When procurement decisions are made, they rarely make headlines. Yet the contracts behind them determine how resources move, how products are made, and what kind of future we build. For years, we have discussed sustainability in production and consumption, but not enough about the missing middle: how things are purchased. Circular impact procurement is changing that. It transforms procurement from a transactional process into a tool for systemic change – connecting the act of buying to the goals of climate action, social inclusion, and long-term resilience
This vision guided our session during Catalyzing Change Week 2025, titled Circular Impact Procurement: Powering Systemic Change through Social Business. Hosted by Catalyst Now and organized under Yunus Environment Hub’s Circular Impact Procurement Initiative (CIPI), the discussion brought together entrepreneurs and practitioners who are already proving what circular procurement can achieve in practice. On the panel were Shobha Raghavan, CEO of Saahas Zero Waste in India; Derrick Sarfo, founder of DercolBags Packaging in Ghana; Matthias Fuchs, Chief Marketing Officer at OceanSafe in Germany; and Richard Steiner, a sustainable procurement expert working with corporations across Europe.
What followed was a conversation that bridged continents, sectors, and disciplines – uniting waste managers, material innovators, packaging entrepreneurs, and procurement specialists in one shared question: how can purchasing become a lever for change rather than a barrier to it?
From Transactions to Transformation
Procurement is often misunderstood as a back-office function. In reality, it governs the flow of billions of euros and dollars each year. The way organizations source goods and services decides not only cost efficiency but also environmental and social outcomes. Yet most procurement systems were designed decades ago, optimized for price and volume, not for planetary boundaries or human well-being.
Circular impact procurement seeks to rewrite this logic. It integrates circularity – keeping resources in use longer and minimizing waste – while directing purchasing power toward social businesses that generate measurable social and environmental value. At Yunus Environment Hub, we launched CIPI with support from the German government and the European Union to help organizations make this shift. Our work shows that when procurement departments buy from social businesses offering circular solutions, they accelerate innovation, strengthen supply-chain resilience, and reduce their footprint simultaneously.
This is not theory. Around the world, entrepreneurs are already supplying circular products and services – recycled materials, biodegradable packaging, refurbished electronics, composting systems, or circular textiles. Yet their reach remains limited because procurement systems still treat sustainability as an add-on rather than a core criterion. The goal of our panel was to understand how to close that gap.
A Global Panel, A Shared Challenge
Each panelist represented a different point in the circular value chain. In India, Saahas Zero Waste operates large-scale waste management systems, recycling and processing hundreds of tons of material every day while creating dignified jobs for marginalized workers. In Ghana, DercolBags Packaging replaces single-use plastics with compostable alternatives made and distributed by women entrepreneurs. And in Germany, OceanSafe produces next-generation biodegradable textiles designed to safely return to nature once their use cycle ends. Connecting these innovators to buyers is exactly what circular impact procurement aims to do.
The panel opened with a simple premise: if procurement holds the power to shape markets, then changing how we buy could transform entire systems. But awareness and access remain the first hurdles.
The Awareness Gap
Across contexts, the first barrier is visibility. Many procurement teams are unaware of the circular solutions already available in their own regions. Shobha Raghavan noted that even in India’s fast-growing sustainability ecosystem, “green procurement” is still in its infancy. Teams are used to long-standing suppliers and standardized processes, while sustainable alternatives are often excluded from vendor lists simply because no one has mapped them.
The same pattern appears in Ghana. As Derrick Sarfo explained, circular entrepreneurs spend much of their time simply proving they exist. “Before we even talk about contracts,” he said, “we have to make organizations aware that sustainable options are available locally.” Awareness is the foundation of demand. Without it, even the most innovative solutions remain invisible.
Matthias Fuchs from OceanSafe confirmed this from the European textile perspective. Procurement officers in fashion and home goods, he observed, are often overwhelmed by sustainability claims. With hundreds of new materials, certifications, and marketing terms, decision-makers struggle to tell credible circular solutions from greenwashing. “If a buyer can’t distinguish between technologies, they default to what they know,” he said. This lack of technical understanding keeps even large companies trapped in linear procurement.
