The role of supply chain collaboration in driving the transition to a circular economy and its contribution to sustainable development outcomes

Abstract

The circular economy is gaining a lot of interest as an alternative system that could address global challenges of environmental degradation and the depletion of the Earth’s resources. Business leaders are aware of the opportunities presented by the circular economy to gain competitive advantage whilst being responsible corporate citizens. The fast-moving consumer goods, packaging, mining, and heavy industry sectors are representative of the growing consumption patterns driven by population growth and urbanisation and the unsustainable negative impacts of the linear ‘take, make, use and dispose’ system. A transition to a circular economy in these sectors could have the biggest impact on the global economy, society, and the environment. This study aimed to develop new insights and understanding of supply chain collaboration for the transition to a circular economy. A better grasp of supply chain collaboration would better equip business leaders to make the necessary paradigm shifts to dramatically transform how their companies create, capture and deliver their value proposition to their customers, as demanded by the circular economy business models. This study investigated the major constructs of supply chain collaboration such as partner section, partner capabilities and the management of collaborative relationships. The enablers and barriers to transitioning as well as how the circular economy contributed to sustainable development outcomes were also investigated. The research was designed as an exploratory, qualitative research. Data gathering was done through 18 semi-structured interviews of decision makers involved in circular economy and supply chain collaborations in the FMCG, Packaging, Mining and Heavy Industry sectors in South Africa and parts of Africa. The output of the study was a conceptual framework presenting the new insights on the key constructs of supply chain collaboration for a circular economy. This study served to confirm and thus add to the existing body of knowledge by making a potential contribution to the circular economy literature. The research also contributed potential refinements to the CE literature. These potential refinements to the CE literature included supplier development incentives and financial capability (related to collaborations); lack of institutional coordination, economies of scale, global frameworks, and consumer advocacy (related to the barriers and enablers of the transition); and lastly, country and sector context related to sustainable development outcomes. The research also identified new insights that are potential extensions to the CE literature, related to supply chain collaborations for a circular economy. These potential extensions to the CE literature included partner due diligence and partner support.