Circular business models based on remanufacturing and reuse promise significant cost savings as well as radical reductions in environmental impact. Variants of such business models have been suggested for decades, and there are notable success stories such as the Xerox product–service offering based on photocopiers that are remanufactured. Still, we are not seeing widespread adoption in industry. This paper examines causes for reluctance. Drawing on a hypothesis‐testing framework of business model innovation, we show that circular business models imply significant challenges to proactive uncertainty reduction for the entrepreneur. Moreover, we show that many product–service system variants that facilitate return flow control in circular business models further aggravate the potential negative effects of failed uncertainty reduction because of increased capital commitments. Through a longitudinal action research study we also provide a counterexample to many of the challenges identified in previous studies, which could be overcome in the studied case. Copyright © 2015 John Wiley & Sons, Ltd and ERP Environment

Summary Circularity metrics are useful for empirically assessing the effects of a circular economy in terms of profitability, job creation, and environmental impacts. At present, however, there is no standardized method for measuring the circularity of products. We start by reviewing existing product‐level metrics in terms of validity and reliability, taking note of theoretically justified principles for aggregating different types of material flows and cycles into a single value. We then argue that the economic value of product parts may constitute a useful basis for such aggregation; describe a set of principles for using economic value as a basis for measuring product circularity; and outline a metric that utilizes this approach. Our recommendation is to use the ratio of recirculated economic value to total product value as a circularity metric, using value chain costs as an estimator. In order to protect value chain actors’ sensitive financial data and facilitate neutrality regarding outsourcing or insourcing, we suggest a means to calculate product‐level circularity based on sequential approximations of adding one product part and activity at a time. We conclude by suggesting potential avenues for further research, including ways in which the proposed metric can be used in wider assessments of the circular economy, and ways in which it may be further refined.

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Numerous investigations have indicated that projected climate change will impact strongly on forest growth and composition. To adapt managed forests to changing environmental conditions it may be necessary to modify traditional forest management strategies. An extended version of a forest gap model was applied to a managed forest district in northeastern Germany. The model was initialized with forest inventory data and run using routines devised to simulate three management scenarios: (1) maximized timber production, (2) climatically well-adapted forest composition, and (3) maximized tree species diversity. The strategies were compared with a baseline scenario of traditional management without any response to climate change. The comparisons were based on simulated wood production and species composition after 110 years of development. The results underline the important influence that management strategies have on forest growth. Forest management may adopt a variety of strategies to respond to the expected changes in climate. Process-oriented forest gap models can aid in the assessment of these strategies.

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This paper investigates the relationship between the environmental orientation and economic performance of small firms. We conduct a quantitative analysis on a sample of 299 environmentally oriented and all other small (2–49 employees) Swedish firms. We estimate the effect of environmental orientation on profit margin to examine how environmentally oriented firms perform in relation to non‐environmentally oriented firms. To do this, we employ a quasi‐experimental design in which we create a control group of non‐environmentally oriented firms that are very similar to their environmentally oriented counterparts. We use two measures of environmental orientation: (i) a third‐party classification, and (ii) a self‐assessment of environmental differentiation. The findings show a negative effect of environmental orientation on economic performance. Our contribution to the literature is in using a novel and more rigorous way to measure the relationship between environmental orientation and economic performance and providing implicit support for the existence of a causal link from economic performance to environmental orientation. Copyright © 2013 John Wiley & Sons, Ltd and ERP Environment

Understanding product circularity as "three-dimensional" could anchor the Circular Economy to common principles while affording its followers flexibility about how to measure it in their specific sectors and disciplines and within their organization's means. Inspired by a heuristic developed for the urban planning profession to cope with the inherent conflicts of Sustainable Development, this article argues that measuring product-level circularity should consider ways to achieve (1) high material recirculation, (2) high utilization, and (3) high endurance in products and service offerings.Achieving all three dimensions ensures that material flowing through the economy is recovered from prior use phases, that it is used intensely, and that it retains its value in spite of exogenous changes. The article argues further that these three dimensions ought to be measured and reported separately rather than as a composite metric and that certain applications will have opportunities to improve circularity through certain dimensions better than others. The article also explains how researchers at RISE (Research Institutes of Sweden AB) are working with industry and government partners to measure the three dimensions and how diverse actors interested in the Circular Economy can use the three dimensions to take the first steps in their transition to circularity.