Circular Sovereignty Forum
Can Europe secure the critical raw materials it needs without stepping back from global trade?
Recorded at the Circular Sovereignty Forum at IFAT Munich, with Susanne Kadner of Circular Republic, João Merico of the Ellen MacArthur Foundation, and Roland Gauß of EIT Raw Materials, on the link between circularity, geopolitics, and supply security.
What you’ll hear in this episode:
- What companies actually want from EU regulation: predictability above all. First movers need to know the rules they invested in will not be reversed by the next reform.
- Why recycling alone will not close the gap. Reuse, leasing, and product as a service have to scale alongside it, even when fast innovation cycles make reusing yesterday’s components harder.
- Why venture money is shifting toward Europe as US green subsidies are rolled back, and where Europe still loses ground on a level playing field.
The episode also covers Europe’s urban mines and the secondary raw materials in them, and the case for diversifying supply rather than concentrating it on single suppliers.
This is the first episode in the Circularity.fm IFAT special, recorded at IFAT.
People
Susanne Kadner, Co-Founder, Circular Republic (UnternehmerTUM)
https://www.linkedin.com/in/susanne-kadner/
João Merico, Senior Strategy Associate, Critical Minerals & Energy Transition, Ellen MacArthur Foundation
https://www.linkedin.com/in/jo%C3%A3o-murilo-silva-merico-a88633202/
Roland Gauß, Innovation and Product Development Director, EIT RawMaterials
https://www.linkedin.com/in/roland-gau%C3%9F-52108b126/
Patrick Hypscher, Circular Business Strategist, PaaS Expert
https://www.linkedin.com/in/hypscher/
Chapters
00:00 Intro
02:22 Why a Sovereignty Forum at IFAT
03:11 What companies want from Brussels: clarity and predictability
04:37 How US finance pulls startups out of Europe
05:46 Front runners vs companies waiting on Brussels
07:52 Why sovereignty needs collaboration
08:37 João Merico: why critical minerals matter
09:15 Beyond recycling: other circular business models
09:57 Reuse and fast innovation cycles
11:12 Global vs regional circular economy
12:27 Circularity and climate goals
13:45 Roland Gauß: Europe’s raw materials and urban mines
14:50 The level playing field and US incentives
16:55 Winning the hesitant majority to diversify
18:42 Outro
About
IFAT is the world’s leading trade fair network for environmental technologies. It focuses on water, wastewater, waste, recycling and circularity, bringing together companies, innovators and industry professionals to present solutions for resource efficiency and sustainable infrastructure.
IFAT Munich is the flagship event of that network and the most important meeting place for the sector. It takes place every two years in Munich and showcases technologies and services for water, wastewater, waste and raw materials management, with the 2026 edition featuring around 3,400 exhibitors from about 60 countries.
Further Links
IFAT: https://ifat.de/en/
Circular Republic: https://www.circular-republic.org
UnternehmerTUM: https://www.unternehmertum.de
Ellen MacArthur Foundation: https://www.ellenmacarthurfoundation.org
EIT RawMaterials: https://eitrawmaterials.eu
Transcript
[00:00:00] Intro
Roland Gauß: We believe, as Europeans, in a global market and trade and collaboration, and that’s so good. But if you focus and concentrate your supply in various areas onto single suppliers. It’s simply not smart. So the smart solution is to diversify. Do not put all your eggs into one basket. That’s the first thing you learn if you wanna run a business.
Patrick Hypscher: My name is Patrick Hypscher, and this is Circularity.FM, the podcast about understanding, building, and managing circular business models
Patrick Hypscher: Welcome to a new series of Circularity.fm. This one is a special from IFAT. IFAT is the world’s leading trade fair for environmental technologies, and I can tell you it’s massive. More than 3,000 exhibitors, many visitors, and a fully packed program. We had a hard time choosing highlights, and we picked four, and these four we wanna share with you.
Patrick Hypscher: We kick off with the topic of resilience and sovereignty. More details in a minute. After that, we will look into the economic potential of circularity. Then we have a deep dive on startups. Circular Republic will present its startup landscape two thousand twenty-six, and we will discuss the background.
