A N M Adnan 

 

 Sustainable Business Model Adaptation in International 
Markets: A Case Study on Circular Economy and Green 
Supply Chain Integration by Multinational Enterprises 

  
Master’s Thesis 

 

 

 

 

 

 

 
  Vaasa 2025 

Master of Science in Economics and Business Administration 
                                  Master's Degree Programme in International Business 
                                                                                                 University of Vaasa   



2 

UNIVERSITY OF VAASA 
Master of Science in Economics and Business Administration 

Author: A N M Adnan 
Title of the thesis:  Sustainable Business Model Adaptation in International Markets: A 

Case Study on Circular Economy and Green Supply Chain Integration 
by Multinational Enterprises.  

Degree: Master's Degree Programme in International Business                                                                                    
Discipline: International Business   
Supervisor: Arto Ojala 
Year: 2025 Pages: 84 

 
ABSTRACT : 
 
Sustainability has transitioned from a peripheral concern to a central strategic imperative for 
Multinational Enterprises (MNEs) in the contemporary global landscape. Within this context, 
Business Model Innovation (BMI) is recognized as a critical mechanism for embedding sustaina-
bility into the core of an organization. Specifically, the integration of Circular Economy (CE) prin-
ciples, which aim to eliminate waste and circulate resources, and Green Supply Chain Manage-
ment (GSCM) practices, which embed environmental considerations across the product lifecycle, 
represents a potent synergistic approach. However, the academic discourse remains fragmented, 
with limited empirical understanding of how MNEs navigate the integration of these concepts 
across diverse and often challenging international institutional environments.  
 
The primary goal of this study is to examine how MNEs adapt their business models to incorpo-
rate CE and GSCM principles across various international markets. The research is guided by two 
main questions: first, how are these adaptations reflected in their business models, and second, 
what internal capabilities and external institutional factors influence this process? To frame this 
inquiry theoretically, the study is based on Institutional Theory, which explains how external co-
ercive, normative, and mimetic pressures influence organizational behavior, and the Resource-
Based View (RBV), which emphasizes the internal resources and capabilities that provide a com-
petitive advantage. 
 
The key findings reveal that the adaptation of Sustainable Business Models (SBMs) is a multifac-
eted and context-sensitive process. It was found that MNEs do not implement a uniform global 
strategy but engage in a deliberate balancing act between global strategic alignment and local 
operational customization. The integration of CE and GSCM imposes a vital reconfiguration of 
key business model components, including value propositions, key activities, and key partner-
ships. Externally, the reworking is strongly influenced by a combination of regulatory pressures, 
market demands, and infrastructural readiness in host countries. Internally, the efficiency of in-
tegration is resolved by organizational capabilities such as cross-functional collaboration, tech-
nological expertise, senior leadership commitment, and the ability to foster strategic partner-
ships with suppliers. The interaction between these external pressures and internal capabilities 
was identified as the central dynamic explaining the alteration in adaptation strategies and out-
comes. 
 

KEYWORDS: Sustainability, Circular Economy, Green Supply Chain Management, Sustainable 
Business Model, Multinational Enterprises, Business Model Innovation, Resource-Based View. 

  



3 

Contents  

1 Introduction 6 

1.1 Background of the study 6 

1.2 Research Gap 9 

1.3 Research Objective and Research Questions 13 

1.4 Definition of Key Concepts. 14 

1.5 Research Process 15 

1.5.1 Literature Review and Theoretical Framework 15 

1.5.2 Research Design and Methodological Strategy 15 

1.5.3 Data Collection Procedures 16 

1.5.4 Analysis of Collected Data 16 

1.5.5 Interpretation and Final Synthesis 16 

2 Literature Review 17 

2.1 Sustainability 18 

2.2 Circular Economy (CE) 20 

2.3 Green Supply Chain Management (GSCM) 22 

2.4 Business Model Innovation (BMI) 25 

2.5 Institutional Theory 27 

2.6 Resource-Based View (RBV) 28 

3 Conceptual Framework 30 

3.1 Sustainability through the Lens of Circular Economy 32 

3.2 Sustainability through the Lens of GSCM 34 

3.3 Business Model Innovation (BMI) through the Lens of Sustainability 35 

3.4 Business Model Canvas: Sustainability Orientation in the Context of CE and 

GSCM 36 

4 Methodology 42 

4.1 Research Philosophy and Rationale 42 

4.2 Case Study Approach 43 

4.3 Data Collection Techniques 44 



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4.4 Participant Selection 45 

4.5 How the data was analyzed 46 

4.6 Ensuring Quality and Reliability 47 

4.7 Ethics 47 

4.8 Company Overviews for Methodology Section 48 

4.8.1 Company A 48 

4.8.2 Company B 48 

4.8.3 Company C 49 

4.8.4 Company D 49 

4.8.5 Company E 49 

5 Findings 51 

6 Discussions 59 

6.1 Sustainable Business Model Canvas: Adaptation Based on Analyzed Themes 59 

6.2 Limitations 63 

6.3 Future Research Possibilities 64 

7 Conclusions 66 

References 68 

Appendices 79 

Appendix 1. Semi-structured interview questions 79 

Appendix 2. Mapping Key Sustainability Themes to Business Model Canvas (BMC) 

Components 81 

 
 
 
 
 
 
 
 
 
 
 
 



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Figures 
 
Figure 1. GSCM for a Sustainable Industry. 24 

Figure 2. Sustainable Business Model Adaptation Funnel. 31 

Figure 3. Business Model Canvas. 37 

Figure 4. Sustainable Business Model Canvas. 59 

 
Tables 
 
Table 1. Definition of Key Concepts. 14 

Table 2. Definitions of Sustainability. 19 

Table 3. Definitions of Circular Economy (CE). 21 

Table 4. Definitions of Green Supply Chain Management (GSCM). 23 

Table 5. Definitions of Business Model Innovations (BMI). 26 

Table 6. Transformation of BMC Elements under CE and GSCM. 41 

Table 7. Research methods and design of the study. 44 

Table 8. Details of the Interviewees. 45 

Table 9. MNE Details at a Glance. 50 

 

Abbreviations  
 

CE Circular Economy 

GSCM Green Supply Chain Management 

SBM Sustainable Business Model 

BMI Business Model Innovation 

RBV Resource-Based View 

TBL Triple Bottom Line 

MNE Multinational Enterprises 

SDGs Sustainable Development Goals 

BMC Business Model Canvas 

TLBMC Triple-Layered Business Model Canvas  

SIBMIs Sustainable International Business Model Innovations  

 



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1 Introduction  

1.1 Background of the study  

Sustainability has shifted from a peripheral corporate concern to a dominant strategic 

imperative for multinational enterprises (MNEs). The fast-tracking pace of climate 

change, biodiversity loss, and resource exhaustion has underscored the boundaries of 

traditional growth models, forcing firms to reexamine their long-term practicality. Stake-

holders, extending from customers and investors to regulators and civil society, now ex-

pect firms to take an active role in addressing ecological and social concerns, not as an 

add-on to business but as an essential part of it. The United Nations’ Sustainable Devel-

opment Goals (SDGs) articulate a global program to achieve environmental integrity, so-

cial progress, and economic prosperity by 2030 (van der Waal, Thijssens, & Maas, 2021). 

