Enabling Circular Value Chains via Technology-Driven Scope 3 Cooperation

Despite major policy, industry, and individual efforts to reduce global environmental damage, the industry-induced carbon footprint continues to persist under changing geographical patterns. Having shifted significantly from advanced economies to emerging economies and developing world regions, greenhouse gas emissions from footprint-heavy activities, such as raw material sourcing and waste disposal, are not addressed by institutional and corporate solutions due to different regional standards or the overall absence of mandatory reporting. Rooted in the analysis of industry practices and past literature, the present research presents an integrated theme-based perspective on the interplay between focal firms and their suppliers in the context of advanced and emerging economies in underreported Scope 3 activity carbon footprint management. We argue that it is technology-driven unified efforts, which enforce factors such as traceability, transparency, and predictive and prescriptive capabilities within Scope 3 activities, that need to be addressed to ensure the activation and maintenance of a truly sustainable global value chain (GVC). By departing from traditional command-and-control practices and extending upon the existing governance-focused framework of sustainable value creation, this paper highlights the essential co-creating stance of non-focal actors in achieving a circular approach to sustainability within GVCs.