Patrick Hypscher: And for the final episode, we will combine all the three previous topics, resilience, economics, and startups. We will highlight the winners from the Circular Technology Award in the categories Automated Disassembly and Critical Raw Materials. The first stop in this episode is the Circular Sovereignty Forum. This has been hosted by Circular Republic, the Ellen MacArthur Foundation, and IFAT Munich. We will hear perspectives from Susanne Kadner co-founder of Circular Republic
Patrick Hypscher: João Merico from Ellen MacArthur Foundation and Roland Gauß from EIT Raw Materials. The topic of sovereignty is a wide one. It includes geopolitics, economics, of course circularity, policy instruments, and many more. So let’s dive into this conversation let’s start with Susanne
[00:02:22] Why a Sovereignty Forum at IFAT
Patrick Hypscher: Susanne, we are at the IFAT here and you host the Circular Sovereignty Forum. Why did you initiate that?
Susanne Kadner: Well, the IFAT, you just mentioned it, is the world’s largest environmental technology fair, and we think it’s the perfect place to showcase what kind of innovative potential we already have in Germany, we already have in Europe, because it’s this innovative potential that we need if you really wanna make this transformation towards a circular economy in reality.
Susanne Kadner: And many of those technologies here are already what we need today to improve, for example, the recycling aspect e- within the circular economy, but then also addressing other issues in robotics for automated disassembly. So there’s a whole host of innovative ideas that’s being showcased. And that’s why having the Circular Sovereignty Forum here is the perfect spot for us.
[00:03:11] What companies want from Brussels: clarity and predictability
Patrick Hypscher: Wonderful. About two years ago, the European Commission released the Critical Raw Materials Act, and later this year there will be the Circular Economy Act. So you talk to a lot of companies, what are their expectations towards the European Commission?
Susanne Kadner: Yeah, I mean, we brought out a policy paper which is trying to answer exactly that, and what comes out most from it is that they want clarity, so the end-of-waste definition, for example.
Susanne Kadner: Accelerated permitting, they want speed. The transparency aspect is clear. How do we calculate benefits that come from recycled content, for example scope three emissions that have been saved. It’s been an important topic that was discussed here today. But what’s most of all important for them is the predictability that regulations which have been planned are not being taken away or reformed through omnibus, for example.
Susanne Kadner: They want to know that if they’re first movers, they can win and they will not lose.
Patrick Hypscher: We heard today someone saying necessity is driving innovation. And when we talk about critical raw materials and geopolitical dimensions, we always have this tension between the nation-state perspective and companies.
Patrick Hypscher: Companies are a bit more flexible at least in the long term because they can relocate their operations. So how can a body like the European uh, Union actually also innovate and try to make companies move into the circular economy?
[00:04:37] How US finance pulls startups out of Europe
Susanne Kadner: Yeah. That’s a very important point. I mean, we are at Circular Republic located at Europe’s largest entrepreneurship center.
Susanne Kadner: And specifically for the young companies, it’s very interesting to go abroad, to go to the US where the finance streams are not comparable to what we see in Europe or in Germany. So that’s one thing. Make sure that the money is there for the innovative companies being able to scale. That’s one aspect.
Susanne Kadner: The other point is there are many companies who want to stay within Europe, who want to stay within Germany, and here what’s really important is make it easier for them to make their business model work, and that sort of relates back to the question we just discussed. You know, have the predictability of how you’re gonna set up your business model.
Susanne Kadner: ‘Cause, yeah, as a company, you have the flexibility to go abroad, but that’s also linked to a risk, of course, because what if environmental or regulations change like we have seen in the US? What if the ground there suddenly is not so fitting for your business model anymore? At least here you know how it is.
Susanne Kadner: But here we have to guarantee the predictability as well, so we have this competitive advantage compared to other areas. Yeah.
[00:05:46] Front runners vs companies waiting on Brussels
Patrick Hypscher: And at the same time, we’re seeing already, luckily, companies that are moving in that direction, so they set up circular business models, they change their supply chains to become more resilient, more circular.
