Circular Economy and Digital Supply Chain : The role of emerging technologies for facilitating sustainability

Abstract

Increasing demand for sustainability and rapid digital technological development is changing how companies operate and manage their supply chains. This thesis investigates integrating digital technologies into supply chains to support the transition toward a circular economy (CE). The study mainly addresses how digital transformation helps to improve waste reduction, traceability, and transparency— the fundamental elements of circular economy objectives. This research emphasizes the application of emerging digital technologies or industry 4.0 tech-nologies, including the Internet of Things (IoT), Artificial Intelligence (AI), blockchain, digital twins, big data analytics, cloud computing, and additive manufacturing.

A qualitative research methodology was adopted, applying a thematic analysis approach to explore patterns and insights within the data. Following Braun and Clarke’s six-phase framework, the study systematically identified key themes relevant to the research objectives. Content analysis was then conducted using sustainability and annual reports from 18 multinational companies across various industries doing business operations in Finland. Through this method, five core themes emerged: the adoption of digital technologies, supply chain transparency, circular manufacturing integration, implementation challenges, and future directions for innovation.

Findings show that digital technologies improve supply chain functions and facilitate the implementation of circular economy practices more efficiently for businesses. Such digital technologies facilitate integration to enable real-time tracking, efficient use of resources, and development of closed-loop production systems. As per research, big companies have seen positive trends in adopting such technologies, but there are persistent challenges—financial, technical, regulatory, and organizational in nature. Small and medium-sized enterprise organizations (SMEs) are also negatively impacted, as they typically do not have the technical capability and the funds needed for digital transformation.

The research concludes that effective integration of digital technologies into supply chains is more than just the adoption of new technology. It requires coordinated planning to link technology and sustainability objectives, interdepartmental coordination, and supporting regulatory and policy environments. The findings emphasize that digital solutions must be embedded into the overall supply chain strategy to achieve meaningful circular economy outcomes. This thesis adds to an understanding of how digital technologies are currently being used in the industry by offering insights based on actual company practices. It also highlights the practical barriers and enablers influencing how organizations implement circular and digital strategies together.