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Circular economy finance: Clear winner or risky proposition?

Author

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  • Paul Dewick
  • Magnus Bengtsson
  • Maurie J. Cohen
  • Joseph Sarkis
  • Patrick Schröder

Abstract

A major shift in private and public investment is needed to forge a transition to a circular economy. A recent surge of activity from policy makers, the financial industry, and other stakeholders suggests commitment and progress toward providing resources to facilitate this process. In this forum article, we provide a measured, and in some respects critical and corrective, assessment of these developments. We highlight the riskthat progress toward a circular economy will be curtailed by strategic decisions based on contestable understanding, fuzzy indicators, and inadequate information. Before major industry actors implement international investment standards, launch innovative financing vehicles, and ramp up investment, we call for more effective oversight to prevent the circular economy from becoming yet another compromised and ultimately ineffectual sustainability concept.

Suggested Citation

  • Paul Dewick & Magnus Bengtsson & Maurie J. Cohen & Joseph Sarkis & Patrick Schröder, 2020. "Circular economy finance: Clear winner or risky proposition?," Journal of Industrial Ecology, Yale University, vol. 24(6), pages 1192-1200, December.
    • Handle: RePEc:bla:inecol:v:24:y:2020:i:6:p:1192-1200
    DOI: 10.1111/jiec.13025
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    References listed on IDEAS

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    Cited by:

    1. Ozili, Peterson K & Opene, Francis, 2022. "The role of banks in the circular economy," MPRA Paper 113466, University Library of Munich, Germany.
    2. Peterson K. Ozili, 2022. "Circular Economy and Central Bank Digital Currency," Circular Economy and Sustainability, Springer, vol. 2(4), pages 1501-1516, December.
    3. Luthra, Sunil & Kumar, Anil & Sharma, Manu & Arturo Garza-Reyes, Jose & Kumar, Vikas, 2022. "An analysis of operational behavioural factors and circular economy practices in SMEs: An emerging economy perspective," Journal of Business Research, Elsevier, vol. 141(C), pages 321-336.
    4. Peterson K. Ozili, 2021. "Circular Economy, Banks, and Other Financial Institutions: What’s in It for Them?," Circular Economy and Sustainability, Springer, vol. 1(3), pages 787-798, November.
    5. Khan, Syed Abdul Rehman & Yu, Zhang & Sharif, Arshian, 2021. "No Silver Bullet for De-carbonization: Preparing for Tomorrow, Today," Resources Policy, Elsevier, vol. 71(C).
    6. Olga Lingaitienė & Aurelija Burinskienė, 2021. "Core Elements towards Circularity: Evidence from the European Countries," Sustainability, MDPI, vol. 13(16), pages 1-16, August.
    7. Ozili, Peterson K, 2022. "Circular economy and central bank digital currency," MPRA Paper 113469, University Library of Munich, Germany.
    8. Bhavesh Kumar & Love Kumar & Avinash Kumar & Ramna Kumari & Uroosa Tagar & Claudio Sassanelli, 2024. "Green finance in circular economy: a literature review," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(7), pages 16419-16459, July.
    9. Joerg S. Hofstetter & Valentina Marchi & Joseph Sarkis & Kannan Govindan & Robert Klassen & Aldo R. Ometto & Katharina S. Spraul & Nancy Bocken & Weslynne S. Ashton & Sanjay Sharma & Melanie Jaeger-Er, 2021. "From Sustainable Global Value Chains to Circular Economy—Different Silos, Different Perspectives, but Many Opportunities to Build Bridges," Circular Economy and Sustainability, Springer, vol. 1(1), pages 21-47, June.
    10. Robert H. W. Boyer & Ann‐Charlotte Mellquist & Mats Williander & Sara Fallahi & Thomas Nyström & Marcus Linder & Peter Algurén & Emanuela Vanacore & Agnieszka D. Hunka & Emma Rex & Katherine A. Whalen, 2021. "Three‐dimensional product circularity," Journal of Industrial Ecology, Yale University, vol. 25(4), pages 824-833, August.
    11. Beatriz de Souza Mello Gonçalves & Flávio Leonel de Carvalho & Paula de Camargo Fiorini, 2022. "Circular Economy and Financial Aspects: A Systematic Review of the Literature," Sustainability, MDPI, vol. 14(5), pages 1-41, March.
    12. Sara Moggi & Renata Paola Dameri, 2021. "Circular business model evolution: Stakeholder matters for a self‐sufficient ecosystem," Business Strategy and the Environment, Wiley Blackwell, vol. 30(6), pages 2830-2842, September.
    13. Ozili, Peterson K, 2021. "Circular economy, banks and other financial institutions: what’s in it for them?," MPRA Paper 107397, University Library of Munich, Germany.
    14. Gutberlet, Melissa & Preuss, Lutz & Thorpe, Andrea Stevenson, 2023. "Macro level matters: Advancing circular economy in different business systems within Europe," Ecological Economics, Elsevier, vol. 211(C).

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