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Circular Economy Principles and Responsible Manufacturing: Assessing Implications for Resource Conservation, Emission Reduction, Cost Performance, and Environmental Legitimacy

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Circular Economy Strategies and the UN Sustainable Development Goals

Part of the book series: Sustainable Development Goals Series ((SDGS))

Abstract

Research reveals that manufacturing firms in developed economies have proactively responded to adopting circular economy principles. However, empirical research gaps exist concerning whether businesses still operate ‘Take, Make and Dispose of’ models in emerging economies. Drawing insights from the institutional and natural resource-based view theories, this chapter explores whether adopting circular economy principles is an antecedent to responsible manufacturing, resource conservation, and emission reduction. In addition to examining the impact of responsible manufacturing, resource conservation, and emission reduction on cost performance and environmental legitimacy, the chapter highlights the mediating mechanisms of resource conservation and emission reduction between responsible manufacturing, cost performance, and environmental legitimacy. Using a quantitative survey approach, 282 responses from manufacturing firms in Ghana are analysed using SmartPLS. The results indicate that adopting circular economy principles significantly predicts responsible manufacturing, resource conservation, and emission reduction. The effects of resource conservation and emission reduction on environmental legitimacy and cost performance were positive and significant. Although responsible manufacturing had an insignificant impact on environmental legitimacy, its effects on resource conservation, emission reduction, and cost performance were significant. The results further revealed that emission reduction partially and fully mediated the relationships between responsible manufacturing, environmental legitimacy, and cost performance. In contrast, resource conservation presented full and no-mediation effects between the same. The chapter suggests that the growing circular orientation of manufacturing SMEs in emerging economies is driven by the need to gain environmental legitimacy and cost reduction. Building on these findings, implications are highlighted for managers, academicians, and policymakers.

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Authors and Affiliations

  1. Business and Accounting Discipline, Faculty of Arts and Society, Charles Darwin University, Darwin, NT, Australia

    Charles Baah

  2. Business School, University of Bristol, Bristol, UK

    Ebenezer Afum

  3. School of Management and Marketing, Curtin University, Perth, WA, Australia

    Yaw Agyabeng-Mensah

  4. School of Management Operations, and Marketing, University of Wollongong, Wollongong, NSW, Australia

    Douglas Opoku Agyeman

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  1. Charles Baah
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  2. Ebenezer Afum
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  4. Douglas Opoku Agyeman
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Editors and Affiliations

  1. Business and Accounting Discipline, Faculty of Arts and Society, Charles Darwin University, Darwin, NT, Australia

    Michael Odei Erdiaw-Kwasie

  2. Department of Agribusiness under the Faculty of Agricultural Economics and Rural Development, Bangabandhu Sheikh Mujibur Rahman Agricultural University, Gazipur, Bangladesh

    G. M. Monirul Alam

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Baah, C., Afum, E., Agyabeng-Mensah, Y., Agyeman, D.O. (2023). Circular Economy Principles and Responsible Manufacturing: Assessing Implications for Resource Conservation, Emission Reduction, Cost Performance, and Environmental Legitimacy. In: Erdiaw-Kwasie, M.O., Alam, G.M.M. (eds) Circular Economy Strategies and the UN Sustainable Development Goals. Sustainable Development Goals Series. Palgrave Macmillan, Singapore. https://doi.org/10.1007/978-981-99-3083-8_10

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