Advancing the circular economy in construction through circular business models

Unofficial AI-generated summary based on the public title and abstract. Not an official translation.

🔬研究者:Provides a conceptual framework for studying CBMs in construction, highlighting research gaps and potential directions.

🏢実務担当者:Offers insights into how construction firms can adopt circular business models to enhance sustainability and competitiveness.

🏛政策担当者:Suggests policy levers to promote circular economy in construction, such as incentives for CBM adoption.

Introduction The global urban population is projected to rise from 55% in 2025 to 70% by 2050, adding approximately 2.5 billion people to cities (World Bank, 2021). The demand for construction is expected to surge in response; however, despite its growth, the construction sector is considered the least efficient industry and is widely recognized as the major contributor to global resource consumption. The sector uses around 50% of all extracted materials and is responsible for a significant percentage of total waste production and emissions (Prochazkova et al., 2021). While sustainability is intended to be the central theme in this sector, the dominant production and consumption patterns are still driven by a linear take-make-dispose mindset, one closely associated with resource extraction, emissions, and waste creation (Tan et al., 2022). According to the International Resource Panel, global extraction of materials is projected to exceed 165 Gt in 2060 if business-as-usual scenarios persist, doubling the extraction levels of 2011 (OECD, 2019). Global warming, biodiversity loss, and changes in the nitrogen cycle may irreversibly alter the Earth's ecosystem (Mason et al., 2022). CE minimizes resource depletion, waste, and emissions by maintaining products, components, and materials at their highest utility and value (AlJaber et al., 2023). CE seeks to alter the "take-make-dispose" patterns that threaten to undermine Earth's sustainability and approach its limits (Norouzi et al., 2021). In recent years, the concept has moved beyond revenue streams to become a key part of sustainability discussions, especially in CE (Geissdoerfer et al., 2020). As a result of this shift, CBMs are emerging. CBMs take a broader view of value, encompassing the environment, society, and a wider range of value chain partners than conventional business models (Jayakodi et al., 2024). In addition to what a company sells, they rethink how it's created, delivered, held onto, and repurposed to add value to society (Geissdoerfer et al., 2020). Embracing the CE necessitates the development of novel CBMs. Although CE is gaining traction in construction, it has historically been more limited than other sectors, often limited to recycling and waste minimization. In existing studies, material efficiency and circular design strategies were emphasized (Norouzi et al., 2021). In contrast, the circular business model has received significantly less attention (Guerra et al., 2021; Mackenbach et al., 2020). As Jayakodi et al. (2024) note, there is still a notable lack of clarity surrounding the theoretical conceptualization and practical applicability of CBMs in construction. This paper contends that CBMs are the critical enabler and the "missing link" needed to effectively convert CE from fragmented practices to a scalable and systemic transformation of the construction industry. Embracing circularity in this context requires more than material innovation; it demands the creation of novel business models that support long-term value retention, economic viability, and resource regeneration. This Opinion article aims to contribute to ongoing discussions about accelerating the construction industry's circular transformation. The paper does not present new empirical findings; instead, it draws on existing evidence and literature to provide an interpretive perspective. More precisely, it contends that Circular Business Models (CBMs) form the "missing link" between discontinuous circular practices and systemic change in construction. The article is structured around three organizing themes: (1) how CBMs are defined and framed in construction, (2) what obstacles stifle their use, and (3) which enablers and policies could support their wider implementation. The deliverable of the paper set is a conceptualization of how Circular Business Models (CBMs) can contribute to advancing the circular economy in construction. Given the sector's diversity, the discussion concentrates on building construction and renovation, where the use of cement, steel, and timber is most intensive and demolition waste is particularly substantial. These subsectors provide the clearest ground to illustrate how CBMs can help retain value, close resource loops, and reshape patterns of value creation. Rather than offering a detailed mapping exercise, the paper draws attention to points in the material, energy, and waste flows where CBM practices can intervene most effectively. Scope and Approach This article presents a focused conceptual discussion rather than a systematic review. The literature considered was chosen selectively to highlight the most relevant strands of debate on the circular economy and circular business models in construction