In the early 2000s, Peugeot, Citroën, and Toyota all sought to enter the small city car market. Rather than going it alone, they shared the design and development of three versions of small hatchbacks. Produced in a shared factory and differentiated through cosmetics, marketing, and service, their collaboration reduced upfront costs and risk while preserving competition across the market.
This kind of strategic partnership is nothing new. In the linear economylinear economyAn economy in which finite resources are extracted to make products that are used - generally not to their full potential - and then thrown away ('take-make-waste')., businesses have long collaborated to overcome high upfront costs, inadequate infrastructure, and shifting customer expectations. Yet in the circular economycircular economyA systems solution framework that tackles global challenges like climate change, biodiversity loss, waste, and pollution. It is based on three principles, driven by design: eliminate waste and pollution, circulate products and materials (at their highest value), and regenerate nature. transition, many companies still act alone, making isolated and incremental improvements that risk diminishing returns.
But it is precisely the business-led form of collaboration that offers a path to the circular economy. While internal capabilities matter, this shift towards coordinated action allows companies to reduce risk, cut costs, and shape the market conditions circular solutions need to succeed.
This is referred to as pre-competitive collaboration – where businesses work together on issues that are not tied to their competitive advantage. But to unlock real impact, businesses must move from broad intent to clear, actionable goals that make circular solutions commercially viable.
Three ways businesses can collaborate:
Joint learning and direction setting – This involves businesses sharingsharingThe use of a product by multiple users. It is a practice that retains the highest value of a product by extending its use period. knowledge, setting standards, and aligning on industry goals, which helps identify common challenges and speed up each company’s solution development while building trust, mutual understanding, and a more substantial base for collective advocacy and commercial collaboration.
Collective advocacy – Once aligned, businesses can work together to influence the policies and regulations that enable their ambitions. A collective voice of businesses carries more weight with policymakers, who need clear evidence of positive business intent to create supportive policies.
Commercial collaboration – Ultimately, businesses can go further. By joining resources, companies can invest in solutions, launch joint ventures, share infrastructure, or co-develop products and services that create new circular value.
Commercial collaboration can unlock circular solutions at scale: four strategic pathways
This collection of case studies focuses on the third and most ambitious form of collaboration: commercial collaboration between competitors, often called ‘co-opetition’. Many competitors transitioning towards the circular economy face similar barriers or depend on the same infrastructure. And while partnering to tackle them may seem counterintuitive, commercial collaboration offers greater, more feasible opportunities for investment and scale.
The following case studies provide replicable examples of commercial collaboration between competitors for a circular economy.
FlipFlipFlipFlip
What sparks collaboration between competitors?
Commercial collaboration is driven by mutual opportunity, yet often difficult to initiate. While some collaborations emerge organically through shared opportunity, most need to be intentionally initiated. A clear instigator or convener is often essential: this could be a forward-thinking business or a neutral third party such as a coalition builder, trade association, or nonprofit. These actors can be crucial to framing the shared challenge, bringing the right partners to the table, and maintaining momentum.
Policy can also play an enabling role. Mechanisms such as Extended Producer Responsibility (EPR), targeted levies, or fiscal incentives can encourage companies to pool resources into necessary innovation, logistics, and infrastructure, creating the conditions for commercial collaboration, especially in highly competitive or fragmented sectors.
What makes commercial collaboration successful?
Shared vision
A shared vision acts as a cornerstone that aligns participants, provides clarity, and builds momentum. Starting with a few like-minded companies lays the groundwork for broader collaboration. For many companies, this vision needs to align with their own organisational goals.
Trust and mutual benefit
Trust is equally essential. It often begins with informal conversation or pre-competitive engagement, and evolves through commitment and mutual benefit. Each participant needs a clear case for why they’re investing time, capital, or IP. Maintaining this requires transparent resource allocation, fair representation, and performance monitoring to ensure all partners are contributing and benefiting equitably.
Strong governance and legal compliance
Successful collaboration requires clear decision-making structures, defined roles, and conflict-resolution mechanisms, alongside robust information-sharing protocols and clear exit processes for partners. Given the competitive context, legal counsel should be engaged early to ensure compliance with competition law. Frameworks such as the UK Competition and Markets Authority (CMA) and EU Commission Horizontal Cooperation Guidelines encourage sustainability-driven partnerships between competitors, provided they’re transparent, inclusive, serve the public interest, and offer open-door policies for guidance. Neutral third-party conveners or legally distinct joint ventures can provide the independent structure and compliance pathways needed to maintain balance, trust, and accountability.
Joining forces to catalyse the circular economy
Commercial collaboration is shifting the spotlight from isolated business impact to market-wide transformation. Whether driven by policy, market demands, or mutual opportunities, these collaborations allow businesses to avoid fragmented approaches and pool resources, reducing cost and risk, signalling commitment, and attracting investment from public, private, and philanthropic financiers.
Collaboration does not require sacrificing competitiveness. With the right governance and ambition, commercial collaboration can expedite the systemic change needed for a circular economy while creating new forms of value. The case studies in this collection offer practical proof of this across industries and regions. Together, they demonstrate how competitors can come together to solve shared problems and unlock circular solutions commercially viable at scale. As more sectors embrace this approach, what was once considered insurmountable may soon become business as usual.
