Seeking circularity: The role of government initiatives in facilitating circular business model transformation in SMEs

The article conceptualises the theoretical and applied provisions of transformation of business models of agricultural enterprises on the basis of circular economy. It is noted that the strategies of the circular economy include the development of product processing (closing the cycle), increasing resource efficiency (narrowing the use of resources), extending the phase of product use (expansion), more intensive use of products (intensification), and replacing products with services and software solutions (dematerialisation), and it is proposed to understand the circular model as a business model that allows for product processing, expansion of the use of materials and energy, and dematerialisation. The main ways of forming circular business models are identified, including start-up, business model diversification, business model transformation, business model acquisition (take-over). A list of tools for creating a business model based on the principles of the circular economy has been compiled: business cycle canvas, sustainable innovative circular business model framework, circular business model framework, adapted sustainable business model framework, circular business model mapping. The tools for forming a business model based on the circular economy provide companies with a structured approach to the development and implementation of circular business models, promoting sustainable development and increasing the efficiency of resource use. The author proves that agriholdings, as the main players in the agricultural sector, have a significant impact on the environment. Implementation of the principles of circular economy allows minimising this impact by reducing waste and using resources more efficiently. This is in alignment with global sustainable development goals aimed at preserving natural resources for future generations. Successful cases of transformation of agriholdings' business models based on the circular economy are studied, which demonstrate how agriholdings can successfully transform their business models based on the circular economy, achieving sustainable development, economic benefits and reducing negative environmental impact.

This study explores the integration of digitalization and circular economy (CE) principles within the maritime industry through a theoretical analysis, proposing a framework that aligns business models with Sustainable Development Goals (SDGs) and net-zero objectives. By investigating how digital servitization and circular business models can drive economic, social, and environmental outcomes, this research provides valuable insights into sustainable value creation and capture across maritime value chains. The theoretical analysis covers the evolution of business models, emphasizing their collective role in fostering sustainable transformation within the maritime sector. The central idea of this study is a sustainable value mapping approach that aligns product–service systems (PSSs) with circular economy principles, incorporating lifecycle thinking (LCT) to capture the full environmental, economic, and social impacts. This broader perspective on the economic value proposition highlights the need for a shift from selling products to offering servitized products, acknowledging the importance of sustainability across the entire product lifecycle. This framework offers actionable guidance for maritime stakeholders committed to transitioning their value chains towards sustainable, circular models, addressing both production and consumption dimensions to achieve broader environmental and social benefits.

NOTE: THIS ARTICLE WAS PUBLISHED WITH THE INFORMING SCIENCE INSTITUTE. Aim/Purpose................................................................................................................................................................................................. The main objective of the current study is to develop a business model for service providers of cloud computing which is designed based on circular economy principles and can ensure the sustainable consumption. Background Even though the demand for cloud computing technology is increasing day by day in all over the world, the current the linear economy principles are incapable to ensure society development needs. To consider the benefit of the society and the vendors at the same time, the principles of circular economy can address this issue. Methodology................................................................................................................................................................................................. An extensive literature review on consumption, sustainable consumption, circular economic, business model, and cloud computing were conducted. the proposed model of Osterwalder, Pigneur and Tucci (2005) is admitted designing the circular business model. Contribution................................................................................................................................................................................................. The proposed model of the study is the contribution of this study where provides the guidelines for the cloud computing service providers to achieve both their economic profits and the society’ needs. Findings Finding reveals that if the cloud computing service providers design their business model based on the “access” principle of circular economy, they can meet their economic profits and the society’ needs at a same time. Recommendations for Practitioners.............................................................................................................................................................. It is recommended to the startup and the existing businesses to utilize the proposed model of this study to reach a sustainable development. Recommendation for Researchers................................................................................................................................................................ It proposes a new circular business model and its linkages with community building. Impact on Society............................................................................................................................................................................................ The proposed model of the study provides guidelines to the cloud computing service providers to design a business model which is able not only to meet their economic profit, but also to meet the society’s and customers’ benefits. Future Research............................................................................................................................................................................................... Future researches can build on this research model which proposed in this study to examine the limitations of this model by using empirical researches.

