Innovations in governance for sustainable product design

We are depleting the planet’s limited resources at an unsustainable rate. In an era marked by urgent sustainability challenges, such as environmental degradation, resource depletion, and social inequalities, the circular economy driven by innovative approaches emerges as a beacon of hope. Technological innovation, long recognised as a key driver of transformation, has profoundly impacted our world. However, despite its many benefits, it also introduces unforeseen risks and new complexities.

The European Environment Agency (EEA) recognises the crucial role of innovation in fostering sustainable societies, according to one of its reports published in 2021. The report highlights the need to shift from technology-centred solutions to people-driven approaches. In this context, governance innovations play a fundamental role, as they help design effective mechanisms and establish a balance between experimentation and caution, harnessing their potential to enhance sustainability.

In this way, adopting a circular system offers the opportunity to rethink how we produce and consume, improve environmental quality, increase resource efficiency, and develop innovative business models. Within this framework, governance innovations are crucial for designing sustainable products and enhancing circular practices, which, in turn, improves quality of life. Therefore, policymakers play a vital role in this transition by employing tools such as strategy development, capacity building, economic incentives, and regulations.

The circular economy seeks to go beyond the conventional linear economy model, which is based on taking, producing, consuming, and disposing. Instead, it emphasises the continuous use of resources, striving for zero waste and aligning with broader climate and sustainability goals. It is not just about optimising the current linear system with green and clean production techniques; adopting circular economy principles also requires transforming relationships across value chains and identifying synergies between sectors.

For these reasons, effective governance conditions are essential for the successful implementation of the circular economy. By implementing policies and strategies that promote resource efficiency and waste reduction, governance can significantly support the transition to a more sustainable economic model that not only benefits the environment but also enhances overall sustainability and the quality of life for citizens.

The importance of sustainable product design

Given the current European scenario, how are governments addressing the urgent need to extend the economic life of resources? Are they actively promoting strategies to prolong product longevity, minimise waste generation, and maximise material recovery through recycling and composting initiatives?

To answer these questions, we must first recognise that product design accounts for approximately 80% of its total environmental impact. To minimise this, products and production processes must be redesigned according to the principles of the circular economy, aligning with the EU’s priorities on waste prevention and measuring design impact based on factors such as CO2 emissions throughout the value chain, the resources used during production, the impact of the product’s lifecycle on land and oceans, and the level of hazardous chemicals and gases released into the atmosphere during the product’s lifecycle, among others. These considerations are crucial for companies to develop and implement design strategies that promote sustainability.

The European Commission’s Circular Economy Action Plans were first introduced in 2015. Their goal was to establish regulatory frameworks, allocate EU funds, and monitor the transition towards a circular economy. In 2020, in line with the European Green Deal, Brussels issued an updated action plan, setting the ambitious goal of doubling the recycling of materials and their reintegration into the economy by 2030. The effectiveness of Brussels’ actions on design and production relies on the impact of enabling measures and the use of EU funds. An analysis of the Member States shows that, while progress has been made, achieving this goal remains a challenge.

Nevertheless, since 2020, the European Commission has been consistently incorporating sustainability criteria for product design and circular production into its legislative proposals. These include a proposal for a Sustainable Products Initiative, a proposal within the Circular Electronics Initiative, a proposal to revise the Industrial Emissions Directive, incorporating circular economy practices in future Best Available Techniques reference documents, and a review of the 2011 Restriction of Hazardous Substances Directive, alongside guidance to clarify its connection with the 2006 REACH regulation and ecodesign requirements.

European funds for governance

At the end of 2022, except for the new common charger directive, which will come into force in December 2024, these measures were still in the process of adoption. In February 2023, Brussels launched the Green Deal Industrial Plan, aligned with the Circular Economy Action Plan (CEAP), thus providing a framework to transform the EU industry towards net-zero emissions.

Of the 54 specific actions planned by the first CEAP, the second, adopted in 2020, added another 35 actions aimed at improving circularity, with the ambitious goal of doubling the EU’s circular material use rate by 2030. The primary aim of both plans is to support the transition to a circular economy by promoting sustainable production, consumption, and resource efficiency for the benefit of businesses and citizens. Approximately a quarter of the 89 actions specifically target the design and production phases, encompassing four categories: establishing the right regulatory framework, implementing cross-cutting measures, financing circularity projects, and monitoring progress in the circular economy.

In this context, it is important to highlight the role of European funding as a governance tool to enable and accelerate sustainability, improve quality of life, and support a robust circular economy model.

The LIFE programme

Firstly, the LIFE programme, the EU’s funding instrument for the environment and climate action, significantly improves quality of life, supports a robust circular economy, and accelerates sustainability. By financing projects that protect and restore natural habitats, reduce pollution, and promote biodiversity, this programme directly contributes to a healthier environment, a crucial factor for human well-being.

LIFE’s emphasis on climate mitigation and adaptation also helps communities prepare for and combat the impacts of climate change, thus improving resilience and living conditions. In the circular economy field, this programme supports initiatives that improve resource efficiency and waste management, promoting recycling and sustainable production practices. LIFE also funds innovative pilot projects and research that drive the development and implementation of new scalable technologies and sustainable practices. By supporting policy development and capacity building, the programme ensures effective governance and widespread adoption of sustainability principles.