For MNEs, whose global operations span several markets, supply chains, and regulatory 

environments, the SDGs signify both a moral imperative and a strategic prospect to 

shape sustainable development paths across industries and geographies (van Zanten & 

van Tulder, 2018). 

 

Meeting these potentials demands more than incremental functioning enhancements 

or isolated environmental initiatives. The discussion on corporate sustainability has 

evolved from corporate social responsibility as an external practice to the integration of 

sustainability into the core strategic and operational aspects of the firm (Burritt, Christ, 

Rammal, & Schaltegger, 2020). This shift necessitates companies to reconsider their fun-

damental expectations about how value is created, delivered, and captured, implanting 

sustainability reflections into the very construction of the business. Static business rep-

resentations are increasingly inadequate in an era marked by rapid technological ad-

vances, unstable resource markets, and shifting societal values. Adaptability, resilience, 

and innovation are now fundamentals for long-term competitiveness. 

 

One tactical approach that addresses these demands is Business Model Innovation (BMI). 

BMI involves the purposeful reconfiguration of the basics of a business model, which is 



7 

in the form of value propositions, value delivery mechanisms, and value capture struc-

tures in response to changes in market, technological, institutional, or environmental 

conditions (Foss & Saebi, 2017). In sustainability contexts, BMI is not about marginal 

“green” initiatives but about implementing conservation and social objectives into the 

organization’s strategic fundamentals. This involves reforming products, services, pro-

cesses, and value networks to achieve an equilibrium between economic performance 

and sustainability results (Bocken et al., 2014). The framework provided by Bocken et al. 

(2014) offers sustainable business model archetypes, including exploiting material and 

energy competence, creating value from waste, replacing with renewable resources, car-

rying functionality over ownership, and encouraging sufficiency-oriented consumption. 

According to Institutional Theory, organizations operate within broader institutional en-

vironments characterized by coercive compressions (laws and regulations), normative 

pressures (societal values and professional norms), and mimetic pressures (competition 

of industry leaders) (DiMaggio & Powell, 1983). MNEs are uniquely impacted by these 

pressures because they function across multiple institutional circumstances, each with 

diverse regulatory regimes, cultural prospects, and stakeholder priorities. This complica-

tion requires them to strike a balance between global tactical coherence and local re-

sponsiveness (Zaheer, 1998). 

 

From a Resource-Based View (RBV) perspective, successful BMI for sustainability de-

pends on emerging and positioning valuable, rare, inimitable, and non-substitutable 

(VRIN) resources and competences (Barney, 1991). These may include technological 

know-how, supply chain management services, innovation capacity, brand status, and an 

organizational philosophy that supports environmental stewardship. RBV highlights that 

even under parallel institutional pressures, firms with greater internal capabilities are 

better positioned to integrate sustainability into their business models efficiently. Thus, 

BMI develops as the connection of responding to external institutional forces and lever-

aging internal strategic resources. 

 



8 

Within this strategic relationship, the Circular Economy (CE) has appeared as a trans-

formative paradigm that essentially challenges the traditional linear “take–make–dis-

pose” model of production and consumption. By stressing the principles of designing out 

waste and pollution, keeping products and materials in constant circulation, and renew-

ing natural systems, CE encourages an uplifting and regenerative method to industrial 

activity (Geissdoerfer, Savaget, Bocken, & Hultink, 2017). Moreover, CE boosts innova-

tion in materials science, process engineering, and digital tracking technologies, skills 

that can strengthen competitive advantage (Murray, Skene, & Haynes, 2017). From an 

institutional perspective, CE aligns with regulatory trends encouraging waste minimiza-

tion and resource productivity, as well as with stakeholder hopes for responsible con-

sumption and production, exemplified in SDG 12 (United Nations, 2015). From an RBV 

lens, executing CE requires abilities such as design innovation, materials science exper-

tise, reverse logistics infrastructure, and knowledge management systems for resource 

streams. These competences are often path-dependent, meaning they are industrialized 

over time and cannot be easily replicated by competitors, giving organizations a sustain-

able, modest advantage.  

 

Green Supply Chain Management (GSCM) represents a comprehensive approach to in-

tegrating environmental responsibility throughout the entire product life cycle, encom-

passing sourcing of raw materials, production, distribution, consumption, and eventual 

disposal or recovery. Rather than treating sustainability as an isolated operational func-

tion, GSCM surrounds environmental thinking in procurement policies, supplier selec-

tion criteria, manufacturing procedures, logistics systems, and post-consumer product 

management (Srivastava, 2007). In global supply networks typical of MNEs, where sup-

pliers function in countries with varying environmental regulations and application ca-

pacities, GSCM plays a vital role in maintaining consistency and credibility in sustainabil-

ity performance (Seuring & Müller, 2008). From an economic standpoint, GSCM can con-

dense costs through improved competence, waste minimization, and energy savings, 

while also mitigating the risk of supply interruptions caused by resource insufficiency or 

regulatory changes (Hervani, Helms, & Sarkis, 2005).   



9 

When CE and GSCM are combined within a BMI framework, the result is a synergistic 

approach that aligns strategic vision with operational implementation. CE guides the pri-

mary direction for resource circularity and system regeneration, while GSCM offers prac-

tical mechanisms for applying this direction across global supply networks. External 

forces from institutions create the push for adoption, while internal resources and com-

petencies influence how effectively these strategies are executed and maintained over 

time. High institutional distance may necessitate significant adaptation of global strate-

gies to local frameworks, and the liability of foreignness can add costs and legitimacy 

challenges for MNEs (Zaheer, 1998). Overcoming these obstacles requires both sensitiv-

ity to local institutional contexts and the ability to transfer and adapt VRIN resources in 

ways that preserve strategic coherence and continuity. 

 

Against this background, this research aims to explore how MNEs employ business 

model innovation to assimilate circular economy principles and green supply chain man-

agement practices into their operations across various institutional circumstances. It 

aims to understand how external institutional pressures and internal resource capabili-

ties interrelate to shape strategic decisions, operational practices, and performance out-

comes in the framework of sustainable business model adaptation. By adopting a quali-

tative multiple-case study approach, the study will provide insights into the mechanisms, 

capabilities, and contextual factors that allow MNEs to align economic performance with 

environmental stewardship and social responsibility on a global scale. 

 

This thesis utilized AI tools, including ChatGPT and Gemini, for ideation, and Grammarly 

for ensuring grammatical accuracy and coherence of language. 

