The circular economy, environmental performance and environmental management systems: the role of absorptive capacity

Abstract

Purpose Despite the general interest in the circular economy, organisations have difficulties in implementing circular practices. Developing absorptive capacity (ACAP) may foster circularity among organisations. The paper aims to shed light on relationship between ACAP and organisational performance. Design/methodology/approach To empirically investigate the contribution of ACAP in circular economy implementation, the authors analysed a European sample of more than 800 Eco-Management and Audit Scheme-registered organisations through partial least squares structural equation modelling. Findings The analysis demonstrates that ACAP and the underlying organisational activities of a firm significantly facilitate the implementation of a circular economy and the internalisation of an environmental management system (EMS), which consequently improve the overall performance of organisations. The authors found that the diffusion of the circular economy in the organisations’ environment does not affect their commitment to implement a circular economy. Originality/value The study expands the academic literature by framing the concept of the circular economy with ACAP theory, thereby highlighting the contribution of acquisition, assimilation, transformation and exploitation. The results also provide useful insights for practitioners highlighting how organisations with an environmental certification can identify and pursue opportunities deriving from a circular economy. Finally, the research contributes to the debate on the effect of internalising EMSs and how ACAP improves economic performance, environmental performance and reputation.

Institutional and stakeholder pressures on organisational performance and green human resources management

“…Absorptive capacity has been frequently linked to HRM, but our knowledge of its links with GHRM and performance outcomes is still emerging. Further studies can consider framing their investigations in absorptive capacity theory (Marrucci et al, 2021). Finally, future research can examine the role of organisational citizenship behaviour.…”

Circular Economy Role in Industry and Environmental Sustainability: Qualitative Content Analysis Approach

“…Numerous businesses include this concept in their promotion of sustainable development strategies to demonstrate the challenges and opportunities associated with sustainability (Marrucci, Daddi, & Iraldo, 2021). The managerial process cannot be formed based on already available theoretical knowledge.…”

“…Ultimately, the continuation of these services is contingent upon a sound government (Beckmann, Sivarajah, & Irani, 2021). The concept describes the difficulties and opportunities of sustainability, and several Businesses take advantage of this concept in their sustainable and development strategies (Marrucci, Daddi, & Iraldo, 2021). The existing level of theoretical knowledge is not suitable for management strategy.…”

Do dynamic capabilities matter? A study on environmental performance and the circular economy in European certified organisations

“…In addition to the adoption of other circular economy tools such as LCAs, other common sensing activities should be adopted by organisations. Monitoring market trends and technology development, observing competitors' strategies, taking into account customers' needs and requirements, involving customers and suppliers and pursuing R&D activities should be incorporated into the working activities of those organisations that aim to move towards a circular economy (Marrucci, Daddi, & Iraldo, 2021b). In particular, Ko and Liu (2017) highlighted that the effects of environmental strategies can lead to EMSs can be a leverage to foster circular economy transition and better environmental performance.…”