Abstract
The shift towards a more resource efficient circular economy has become a necessity in the wake of current ecological, economic and social sustainability challenges. Mirroring circular-related developments in policy and business quarters, the circular economy literature is growing as a distinct field of academic enquiry. Yet, the conceptual and theoretical foundations of circular economy thinking need consolidation. Drawing from strategic management, sustainability transitions and systems theories, this article establishes some theoretical anchoring for circular economy business models. It finds that circular business models contribute to an understanding of both competitive advantage and the systemic nature of business. It also develops a future agenda for management research at the interface between the circular economy and business models.
Highlights
The state of the planet Earth is appalling
This research unveils that the theoretical coupling of circular business models (CBMs) can be informed by an interpretive repertoire comprising strategic management theories as well as transitions and systems theories
The strategic management perspective is useful to highlight the competitiveness logics underlying CBMs and it is pertinent to advance the current understanding of circular economy (CE) business strategies
Summary
The state of the planet Earth is appalling. Biodiversity is falling, with 1 million species at risk of extinction; deserts are spreading; forests are being lost; coral reefs are dying; carbon emissions keep rising, and oceans are devastated by overfishing and plastic waste [1]. In the light of the escalating ecological crisis and following Hart’s (1995) [24] line of argument, De Angelis (2018) [44] notes that the attainment of a sustained and sustainable competitive advantage requires the development of resources and capabilities for managing natural resources more efficiently and effectively, which is at play when implementing BMs based on CE principles She argues that competitiveness logics support the case for adopting CBMs. While resource-based theories help with the positioning of the CBM concept within the strategic management field linking CBMs to competitive advantage, they are only partially fit for the purpose of the theoretical coupling of CBMs. The NRBV of the firm rightly portrays firms in relation to a wider organisational context [67]. The systemic thinking underlying CE principles and practices points to the appropriateness of system theory to develop the theoretical anchoring of CBMs and highlights that the CBM concept is useful to portray the systemic nature of business
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