Drivers for and barriers to circular economy transition in the textile industry: A developing economy perspective

Abstract

AbstractIncreasingly, pressing sustainability issues including the rise in greenhouse gas (GHG) emission rates, climate change‐related vulnerabilities, and natural resource depletion have propelled companies to transition from a linear economy to a circular economy (CE). While circular business models are gaining currency in the manufacturing sector, empirical research on CE transition in the continuous process industry in developing economies is scarce. Accordingly, the purpose of this study is to investigate the drivers and barriers of CE adoption in the textile industry of Pakistan. To this end, we utilized a qualitative methodology, and a total of 22 semi‐structured interviews were conducted with consultants and senior corporate managers working in the textile sector. Building on the natural resource‐based view (NRBV) and institutional theory, the findings revealed various internal drivers (resource efficiency‐related, organization‐related, and research and innovation‐related factors) and external drivers (market, regulatory, and societal factors) for CE transition. Additionally, the findings demonstrated internal barriers including behavioral, technical, and economic issues, and external issues such as customer and brand‐related barriers, regulatory and policy‐related barriers, as well as supply chain‐related barriers hindering the adoption of CE. We argue that it is one of the early studies to utilize the NRBV and institutional theory to examine the drivers and barriers and provide novel insights into the CE transition in the textile process industry in a developing economy. The findings can assist academics, consultants, practitioners, and policymakers to understand and promote CE as a sustainable strategy in the textile process industry.