and related fields. These include key reviews, recent policy initiatives, technological advances, and illustrative industry cases. The purpose is not to provide an exhaustive survey of all existing studies, but to develop a clear conceptual perspective on CBMs in construction. Reframing the Circular Economy Through a Business Lens The construction sector is responsible for nearly 40% of global carbon emissions and a similar proportion of energy usage (Mosca, 2024). Sustainability has become a real concern in the construction sector, with implications for all agents and levels, from planning to deconstruction (Regúlez et al., 2023). Adopting the CE principle in the construction industry promotes the use of sustainable materials, maximizes material recovery, and avoids unnecessary waste generation and waste disposed of in landfills (Akanbi et al., 2018). Nonetheless, while these practices contribute to minimizing environmental impact, they largely emphasize material efficacy rather than a holistic view of business operations(Mohapatra et al., 2024) Beyond construction, businesses in other sectors have also demonstrated how Circular Business Models can operationalize circular economy principles. In the automotive industry, for example, firms are adopting Industry 4.0-enabled lifecycle frameworks to support vehicle remanufacturing and material recovery, especially in the transition to electric mobility (Yu et al., 2022). In manufacturing and ICT sectors, companies are using digital tools such as IoT, AI, and product–service systems to extend product lifespans, improve traceability, and facilitate reverse logistics (Han et al., 2023; Perotti et al., 2024). These wider industry experiences provide a useful reference point for understanding how similar business logics may be adapted and applied in the construction sector. A CBM describes how an organization creates, delivers, and captures value within a circular system designed to prevent or postpone obsolescence and favor the use of resources (Geissdoerfer et al., 2020). CBMs aim to help firms devise suitable strategies to slow, close, and narrow resource loops, which can be achieved through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, and recycling methods. CBM is mentioned as one of the financial enablers in implementing CE principles in the built environment (Prochazkova et al., 2021). Successfully transitioning to a circular built environment requires construction firms to reconsider their core business logic, integrating circularity into repeatable organizational processes and unique project execution (Jayakodi et al., 2024). This shift in perspective, from focusing merely on circular practices to fundamentally rethinking the business model, is essential for accelerating CE uptake, managing risks, and capturing new opportunities in the digital age (De Wolf et al., 2024). The CE effort in construction risks remaining fragmented if this strategic business model lens is not adopted (Prochazkova et al., 2021) Several industries, including electronics and manufacturing, demonstrate the potential for circular business models. For example, Philips developed a Product-as-a-Service model by providing lighting and extending product life (Yang et al., 2017). Manufacturers maximize resource efficiency and support remanufacturing through data analytics and lifecycle tracking (Kerin & Pham, 2020). Insights into the construction industry's transition to circularity can be obtained from these sectoral shifts, which illustrate the economic and operational viability of CBMs. Understanding Circular CBM Using CBMs, organizations can create, deliver, and retain value within ecological limits. Unlike conventional business models, CBM stresses sustainability as a core principle, reducing waste and extending product lifespans. Competitive advantages and operational efficiency depend on CE principles. As Brändström et al. (2024) explained, CBMs enable firms to design, maintain, repair, reuse, remanufacture, refurbish, and recycle strategies to reduce resource loops. Construction is particularly resource-intensive and project-based, so this shift transforms the firm from a one-time seller to a steward of value across the product lifecycle. The transition toward CBMs is an environmental imperative and a significant economic opportunity. The circular economy is estimated to unlock $4.5 trillion in value by 2030 as businesses benefit from lower costs, enhanced customer and employee relationships, increased sales, and reduced risks associated with linear models; furthermore, applying CE principles to five key material areas—cement, aluminum, steel, plastics, and food—could eliminate 9.3 billion tons of CO₂ emissions by 2050, equivalent to cutting all current transport emissions to zero. (WBCSD, 2023). These projections highlight the strategic importance of embedding CBMs in the construction industry. One such archetype is Product-as-a-Service (PaaS), which replaces ownership. For example, Philips' "Pay-per-Lux" model, piloted in Amsterdam's Schiphol Airport, provides lighting as a service, promoting long-term product responsibility and reducing waste (De Wolf et al., 2024). Resource Recovery M

• openalex https://doi.org/10.3389/fbuil.2025.1629769first seen 2026-08-02 18:34:29