Introduction. This case study examines the economic justification for the implementation of a circular economy. The case study is structured in 2 parts. The first part describes the principles of circular economy and business models, covering the theoretical basis of this study. The theoretical basis includes a description of the principles of circular economy and the possible implementation of these principles in business operations. The second part evaluates the impact of the introduction of circular economy principles and business model on the company's financial performance and company value. The methods used are economic evaluation and investment decision methods and financial analysis, modeling and forecasting. The limitations are the research based on one company and the fact that the financial statement for 2019 was not submitted at the time of writing; however the results obtained are applicable to other companies and industries. The principles of circular economics and business models described in this case study can serve as a example for companies considering implementing the principles of circular economy in business operations. Aim and tasks. The purpose of the study is to determine what the principles of circular economy are, how to implement them in business and how their implementation affects business results and company value. Following tasks have been defined in order to achieve the aim: describe the principles of circular economy, business and financing models; to analyze the business models of the circular economy in Latvia and in the world and to evaluate the impact of the implementation of the principles of circular economy and business model on the company's financial indicators and the company's value. Results. Evaluating the investments made by the company AS “Cēsu Alus” and the planned investment projects related to the modernization of production equipment and improvement of efficiency, it can be concluded that the implementation of circular economy investment projects will be profitable. The company has opportunities to continue the investment project program; moreover, based on the experience of similar companies studied, AS “Cēsu Alus” can create additional revenue streams for the company when adopting circular economy principles. Conclusions. Investing the company's funds in investment projects designed to improve the company's efficiency, ensuring resource savings and efficient use, which in turn leads to financial savings, the company's value increases significantly, thus concluding that circular economy investment projects that save resources and improve the efficiency of the company will make the greatest contribution to increasing the value of the company.

Business models for circular economy keep products alive and operating for as long as possible during their use and consumption. Business model (BM) innovation in the circular economy (CE) helps firms design their BMs based on CE principles and identify new value-creation opportunities. Since research on the design of circular business models (CBM) is at an early stage, there is a lack of unified terminologies, and the meanings and relationships between the various CBM archetypes are unclear. This study aims to review and analyze existing emerging BMs in CE from peer-reviewed journals and recommend future research directions. The systematic review of 76 research articles resulted in identifying 23 CBM archetypes. This study analyzes the CBM archetypes based on descriptions, examples, similarities in the terminologies, and the frequency of use in the literature. The review identifies the three widely adopted CBM classification frameworks, the ReSOLVE framework (Ellen MacArthur Foundation), Accenture’s CBM framework, and the CBM strategies by Bocken et al. Most of the studies in this review combine BMs derived from several classification approaches to categorize suitable BM archetypes for the CE, which illustrates the lack of comprehensive classifications. The key findings show that providing access to a product’s functionality, recycling materials that would otherwise be sent to landfills, and restoring the functionality of existing products (re-manufacturing/refurbishing) are the most discussed archetypes in CBM literature, and other types do not get adequate attention. Future studies should examine BMs that have not received enough attention and provide a comprehensive classification of CBMs that clarifies their meaning and relationships. With this study, we contribute to advancing the body of knowledge in CBM and help practitioners in developing new CBMs.

The aim of the article is to justify the feasibility of implementing circular business models as an effective tool for achieving sustainable development goals, analyze the interconnection between different circular processes and business models, and evaluate the potential for their practical application. Methodology. The article uses a systems approach to study the circular economy as an alternative to the linear model. Comparative analysis, modeling, and systematization methods are applied to develop a cycle-centric product lifecycle model and to characterize circular business models. Basedon the case method, the practical experience of implementing circular economy principles by IKEA is analyzed. Results. The essence of the circular economy concept is revealed, and its key processes, based on the principles of reducing resource usage, reuse, repair, recycling, resource recovery, and modification, are identified. A cycle-centric product lifecycle model was developed, visualizing the transformation from a linear to closed cycle and demonstrating the interconnection between different stages of resource utilization in a circular economy. Five main business models of the circular economy are analyzed: circular supplies, resource recovery, platforms for exchange and sharing, extending the product life cycle, and the "product as a service" concept. The interconnection between each business model and corresponding circular processes that ensure its functioning was determined. Scientific novelty. The developed cycle-centric product lifecycle model reflects the transformation from a linear economic model to a circular one. The interconnection between circular business models and corresponding circular processes that ensure their functioning was established. A systematization of circular business models with detailed descriptions of their features and potential for achieving sustainable development goals is proposed. Practical significance. The research results allow companies to identify optimal circular business models for implementation, considering their specific activities and available resources The analysis of IKEA's experience provides practical recommendations for implementing circularity principles in company operations. The research results allow companies to determine the optimal circular business models for implementation, considering the specifics of their activities and available resources.