At CIPI, we see this daily. Buyers are not resistant to change – they are simply overloaded. What they need is translation: clear data, credible suppliers, and examples that show circular solutions can meet performance and compliance standards. Building this bridge between social innovators and procurement professionals is where systemic change begins.
Cost and Compliance: Two Hard Realities
Even when awareness grows, procurement runs into structural constraints. The first is cost. Circular products often carry higher upfront prices than virgin alternatives, particularly at small scale. Shobha explained that many tenders in India still operate on an “L1” principle – awarding contracts to the lowest bidder. “If recycled goods cost 25–30 percent more,” she noted, “the decision rarely moves forward.” Life-cycle costing, which accounts for durability, maintenance, and end-of-life value, remains underused.
Matthias echoed this view from Europe: cost parity is essential for mainstream adoption. “Price is still king,” he said, “and the challenge is to prove value over time.” Circular solutions must compete not only on ethics but also on economics. As production volumes increase and regulatory pressure mounts, cost parity is gradually emerging – but procurement systems need to reward long-term value rather than short-term savings.
The second constraint is compliance. Regulatory landscapes are evolving faster than companies can adapt. From the EU’s upcoming deforestation rules to extended producer responsibility (EPR) schemes and supply-chain due-diligence acts, buyers face growing obligations without consistent guidance. Richard Steina summarized the resulting paralysis: “Many corporates would rather do nothing than risk doing something non-compliant.” What began as sustainability ambition can become a fear of mistakes. The solution, he argued, lies in better data and more pilots – small, well-documented projects that allow companies to learn safely and scale responsibly.
Feedstock and Quality: The Circular Supply Challenge
For social businesses working with recycled or recovered materials, maintaining consistent input quality is another struggle. Shobha explained that post-consumer waste in India is highly heterogeneous. “You need an assured feedstock, consistent volume, and predictable quality,” she said. “Without that, production falters.” Informal waste collection and fluctuating market prices further complicate planning. While Saahas has built formalized partnerships with municipalities and industries, most of the sector still depends on unstable supply chains.
The lesson applies globally: circular production cannot thrive without circular logistics. Investments in sorting, quality control, and traceability are essential for scaling. Buyers can help by committing to longer-term contracts, which stabilize demand and allow suppliers to invest in better systems.
Leadership and Enforcement
Even the best regulations mean little without leadership commitment. Derrick described how Ghana amended its procurement law in 2016 to encourage sustainable purchasing in government institutions. Yet implementation has been slow. “Leaders know these rules exist,” he said, “but they don’t enforce them within their teams.” The gap between policy and practice persists not because of ignorance but because sustainability lacks priority in executive performance metrics.
Richard reinforced the same point. “If the C-suite values only profit and growth, departments will follow suit,” he said. Setting circularity and social value as measurable KPIs, from the board level down to procurement officers, is critical. Without top-down alignment, progress depends on individual champions – and champions eventually burn out.
From Barriers to Breakthroughs
Despite these challenges, the panel was not a lament. It was a roadmap. Each speaker offered practical strategies that have worked in their context – approaches that buyers anywhere can adapt.
Start small, learn fast
Matthias advised companies to begin with “lighthouse projects” – small, focused procurements where they can manage risk, test processes, and gather evidence. OceanSafe often starts with a single textile line before scaling to full product portfolios. The controlled scope allows for quick iteration and data-driven evaluation. Success stories, no matter how modest, create internal momentum.
Co-design with buyers
Derrick shared how co-design transformed relationships with clients. When DercolBags partnered with a major Ghanaian bank to replace single-use lunch containers, they didn’t impose a finished solution. Instead, they designed the rollout together, starting with the physical product before integrating digital tracking. “They felt ownership,” he said, “and that made adoption easier.” The project later expanded beyond the head office, turning staff into active participants. This lesson applies to any organization: co-creation builds buy-in.