 

1.2 Research Gap 

The academic discourse on sustainability has matured considerably, yet there remain 

significant areas where knowledge is either incomplete or fragmented, particularly when 

viewed through the lens of multinational enterprises (MNEs) attempting to reconcile 

global sustainability imperatives with complex operational realities. Although business 



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model innovation (BMI), circular economy (CE), and green supply chain management 

(GSCM) have each been explored extensively, the intersection of these themes within 

diverse institutional environments is still underdeveloped. Addressing this gap is vital 

because MNEs are not only subject to the pressures of global environmental agendas 

but also to the constraints and opportunities that arise from varied regulatory regimes, 

cultural contexts, and resource conditions. 

 

Gap 1: Limited empirical understanding of business model innovation for sustainability 

in MNEs across diverse institutional contexts. 

 

BMI for sustainability has been widely acknowledged as a crucial driver for embedding 

environmental and social considerations into the strategic core of organizations (Foss & 

Saebi, 2017; Bocken, Short, Rana, & Evans, 2014). By altering value propositions, delivery 

systems, and revenue structures, BMI offers firms the flexibility to respond to the 

evolving expectations of stakeholders and the challenges posed by environmental 

degradation. However, much of the empirical work in this area focuses on case studies 

within single-country settings or narrow industry contexts, particularly in developed 

economies where institutional conditions, such as supportive regulation, advanced 

infrastructure, and sustainability-aware markets, are conducive to innovation 

(Geissdoerfer, Savaget, Bocken, & Hultink, 2017). 

 

The reality for MNEs is more complex. Institutional theory (DiMaggio & Powell, 1983) 

posits that organizations are influenced by coercive, normative, and mimetic pressures, 

all of which can differ substantially across national borders. Zaheer’s (1998) concept of 

the liability of foreignness further highlights that firms face additional costs when 

operating in unfamiliar environments, not only due to market unfamiliarity but also 

because of variations in institutional frameworks. In sustainability contexts, these 

variations manifest as differences in environmental legislation, cultural perceptions of 

corporate responsibility, and the availability of enabling infrastructure (Xu & Shenkar, 

2002). Existing research has not sufficiently examined how MNEs navigate these 



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disparities when innovating their business models to achieve sustainability. The tension 

between global standardization for efficiency and local adaptation for legitimacy is 

particularly underexplored (Burritt, Christ, Rammal, & Schaltegger, 2020). Without 

empirical evidence of how these strategic adjustments occur in practice across multiple 

institutional contexts, there is a risk of oversimplifying the pathways through which BMI 

for sustainability can be achieved in globally distributed organizations. 

 

Gap 2: Insufficient integration of the circular economy and green supply chain 

management within a unified strategic framework. 

 

While CE and GSCM are both recognized as essential tools for achieving organizational 

sustainability, their integration into a single strategic framework remains limited in both 

theory and practice. CE offers a macro-level vision of regenerative economic systems, 

aiming to design out waste, maintain material utility, and regenerate natural ecosystems 

(Kirchherr, Reike, & Hekkert, 2017; Geissdoerfer et al., 2017). Its practical applications 

include eco-design, modular product development, closed-loop manufacturing, and 

product-as-a-service models (Bocken et al., 2014; Murray, Skene, & Haynes, 2017). GSCM, 

by contrast, operates at a supply chain level, embedding environmental considerations 

into procurement, production, logistics, and end-of-life product recovery (Srivastava, 

2007; Zhu, Sarkis, & Lai, 2013). 

 

CE discussions tend to prioritize product and system design, while GSCM literature 

focuses on operational execution and supplier engagement (Seuring & Müller, 2008). Yet 

in practice, the two are deeply interdependent: CE initiatives require the logistical and 

operational capabilities that GSCM provides, such as reverse logistics for product take-

back, green sourcing strategies, and collaborative supplier development (Carter & Rogers, 

2008; Hervani, Helms, & Sarkis, 2005). Conversely, GSCM gains strategic coherence when 

guided by CE principles that extend environmental considerations beyond supply chain 

stages to the entire product life cycle (Lewandowski, 2016). Without an integrated 

framework, organizations risk implementing fragmented initiatives, such as adopting 



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circular design without enabling supply chain mechanisms, or greening procurement 

without aligning it to long-term circularity goals. This fragmentation is even more 

pronounced in MNEs, where diverse institutional environments can create uneven 

adoption of CE and GSCM practices. Regulatory differences, infrastructure gaps, and 

cultural variations in consumption norms all influence the feasibility and design of 

integrated strategies.  

 

Gap 3: Limited research on the interplay between institutional pressures and internal 

resource capabilities in sustainable business model adaptation. 

 

Institutional theory and the resource-based view (RBV) have each contributed valuable 

understanding to the organizational approach. Institutional theory explains how 

organizations reply to external pressures, including formal guidelines, societal standards, 

and industry standards (DiMaggio & Powell, 1983; van Zanten & van Tulder, 2018). RBV, 

in contrast, centers on internal organizational strengths, signifying that continued 

competitive advantage rises from resources and proficiencies that are appreciated, rare, 

unique, and non-substitutable (Barney, 1991; Teece, Pisano, & Shuen, 1997). 

 

In sustainability frameworks, RBV has been used to showcase abilities such as environ-

mental innovation, process optimization, and strong stakeholder systems as drivers of 

sustainable act (Hart, 1995). However, the two viewpoints are often applied distinctly, 

with little combination in illuminating how firms adjust business models for sustainability. 

This separation limits understanding of the active interaction between external demands 

and internal capabilities, predominantly in MNEs, where both sets of issues vary expres-

sively across settings. For example, an MNE with advanced R&D in renewable materials 

may be able to pioneer CE practices in markets with minimal regulatory support, while 

robust supplier management systems can enable GSCM in challenging institutional set-

tings. Conversely, rigorous environmental regulations in certain jurisdictions may induce 

firms to develop new organizational capabilities, such as closed-loop supply chains or 

renewable energy sourcing that later serve as viable assets globally. Burritt et al. (2020) 



13 

perceive that the encounter for many MNEs lies not in pronouncing sustainability com-

mitments but in aligning these promises with both external requirements and internal 

strengths across varied operational circumstances. 

 

1.3  Research Objective and Research Questions  

This study's main intention is to find out how MNEs adapt business models for sustaina-

bility to fit several international markets by integrating CE and GSCM principles. As sus-

tainability becomes a progressively crucial strategic concern, organizations face growing 

pressure to assimilate environmental and resource-efficient practices into their opera-

tions. However, the edition of SBMs by MNEs differs across markets due to different in-

stitutional situations, stakeholder hopes, and infrastructural readiness. Understanding 

how and why these adaptations happen, as well as what shapes them, is vital for both 

theory and practice.  

 

To address this objective, the resulting research questions are proposed:  

1. In what ways do MNEs adapt business models to integrate CE and GSCM principles 

across different international markets?  

