extended Producer Responsibility (pEPR) scheme and the forthcoming UK-wide Digital Waste Tracking service will drive improved data availability. We will also identify key evidence gaps and areas for collaboration through the UK-wide Circular Economy Analytical Group.

Scotland generated 9.55 million tonnes of waste in 2023, a reduction of around 20% since 2011, of which 86% was managed in Scotland. Material reprocessing is a cornerstone of Scotland’s transition to a circular economy and converting these waste materials into valuable new resources at their end of life not only opens up new economic opportunities but underpins our transition to net zero. The Waste Reprocessing Infrastructure in Scotland Report summarises the current, planned and proposed waste reprocessing infrastructure across Scotland, the key policies in place to support the material value chain, and the main barriers and opportunities for its future development.

We will also work with other nations in the UK to understand how data developments at EU level might be applied in Scotland. This includes the Ecodesign for Sustainable Products Regulation, which requires products to feature a Digital Product Passport to provide comprehensive information about each product’s origin, materials, environmental impact and disposal recommendations.^[13]

3.8 Policy alignment

Priority: Integrate circular economy principles across policy

A circular economy connects across numerous Scottish Government policy ambitions and is embedded within the National Strategy for Economic Transformation, the Green Industrial Strategy, National Planning Framework 4, and the Onshore Wind Sector Deal for Scotland.^[14]

More widely, Zero Waste Scotland has developed working partnerships, including with the Economic Development Association Scotland, to explore the role of circularity in economic policy and strategy.^[15]

By building on these links and continuing to develop future partnerships we will ensure better integration of circular economy principles, build stronger ownership, increase policy coherence, and maximise co-benefits.

A more circular economy cannot be achieved through isolated activities, and we need to take a systems-based approach that considers all elements of a system. Given the complexity and numerous factors that influence the production, design and flow of goods and materials, this approach is needed to both model and understand issues that impact the supply chain and it underpins the development of the roadmaps covered under the priority sectors section that follows.