TERMS OF REFERENCE FOR
CIRCULAR ECONOMY INVESTMENT DATASET
APRIL 2025
I.
BACKGROUND
IFC — a member of the World Bank Group — is the
largest global development institution focused on the private sector in
emerging markets. We work in more than 100 countries, using our capital,
expertise, and influence to create markets and opportunities in developing
countries. In fiscal year 2024, IFC committed a record $56 billion to private
companies and financial institutions in developing countries, leveraging the
power of the private sector to end extreme poverty and boost shared prosperity
as economies grapple with the impacts of global compounding crises. For more
information, visit www.ifc.org.
IFC’s Climate Business Department (CBD) works
across the organization and beyond to implement the Climate Change Action Plan
and deliver on Paris Alignment. Among other things, CBD is responsible for
supporting IFC investment and advisory teams to identify and account for
climate investments, track committed climate finance, partner across the
institution on IFC’s Labeled Bond Program (Green, Blue, Transition), develop
analytical tools, lead climate risk management, and develop thought leadership
via publications and external partnerships. This is all to help scale IFC
climate impact and guard against greenwashing.
To deliver on its priorities, CBD’s Climate
Capacity Building & Inclusion Accelerator (CBDCI) team engages with staff
and clients to build capacity around select thematics including Sustainable
Finance (Green Bonds, Sustainability Bonds, Sustainability-linked finance,
Transition Finance, etc.); Circular Economy (a transformative model to
avoid resource depletion and promote the regeneration of natural ecosystems,
through strategies and approaches to minimize the use of natural resources,
maintain the value of products and materials, and prevent or reduce waste); and
Nature Based Solutions among others.
IFC and the Circular Economy
The circular economy represents a
transformative economic model that minimizes the use of natural resources,
maintains the value of materials and products, and eliminates waste. It
contributes significantly to climate mitigation and adaptation, biodiversity
and nature finance, and blue economy outcomes. It also improves macroeconomic
resilience by reducing dependency on scarce or volatile raw materials and
global supply chain vulnerabilities.
Circular economy investments are essential to
accelerating the global transition to sustainable, regenerative, and low-carbon
economies. However, the current market lacks consistent, transparent, and
reliable data on financial flows into CE activities, particularly in emerging
markets.
To drive greater alignment in what defines circular
economy finance, IFC and a coalition of global partners developed the Harmonized
Circular Economy Finance Guidelines, which will be launched externally in
May 2025. These Guidelines provide globally applicable definitions,
classifications, and metrics to help financial institutions, corporates, and
investors evaluate, disclose, and direct capital to eligible circular economy
activities.
Following the publication of the Harmonized
Circular Economy Finance Guidelines, IFC is seeking to develop a
comprehensive global dataset on private sector investments aligned with the Harmonized
Circular Economy Finance Guidelines, to map private sector investment flows and
guide IFC and the broader investment community.
II.
PROJECT DESCRIPTION
The
main objective of this assignment is to develop a global dataset of private
sector investments in circular economy initiatives from 2018 to 2024—or based
on availability of data—and across three sectors (electronics and appliances;
packaging; and textiles), produce a methodology document aligned with the final
Harmonized Circular Economy Finance Guidelines, and draft an analytical
report, including insights from the Africa region.
The deliverables of this engagement will be
used by IFC for internal and external initiatives including the development of an
external Circular Economy Investment Tracker (CEIT), which will inform stakeholders
on global investment trends and gaps and enable better policy and investment
decisions.
III.
TIMEFRAME
The contract is
expected to begin on June 1, 2025, and be completed by November 1, 2025. A
final project timeline will be agreed upon with the selected vendor.
The selected vendor may be considered for
follow-on work to update and expand the dataset and analysis in future years,
subject to IFC’s needs and available funding. In the event that IFC decides to
transfer ownership of the CEIT, the vendor will be given the opportunity to
continue its development and publication. Once the CEIT data is published, the
vendor may also produce and disseminate its own analytical reports and related
materials based on the data.
IV.
SUMMARY OF DELIVERABLES
Key
Deliverables will include:
No.
Deliverables
1.
Project Workplan: Development of a
project workplan outlining proposed timelines, milestones, and data sources
(e.g., Pitchbook). The workplan will be developed in close coordination with
IFC and must be formally agreed upon before initiating substantive project
activities. The sectors and dataset timeframe will be agreed upon between
vendor and IFC before commencing work.
2.
Methodology Document: A comprehensive
document outlining the data collection sources (drawing from only publicly disclosed
information) and classification methodology.
The methodology must
include:
- Data sources and verification
- Procedures to prevent double
counting or misclassification
- Alignment with the final Harmonized
Circular Economy Finance Guidelines
3.
