What is the relation between circular economy and sustainability?: Answers from frontrunner companies engaged with circular economy practices

Abstract

The circular economy (CE) concept has become a major interest for companies, promising new business opportunities and a decrease in environmental impacts. Though research on circular business models has recently increased, few scholars have investigated how companies engaged with CE view the connection between CE and sustainability. To address this gap, this paper uses a semi-quantitative survey and semi-structured interviews conducted with companies based in Italy and the Netherlands. Purposive sampling was employed to target firms associated with national and international CE networks, as these companies already engage with CE practices. The survey was distributed online to over 800 firms, of which 155 provided information on their understanding of the CE concept and its relationship with sustainability. The survey results are complemented through findings from 43 interviews with a subset of the survey respondents. The survey answers show that companies view CE as one of the tools to achieve sustainable development, particularly in the environmental domain, where the focus lies on environmentally friendly resource use. Yet, the respondents are less confident whether CE increases economic and social benefits of firms. Interviews show that a majority of respondents position sustainability as the overarching concept. However, most companies advocate that the private sector should strive for both sustainability and circularity, though the distinction between the two concepts in daily business operations seems synthetic and futile to some. These findings provide an important stepping stone for better understanding how firms could apply CE practices to move towards a more sustainable society.