Market and regulatory pressures strongly drive circular economy adoption, especially with integrated supply chains.

Why It Matters

Understanding the drivers of circular economy adoption is crucial for businesses aiming to transition towards more sustainable models. This insight highlights that strategic focus on compliance and market opportunities, alongside fostering deeper supply chain collaboration, can accelerate the implementation of resource-efficient practices.

Key Finding

External mandates like regulations and market demands are the strongest motivators for adopting circular economy practices. When supply chains work closely together, these pressures lead to more circularity, but this integration can also make it harder to implement truly groundbreaking circular strategies.

Key Findings

• Coercive market and regulatory pressures have a greater impact on the adoption of Circular Economy practices than normative and mimetic pressures.
• Higher levels of supply chain integration amplify the effect of institutional pressures, promoting incremental Circular Economy practices.
• Supply chain integration can sometimes hinder radical Circular Economy approaches by reinforcing existing linear supply chain structures.

Research Evidence

Aim: What is the relative impact of different institutional pressures (coercive, normative, mimetic) on the adoption of circular economy practices, and how does supply chain integration mediate this relationship?

Method: Expert Panel / Delphi Method

Procedure: A panel of 30 experts in Circular Economy was consulted using a Delphi-like approach to identify and rank the influence of various institutional pressures on the adoption of circular economy practices and to explore the role of supply chain integration.

Sample Size: 30 experts

Context: Business and Industrial Organization, specifically within the domain of Circular Economy and Supply Chain Management.

Design Principle

External pressures, particularly regulatory and market-driven ones, are potent catalysts for adopting resource-efficient practices, and supply chain integration can amplify their effect for incremental improvements.

How to Apply

When developing new products or services, analyze the existing and anticipated regulatory landscape and market trends that favor circularity. Simultaneously, explore opportunities for deeper collaboration with suppliers and distributors to streamline circular material flows.

Limitations

The findings are based on expert opinion and may not fully capture the nuances of all organizational contexts. The study also notes that supply chain integration can sometimes impede radical circular economy adoption.

Student Guide (IB Design Technology)

Simple Explanation: Companies are more likely to go green if the government or customers force them to. Working closely with suppliers helps, but can sometimes stop companies from making really big, new green changes.

Why This Matters: This research helps understand the external forces and internal collaborations that drive companies to design and produce more sustainably, which is a key goal in many design projects.

Critical Thinking: To what extent can companies proactively shape institutional pressures to favor circularity, rather than merely reacting to them?

IA-Ready Paragraph: This study highlights that external pressures, particularly market and regulatory mandates, are significant drivers for adopting circular economy practices. Furthermore, enhanced supply chain integration can amplify these pressures, facilitating incremental adoption of circular strategies, though it may also present barriers to more radical circular innovations.

Project Tips

• When researching a product, consider the regulations and customer expectations that might push for more sustainable materials or processes.
• Think about how a product's supply chain could be made more integrated to support circularity, but also consider if this might limit future, more innovative circular designs.

How to Use in IA

• Use this research to justify why certain sustainable design choices are being made, linking them to market or regulatory pressures.
• Discuss how supply chain integration in your design project could enhance circularity, while acknowledging potential limitations for radical innovation.

Examiner Tips

• Demonstrate an understanding of the external forces that influence design decisions towards sustainability.
• Critically evaluate the trade-offs between incremental improvements driven by integration and the potential for more disruptive circular innovations.

Independent Variable: Institutional pressures (coercive, normative, mimetic)

Dependent Variable: Adoption of Circular Economy practices

Controlled Variables: Supply chain integration

Strengths

• Utilizes expert knowledge for in-depth insights.
• Addresses the interplay between external pressures and internal supply chain dynamics.

Critical Questions

• How might the 'hierarchy' of pressures differ across industries or geographical regions?
• What specific strategies can mitigate the risk of supply chain integration hindering radical circular innovation?

Extended Essay Application

• Investigate how a specific regulatory change (e.g., Extended Producer Responsibility laws) impacts the design of products within a particular sector.
• Analyze the supply chain of a product and propose design interventions that leverage integration for enhanced circularity, while also identifying potential barriers to more disruptive circular models.

Source

Understanding the relationship between institutional pressures, supply chain integration and the adoption of circular economy practices · Journal of Cleaner Production · 2023 · 10.1016/j.jclepro.2023.139686