SMEs on the way to a circular economy: insights from a multi-perspective review

Abstract

The transition to a circular economy (CE) has garnered widespread attention as a solution to address economic, environmental, and social challenges. While large enterprises and policymakers have made steps in adopting CE practices, small and medium-sized enterprises (SMEs) face unique challenges due to limited resources and expertise. Understanding the multi-level perspective (MLP) is essential for SMEs to successfully transition to a CE, as it considers factors at the micro, meso, and macro levels. However, current research often focuses on single levels, necessitating a comprehensive understanding of the phenomenon through systematic research. To address this need, this study conducts a systematic literature review (SLR) using the MLP framework to analyse existing research on SMEs' transition to a CE. The study aims to identify macro-, meso-, and micro-level factors, actors, and mechanisms influencing the transition process. The SLR contributes to academic understanding by developing a conceptual model that elucidates the dynamics of the circular transition process within SMEs. Additionally, it provides practical recommendations to support SMEs in navigating the transition successfully. The adoption of the MLP framework empowers SMEs, policymakers, industry associations, and consumers to play their roles effectively in driving the CE transition. While the study acknowledges certain limitations, it opens avenues for future research and enhancement of CE practices in SMEs.

Influence of Circular Economy Adoption in European Sme S Performance

“…This systemic transition will inevitably be hampered by poor knowledge and resource transfer between various levels of society (Barrie & Kanda, 2020). Therefore, intermediaries play a significant role in the adoption of CE practices by SMEs: they facilitate knowledge exchange, collaboration, and resource transfer, which are crucial for the transition to a CE (Ahmadov et al, 2023;Gennari, 2023). Also, since IS is recognized as a key strategy to support the transition towards the CE, it is important to understand their role to SMEs.…”

“…The facilitation provided by intermediaries could foster an ideal environment for the integration of circular strategies within smaller business entities. While all businesses can benefit from the support of intermediaries in their CE transition, SMEs in particular may require more intervention due to their unique challenges (Ahmadov et al, 2023;Gennari, 2023).…”