Circular economy and paradox theory: A business model perspective

Recently the circular economy has got a lot of attention within discussions of policy makers, academics and practitioners. The circular economy proposes the treatment of environmental and climate change problems, simultaneously promising benefits for the business. The circular economy promotes the reduction of the consumption and reuse or recycling of the resources that in various aspects contradicts traditional business models that stream to linear growth of sales of their products. Yet the circular economy concept has been more discussed regarding its global scale, but there is a lack of scientific discussions about the approaches of the adoption of circular economy principles on the business level. This paper conceptualises multi-level dimensions of the circular economy and highlights challenges related to the perception of the circular economy principles in the micro business level. The conducted research shows that rural SMEs of six EU countries have rarely heard about the circular economy and even less about circular business models. While rural SMEs are more familiar with the bio and green economies forming good base for developing circular business models, they are reluctant towards introducing new business models. This paper aims to assess the level of the advancement in introduction of the circular business models among rural SMEs of EU countries. This article emphasizes the circular economy as an inseparable part of the business models of rural SMEs and rural economies of EU countries. This study has a policy implication as we suggest that the government should play an important role in promotion of circular business models in rural SMEs. The existing public support system is fragmented, and in most cases just incidentally encourage rural SMEs to adopt new circular business models. Also, the circular economy on a local level, especially in rural areas, has an important role in ensuring social wellbeing of local inhabitants. The methodological approach and research results presented in the paper can be used further developing EU support system and priorities beyond 2020.

Purpose This paper aims to gain insights into the paradoxical tensions emerging from circular business model innovation (CBMI) and how to overcome them by developing a theoretical framework drawing on two theoretical streams: firstly, the paradox theory for shedding light on the often “invisible” contradictions generated by the implementation of circular economy (CE) principles in business model transformation; and secondly, the dynamic capability theory that can contribute to the investigation of how to manage these contradictions. Design/methodology/approach The study uses a longitudinal case study approach to gain an in-depth understanding of the transformation and challenges faced by an incumbent firm in adopting a circular business model. Qualitative research methods are used to explore the paradoxical tensions and dynamic capabilities involved in the process. Findings The study finds that incumbent firms face numerous challenges and paradoxical tensions in the CBMI process. These tensions arise from difficulties in implementing organizational changes, balancing competing priorities and managing conflicting goals. Dynamic capabilities are crucial in managing these tensions and facilitating the transition to a circular business model. Research limitations/implications This paper contributes to the theoretical development of paradox theory by applying it to the new field of CBMI which is currently slightly investigated and responds to the call for studies looking at more fine-grained types of sustainable business models. The study adds to previous literature that how the firm handles paradoxes and tensions influences the pace and results of the process. If the firm becomes discouraged during the early stages of identifying new opportunities, the pace slows down, and the firm becomes hesitant to collaborate more with partners. Furthermore, the ability to capitalize on these opportunities is affected by these tensions and contradictions. Originality/value This paper contributes to the literature by empirically investigating the process of CBMI in incumbent firms. It fills the gap in existing research by examining the existence of paradoxical tensions in a real-life setting and exploring the role of dynamic capabilities in managing these tensions. The findings provide practical insights for firms seeking a transition towards a CE and highlight that the ability to sense the external context should be developed as the new business model entails a central role of external actors.

