Corporate Circularity Strategy for Meeting the CSRD Requirements : Developing a Methodology for Material Flow Analysis in Industrial Companies with focus on ESRS E5

The growing pressure on natural resources and the ambition to reach net zero emissions have led to stricter sustainability regulations in the European Union (EU). The Corporate Sustainability Reporting Directive (CSRD), together with the European Sustainability Reporting Standards (ESRS), introduces new requirements for companies to report on resource use and circular economy under ESRS E5. To meet these demands, companies need reliable tools to map and evaluate material flows. Material Flow Analysis (MFA) is one such tool, but current MFA methodologies are often designed for national or regional analyses and lack practical applicability at the corporate level in the manufacturing industry. This reveals a knowledge gap in developing an applicable approach to MFA tailored to industrial companies in line with ESRS E5. This thesis addresses that gap by proposing a methodology specifically designed for the manufacturing sector. In this thesis, a qualitative research approach was used, based on a literature and document review that is supported by interviews with practitioners from Swedish manufacturing companies, researchers and consultants. Based on the synthesis of findings, an eight-step methodology for conducting MFA within industrial companies was developed. This methodology was then tested through a case at Saab AB, focusing on a key product for the business area Saab Dynamics, the AT4, to evaluate its practical applicability in a real-world setting. The results show that companies, interviewed in this thesis, are at different stages of implementing and applying ESRS E5 and often face problems with data quality and availability. While the MFA methodology is strong in theory, using it in practice showed some limits, such as missing data and a lack of standard systems. Even so, MFA entails a clear structure and holds adaptability across different settings suggest that it, in combination with ESRS E5 KPIs could serve a useful tool for supporting circular strategies in companies. The thesis concludes that manufacturing firms need to improve internal data quality and cross-departmental collaboration which is essential for reliable MFA implementation. Future research is recommended to test the methodology with more complete datasets and further develop the analysis phase to link MFA results with improvements in resource efficiency.