2. What internal capabilities and external institutional aspects influence the adaptation 

of SBMs by MNEs?  

 

These questions aim to generate insights into the mechanisms through which 

sustainability-oriented business models evolve in a global context. The first question 

focuses on the adaptation process itself, looking at the specific ways in which CE and 

GSCM are integrated into MNE operations across borders. It guides the descriptive and 

analytical part of the study, helping to map patterns of sustainable practice and 

innovation. This question will be explored through a qualitative case study method, 

utilizing interviews and company documentation to understand adaptation strategies in 

practice.  The second question shifts the focus to drivers and barriers. It seeks to identify 

the internal resources (e.g., organizational capabilities, leadership commitment, 

technological assets) and external pressures (e.g., regulation, cultural norms, market 



14 

demand) that shape how these adaptations unfold. This aligns with theoretical lenses 

such as the RBV and Institutional Theory, and it will be explored through within-case and 

cross-case analysis of selected MNEs. 

1.4 Definition of Key Concepts. 

This study builds on a set of core ideas that shape the direction of the research. These 

include sustainability, the circular economy, green supply chain management, business 

model innovation, and sustainable business models. To provide clarity and a shared 

understanding, definitions of a few important concepts are given below. 

Table 1. Definition of Key Concepts 

Key Concepts Author(s) and 
Year 

Article Title Definition 

Sustainability McMichael et 
al., 2003 

New visions for address-
ing sustainability. Sci-
ence, 302(5652), 1919–
1920 

Sustainability means transform-
ing our ways of living to maxim-
ize the chances that environ-
mental and social conditions will 
indefinitely support human se-
curity, well-being, and health. 

Circular Econ-
omy (CE)  

Kirchherr et 
al., (2017)  

Conceptualizing the CE: 
An analysis of 114 defini-
tions  

A structure of the economy 
aimed at putting an end to 
waste and maintaining re-
sources in a state of use for as 
long as is feasible through reuse, 
refurbishment, and recycling.  

Green Supply 
Chain Manage-
ment (GSCM)  

Srivastava, 
S.K. (2007)  

Green supply-chain man-
agement: A state-of-the-
art literature review  

The combination of environ-
mental rational into all phases 
of supply chain administration, 
including product strategy, 
sourcing, production, logistics, 
besides end-of-life practices.  

Business Model 
Innovation 
(BMI)  

Foss & Saebi 
(2017)  

Fifteen years of business 
model innovation re-
search: Current status 
and future challenges  

The purposeful modification or 
re-configuration of a firm's com-
mercial prototype to familiarize 
itself with changing market, 
technological, or environmental 
demands.  

Sustainable 
Business Model 
(SBM)  

Audretsch & 
Link (2019)  

Embracing an entre-pre-
neurial ecosys-tem: An 
analysis of the govern-
ance of research joint 
ventures  

A business model that creates, 
delivers, and captures value 
through sustaining or restoring 
environmental, social, and eco-
nomic capital.  



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1.5 Research Process 

This research is guided by a well-defined sequence of activities designed to address the 

stated objectives and thoroughly answer the research questions. The structure ensures 

academic precision and practical application. The process is broken down into five 

interconnected phases: (1) an extensive review of relevant literature and foundational 

theories, (2) development of a tailored research design, (3) systematic collection of 

empirical data, (4) rigorous analysis of the findings, and (5) interpretation and synthesis 

of insights. 

 

1.5.1 Literature Review and Theoretical Framework 

The research begins with a comprehensive examination of existing academic studies and 

practitioner reports that focus on the CE, green supply chain practices, and SBM devel-

opment within multinational settings. The review will draw on established theoretical 

constructs, including stakeholder theory, institutional theory, and the RBV, to provide 

conceptual depth. This phase sets the groundwork by identifying existing knowledge 

gaps and refining the study’s direction. 

 

1.5.2 Research Design and Methodological Strategy 

Given the exploratory nature of the investigation and the contextual variation associated 

with it, a qualitative methodology is the most suitable approach. Employed a multiple-

case study design to gather rich, contextualized details about how multinational compa-

nies integrate sustainability practices into the various geographic and operational con-

texts in which they operate. This method provides contextual richness and flexible data 

interpretation. Different industries and global regions were represented in the purposive 

sampling of organizations selected for this project, thereby enhancing the relevance of 

the insights to be generated. 

 



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1.5.3 Data Collection Procedures 

The key players in sustainability, supply chain operations, and regional management 

within selected MNEs were the primary data sources acquired using semi-structured in-

terviews. These participants have provided the necessary details in their responses, en-

abling a thorough analysis that addresses all the research questions. An interview guide 

was used conversationally to ensure that the necessary topics were covered, while also 

allowing for the natural unfolding of the dialogue. All the interviews were conducted via 

digital means to ensure that all conversations were recorded and took place in a safe and 

secure environment. 

 

1.5.4 Analysis of Collected Data 

The gathered data have undergone thematic analysis to reveal repeated themes and sto-

ries in sync with the study's intent. This method provides a means for augmented inter-

pretation of qualitative data. Coding was performed using software like NVivo to main-

tain consistency and make the large volume of information manageable. Comparison 

between cases aided in surfacing and declaring patterns, as well as making distinctions 

that add interpretive richness.  

 

1.5.5 Interpretation and Final Synthesis 

The research aims to provide a precise understanding of how the implementation of sus-

tainable global strategies occurs within transnational corporations across various envi-

ronments. A detailed, theoretically robust, and practically relevant set of findings was 

the desired outcome. Hence, the final step is to reframe the analyzed data about the 

main research questions and theoretical frameworks. Both the academic and real-world 

significance of the findings were considered, especially in terms of their contribution to 

corporate sustainability from the MNE's point of view, concerning the integration of sus-

tainability into their overall strategy. At the latter part of the thesis, the study's limita-

tions are discussed, along with some very promising avenues for further research. 



17 

2 Literature Review   

The existing literature increasingly positions sustainability as a strategic priority for mul-

tinational enterprises (MNEs), particularly as they operate in diverse and complex global 

environments. Rather than treating environmental responsibility as a compliance exer-

cise, recent work views it as a long-term source of competitiveness firmly tied to how 

firms create, deliver, and capture value (Foss & Saebi, 2016; Bocken et al., 2016). Within 

this conversation, three interconnected themes dominate: circular economy practices, 

green supply chain management, and business model innovation. The circular economy 

advocates for a shift away from linear production towards resource recovery, waste re-

duction, and regeneration across product lifecycles (Geissdoerfer et al., 2017). Authors 

stress that MNEs must embed such principles not at the margins, but throughout their 

value chains and global networks to build resilience and legitimacy in both developed 

and emerging markets (de Man & Strand, 2020; Lüdeke-Freund et al., 2017). 

