Circular Innovation Processes: The Role of Absorptive Capacity, Innovation Communities, and Integrated Management Systems in Cradle-to-Cradle Product Development

The circular economy (CE) has emerged as a key perspective for advancing sustainable develop-ment in organizations and across entire value chains. A root concept of the CE is Cradle-to-Cradle (C2C) – a circular product design concept with attached certification system. With C2C’s demand for eliminating toxic substances from the supply chain as requirement for closing material loops, it goes substantially beyond conventional recycling and provides firms with guidance for implement-ing closed-loop circularity. This dissertation aims at gaining a deeper understanding of firms’ in-novation processes for CE implementation, hereafter called circular innovation (CI) from a C2C perspective. Understanding CI processes is important to facilitate the diffusion of materials in C2C quality. This dissertation adopts absorptive capacity (ACAP, Cohen and Levinthal 1989) as overarch-ing theoretical framing to understand the innovation processes and the underlying knowledge and learning flows on circularity. With a qualitative process studies approach based on case stud-ies of C2C pioneers, this thesis provides in-depth insights on how the C2C-based knowledge on circularity is identified, assimilated and applied in organizational innovation processes. The con-tribution of this dissertation is fourfold: first, it provides an in-depth understanding of the learning and collaboration processes for CI; second, it further elaborates ACAP theory by emphasizing the role of actors in the general absorptive process, third, it highlights the C2C standard’s role as a boundary object in the CI process; and fourth, it provides a parsimonious C2C innovation process model, highlighting the core constructs of CI processes.