Abstract
Circular economy is an innovative approach to operationalize principles of sustainability management. The concept is based on the ‘closing the loop’ of product lifecycles and is expected to bring benefits for environment and economy as well as to contribute to the responsible business conduct. These benefits refer to reduced usage of resources, lower impact on the natural environment, cost savings and jobs creation. The implementation of circular economy has a disruptive impact on company operations and leads to the need of establishing new business models. While the concept remains significantly unexplored, few studies outline a practical approach to implement principles of circular economy in companies.
We would like to add to this literature examining the practice of business models. The concept of circular economy remains an emerging approach in business practice and relates mainly to changes in production and consumption. We discuss how companies adopt the concept of circular economy and how it affects their business models. The business model redesigned may be a key to the radical improvement of sustainable performance as well as the creation of greater environmental and societal value. Simultaneously, it is expected to deliver positive financial results. We offer the case study analysis to illustrate the innovative approach to sustainable value creation and formulate implications for further practice of circular economy.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
References
Ayres, R. (2004). On the life cycle metaphor: Where ecology and economies diverge. Ecological Economics, 48, 425–438.
Blomsma, F., & Brennan, G. (2017). The emergence of circular economy: A new framing around prolonging resource productivity. Journal of Industrial Ecology, 21(3), 603–614.
Bocken, N., Short, S., Rana, P., & Evans, S. (2013). A literature and practice review to develop sustainable business model archetypes. Journal of Cleaner Production, 65, 42–56.
Boons, F. A. A., & Lüdeke-Freund, F. (2013). Business models for sustainable innovation: State-of-the-art and steps towards a research agenda. Journal of Cleaner Production, 45, 9–19.
Boulding, K. (1966). The economics of the coming Spaceship Earth. In Environmental quality in a growing economy. Baltimore: Resources for the Future, Inc. http://dieoff.org/page160.htm
Chertow, M. (2007). Uncovering’ industrial symbiosis. Journal of Industrial Ecology, 11(1), 11–30.
Cohen-Rosenthal, E. (2004). Making sense out of industrial ecology: A framework for analysis and action. Journal of Cleaner Production, 12, 1111–1123.
COM (33). (2017). Report from the commission to the European parliament, the council, the European economic and social committee and the committee of the regions on the implementation of the circular economy action plan, European Commission.
COM (398). (2014). Communication from the commission to the European parliament, the council, the European economic and social committee and the committee of the regions towards a circular economy: A zero waste programme for Europe, European Commission.
Costea-Unărințu, A. (2016). The circular economy in the European Union. Knowledge Horizons – Economics, 8(1), 148–150.
Deloitte. (2013). Circular economy. From theory to practice. https://www2.deloitte.com/content/dam/Deloitte/fi/Documents/risk/Circular%20economy%20FINAL%20web.pdf
Economist. (2014). http://www.economist.com/news/business-books-quarterly/21672014-helping-environment-must-be-presented-boon-business-first-greening
Ellen MacArthur Foundation. (2013). Towards the circular economy. Economic and business rationale for an accelerated transition. https://www.ellenmacarthurfoundation.org/assets/downloads/publications/Ellen-MacArthur-Foundation-Towards-the-Circular-Economy-vol.1.pdf
Ellen MacArthur Foundation. (2015). Delivering the circular economy a toolkit for policymaker. https://www.ellenmacarthurfoundation.org/assets/downloads/publications/EllenMacArthurFoundation_PolicymakerToolkit.pdf
EMAS. (2007). EMAS Newsletter. http://ec.europa.eu/environment/emas/pdf/newsletter/emas_nl_4_07.pdf
Engert, S., Rauter, R., & Baumgartner, R. (2016). Exploring the integration of corporate sustainability into strategic management: A literature review. Journal of Cleaner Production, 112, 2833–2850.
Erkman, S. (1997). Industrial ecology: An historical view. Journal of Cleaner Production, 5(1/2), 1–10.
EU. (2010). Waste. http://ec.europa.eu/environment/waste/index.htm
European Commission. (2012). Waste – Hazardous waste. http://ec.europa.eu/environment/waste/hazardous_index.htm
Frosch, R., & Gallopoulos, N. (1989). Strategies for manufacturing. Scientific American, 261(3), 144–152.
Geng, Y., Fu, J., Sarkis, J., & Xue, B. (2012). Towards a national circular economy indicator system in China: An evaluation and critical analysis. Journal of Cleaner Production, 17, 216–224.
Hahn, T., Figge, F., Aragón-Correa, J., & Sharma, S. (2017). Advancing research on corporate sustainability: Off to pastures new or back to the roots? Business and Society, 56(2), 155–185.
Hamilton, K., & Atkinson, G. (2006). Wealth, welfare and sustainability. Northampton: Edward Elgar.
Hogevold, N., Svensson, G., Wagner, B., Petzer, D., Klopper, H., Sosa Varela, J., Padin, C., & Ferro, C. (2014). Sustainable business models. Corporate reasons, economic effects, social boundaries, environmental actions and organizational challenges in sustainable business practice. Baltic Journal of Management, 9(3), 357–380.
ISWA. (2013). Global waste management outlook. http://www.iswa.org/nc/home/news/news-detail/article/press-release-global-waste-management-outlook-gwmo/109/
Kavadias, S., Ladas, L., & Loch, C. (2016, October). The transformative business model. Harvard Business Review. https://hbr.org/2016/10/the-transformative-business-model
Kopnina, H. (2014). Consumption, waste and (un)sustainable development: Reflections on the Dutch holiday of Queen’s day. Environmental System Decisions, 34, 312–322.