 

In parallel, green supply chain scholarship emphasizes the integration of environmental 

considerations into sourcing, production, logistics, and reverse logistics (Srivastava, 2007; 

Ahi & Searcy, 2013). Progress in this field emphasises supplier collaboration, eco-design, 

responsible procurement, and product stewardship as tools for reducing ecological risk 

and enhancing operational efficiencies (Zhu, Sarkis, & Lai, 2013; Dubey et al., 2017). 

However, managing such change across countries with different institutional pressures 

and stakeholder expectations remains highly challenging (Fahimnia et al., 2015; Jia et al., 

2020). The business model innovation literature links these strands by arguing that sus-

tainability demands more than incremental improvements; it requires redesigning the 

organisation’s core logic and capabilities (Schaltegger et al., 2016; Pieroni et al., 2019). 

It is particularly relevant for MNEs balancing globally integrated strategies with the need 

for responsiveness to local conditions (Meyer & Peng, 2016; Sinkovics et al., 2021). 

 

Although theoretical contributions on sustainable business model adaptation are grow-

ing, there remains a limited understanding of how MNEs practically integrate circular 

economy and green supply chain practices into their business models while navigating 



18 

resource constraints, institutional differences, and strategic tensions between headquar-

ters and subsidiaries (Lüdeke-Freund et al., 2017; Foss & Saebi, 2018). This review, there-

fore, brings together insights from these three strands of literature to build a conceptual 

foundation for analysing how MNEs pursue sustainability-oriented business model ad-

aptation in international contexts. The following sections develop each thematic area in 

greater detail to guide the empirical enquiry of this study. 

 

2.1 Sustainability  

Sustainability began as an environmental concept and has evolved into a broader mind-

set that influences how organizations operate and make decisions. The term became 

mainstream after the Brundtland Report, which defined sustainable development as 

progress that “meets the needs of the present without compromising the ability of fu-

ture generations to meet their own needs” (WCED, 1987). Over time, scholars have 

agreed that sustainability rests on three interconnected elements: environmental pro-

tection, social well-being, and economic stability (Elkington, 1997; Dyllick & Hockerts, 

2002). What began primarily as a concern for conserving natural resources (Pearce & 

Turner, 1990) is now considered a guiding principle influencing how industries operate 

across international supply chains (Porter & Kramer, 2006; Hart & Milstein, 1999). 

 

The earliest debates on sustainability emerged from ecological thinking in the 1970s, 

which focused on the limits to growth and the need to conserve resources (Meadows et 

al., 1972). In the 1990s, this thinking grew in importance in the management world with 

the overview of the ‘Triple Bottom Line’ approach, which recommended that companies 

should report and achieve not just financially, but also socially and environmentally 

(Elkington, 1997). Scholars claimed that companies cannot continue in the long run with-

out distinguishing their dependence on healthy social and ecological systems 

(Shrivastava, 1995; Gladwin et al., 1995). More recent advances in sustainability thinking 

highlight the resilience of structures and planetary limitations, calling for a deeper un-

derstanding of how human and natural systems are entangled (Folke et al., 2010; Rock-

ström et al., 2009). 



19 

Table 2. Definitions of Sustainability. 

Author(s) and Year 
(Page) 

Article Title Definition (Direct Quote) 

Geissdoerfer, Vladimirova 
& Evans (2018, p. 402) 

Sustainable Business 
Model Innovation: A 
Review 

“Sustainability has been defined as mee-
ting the needs of the present without 

compromising the ability of future gene-
rations to meet their own needs.” 

Srivastava (2007, p. 54) Green supply-chain 
management: A 
state-of-the-art lite-
rature review 

“Sustainability is concerned with corpo-
rate activities that demonstrate the in-

clusion of social and environmental con-
cerns in business operations and in inte-

ractions with stakeholders.” 

Hart (1994, p. 991) A Natural-Resource-
Based View of the 
Firm 

“Sustainability implies that firms must 
develop capabilities that not only reduce 
their negative environmental impact but 

also actively contribute to long-term 
ecological balance.” 

Burritt, Christ, Rammal & 
Schaltegger (2020, p. 2) 

Multinational Enter-
prises and Sustaina-
bility: A Review and 
Research Agenda 

“Sustainability refers to corporate strate-
gies that integrate economic prosperity, 
environmental quality, and social equity 
to create long-term value for both busi-

ness and society.” 

van der Waal, Thijssens & 
Maas (2021, p. 2) 

The Innovative Con-
tribution of Multina-
tional Enterprises to 
the Sustainable 
Development Goals 

“Sustainability is increasingly operatio-
nalized through the United Nations’ Sus-

tainable Development Goals, which 
combine environmental, social, and 

economic dimensions.” 

 

Multinational enterprises (MNEs), given their extensive transnational operations and re-

source footprints, play a decisive role in advancing sustainability agendas globally (Christ-

mann, 2004; Kolk, 2016). As institutional actors embedded in multiple regulatory, cul-

tural, and market environments, MNEs adopt sustainability not only to ensure legitimacy 

across host and home countries but also to manage global supply chain risks and capture 

emerging opportunities (Garriga & Melé, 2004; Doh & Guay, 2006; Kostova & Zaheer, 

1999).  

 



20 

2.2 Circular Economy (CE) 

The circular economy (CE) has emerged as a prominent alternative to the traditional lin-

ear model of "take, make, dispose," which characterizes most industrial structures. Ra-

ther than moving materials in a straight line from extraction to waste, the CE framework 

encourages continuous resource use through strategies such as reuse, refurbishment, 

remanufacturing, and recycling (Geissdoerfer et al., 2017). The European Commission 

(2015) describes it as an economy designed to be restorative, where products and ma-

terials stay in circulation for as long as possible and waste generation is minimised. While 

the idea builds on earlier traditions such as industrial ecology, cradle-to-cradle design, 

and eco-efficiency (Frosch & Gallopoulos, 1989; Braungart et al., 2007), it has developed 

into a shift in thinking that calls for systemic change across industries and broader value 

networks. Although the term "circular economy" is relatively recent, its intellectual roots 

can be traced back to ecological economics, particularly warnings in the 1960s and 1970s 

about the environmental limits to linear growth (Boulding, 1966; Pearce & Turner, 1990). 

During the early 2000s, policymakers, especially in Europe and China, began promoting 

CE through national strategies aimed at decoupling economic prosperity from resource 

extraction (Murray, Skene & Haynes, 2017; Kirchherr et al., 2018).  

 

CE is often viewed as a practical means of implementing the broader ideals of sustaina-

ble development. Rather than addressing environmental harm after it occurs, circularity 

aims to design waste and pollution out of the system by keeping materials circulating 

within the economy (Ghisellini, Cialani, & Ulgiati, 2016). From a sustainability standpoint, 

CE contributes to environmental preservation by reducing pressures on ecosystems, 

while also yielding social benefits through local employment and economic benefits 

through cost savings and resource security (Korhonen, Honkasalo, & Seppälä, 2018). 

