Revealing the Effects of Circular Economy, Eco‐Innovation and Industry 4.0 on Sustainability Performance and Competitive Advantage in Manufacturing Companies

Rafael Mora‐Contreras and Javier Carrillo‐Hermosilla

Sustainable Development, 2025, vol. 33, issue S1, 1249-1270

Abstract: Successful implementation of the circular economy (CE) is expected to lead companies to improve their sustainability performance and achieve competitive advantages to support the transition to a more desirable economic system. However, the body of knowledge and evidence of impacts shows fragmented and, in some cases, contradictory results. This study helps to close this gap by investigating the effect of stakeholder pressure, Industry 4.0, and eco‐innovation on the implementation of CE and its consequences for manufacturing companies' competitive advantage and sustainability performance. This quantitative study based on a survey of Colombian companies and a novel research model clarifies to what extent the implementation of CE leads to improvements in manufacturing companies, considering the key determinants that influence this relationship. The findings point out that eco‐innovations and stakeholder pressure drive CE and, consequently, circular practices improve sustainability performance and competitive advantage, while Industry 4.0 has a fragmented influence.

Date: 2025
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https://doi.org/10.1002/sd.70075

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Persistent link: https://EconPapers.repec.org/RePEc:wly:sustdv:v:33:y:2025:i:s1:p:1249-1270

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