Korhonen, J., Nuur, C., Feldmann, A., & Birkie, S. E. (2018). Circular economy as an essentially contested concept. Journal of Cleaner Production, 175, 544–552.
Lacy, P., & Rutqvist, J. (2015). Waste to wealth. Basingstoke: Palgrave Macmillan.
Lewandowski, M. (2016). Designing the business models for circular economy – Towards the conceptual framework. Sustainability, 8(1), 43.
Liu, X. (2014). Research on circular economy and industrial clusters. Management and Engineering, 15, 1838–5745.
Lütkehus, R. (2014). How Europe can become less dependent on raw materials imports. European View, 13, 295–302.
Malone, E., Bradbury, J., & Dooley, J. (2009). Keeping CCS stakeholder involvement in perspective. Energy Procedia, 1, 4789–4794.
Marcus, A. (1996). Business and society. Strategy, ethics and the global economy. Chicago: Irwin.
Mathews, J., Tang, Y., & Tan, H. (2011). China’s move to a circular economy as a development strategy. Asian Business and Management, 10(4), 463–484.
McDonough, W., & Braungart, M. (1998, October). The NEXT industrial revolution. Atlantic Monthly, 282(4), 82–92.
McDonough, W., & Braungart, M. (2002). Cradle to cradle: Remaking the way we make things. New York: North Point.
MEA. (2010). Millennium ecosystem assessment report. http://www.maweb.org/documents/document.356.aspx.pdf
Murray, A., Skene, K., & Haynes, K. (2017). The circular economy: An interdisciplinary exploration of the concept and application in a global context. Journal of Business Ethics, 140, 369–380.
Ormazabal, M., Prieto-Sandoval, V., Jaca, C., & Santos, J. (2016). An overview of the circular economy among SMEs in the Basque Country: A multiple case study. Journal of Industrial Engineering and Management, 9(5), 1047–1058.
Osterwalder, A., & Pigneur, Y. (2010). Business model generation: A handbook for visionaries, game changers, and challengers. Hoboken, NJ: Wiley.
Park, J., Sarkis, J., & Wu, Z. (2010). Creating integrated business and environmental value within the context of China’s circular economy and ecological modernization. Journal of Cleaner Production, 15, 1494–1501.
Rainey, D. (2006). Sustainable business development. Cambridge: Cambridge University Press.
Rego, A., Cunha, M. P., & Polónia, D. (2017). Corporate sustainability: A view from the top. Journal of Business Ethics, 143(1), 133–157.
Rizos, V., Behrens, A., Van Der Gaast, W., Hofman, E., Ioannou, A., Kafyeke, T., et al. (2016). Implementation of circular economy business models by small and medium-sized enterprises (SMEs): Barriers and enablers. Sustainability, 8(11), 1212.
Schwartz, M. S., & Carroll, A. B. (2008). Integrating and unifying competing and complementary frameworks. The search for a common core in the business and society field. Business and Society, 47(2), 148–186.
Stubbs, W., & Cocklin, C. (2008). Conceptualizing a ‘sustainability business model. Organization and Environment, 21, 103e127.
Taranic, I., Behrens, A., & Topi, C. (2016). Understanding the circular economy in Europe, from resource efficiency to sharing platforms: The CEPS framework. Centre for European Policy Studies, No. 143.
The World Bank. (2010). Waste generation. http://siteresources.worldbank.org/INTURBANDEVELOPMENT/Resources/336387-1334852610766/Chap3.pdf
The World Bank. (2012). What a waste. A global review of solid waste management. https://siteresources.worldbank.org/INTURBANDEVELOPMENT/Resources/336387-1334852610766/What_a_Waste2012_Final.pdf
Wang, L. (2014). Construction on cluster green supply chain based on circular economy. Contemporary Logistics, 16, 78–82.
WBCSD. (2017). CEO guide to the circular economy. https://www.basf.com/documents/corp/en/sustainability/publications/2017/CEO_Guide_to_the_Circular_Economy.pdf
Weill, P., & Vitale, M. (2001). Place to space: Migrating to e-business models. Boston: Harvard Business Press.
Wieser, H. (2016). Beyond planned obsolescence. Product lifespans and the challenges to a circular economy. GAIA, 25(3), 156–160.
Yong, R. (2007). The circular economy in China. Journal of Mater Cycles Waste Management, 9, 121–129.
Yuan, Z., Bi, J., & Moriguichi, Y. (2006). The circular economy: A new development strategy in China. Journal of Industrial Ecology, 1–2, 4–8.
Zott, C., Amit, R., & Massa, L. (2011). The business model: Recent developments and future research. Journal of Management, 37(4), 1019–1042.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2019 Springer Nature Switzerland AG
About this chapter
Cite this chapter
Aluchna, M., Rok, B. (2019). Closing the Loop: Circular Economy Through Sustainable Innovation Lens. In: Capaldi, N., Idowu, S.O., Schmidpeter, R., Brueckner, M. (eds) Responsible Business in Uncertain Times and for a Sustainable Future. CSR, Sustainability, Ethics & Governance. Springer, Cham. https://doi.org/10.1007/978-3-030-11217-2_2
Download citation
DOI: https://doi.org/10.1007/978-3-030-11217-2_2
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-030-11216-5
Online ISBN: 978-3-030-11217-2
eBook Packages: Business and ManagementBusiness and Management (R0)