Supply chain collaboration and sustainability performance in circular economy: A systematic literature review

Abstract

With the emergence of the circular economy (CE), conventional supply chains are transitioning towards circular supply chains (CSCs) that achieve improved sustainability performance. Inter-organisational relationships across supply chains need to be redefined to achieve this. We perform a systematic literature review to examine how collaboration may improve sustainability performance in implementing circularity in supply chains. A content analysis has been conducted on 82 journal articles published in the last five years using deductively derived constructs related to supply chain collaboration practices, CE implementation strategies, and sustainability outcomes. Further, a contingency analysis has been conducted to enhance the findings of the content analysis and understand the associations among constructs. Based on the analysis, a conceptual framework is developed to identify appropriate collaboration practices to enhance symbiotic relationships internally and externally in CSCs to improve sustainability performance. Sharing information, penalties and incentives, sharing responsibility for product recovery, risk-sharing, and joint product design are the prominent external vertical collaboration practices advocated for successful CE implementation. Cross-functional coordination and collaboration with government agencies are the most acknowledged internal and external horizontal collaboration practices, respectively. The study reflects that the main focus of CSCs is on improving environmental and economic aspects rather than social performance. The engagement of external parties such as governmental, non-governmental organisations, entrepreneurs, and research institutes complements managerial understanding on collaboration to improve the sustainability performance of CSCs. The study provides a foundation for future empirical work to assess the implications of different collaboration practices in CSCs.