Patrick Hypscher: While at the same time, companies within the same industry that have more or less the same preconditions, they stick to a more linear approach. So what separates the more, the front runners from the companies that are a bit more hesitant?
Susanne Kadner: I mean, one thing, and that sort of adds onto the last question, I wanted to mention this as well.
Susanne Kadner: It’s the strategic aspect. We’re seeing that investments, venture money is being redirected to Europe because of the sort of changing environments that we’ve seen in the US. The IRA that was put in place under Biden. So the IRA provided a lot of positive ground for innovative companies in the green tech space to flourish, and now this is being taken away, and we see that a lot of investments are now flowing into the European Union.
Susanne Kadner: So the credibility by investors to what the European Union can establish is there, and that’s a very important signal. So coming to the question that you’ve just asked, why are some companies front runners, why are they not? I think it sort of depends on where they are standing. Some have given themselves a clear circularity target some years ago, maybe due to regulation, impending regulation, and they are trying to understand now how to make this real.
Susanne Kadner: And over the course of this process, the geopolitical landscape has changed, and they are really seeing now how important this is to remain in control of your own material value streams. And that very often is linked to a changing business model as well. So for these companies, they were front runners, but they’re seeing that they’re actually benefiting from this, despite maybe the fact that European regulation is not really rewarding them for it.
Susanne Kadner: But for them, remaining or retaining the control of their really high value material streams is paramount. So for them, it’s very interesting. And for the other companies who are not following suit, some of them are waiting for Brussels to decide what comes first, you know.
Susanne Kadner: What is what do you need uh, hereto or not anymore, and then they can only be reactive. It’s their decision.
[00:07:52] Why sovereignty needs collaboration
Patrick Hypscher: Today we experienced two hours of intensive exchange and discussion. What’s your takeaway from today’s event?
Susanne Kadner: Well, my takeaway is this old saying you can only do it together.
Susanne Kadner: But I like what the Ellen MacArthur Foundation brought into this discussion. We’re talking about sovereignty, but we need to talk about sovereignty and collaboration at the same time. And so being here today, having these different companies in the room together with politics, we are all driven by the same questions.
Susanne Kadner: I’ve mentioned it, it’s clarity, it’s transparency, but it’s the act, need to act as well, and that’s really sort of like this positive energy that I’m taking away.
Patrick Hypscher: Susanne, thanks for facilitating this collaboration.
Susanne Kadner: Thank you so much.
[00:08:37] João Merico: why critical minerals matter
Patrick Hypscher: João, you co-hosted this session today. Why is this such an important topic for the Ellen MacArthur Foundation?
Joao Merico: Critical minerals is an extremely important subject at the moment. We’re going to experience a very high demand stemming from energy transition and mobility transition, digital transition. We have circular economy at the very core of that transition.
Joao Merico: So resources are designed to be kept in the economy, to be reused, to be made as productive as possible, creating value, but at the same time reducing any negative impact it can have so we need to transition to a global circular economy for that matter.
Patrick Hypscher: And what are the strategies that are available to achieve the goals you just mentioned?
[00:09:15] Beyond recycling: other circular business models
Joao Merico: One of the main strategies that are being currently discussed all over the world is the need to increase recycling of these critical minerals, which is absolutely key strategy and way forward, particularly because in these minerals, we’re able to have high rates of recycling back compared to other sectors of the economy, right?
Joao Merico: Some of these minerals can be recycled again and again. However, recycling will not solve the whole thing. It’s not the full picture. We do need a diverse set of circular business models beyond recycling as well, sharing models, leasing and rental, like product as a service, material as a service, and et cetera, to make sure we increase the durability of these products in the economy, ensure they can be repaired, reused, remanufactured and eventually recycled at scale and global.
[00:09:57] Reuse and fast innovation cycles
Patrick Hypscher: The topic of critical raw materials mostly comes down to the specific materials. So how can, like, a reuse model really work considering the fast innovation cycles that maybe the kind of permanent magnet that was state-of-the-art last year may not be the one next year, and reusing that won’t bring you in a competitive position.