With a total budget of €697.5 million in 2024, its Circular Economy and Quality of Life sub-programme is crucial for implementing governance innovations, improving product design, and enhancing quality of life. By co-financing projects focused on waste recovery and the management of water, air, noise, soil, and chemicals, this sub-programme addresses key environmental challenges and promotes a healthier living environment.

Through financing Standard Action Projects (SAPs), this sub-programme supports the implementation of innovative solutions and best practices. Additionally, the focus on environmental governance ensures that circular economy principles are integrated into policy frameworks and business practices, fostering a systematic approach to sustainability.

Circular Economy and Quality of Life also covers Strategic Integrated Projects (SIPs), which focus on implementing environmental and climate action plans or strategies at the regional, multiregional, national, or transnational level, developed by Member State authorities and required by EU legislation or policies.

By seeking solutions ready for market-scale implementation under near-commercial conditions, the European Commission, through the LIFE programme, ensures that innovations can be scaled up quickly and effectively, maximising their impact. Overall, by supporting cutting-edge projects and fostering stakeholder collaboration, the Circular Economy and Quality of Life sub-programme accelerates the transition to a circular economy, improves resource efficiency, and leads to better living conditions and environmental quality.

Horizon Europe and its impact on sustainability

Secondly, the Horizon Europe funding programme, with a budget of €95.5 billion for the 2021-2027 period, directly contributes to innovations in sustainability and quality of life, through its clusters on Climate, Energy, and Mobility, and on Food, Bioeconomy, Natural Resources, Agriculture, and Environment. This programme also integrates five Research and Innovation Missions to enhance funding effectiveness by pursuing well-defined objectives. The European Commission collaborated with policy experts to develop case studies and reports on the implementation of a mission-oriented policy approach.

Horizon Europe also includes a specific intervention area to support innovation in democracy and governance, with the aim of opening new avenues for positive impacts on citizens’ lives. In this regard, it is worth mentioning the topic HORIZON-CL6-2025-03-GOVERNANCE-XX: Preparing farmers for the future of agriculture by providing the right knowledge and skills at the right time and place, included in the initial draft of Horizon Europe’s Cluster 6 2025 Work Programme.

By promoting a culture of continuous learning and adaptation, the agricultural sector can contribute effectively to a more sustainable and equitable future, better responding to the needs of current environmental scenarios. This approach not only addresses immediate challenges but also positions the sector to seize long-term opportunities, ensuring resilience and prosperity for future generations.

This cluster also includes the destination Innovative Governance, Environmental Observations, and Digital Solutions in Support of the Green Deal, aimed at opening new doors to improving citizens’ quality of life.

Notably, this year, within this destination, is the topic Partnership of Agriculture of Data, which aims to enhance the climate, environmental, and socioeconomic sustainability and productivity of agriculture, and strengthen policy monitoring and evaluation capacities through Earth and environmental observation and other data, alongside innovative data technologies. The 2025 call is expected to continue including topics in this line.

Horizon Europe also supports European partnerships, where the EU collaborates with national authorities and the private sector to jointly develop and implement research and innovation initiatives. The governance approach adopted by these partnerships fosters coordinated actions towards circularity goals, contributing to better health outcomes through research on clean air, healthy ecosystems, and disease prevention.

Governance for sustainability: supporting governments

These efforts directly impact citizens’ well-being, create economic opportunities by stimulating green technology markets and circular business models, and also influence policy decisions at various levels. Their governance innovations shape regulations, funding priorities, and social norms.

Therefore, the application of innovation in governance is essential for having a positive impact on citizens’ lives and involving them in sustainability efforts. European governance, through the deployment of LIFE and Horizon Europe funding, plays a vital role in aligning incentives for industries, research institutions, and policymakers, to accelerate the transition to a circular economy and promote circular product design. In this way, these strategies benefit not only the environment but also citizens’ quality of life.

Globally, governments are implementing and experimenting with novel approaches, transforming how they serve citizens and operate internally. By adopting innovative governance practices, governments can promote sustainability in product design, ensuring products are created with their entire life cycle in mind. This not only reduces waste but also optimises resource use, leading to better environmental and economic outcomes.

These innovations in governance can significantly improve quality of life by making government services more efficient, transparent, and responsive to the population’s needs. Moreover, by involving citizens in the governance process, governments can better align their policies and initiatives with the real needs and aspirations of their communities, fostering a more inclusive and dynamic society.

We must support our governments and help them harness innovative strategies to achieve policy goals at local, national, and global levels, ensuring they meet their commitments effectively. By learning from past lessons, anticipating future trends, and developing solutions in the present, we pave the way for sustainable governance.

The expert team dedicated to Climate, Natural Resources, and Environment at Zabala Innovation works on developing innovative governance. By leveraging cross-cutting approaches like those mentioned, we can unlock significant environmental benefits embedded in projects submitted to various funding programmes, improving their impact and chances of securing funding. This collaborative model is key to achieving sustainable governance, sustainable product design, enhancing the circular economy, and improving our quality of life.