Scholars argue that CE's principal value lies in its ability to translate the global sustaina-

bility agenda into business-level actions (Blomsma & Brennan, 2017; Ritala et al., 2018). 

However, this often needs changes in organizations, infrastructure, and consumer be-

havior, signifying that CE is not just a technological resolution but a more reflective socio-

economic shift (Geissdoerfer et al., 2020). 



21 

MNEs play a vital role in advancing the circular economy because their operations link 

suppliers, producers, and consumers across different institutional environments. Their 

scale and influence allow them to act as drivers of change by transferring technologies, 

establishing environmental standards, and shaping expectations throughout their supply 

networks (Kolk & Van Tulder, 2010; Urbinati, Chiaroni & Chiesa, 2017).  

Table 3. Definitions of Circular Economy (CE). 

Author(s) and 
Year (Page) 

Article Title Definition (Direct Quote) 

Kirchherr, Reike 
& Hekkert 
(2017, p. 224) 

Conceptualizing the 
Circular Economy: An 
Analysis of 114 Defini-
tions 

“A circular economy describes an economic sys-
tem that replaces the ‘end-of-life’ concept with 

reducing, alternatively reusing, recycling, and re-
covering materials in production/distribution and 

consumption processes.” 

Geissdoerfer et 
al. (2017, p. 
759) 

The Circular Economy 
– A new sustainability 
paradigm? 

“The circular economy is a regenerative system in 
which resource input and waste, emission, and 

energy leakage are minimized by slowing, closing, 
and narrowing material and energy loops.” 

Lewandowski 
(2016, p. 17) 

Designing Business 
Models for the Circular 
Economy—Towards a 
Conceptual Frame-
work 

“Circular Economy is an economic system that re-
presents a shift from the linear model of ‘take, 

make, dispose’ to a circular flow where resources 
are kept in use as long as possible, extracting 

maximum value, and then recovered and regene-
rated.” 

Hofstetter et al. 
(2021, p. 5) 

From Sustainable Glo-
bal Value Chains to Cir-
cular Economy 

“Circular economy is a concept aiming at closing 
material loops and extending the lifecycle of pro-
ducts, components, and materials through reuse, 
refurbishment, remanufacturing, recycling, and 

other restorative strategies.” 

Rizos et al. 
(2016, p. 6) 

Implementation of Cir-
cular Economy Busi-
ness Models by SMEs: 
Barriers and Enablers 

“Circular Economy refers to business models and 
practices that minimize resource input and waste 
generation while creating economic, social, and 

environmental value.” 

Tapaninaho & 
Heikkinen 
(2022, p. 145) 

Value creation in circu-
lar economy business 
for sustainability: A 
stakeholder perspec-
tive 

“Circular economy can be defined as a systemic 
approach to economic development designed to 
benefit businesses, society, and the environment, 
by decoupling growth from the consumption of fi-

nite resources.” 

 

Scholars have increasingly emphasized the interrelationship between the circular econ-

omy, green supply chain management, and business model innovation. Accepting circu-



22 

lar principles necessitates that firms rearrange their supply chain actions so that re-

sources can be recovered, products can circulate longer, and lifecycles can be prolonged. 

This links directly with recognized practices in green supply chain management, including 

green procurement, reverse logistics, and the formation of closed-loop systems (Zhu & 

Sarkis, 2004). 

 

The move toward circularity also compels organizations to reconsider the very founda-

tions of their business logic. In many cases, this takes the form of sustainability-oriented 

business model innovation, where firms redesign their value propositions, delivery 

mechanisms, and revenue structures to align with circular principles (Bocken et al., 2014; 

Foss & Saebi, 2017). Rather than treating circular economy initiatives as isolated projects, 

this perspective situates them within the broader context of organizational change. In 

this way, the circular economy operates both as a catalyst and as an outcome of innova-

tion across supply chains and business models. For multinational enterprises in particular, 

it proposes a strategic pathway to align long-term attractiveness with sustainable devel-

opment goals, while concurrently reinforcing their part in shaping global business prac-

tices (Genovese et al., 2017; Yang et al., 2022). 

 

2.3 Green Supply Chain Management (GSCM) 

Green supply chain management (GSCM) has grown as a key response to rising concerns 

about the environmental impact of global production and distribution. It figures on tra-

ditional supply chain management by purposely mixing environmental intelligence into 

every stage, from product design and raw material tracking to manufacturing, logistics, 

use, and end-of-life recovery (Srivastava, 2007; Seuring & Müller, 2008). Early thinking in 

this field originated from corporate environmental management and pollution preven-

tion efforts (Hart, 1995; Porter & van der Linde, 1995), but has since changed into a wider, 

collaboration-oriented tactic that ranges beyond company limitations. 

 



23 

Table 4. Definitions of Green Supply Chain Management (GSCM). 

Author(s) and 
Year (Page) 

Article Title Definition (Direct Quote) 

Srivastava 
(2007, p. 54) 

Green Supply-Chain Ma-
nagement: A State-of-
the-Art Literature Review 

“Green supply chain management is integra-
ting environmental thinking into supply chain 
management, including product design, ma-
terial sourcing and selection, manufacturing 

processes, delivery of the final product to the 
consumers as well as end-of-life management 

of the product after its useful life.” 

Jabbour, Jugend, 
de Sousa Jab-
bour et al. 
(2013, p. 144) 

Green Supply Chain Ma-
nagement in Local and 
Multinational High-Tech 
Companies in Brazil 

“GSCM refers to the extent to which environ-
mental issues are integrated into supply chain 

management practices, from green purcha-
sing to integrated life-cycle management.” 

Zhu, Sarkis & Lai 
(2008, p. 267) 

Green Supply Chain Ma-
nagement: Pressures, 
Practices and Perfor-
mance within the 
Chinese Automobile In-
dustry 

“Green supply chain management can be de-
fined as the adoption of environmentally 

friendly practices into the supply chain, ran-
ging from green design to green operations, 
green manufacturing, green logistics, and re-

verse logistics.” 

Dong, Kim & Wu 
(2021, p. 11) 

Green Supply Chain Ma-
nagement and Clean 
Technology Innovation: 
Evidence from Multina-
tional Enterprises in 
China 

“GSCM is a set of practices that integrates en-
vironmental criteria into upstream and 

downstream supply chain management acti-
vities, aiming at reducing environmental im-

pact and enhancing innovation.” 

Maeno et al. 
(2022, p. 108) 

CO₂ Mitigation through 
Global Supply Chain Res-
tructuring 

“Green supply chain management seeks to 
minimize carbon emissions and resource con-
sumption across supply networks, optimizing 

both environmental and economic out-
comes.” 

Glover et al. 
(2014, p. 332) 

An Institutional Theory 
Perspective on Sustai-
nable Practices across the 
Dairy Supply Chain 

“Green supply chain management refers to 
the implementation of environmentally res-
ponsible practices in supply chains driven by 

institutional and stakeholder pressures.” 

