Circular Economy Practices and Sustainable Supply Chain Performance: JEL Classification: M11, M14, L23, Q01, Q53

Hilman Hadi; Reski Nursyam

doi:10.37899/mjdm.v3i3.397

Authors

Hilman Hadi Management Department at Muslim University of Indonesia
Reski Nursyam Department of Communication Science, Muslim University of Indonesia

DOI:

https://doi.org/10.37899/mjdm.v3i3.397

Keywords:

Circular Economy, Manufacturing Industry, Organizational Capability, Resource Efficiency, Sustainable Supply Chain Management

Abstract

This study investigates the influence of Circular Economy Practices on Sustainable Supply Chain Performance within manufacturing organizations. A quantitative research design was employed using survey data collected from manufacturing firms, and the proposed research model was analyzed using Partial Least Squares Structural Equation Modeling. The empirical findings indicate that Circular Economy Practices positively and significantly influence Sustainable Supply Chain Performance by enhancing resource efficiency, supporting waste reduction, and strengthening collaboration across supply chain activities. The results further demonstrate that circular economy implementation contributes not only to environmental sustainability but also to operational effectiveness and organizational competitiveness. These findings reinforce the strategic role of circular economy practices as organizational capabilities that improve long-term supply chain sustainability. The study contributes to the literature by providing an integrated perspective linking circular economy implementation with sustainable supply chain performance while offering practical insights for managers seeking to strengthen organizational resilience through circular business strategies. Future research should expand the analytical framework by incorporating additional organizational capabilities and broader industrial contexts.

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