Create incentive loops
DercolBags also introduced an incentive model. Retailers who returned clean packaging waste for recycling received discounts on future orders. This closed-loop system rewarded participation and turned sustainability into savings. The principle is simple but powerful – behavior change accelerates when users experience direct benefits.
Professionalize impact
Saahas Zero Waste has focused on combining impact with compliance. The company operates under ISO standards, prioritizing safety, transparency, and reliability. “We bring a combination of impact, compliance, and quality,” Shobha emphasized. This professionalism reassures corporate buyers who must justify supplier selection internally. It also raises the standard for the entire sector, showing that social business can match or exceed corporate rigor.
Redefine procurement criteria
Shobha also argued for impact-based RFPs that evaluate suppliers not only on cost and specifications but also on environmental and social performance. Including metrics such as local sourcing, emissions reduction, and inclusion of women and marginalized groups can shift market incentives. When procurement rewards impact, innovation follows.
Collaborate across sectors
For Richard, collaboration is the single most important factor. Circular businesses and large buyers often operate in separate bubbles – different events, networks, and languages. “Go where the buyers are,” he urged. Circular ventures should present at mainstream procurement conferences and industry fairs, not just sustainability forums. Likewise, corporate buyers should actively seek out social enterprises and integrate them into supplier databases. Visibility breeds trust, and trust enables contracts.
Lessons for The Road Ahead
The conversation reminded me that transformation rarely happens through grand declarations – it happens through contracts, tenders, and daily decisions. The shift to circular impact procurement will not occur overnight, but it is already underway. The pioneers on our panel demonstrate that the technical, social, and financial models exist. What we need now is courage and coordination.
For buyers, the next step is to pilot. Identify one category – packaging, textiles, or waste services – where circular social businesses can compete. Run a structured procurement, measure outcomes, and share results.
For suppliers, professionalism and communication are key. Build credible documentation, meet compliance standards, and articulate the story behind your product – the problem it solves, the lives it touches, the emissions it avoids.
For policymakers, enforcement and incentives matter. Mandating sustainable procurement is not enough; governments must ensure consistent application and reward innovation.
For networks like CIPI, the task is to educate and keep building bridges – to connect the passion of social entrepreneurs with the scale of institutional buyers.
A Shared Vision
As the discussion closed, I reflected on how far this movement has come in only a few years. What began as an experimental idea – linking social business to procurement – has become a practical framework. Through CIPI, we have already mapped over a hundred social businesses with circular solutions in Germany alone, supported by funding from the German government and the European Union. The network is expanding globally, helping organizations align sustainability goals with purchasing decisions.
Our session at Catalyzing Change Week reinforced why this work matters. Every procurement decision is a climate decision, a social decision, a resilience decision. The power to shape systems lies not only with policymakers or CEOs but also with procurement officers, category managers, and sustainability leads. When they collaborate with circular social businesses, they turn routine transactions into instruments of transformation.
Looking Forward
Circular impact procurement is still young, but its trajectory is clear. As climate regulation tightens, as investors demand proof of impact, and as communities call for fairer economies, procurement will become one of the most powerful levers for change. Social businesses are ready. The next step is for buyers to meet them halfway.
At Yunus Environment Hub, we invite organizations in Germany to join the Circular Impact Procurement Initiative – to explore our directory, participate in upcoming webinars, and co-create lighthouse projects that demonstrate what’s possible. Together, we can make circular procurement the new normal, not the exception.
The change will not happen by accident. It will happen through decisions – purchasing decisions made with purpose.
About the Circular Impact Procurement Initiative (CIPI)
CIPI is a program by Yunus Environment Hub, funded by the German Federal Ministry for Economic Affairs and Energy and the European Union. It supports organizations in integrating circular social business solutions into their supply chains through capacity-building, matchmaking, and knowledge exchange. CIPI’s growing directory features verified social businesses across Germany, offering circular solutions ready for procurement.
Image & Video: Catalyst Now