 

As supply chains became more multifaceted and globally spread, the scope of GSCM 

expanded to include reverse logistics, closed-loop systems, and product life-cycle con-

siderations (Guide & Van Wassenhove, 2001; Sarkis, 2012). Researchers began to high-

light that real-world environmental improvements in supply chains necessitate cooper-

ation among multiple actors, like manufacturers, suppliers, logistics partners, and cus-

tomers; rather than secluded efforts by individual firms (Rao & Holt, 2005; Vachon & 

Klassen, 2006). This understanding slowly shifted the attention from internal operational 



24 

changes to synchronized supply network strategies such as information sharing, joint 

problem-solving, and co-development of green technologies (Zhu, Sarkis & Lai, 2013; 

Green et al., 2019). 

 

 

Figure 1. GSCM for a Sustainable Industry (Sheng et al., 2023).   
 

 

For MNEs, GSCM holds further strategic meaning due to the scale and spread of their 

global maneuvers. With supply networks spanning several institutional environments, 

MNEs are often predicted to act as key drivers of environmental progression along inter-

national value chains (Christmann, 2004; Lee, 2008). They generally apply tools such as 

supplier codes of conduct, environmental audits, and capability-building programs to 

spread green practices across organizational boundaries (Kolk & Van Tulder, 2010; Mon-

tiel & Delgado-Ceballos, 2014). At the same time, they must poise global sustainability 

drives with the need to explain with local expectations and restrictions (Rugman & 

Verbeke, 2001; Sinkovics et al., 2016), leading to hybrid methods where globally contin-

uous standards are shared with locally open supplier engagement practices (Gimenez & 

Tachizawa, 2012; Jia et al., 2018). The model in the figure exemplifies the closed-loop 

nature of Green Supply Chain Management (GSCM), where suppliers, manufacturers, 

distributors, consumers, and recovery systems are interrelated through sustainable prac-

tices such as green purchasing, eco-design, recycling, and non-hazardous removal. Sheng 

et al. (2023) stress that such integration is vital for MNEs, as it allows them to coordinate 



25 

environmental strategies across global operations while addressing local institutional 

burdens. The movement from green material sourcing to recovery and reuse demon-

strates how GSCM reduces waste, promotes circularity, and ensures value creation be-

yond traditional linear supply chains. For businesses, particularly multinational corpora-

tions, implementing this model not only supports compliance with international sustain-

ability standards but also boosts competitiveness by aligning green practices with con-

sumer prospects and regulatory demands (Zhu et al., 2019; Sarkis et al., 2020). 

 

2.4 Business Model Innovation (BMI) 

Business Model Innovation (BMI) has emerged as a pivotal mechanism for firms to nav-

igate rapid technological advancements, environmental pressures, and evolving societal 

expectations. At its core, BMI refers to deliberate changes in a firm’s value creation, de-

livery, and capture logic (Teece, 2010). These innovations extend beyond product or pro-

cess improvements and involve rethinking how the firm conducts its business. Zott and 

Amit (2010) emphasize that a business model is a system of interdependent activities 

that transcend the boundaries of a firm. Foss and Saebi (2017) further refine this by de-

fining BMI as a “designed, non-trivial change to key components of a firm’s business 

model, and/or the architecture linking these components,” providing a strategic and in-

tegrative lens on innovation that incorporates both organizational and market dynamics. 

 

The development of BMI research echoes a shift from isolated technological or entre-

preneurial circumstances to broader strategic and societal concerns. Initially discovered 

through lenses such as innovation diffusion or competitive advantage, BMI scholarship 

has matured to integrate multiple theoretical perspectives. This multi-theoretical view 

emphasizes that value in BMI is co-created among various stakeholders and surrounded 

by social and ecological systems. Pan, Xu, and Skare (2022) conducted a bibliometric re-

view of over 800 studies, indicating that sustainable business model innovation (SBMI) 

has emerged as a central theme in recent years, motivated by the joining of sustainability, 

digitalization, and global competitiveness. In practical terms, BMI is formed by both ex-

ternal and internal drivers. Externally, firms face increasing pressure from regulatory 



26 

frameworks, customer demands, technological change, and global sustainability goals. 

Internally, firm-specific resources, leadership cognition, and organizational routines have 

a strong influence on BMI outcomes (Ringvold, Saebi, & Foss, 2022).  

 

In the MNE context, BMI becomes more multifaceted due to institutional, cultural, and 

infrastructural differences across countries. Xu and Shenkar (2002) introduce the con-

cept of “institutional distance” to define how differences in norms, regulations, and cog-

nition influence international processes. Zaheer (1995) adds that MNEs must steer the 

accountability of foreignness by altering business models to fit local situations. 

Chabowski, Gabrielsson, Hult, and Morgeson (2025) reply to this encounter by proposing 

“Sustainable International Business Model Innovations” (SIBMIs), which aligns circular 

economy (CE) principles with international business inevitabilities. 

Table 5. Definitions of Business Model Innovations (BMI). 

Author(s) and 
Year (Page) 

Article / Source Title Definition (Direct Quote) 

Foss & Saebi 
(2017, p. 201) 

Fifteen Years of Research 
on Business Model Innova-
tion: How Far Have We 
Come, and Where Should 
We Go? 

“Business model innovation is defined as de-
signed, nontrivial changes to the key ele-
ments of a firm’s business model and/or the 
architecture linking these elements.” 

Geissdoerfer, 
Vladimirova & 
Evans (2018, p. 
403) 

Sustainable Business 
Model Innovation: A Re-
view 

“Business model innovation refers to the pro-
cess of innovating the business model com-
ponents, their interrelations, and/or the busi-
ness model as a whole.” 

Evers, Anders-
son & Hannibal 
(2023, p. 4) 

Unraveling Business 
Model Innovation in Firm 
Internationalization: A Sys-
tematic Literature Review 

“Business model innovation is a dynamic ca-
pability that allows firms to create, deliver, 
and capture value in new ways through re-
configurations of business model compo-
nents.” 

Antikainen & 
Valkokari (2016, 
p. 8) 

A Framework for Sustaina-
ble Circular Business 
Model Innovation 

“Business model innovation is understood as 
the development of novel configurations of 
business model elements that enable firms to 
better respond to sustainability and circular 
economy challenges.” 

Geissdoerfer et 
al. (2017, p. 
760) 

The Circular Economy – A 
New Sustainability Para-
digm? 

“Business model innovation for circular econ-
omy is the process of changing how value is 
created, delivered, and captured, so as to 
close, slow, or narrow resource loops.” 

 



27 

The accumulation of CE principles into BMI is mutually beneficial and transformative. 

