Circular Economy indicators for supply chains: A systematic literature review

Recently, the Circular Economy paradigm has emerged as an alternative to linear and unsustainable production and consumption systems. In order to implement Circular Economy practices and evaluate their effects, organisations need adequate measurement tools. These tools should extend beyond the single firm boundary and consider the complexity of supply chains, material flows, and environmental and social impacts. However, no established indicator exists to assist the transition of supply chains to a higher degree of circularity; also, most of the literature on Circular Economy indicators has focused on the firm rather than on the supply chain as the level of analysis. Through a Systematic Literature Review, this paper examines decision support tools, and related indicators, employed for assessing the performance of Circular Supply Chains in the academic literature. In parallel, a content analysis and a template technique are employed to evaluate how Multi National Enterprises measure the effect of the adoption of Circular Economy practices in their reports. Results are synthesised in two composite indicators, which aggregate the most commonly employed metrics. Findings show that both academic literature and industrial practice show a scarce consideration of social and circularity measurements, rather focusing on classical environmental impacts and economic ones. In the academic literature, the economic dimension is prevalent; practitioners seem to evaluate and communicate more often the environmental impacts of already adopted Circular Economy practices. Also, different indicators’ categories (monetary, biophysical, composite indicators) are recognised, according to their choices in terms of selection and aggregation of different metrics and to the contribution they can bring to the transition from linear to circular supply chains.