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Institutional policy and business practice to support the implementation of a circular economy in the textile value chain
Report

Institutional policy and business practice to support the implementation of a circular economy in the textile value chain

Ranjula Bali Swain, Susanne Sweet, Sofia Sundström, Elin Bergman and Helena Åhs
Stockholm School of Economics Institute for Research (SIR)
2026-02

Abstract

circular economy textile value chain Sustainable Consumption and Production; Corporate Sustainability EU policy on circular textiles Circular business models
The textile and fashion industry is one of the most resource-intensive sectors and a globally interconnected industrial ecosystem spanning environmental policy, trade, innovation, consumer protection and development cooperation. This stakeholder report synthesises research, policy analysis and stakeholder dialogues conducted within the project Institutional policy and business practice to support the implementation of a circular economy in the textile value chain. Drawing on identified implementation gaps under the EU Circular Economy Action Plan, the report analyses structural barriers and emerging opportunities for circular textiles and presents policy and business recommendations aimed at aligning regulatory frameworks, financial mechanisms, industrial infrastructure, digital governance and international cooperation to enable economically viable, globally scalable and socially just circular textile systems.
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