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Circular Business Models for Construction Companies: A Literature Review and Future Research Directions

Author

Listed:
  • Bowen Zhang

    (Department of Civil, Environmental and Natural Resources Engineering, Luleå University of Technology, 971 87 Luleå, Sweden)

  • Johan Larsson

    (Department of Civil, Environmental and Natural Resources Engineering, Luleå University of Technology, 971 87 Luleå, Sweden)

  • Wiebke Reim

    (Entrepreneurship and Innovation, Luleå University of Technology, 971 87 Luleå, Sweden)

Abstract

The construction industry, being material-intensive, is a major target for sustainability initiatives due to its significant consumption of energy and resources. In response, circular economy principles are gaining interest from the construction industry, since they benefit the environment and promote sustainable societal development. Nevertheless, the implementation of these circular economy principles has not been widely adopted by construction companies within the construction industry, indicating substantial room for improvement in areas such as coordinating policies, market conditions, and business model development for different actors within the project-based construction industry. The objective of this research is to explore the content of circular business models for construction companies, as they play a critical role in promoting the implementation of circular economy principles to foster responsible consumption of raw materials and mitigate the environmental impact of the industry. Current research in this field lacks systematic views, which may enhance understanding and provide a theoretical basis for researchers and construction companies transitioning toward circular economy principles. This article employs a literature review method of including 53 journal articles, where the content of analysis reveals 34 aspects related to circular business models for construction companies. Additionally, the study outlines future research directions, focusing on the intersections between different elements within the business model. The findings of this study offer valuable insights for policymakers on how to strengthen external support and the development of circular value networks to promote the adoption of circular business models from the perspective of construction companies.

Suggested Citation

  • Bowen Zhang & Johan Larsson & Wiebke Reim, 2025. "Circular Business Models for Construction Companies: A Literature Review and Future Research Directions," Sustainability, MDPI, vol. 17(10), pages 1-24, May.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:10:p:4688-:d:1659773
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    References listed on IDEAS

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    1. Wim Lambrechts & Andrew Mitchell & Mark Lemon & Muhammad Usman Mazhar & Ward Ooms & Rikkert van Heerde, 2021. "The Transition of Dutch Social Housing Corporations to Sustainable Business Models for New Buildings and Retrofits," Energies, MDPI, vol. 14(3), pages 1-24, January.
    2. Carlos Galera-Zarco & José Antonio Campos, 2021. "Exploring Servitization in Industrial Construction: A Sustainable Approach," Sustainability, MDPI, vol. 13(14), pages 1-19, July.
    3. Namho Cho & Mounir El Asmar & Mohammad Aldaaja, 2022. "An Analysis of the Impact of the Circular Economy Application on Construction and Demolition Waste in the United States of America," Sustainability, MDPI, vol. 14(16), pages 1-21, August.
    4. Igor Ceratti Treptow & Jordana Marques Kneipp & Clandia Maffini Gomes & Isak Kruglianskas & Rodrigo Reis Favarin & Carlos María Fernandez-Jardón, 2022. "Business Model Innovation for Sustainable Value Creation in Construction Companies," Sustainability, MDPI, vol. 14(16), pages 1-17, August.
    5. Malin zu Castell-Rüdenhausen & Margareta Wahlström & Thilde Fruergaard Astrup & Carl Jensen & Anke Oberender & Pernilla Johansson & Eirik Rudi Waerner, 2021. "Policies as Drivers for Circular Economy in the Construction Sector in the Nordics," Sustainability, MDPI, vol. 13(16), pages 1-18, August.
    6. Vinit Parida & David Sjödin & Wiebke Reim, 2019. "Reviewing Literature on Digitalization, Business Model Innovation, and Sustainable Industry: Past Achievements and Future Promises," Sustainability, MDPI, vol. 11(2), pages 1-18, January.
    7. Luis Manuel Cerdá-Suárez & Juan Felipe Espinosa-Cristia & Karen Núñez-Valdés & Gerson Núñez-Valdés, 2023. "Detecting Circular Economy Strategies in the Fourth Sector: Overview of the Chilean Construction Sector as Evidence of a Sustainable Business Model," Sustainability, MDPI, vol. 15(11), pages 1-23, May.
    8. Sara Scipioni & Meir Russ & Federico Niccolini, 2021. "From Barriers to Enablers: The Role of Organizational Learning in Transitioning SMEs into the Circular Economy," Sustainability, MDPI, vol. 13(3), pages 1-31, January.
    9. Sultan Çetin & Catherine De Wolf & Nancy Bocken, 2021. "Circular Digital Built Environment: An Emerging Framework," Sustainability, MDPI, vol. 13(11), pages 1-34, June.
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    1. Osamudiamen Kenneth Otasowie & Clinton Aigbavboa & Ayodeji Oke & Peter Adekunle, 2026. "Exploring the Dynamics of Client Segments in Circular Economy Business Model for Construction Organisations," Circular Economy and Sustainability, Springer, vol. 6(1), pages 1-19, February.

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