In recent years, exploring business models (BMs) within the circular bioeconomy (CBE) framework has gained increasing prominence in academic discussions, driving transformation across various industries. This research focuses on the textile-fashion (T-F) industry, a sector with significant environmental impact, to examine how innovative BMs can enhance sustainability. By aligning with circular economy (CE) principles - emphasizing resource efficiency, waste reduction, and sustainable development - and leveraging the pathways of CBE, pathways that prioritize renewable biological resources such as plants, animals, and microorganisms, the study explores the potential of green circular business models (GCBMs). Using a qualitative research approach, we review key studies on BMs to assess their alignment with the CBE vision and identify models suitable for implementation. Additionally, we propose and refine a conceptual managerial model through case study analysis within the T-F industry, offering actionable insights for industry stakeholders. This study contributes to BMs research highlighting a significant role for innovative BMs in driving sustainable practices, particularly through the adoption of green circular business models (GCBMs) that align with the green and circular principles. The findings underscore the role of CBE-aligned BMs in fostering competitive advantage, promoting responsible industry practices, and advancing global sustainability goals. This research provides a practical guide for managers and industry leaders seeking to embed circularity and sustainability into their strategies within the CBE framework. • Contex : The circular bioeconomy (CBE) integrates circular economy (CE) and bioeconomy principles to enhance sustainability. CE minimizes resource use and extends product life cycles, while the bioeconomy utilizes renewable biological resources and biotechnology. Despite their synergy, integration remains underdeveloped, particularly in textiles and fashion (T-F), which face environmental challenges. Innovative business models (BMs) aligning with CBE are essential, with business model innovation (BMI) enabling sustainable value creation. However, implementing green circular business models (GCBMs) is complex due to definitional ambiguities and adoption barriers. This study explores effective GCBM integration in T-F to foster circularity and sustainability. • Literature: Existing literature emphasizes the role of CE and bioeconomy in sustainable industries, yet a unified framework integrating both is lacking. Carus and Dammer (2018) note their shared goals but distinct domains. Research on BMI shows circular and bio-based approaches enhance sustainability (Santa-Maria et al., 2022; Guo et al., 2022), though GCBM implementation in T-F remains underexplored, particularly in economic feasibility and scalability. Scholars highlight the need for deeper theoretical insights on BMI in CBE (Salvador et al., 2023) and the lack of consensus on green business model definitions (Trapp & Kanbach, 2021). This study addresses these gaps by structuring BMI integration within CBE for T-F sustainability. • Contributions - What are the main scholarly and practical contributions of your study? This study advances the understanding of CBE-aligned BMs in promoting sustainability in the T-F industry. It fills a key literature gap on the intersection of CE and bioeconomy, refining the concept of GCBMs and contributing to BMI research by identifyng factors influencing sustainable business adoption. The study also strengthens leadership and change management models within CE transition. Practically, it provides industry leaders and policymakers with actionable strategies for circular and bio-based integration. By proposing a roadmap for circularity, it offers guidance for companies adopting sustainable practices. Additionally, it underscores the role of managerial innovation in fostering environmental and social responsibility, emphasizing collaboration among businesses, governments, and stakeholders. Finally, it enriches academic discussion and several ad a strategic resources for sustainability-driven practitioners.

The transition to a Circular Economy (CE) is paramount in fostering sustainable business practices. Recent research highlights a surge in circular innovations, showcasing strong technological solutions, e.g. regarding recyclability or durability, and innovative disruptive ideas for novel business models, such as sharing or repairing concepts. These concepts are often utilized by newly founded enterprises. However, existing Small and Medium Enterprises (SMEs) encounter challenges in adjusting to these new developments and are in need for support to evolve their established business model towards circularity. This paper addresses this gap by proposing a hands-on process for SMEs aiming to embrace more circular practices. The process comprises several steps, starting with an assessment and analysis of the existing business model in alignment with circular economy principles, followed by an exploration of circular economy potentials within the business context. Furthermore, the steps outline specific circular business model patterns and tailored measures resulting in individual action items for the circular transformation of the enterprise’ business model. Through practical implementation, this approach equips enterprises with a structured process for evaluating, refining, and implementing circular business practices.