Data Template: A structured Excel template
outlining the relevant data fields needed to track circular economy
investments, aligned with the final Harmonized Circular Economy Finance
Guidelines.
Minimum fields include:
- Region:
to be aligned with IFC’s regions
- Country:
global coverage, including both emerging markets and developed countries.
African countries will be analyzed with a dedicated focus
- Type
of financial instrument: to be aligned with the final Harmonized
Circular Economy Finance Guidelines
- Sectors:
electronics and appliances; packaging; and textiles
- Materials:
to be aligned with the final Harmonized Circular Economy Finance
Guidelines
- Circular
economy project type or activity category: to be aligned with the final Harmonized
Circular Economy Finance Guidelines
- Year:
2018 – 2024
- Dollar
amount
4.
Final Dataset: Collect, validate,
and compile a global dataset of private sector circular economy investments
for the period 2018–2024, disaggregated by categories defined in the approved
data template.
Provide
recommendations on key visualizations that can be presented through an
external CEIT, including charts, graphs, and comparative indicators that
effectively communicate investment trends, gaps, and opportunities to a
global audience.
5.
Summary Report: Summary report highlighting
key insights and findings from the CEIT, synthesizing trends in private
sector investment in circular economy initiatives. The report will distill
sectoral and regional patterns, identify leading investment themes and gaps,
and provide high-level analysis aligned with the final Harmonized Circular
Economy Finance Guidelines. It will include targeted analysis on select
African countries (to be identified by IFC), offering a deeper understanding
of investment dynamics in the region.
V.
QUALIFICATIONS
The
vendor should demonstrate:
·
Strong
experience collecting and analyzing investment and financial data in
sustainability or circular economy-related sectors
·
Familiarity
with international classification systems such as the Green Bond Principles
·
Ability
to design transparent, replicable methodologies
·
Experience
working with multilaterals, financial institutions, or development agencies.
Prior experience with IFC or the World Bank Group is considered a plus
·
Capacity
to produce high-quality deliverables under tight deadlines
Annex
I: Circular Economy Activity Categories, Financing Types, and Sectors (included in the draft Harmonized
Circular Economy Guidelines)
A.
Circular Economy Activity Categories
The
draft Harmonized Guidelines define three circular economy activity categories
across the materials life cycle, excluding energy and water, as well as
circularity enablers.
- CIRCULAR DESIGN
AND PRODUCTION
Category
1A: Circular Design
Design
phase of products/assets/services that incorporates circular economy strategies
or principles, including the reduction of material inputs and use of
regenerative inputs, and increased ease of reuse, repair, or recycling.
Category
1B: Circular Production
Production
processes that reduce virgin raw material usage and increase production
effectiveness.
- CIRCULAR USE
Category
2: Lifetime Extension
Lifetime
extension of products and assets such as through repair, refurbishment, reuse,
retrofitting, and remanufacturing.
- VALUE RECOVERY
Category
3A: Collection and Sorting
Collection
and sorting to enable circularity of end-of-life products and materials.
Category
3B: Material Recirculation
Organic
and non-organic material management, recycling, and recovery.
+CIRCULARITY
ENABLERS
+Circularity
Enablers
Products,
services, business models, platforms, and tools that enable circularity across
different segments of the materials life cycle, including increased intensity
of use.
A
project, economic activity, or business model can receive the designation of
circularity enabler if it is also tied to circular design and production,
circular use, or value recovery.
B.
Assessing Circular Economy Finance Volume
The
draft Harmonized Guidelines define three financing types to assess volumes of
circular economy finance:
- Type A: General
Purpose Corporate Finance
Includes bonds, loans, and equity. Circular economy volume prorated based
on the portion of the revenue or expenditure stream contributing to
circular economy. - Type B: Defined
Use of Funds
Includes labeled green, blue, or sustainability bonds and loans. Circular
economy volume based on investment amount that meets circular economy criteria,
which may be either the entire project or components of the project. - Type C:
Sustainability-Linked Bonds and Loans
Performance-based instruments that tie their financial characteristics to
material key performance indicators and sustainability performance targets.
Circular economy volume based on either defined use of proceeds or
expected share of business that contributes to circular economy.
C.
Circular Economy Sectors
The
draft Harmonized Guidelines case studies span six circular activity categories
across various sectors:
· Electronics and
appliances
· Packaging
· Textiles
· Construction and the
built environment
· Automotive and
transportation
· Agribusiness
D.
Circular Economy Materials
The
draft Harmonized Guidelines case studies cover materials including:
· Cement
· Construction waste
· Critical minerals
· E-waste
· Fibers
· Glass
· Metals
· Organic materials
· Organic nutrients
· Paper
· Plastics
· Rubber
· Steel
· Wood