Joao Merico: Yeah, that is a very good point, and it is an issue the industry is facing. The technology is evolving, and it’s a issue not only for reuse, but I would say it’s an issue for recycling as well, the materials that are gonna be available post-recycling in the future may not be the ones that are most demanded in the future as well.
Joao Merico: So it’s an issue that we have to manage. On the battery side, for example, a solution for that is once an EV battery reaches the end of its life, it can be applied to stationary batteries, and that might be a very cost-effective and profitable way to maintain the product and circulation before you can recycle and avoid the need to create a whole new battery for stationary storage, for example.
Joao Merico: So we can rely on these strategies and also design new solutions that help us maintain this product circulation because the wasteful way we currently doing the economy is surely bound to fail and be more costly in the right time. So we have to develop new ways o- of engaging with these materials that they become assets to be managed over the long term rather than disposable products.
[00:11:12] Global vs regional circular economy
Patrick Hypscher: Yeah. When you describe these circular initiatives do you separate between, let’s say, a global circular economy where from a worldwide view we keep resources in the loop and a more, let’s say, regional circular economy? Because considering the current geopolitical discussions it seems as though there is a circular economy in North America, in Europe, in Asia, on other continents and some regions are trying to set up their own kind of semi-ring-fence circular economy.
Patrick Hypscher: I mean, you’re working together with global companies around the world, so how do you view that movement or this trend to come up with more regional-focused circular economy, or is that even the case?
Joao Merico: Yeah. We need both. We need local efforts and local innovation and global cooperation.
Joao Merico: This is a massive issue the demand for critical minerals increase by over 3.5, nearly quadrupling. So no region can do it by itself.
Joao Merico: Also, no region can do it without local effort, so we need both. We need better global cooperation that results in win-win positions for everybody. I think that’s where the circular economy also can lead the way and ensure that we hit the right spot between local innovation, local initiatives, and global cooperation.
Joao Merico: Win-win scenario.
[00:12:27] Circularity and climate goals
Patrick Hypscher: You mentioned the climate ambition. My last question is about that because right now in the last one or two years, circular economy has been framed more as an instrument to come up with resilient economy and resilient business practices. To what extent, is it still delivering on climate and sustainability goals?
Joao Merico: Yeah. The circular economy will be absolutely key to deliver on climate goals. On climate, we have a major a need to reduce emissions, reduce our fossil fuel consumption, right? But that alone is not the full picture. If we don’t change how we extract, use, and dispose of our products, if we don’t change the linear process, we’re not gonna hit our climate goals.
Joao Merico: So if we’re gonna aim for doing a renewable energy transition that’s still linear in creating solar panels and wind turbines and batteries, that will still cause enormous environmental impact, that will still have a lot of emissions from manufacturing, emissions that are hard to abate, sectors from cement and chemicals that need circular practices to actually hit net zero.
Joao Merico: The energy transition can take us only so far, and the circular economy can complete that, image, and can bring us to pursue net zero in a resilient value chain. Yeah.
Patrick Hypscher: Joao, thanks for hosting, this event today and your comments on it.
Joao Merico: Well, thank you very much. Thanks for having us. Really appreciate it.
[00:13:45] Roland Gauß: Europe’s raw materials and urban mines
Patrick Hypscher: Roland, Europe is gifted by raw materials but not really extracting it. What is holding Europe back to use the raw materials we have?
Roland Gauß: Well, when we say Europe has raw materials, we have primary raw materials. But we also have a bunch of secondary raw materials in our urban mines, as we call it. Yeah. And there’s much more material you could extract and for some reason over the years we rather started to focus on downstream manufacturing-
Roland Gauß: And kinda left this upper part of the value chain, this extraction posing business, to other places in the world that kinda systematically invested here. I think we just lost it a little bit out of sight and now it reoccurs as a strategic matter. How do you secure access to those most important raw materials that you need for all kinds of manufacturing?
Roland Gauß: And I think it’s a matter of commitment, willingness, social acceptance in specific regions. It comes with investment costs it comes with certain environmental burdens . However, many people don’t know that actually Europe is home of the world leading most sustainable mining and processing technology companies.
Roland Gauß: So if there’s a place where we could sustainably extract materials, it’s here.
