Sustainability assessment in circular inter-firm networks: An integrated framework of industrial ecology and circular supply chain management approaches

Abstract

Circular economy has become a central concept of sustainable production and consumption since its introduction into the public eye. However, to ensure circular economy actually delivers on its promises regarding sustainability, it is vital to anticipate and assess the impact of circular economy practices in an integrated way. For that purpose, holistic assessments are crucial to enable transparent decision-making, clearly indicating possible trade-offs. While previous literature has mainly focused on product, company or country level, this paper contributes to an improved understanding of sustainability assessments on the inter-firm level. Given the vital role of inter-firm networks in the transition to a circular economy, the authors present a systematic literature review of sustainability assessment approaches applicable within circular inter-firm networks. These networks are primarily represented in two related fields relevant to circular economy: industrial ecology offers sustainability assessment approaches for inter- and intra-sectoral business activities at different scales, whereas circular supply chain management is a promising source for sustainability assessment approaches considering product life cycles. Over 100 academic publications are reviewed and categorised according to assessment type, correspondence to the relevant field, and sustainability dimensions addressed. The results demonstrate that life cycle-based methodologies as well as indicator frameworks, often combined with multi-criteria decision-making methods, are the most common ex-post assessment approaches. Concurrently, the most frequent ex-ante assessments are based on mathematical programming. It is further observed that industrial ecology-related publications present more comprehensive environmental assessments, while circular supply chain management literature includes the social dimension more often, but superficially. Overall, the social dimension is least assessed and least integrated into the sustainability assessment. Based on the findings of the review, an integrated framework of approaches is developed, enabling decision-makers to identify suitable sustainability assessment approaches for circular inter-firm networks.