Innovations in the Circular Economy: Commons or Commodity?

Dear Colleagues,

Background

The Circular Economy (CE) is fast becoming an important agenda for technological, organizational and social innovation. Accordingly, CE offers considerable opportunities, across all sectors of the economy, to reshape many of our established practices, that, in turn, will enable the world’s societies and economies to become more sustainable (Boons and Lüdeke-Freund, 2013; Ghisellini et al., 2016; Bocken et al., 2016). Currently, CE principles of closing resource loops, fostering regenerative practices and processes, and celebrate diversity are inspiring the emergence of new products, business models, and innovation platforms worldwide (Lewandowsky, 2016; Gorissen et al., 2016). However, whilst CE offers many opportunities, the practices embedded in the core values are by no means mainstream and, as a research field, there is a growing body of literature celebrating the benefits and showcasing successful exhibits of CE, but more research is required to begin to fully understand the complexities of this potentially world-changing phenomenon.       

Research, however, has identified that innovation in the CE debate often means dealing with radical changes, particularly in the way resources are managed and shared between actors, thus inspiring open and collaborative approaches to innovation and technological development. With the growing realisation of the benefits of Open Innovation across the economy, CE in turn can bring about new business model innovation, invite new and radical resource efficiencies, extend product life-cycles through re-use, re-manufacturing, re-furbishing, new design approaches (such as cradle-to-cradle and bio-mimetics) and radically change the world’s products and services (Planing, 2015). Again, this aligns with the rapidly maturing research fields focussing on ‘servitisation’. The CE’s new business models hold the promise to ‘square the circle’ and bring the interests of businesses and private sector in line with those of the planet and its increasingly constrained or scarce resources (Smith et al., 2010; Schaltegger and Wagner, 2011).

The Research Problem

With a plethora of start-ups and new ventures, small and medium enterprises (SMEs) and large corporations all beginning to actively engaged in CE inspired innovations and business models, the challenge for all these organizations is common. How do they effectively and efficiently ‘commoditise’ these new practices, so that value can be captured for companies and their shareholders, not just create a return on their social responsibility agendas. Unlocking this challenge will lead to the CE becoming a truly mainstream practice in the world’s board rooms. Yet, the field requires further research, from a range of perspectives to ensure we understand the potential hurdles and barriers to be faced.

One such hurdle is the relationship between commoditisation and cooperation. For example, while CE principles rely on the capacity of actors to share, interact collaboratively and exchange resources, innovation practices are often based on pursuing hard-line competitive advantages and activities. From this perspective, the question remains on how to reconcile competition with cooperation/collaboration, how to protect and manage intellectual property rights (IPRs), how a CE inspired innovation ecosystems can combine closed and open innovation approaches, and how to design novel institutions governing value extraction and value sharing mechanisms in innovations inspired by CE.

Many of these tensions and challenges are already being explored in the Open Innovation and field management field (Geels, 2011; Smith et al., 2014), and this Special Issue is keen to encompass these perspectives. The debate focussing on innovation and CE needs to take into account social dimensions, particularly how the most radical new ways of doing (circular) business involve and impact social actors (Murray et al., 2017). For example, what are the implications of radically remodelling how we do business for our workers, employees, communities and societies? Will the innovations of the circular economy just improve business value and protect or grow the role of the environment, or will they also contribute to healthier, more resilient and more prosperous communities and societies accordingly?

The Special Issue

This Special Issue recognizes the relevance of sharing knowledge and capabilities in line with the Open Innovation agenda. We hence wish to debate the interaction between Open Innovation and CE, highlighting the social innovation dimension of CE. We are particularly interested in questioning how CE can inspire people in communities to work together in innovative ways to bring about positive social, economic and environmental change.

These social and often frugal, or grassroots, innovations are often based on principles of sharing and in some instances co-opetition, as opposed to competition (Charter and Keiller, 2014; Feola and Nunes, 2014). At the heart of the sharing principle is the principle of ‘the commons’. The idea of the commons is based on the principles of shared responsibility, shared and open access and collaboration amongst people to create value for the wider community. ‘Commons Innovation’ will not be exploited by one person or company, but value is shared widely, boosting community prosperity and resilience.

References:

1. Bocken, N. M., de Pauw, I., Bakker, C., & van der Grinten, B. (2016). Product design and business model strategies for a circular economy. Journal of Industrial and Production Engineering, 33(5), 308-320.
2. Boons, F., & Lüdeke-Freund, F. (2013). Business models for sustainable innovation: state-of-the-art and steps towards a research agenda. Journal of Cleaner Production, 45, 9-19.
3. Charter, M., & Keiller, S. (2014). Grassroots innovation and the circular economy: a global survey of repair cafés and hackerspaces. Available on line: http://research.uca.ac.uk/2722/1/Survey-of-Repair-Cafes-and-Hackerspaces.pdf (last access 12/09/2017)
4. Feola, G. and Nunes, R. (2014) Success and failure of grassroots innovations for addressing climate change: the case of the Transition Movement. Global Environmental Change, 24. pp. 232-250.
5. Geels, F. W. (2011). The multi-level perspective on sustainability transitions: Responses to seven criticisms. Environmental innovation and societal transitions, 1(1), 24-40.
6. Ghisellini, P., Cialani, C., & Ulgiati, S. (2016). A review on circular economy: the expected transition to a balanced interplay of environmental and economic systems. Journal of Cleaner Production, 114, 11-32.
7. Gorissen, L., Vrancken, K., & Manshoven, S. (2016). Transition thinking and business model innovation–towards a transformative business model and new role for the reuse centers of Limburg, Belgium. Sustainability, 8(2), 112.
8. Lewandowski, M. (2016). Designing the business models for circular economy—Towards the conceptual framework. Sustainability, 8(1), 43.
9. Murray, A., Skene, K., & Haynes, K. (2017). The circular economy: An interdisciplinary exploration of the concept and application in a global context. Journal of Business Ethics, 140(3), 369-380.
10. Planing, P. (2015). Business model innovation in a circular economy reasons for non-acceptance of circular business models. Open journal of business model innovation, 1, 11.
11. Schaltegger, S., & Wagner, M. (2011). Sustainable entrepreneurship and sustainability innovation: categories and interactions. Business strategy and the environment, 20(4), 222-237.
12. Smith, A., Fressoli, M., & Thomas, H. (2014). Grassroots innovation movements: challenges and contributions. Journal of Cleaner Production, 63, 114-124.
13. Smith, A., Voß, J. P., & Grin, J. (2010). Innovation studies and sustainability transitions: The allure of the multi-level perspective and its challenges. Research policy, 39(4), 435-448.

Prof. Dr. Stefano Pascucci
Prof. Dr. Steffen Böhm
Dr. Allen Alexander
Guest Editors

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