Sustainable Business Model Innovation in the Circular Economy Era

Abstract

Sustainable Business Model Innovation has emerged as a key driver in enhancing corporate competitiveness amid the global transition toward a Circular Economy. The paradigm shift from a linear to a circular economy compels organizations to generate value not only in economic terms but also from social and ecological perspectives. This study conducts a systematic literature review to explore the dynamics of SBMI within the framework of Circular Economy, aiming to identify the approaches, challenges, and best practices adopted across various industrial sectors. The findings indicate that integrating Circular Economy principles into business model innovation fosters cross-functional synergy, strengthens stakeholder collaboration, and extends product life cycles. Furthermore, the study emphasizes the contextual nature of Sustainable Business Model Innovation, influenced by industry type, technological capacity, and regulatory environment. The role of digital technologies and policy support is also highlighted as crucial in accelerating Sustainable Business Model Innovation adoption. Sustainable Business Model Innovation is positioned as a strategic response to environmental responsibility and competitive advantage in the circular economy era.