[00:14:50] The level playing field and US incentives
Patrick Hypscher: You mentioned one of the key levers to achieve that is a level playing field. Why is this such an important topic?
Roland Gauß: Well, You know, I’m an innovation director. I believe in innovation.
Roland Gauß: Innovation’s driven by competition, and if you wanna have, you know, the best solution, the most innovative solution, you need to have the best players compete.
Roland Gauß: And particularly in raw materials sector, we face the challenge that in some places in the world there’s a lot of, let’s say state subsidies coming into the business a preferential treatment of electricity costs, access to human capital resources.
Roland Gauß: Conditions you don’t have, for instance, in Europe these days. Or if you look at the latest US investments in the rare earth business large public/private commitments, real dollars going into the business, attracting European smart minds- Mm-hmm
Roland Gauß: to come over and invest in, in the US, then you don’t have the same kinda level playing field to deploy the technology and the l- knowledge we have.
Patrick Hypscher: So it seems as when you talk about level playing field, it’s more a matter of financial incentive or how much am I willing to invest as a- country.
Roland Gauß: Yeah. to secure these as a state, but also as a company, to diversify, risk diversify. US administration installed in several instances even tax schemes at the border, something we Europeans don’t like because we believe in a global trade.
Roland Gauß: But on the other hand, it does protect certain metallurgical industries in the US. It’s one measure.
Roland Gauß: The other is specific VAT tax schemes or incentives to trigger industrial installations in the US. There’s also a clever combination of um, offtake provided by private companies- as well as public authorities, wh- if you consider a Department of Defense in investments in military equipment and security supplies. So there’s kind of a clever combination of making companies these days decide to scale in other places than Europe. Right. And here we need to come forward with a much more clever approach.
Roland Gauß: Let’s put it this way.
Roland Gauß: In Europe, we do see some individual businesses that still kind of make their way. But I think when it comes to European industrial ambitions, and industrial policy, we need to become much better.
[00:16:55] Winning the hesitant majority to diversify
Patrick Hypscher: Yeah. One thing is the regulatory environment and the decisions by the state.
Patrick Hypscher: The other thing is the demand from the companies itself. There are companies that invest in long-term, circular, resilient supply chains. And there are other companies that are frequently shocked. When a certain supply is blocked. Yeah. And then after a couple of months they go back to business as usual. We need the demand of the second group as well to scale up.
Roland Gauß: It’s the majority, by the way.
Patrick Hypscher: Yeah. But how can we win this majority for long-term circular solutions?
Roland Gauß: Well, first of all, to make people really aware of the topic in the key decision-making levels you know. As also presented earlier, we have these raw materials in Europe.
Roland Gauß: We can commit. We have the best people to process these materials. It’s a matter of commitment, and it’s a matter of risk management. It boils down to investment and risk management.
Roland Gauß: Of course, we believe, as Europeans, in a global- market and trade and collaboration, and that’s so good. But if you focus and concentrate your supply in various areas onto single suppliers. It’s simply not smart. So the smart solution is to diversify. Do not put all your eggs into one basket. That’s the first thing you learn if you wanna run a business.
Roland Gauß: So diversify do collaborate with global partners, that’s so important, but still ensure a certain degree of diversity in your supply chains. Do invest also in local or nearshore suppliers and this gives you much more flexibility. And also, you know, if you think in future designs of your products, you wanna have people that know about materials that does best design your products.
Roland Gauß: Yeah. So you don’t wanna send this product designs all around the world, right? Yeah. You want to work with trusted partners and then you end up with a diversified supply.
Patrick Hypscher: Roland, thanks for sharing your perspective.
Roland Gauß: Okay, thanks.
[00:18:42] Outro
Patrick Hypscher: This was the first episode in our IFAT special. The next episode will move from geopolitics to economics. We will look at the economic potential of circularity. Until then, let’s make sure to drive a profitable circular economy. And please don’t forget, your most abundant renewable resource is your imagination.
Patrick Hypscher: My name is Patrick Hypscher, and this is Circularity.FM, the podcast about understanding, building, and managing circular business models