Circular Economy and Green Innovation for Sustainable Business Development

Dear Colleagues,

The concept of a circular economy (CE) has been advocated for across various disciplines as a substitute for conventional linear models that rely on the extraction, production, utilization, and disposal of resources. This paradigm shift envisions the transformation of existing models towards an economy characterized by zero emissions and waste (Schaltegger et al., 2023; Llena-Macarulla et al., 2023; Ahmad, Bask, Laari, & Robinson, 2023). CE focuses on the “reduce, reuse, recycle, and regenerate” principles, aiming to minimize waste and to promote sustainability (Ellen MacArthur Foundation, 2015). This encompasses the adoption of novel business models, along with the integration of material loops in diverse activities and sectors within the CE framework. In the business context, it involves adopting practices that enhance resource efficiency and reduce environmental impacts (Benito-Bentué, Marco-Fondevila, & Scarpellini, 2022; Matos, Martins, Simoes, & Simoes, 2023).

Green innovation (GI) is a key and comprehensive approach that involves developing sustainable solutions and technologies to address environmental challenges and to promote sustainability. Through GI, the way we develop and use technologies is transformed to align them with the sustainable development goals while seeking environmental conservation. In the field of business, it encompasses the creation of environmentally friendly products, processes, and business models (Klewitz & Hansen, 2014) that minimize ecological footprints.

The following are included in this type of innovation: i) those aimed at achieving certain environmental objectives, such as reducing the environmental impact of human activities; creating products, services, and processes that minimize ecological footprints; reducing greenhouse gas emissions; and conserving natural resources; ii) those aimed at achieving energy efficiency, such as the development of technologies that reduce energy consumption, the use of renewable energy sources, and the use of more sustainable energy systems; and iii) eco-design innovations. GI involves incorporating principles such as waste minimization and the use of sustainable materials in the new life cycles of products.

GI also aligns with the principles of CE, since it seeks to close off material cycles and to promote the reuse, recycling, and regeneration of resources to reduce dependence on virgin raw materials, minimizing the generation of waste. The synergy between CE and GI is essential for fostering sustainable business development. This entails not only compliance with environmental regulations but also proactive approaches to reduce reliance on finite resources, to promote energy efficiency, and to create environmentally friendly products and services (Rizos et al., 2016). The goal is to contribute to both ecological and economic sustainability.

In summary, the integration of CE principles and GI is pivotal for sustainable business development, addressing environmental challenges, and creating opportunities for responsible business growth.

• Ahmad, F., Bask, A., Laari, S., & Robinson, C.V. (2023) “Business management perspectives on the circular economy: Present state and future directions”. Technological Forecasting and Social Change. 187, 122182. https://doi.org/10.1016/j.techfore.2022.122182
• Benito-Bentué, D., Marco-Fondevila, M., & Scarpellini, S. (2022) “Financial Institutions Facing the Challenge of the European Taxonomy of Sustainable Investments and the Circular Economy Disclosure”. UCJC Business and Society Review, 19 (73), 120–161. https://doi.org/10.3232/UBR.2022.V19.N2.03
• Ellen MacArthur Foundation (2015) “Towards the Circular Economy: Economic and Business Rationale for an Accelerated Transition”. Disponible en: Ellen MacArthur Foundation – Publications.
• Klewitz, J., & Hansen, E.G. (2014) “Sustainability-oriented innovation of SMEs: A systematic review”. Journal of Cleaner Production, 65, 57-75.
• Llena-Macarulla, F., Moneva, J.M., Aranda-Usón, A., & Scarpellini, S. (2023) “Reporting measurements or measuring for reporting? Internal measurement of the Circular Economy from an environmental accounting approach and its relationship”. Revista de Contabilidad, 26 (2), 220-212. https://www.doi.org/10.6018/rcsar.467751
• Matos, J., Martins, C., Simoes, C.L., & Simoes, R. (2023) “Comparative analysis of micro level indicators for evaluating the progress towards a circular economy”. Sustainable Production and Consumption, 39, 521-533. https://doi.org/10.1016/j.spc.2023.06.002
• Rizos, V., Behrens, A., & Kafyeke, T. (2016) “The Circular Economy: Barriers and Opportunities for SMEs”. CEPS Working Document No. 428. Disponible en: CEPS – Circular Economy for SMEs.
• Schaltegger, S., Loorbach, D., & Hörisch, J. (2023) “Managing entrepreneurial and corporate contributions to sustainability transitions”. Business Strategy and the Environment, 32, 891-902. https://doi.org/10.1002/bse.3080

Prof. Dr. Dolores Gallardo Vázquez
Dr. Inna Choban de Sousa Paiva
Guest Editors

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• circular economy
• green innovation
• sustainable business models
• economic performance