Eco-innovation and the circular economy in the automotive industry

Gonzalo Maldonado Guzmán · Jose Arturo Garza‐Reyes · Sandra Yesenia Pinzón Castro

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Sustainable Supply Chain Management Environmental Sustainability in Business Sustainability and Innovation in Business

Abstract

Purpose Circular economy is emerging as a new sustainability paradigm. Similarly, eco-innovation is being recognized as one of the most important mechanisms that allow the transition from a linear to a circular economy in production processes, as there is a strong relationship between eco-innovation (eco-innovation of products, processes and management) and circular economy activities. However, the relationship between eco-innovation and circular economy is an issue that has been isolated and little analyzed in the academic literature. Therefore, this research fills this gap by exploring the interdependence between eco-innovation and circular economy. Design/methodology/approach The research is conducted through an extensive literature review from where a research framework consisting of two measurement scales, 18 items and three hypotheses were developed. A self-administered questionnaire was distributed and 460 responses were obtained from companies in the automotive and auto parts industry in Mexico. The data obtained were analyzed through confirmatory factor analysis, descriptive statistics and structural equation modeling. Findings The results suggest that eco-innovation of products, process and management has a significant positive impact on the circular economy of companies in the automotive and auto parts industry. Practical implications The findings of this research can inform managers in the automotive sector and policymakers when formulating and deploying environmentally sustainable strategies. Originality/value This paper fills a research gap by expanding the limited body of knowledge that relates eco-innovation and circular economy and providing some evidence of their relationship. The research also allows the unique characteristics of eco-innovation and the circular economy to be understood within a particular context, growing in this manner the body of knowledge on this field.

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References

1981Evaluating Structural Equation Models with Unobservable Variables and Measurement Error 1988Structural equation modeling in practice: A review and recommended two-step approach.1988On the Evaluation of Structural Equation Models 2016The Circular Economy – A new sustainability paradigm?2015A review on circular economy: the expected transition to a balanced interplay of environmental and economic systems 2017Circular Economy: The Concept and its Limitations 2019Business model innovation for circular economy and sustainability: A review of approaches 2000Production planning and control for remanufacturing: industry practice and research needs

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2021Eco-Innovation Diversity in a Circular Economy: Towards Circular Innovation Studies 2023A critical review of the current state of circular economy in the automotive sector 2022Examining the roadblocks of circular economy adoption in micro, small, and medium enterprises (MSME) through sustainable development goals 2021Green Transition: The Frontier of the Digicircular Economy Evidenced from a Systematic Literature Review

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