Educational level: Bachelor / Master This book offers a comprehensive roadmap toward a circular and sustainable healthcare system, structured into three distinct parts. Part I describes circular principles and policy tactics. Chapter 1 outlines the essentials of sustainable healthcare and designates the paradox in daily practice of sustainability and the circular economy. In Chapter 2 the impact of leadership on policy together with best practices is discussed. The legislation and infrastructural web, in which many stakeholders and circular economy initiatives are strangled, is described. Despite the fact that politicians and policymakers are motivated to encourage sustainability, the infrastructure is designed to discourage circular economy projects. This chapter shows examples of setting-up intrinsic motivated teams of hospital staff, green teams, industry leaders and scientific motivated research teams. Swimming against the current is about the legislation paradox. In chapter 3 described as how legislation should be redesigned to accomplish the goals as set out in the green deal and the climate law. Part II serves as a practical guide to implementing circular strategies. In chapter 4 the reader is guided through the fundamentals of circular strategies by visualizing the circular economy. Chapter 5 reveals successful design strategies for products and processes which contribute to a zero-waste society. Using recycled materials by using waste as input for new products is described in chapter 6. In chapter 6 we will explore (surgical) waste as input for new products. Recycled should and could be used more. This is a fundamental concept within circular design principles but hardly used until this moment. Part III explores circular economy design principles on basis of successful examples. This part dives into real-world applications and measurable outcomes. It showcases successful circular design concepts and business models that have reshaped the market. Chapter 7: Is about leading by design. Success stories of circular concepts which have effectively changed the market with circular products and services are designated. Also entrepreneurial success stories of circular economy business models are presented. Chapter 8 investigates how to measuring effectiveness and impact of circular economy products and processes. In particular how reliable some facts are which are used by many to sell products or introduce new policies or legislation. How trustworthy is data from life cycle assessments (LCA’s)? What are the pitfalls? Is it possible to manipulate these data? Why should we characterize one-sided data from an LCA as greenwashing? Circular Economy principles, sustainability and, in broader sense, the climate discussion seem to trigger emotions. Using fundamental and reliable data is essential in order to be able to judge whether a product or process indeed reduces CO2 emissions is essential in decision-making. Chapter 9 focusses on how universities can contribute to sustainable solutions by presenting different cases which resulted in actual results which were implemented or are ready for upscaling. The role of universities as innovation hubs is highlighted through case studies with proven impact. The final chapter offers a reflective and forward-looking analysis on how circular strategies in healthcare can shape future societal developments. The authors reflect on the content in chapter 10. A final part in which a critical analysis is presented and the impact it could have on future developments and the society.

Characterizing Circular and Open Business Models in a profit-driven environment through Business Model Patterns

The circular economy (CE) is widely acknowledged as a highly promising and powerful alternative to the linear economy, representing one of the most significant advancements toward sustainability. Accelerating the transition to the CE requires the adoption of new circular business models (CBMs) by small and medium-sized enterprises (SMEs), given their central role in sustainable development and global economic growth. Despite extensive research on the CE and CBMs reported in the literature over the past decade, there have been limited publications focusing on the transition of SMEs to the CE through the adoption of CBMs. Specifically, there is a lack of frameworks, models, and practical tools for assessing the CE readiness of SMEs and supporting them in the adoption of CBMs. This paper presents an approach to conceptualizing and subsequently operationalizing the circular readiness assessment framework (CRAF), which provides a conceptual foundation for the development of a tool to assist SMEs, aiming to adopt new CBMs, in evaluating their current readiness to perform business processes and activities following CE principles. The framework consists of five key dimensions: sustainable use of materials, efficient utilization of capacity and resources, extended life cycle of machines and equipment, maximizing product and material value, and leveraging customer relationships. These dimensions represent the identified business process and activity areas essential for the effective adoption of CBMs but are often underperforming. The framework was operationalized by developing and testing the self-assessment tool through interviews with the most knowledgeable members of 19 Finnish SMEs across various manufacturing industry and service sectors. Subsequently, it was refined based on the findings, which complement previous research on challenges SMEs encounter in adopting CBMs. Although the 19 SMEs were already taking significant steps toward implementing CE principles in their processes, particularly in resource-efficient production development, many firms still faced difficulties in identifying a suitable CBM and aligning their processes with it. The findings also revealed that many SMEs, despite lacking in-depth expertise and familiarity with CE principles and related terminology, have integrated these principles into their processes and activities, indicating a strong motivation to renew their businesses with CBMs.

The maritime domain is a very broad domain encompassing ship design, construction, transportation, export–import, port management, energy, ocean, and waterways management. The assumption that the marine industry is less flexible for a transition from linear economy to circular economy (CE) is being challenged. A ship is a factory/city in motion, and therefore, CE principles may be applied to a ship. CE principles can be applied to ports, energy, and waterways management. Successful implementation of CE requires a comprehensive mapping of business models, projects, products, and services; identification of all stakeholders; and using biomimicry in manufacturing. CE can help in the regeneration and restoration of natural capital. The circular business models can help in increasing revenue, reducing costs, and saving the environment. CE can be extended to include reimagining, realigning, reworking, and reaching out to different players in the maritime domain. The marine industry faces the challenges of decarbonization and end-of-life vessel management.