Geissdoerfer, Savaget, Bocken, and Hultink (2017) highlight that while CE chains accom-

plish ecological goals by minimizing waste and closing resource loops, they must be en-

circled by a wider sustainability context to guarantee social equity and long-term feasi-

bility. Chabowski et al. (2025) highlight that the changeover from linear to circular mod-

els in international markets necessitates fundamental redesigns of value logic, particu-

larly for MNEs that work in various regulatory and consumer environments. The business 

opportunity linked to CE was valued at $1.5 trillion in 2020 and is expected to grow to 

$4.5 trillion by 2030, further strengthening the strategic significance of circular BMI. 

 

2.5 Institutional Theory 

Institutional theory offers a compelling clarification for how MNEs steer the complex 

web of opportunities, norms, and pressures they meet in diverse global settings. Rather 

than operating exclusively on economic logic or internal efficacies, organizations are of-

ten molded by the external environments in which they function. DiMaggio and Powell 

(1983) proposed that organizations tend to conform to the institutional norms, rules, 

values, and belief systems prevalent in their context to gain social legitimacy and main-

tain stability. This becomes mostly critical for organizations operating in international 

markets, where regulatory constructions and societal outlooks can differ significantly. 

 

When MNEs enlarge into new countries, they face what Kostova and Zaheer (1999) state 

as “institutional duality”: the challenge of aligning their operations with both the stand-

ards of their home country and those of the host country. This dual alignment often in-

volves negotiating between inconsistent regulatory demands or societal norms, espe-

cially in the setting of sustainability and environmental performance. In countries with 

rigorous environmental laws or strong civil society engagement, firms might adopt for-

ward-thinking sustainability initiatives. In less regulated environments, however, firms 

may fight to meet even basic ecological opportunities without undermining cost struc-

tures. 

 



28 

Institutional theory also emphasizes the process of isomorphism, how companies begin 

to resemble one another due to similar external pressures. These pressures can be co-

ercive, such as regulatory requirements; mimetic, where firms emulate peers during un-

certainty; or normative, stemming from industry standards and professionalization (Di-

Maggio & Powell, 1983). For example, a multinational might adopt CE practices not nec-

essarily because of internal innovation, but because leading competitors or regional au-

thorities have made such practices a norm. Bansal and Roth (2000) illustrate that many 

firms implement environmental programs to maintain legitimacy with investors, custom-

ers, and regulatory bodies, even in the absence of direct profitability. 

 

However, institutional theory does not represent organizations as passive actors. As Oli-

ver (1991) claims, firms often indicate a spectrum of responses to institutional pressures, 

including active management or strategic compromise. Large multinational firms, due to 

their resources and political capital, are principally well-positioned to outline or reinter-

pret official expectations in ways that align with their internal strengths or market posi-

tions. This capability to proactively engage with institutional demands is exclusively rel-

evant in today’s climate-conscious business atmosphere. In the context, institutional 

theory supports expounding on how external expectations impact corporate decisions 

regarding sustainability. It explains the status of legitimacy and external orientation 

alongside internal capabilities and strategic commitment.  

 

2.6 Resource-Based View (RBV) 

The resource-based view (RBV) is a strategic framework that aids in explaining how or-

ganizations gain and continue competitive advantages by leveraging what they already 

possess. Central to this theory is the idea that certain resources, whether physical, tech-

nological, human, or intangible, can help a firm outperform others, especially if those 

resources are valuable, rare, difficult to imitate, and not easily replaced (Barney, 1991). 

In today’s business world, where environmental and social anxieties are gaining momen-

tum, this standpoint becomes increasingly applicable. It offers insight into how firms can 

develop sustainability as a core asset rather than giving it as a regulatory burden. 



29 

For multinational companies, applying the RBV means spotting how internal strengths, 

such as sustainability know-how, green technology, and well-developed environmental 

management practices, can serve as long-term assets. Hart (1995) prolonged the tradi-

tional view by suggesting a natural resource-based framework. This disparity highlights 

how environmentally accountable resources, including pollution control technologies, 

sustainable design expertise, and waste-minimizing processes, pay directly to a firm's 

strategic success. Christmann (2000) showed that firms with innovative green technolo-

gies and dedicated environmental strategies often enjoy cost savings and boosted repu-

tations. Darnall and Edwards (2006) similarly found that companies that develop internal 

sustainability capabilities tend to adapt better to external pressures and innovate re-

sponsibly. 

 

Beyond tangible resources, the RBV also values less noticeable yet equally powerful ele-

ments like leadership commitment, employee engagement, and organizational culture. 

These softer assets often foster behaviors and progressions that support long-term en-

vironmental goals. Firms that implant sustainability into their culture create routines and 

practices that are difficult for rivals to copy (Wernerfelt, 1984). This kind of implanted 

knowledge helps companies implement complex strategies like GSCM and circular busi-

ness models more effectively (Pagell & Wu, 2009). However, relying solely on internal 

strengths has its limits. Some scholars argue that the RBV may not adequately account 

for rapid shifts in the external environment, such as regulatory changes or consumer 

expectations (Priem & Butler, 2001). This has led to the idea of integrating the RBV with 

other perspectives, particularly institutional theory, to capture a fuller picture of how 

firms respond to sustainability challenges.  



30 

3 Conceptual Framework 

This study develops a conceptual framework to define how multinational enterprises 

(MNEs) streamline their business models for sustainability when operating in various in-

stitutional backgrounds. Together with CE and GSCM standpoints, it designates both the 

strategic foundation for adaptation and the organizational and environmental impacts 

that affect it. The CE advocates moving away from the traditional linear system towards 

re-forming cycles that keep materials and products in use for as long as possible 

(Geissdoerfer et al., 2017). Operationalizing such activities often relies on GSCM, which 

emphasizes reducing environmental influence across sourcing, production, distribution, 

use, and reverse logistics (Srivastava, 2007). GSCM provides tangible tools such as eco-

design, cleaner production, green procurement policies, and supplier collaboration, 

which bring CE ambitions to life.  

 

However, the ability of firms to integrate CE and GSCM depends significantly on their 

internal strengths. According to the Resource-Based View, firms gain a competitive ad-

vantage from valuable, rare, inimitable, and non-substitutable resources and capabilities 

(Barney, 1991). For MNEs, these may include technological expertise, supportive organ-

izational cultures, strong supplier relationships, and experienced management teams. 

Enterprises with more developed capabilities are better placed to embed CE and GSCM 

practices, experiment with new forms of value creation, and maintain profitability while 

pursuing sustainability goals (Hart & Dowell, 2011). Institutional Theory emphasizes that 

company behavior is shaped by coercive pressures (regulations), normative pressures 

(social and professional expectations), and mimetic pressures (imitation of industry 

peers) (DiMaggio & Powell, 1983).   

 

In this study, sustainable business model adaptation is viewed both as a process and an 

outcome. As a process, it involves an evolving set of actions through which firms intro-

duce, test, and scale sustainable innovations (Foss & Saebi, 2017). As an outcome, it re-

flects changes to a firm’s value proposition, delivery mechanisms, and revenue logic in 

ways that generate economic, environmental, and social value (Boons & Lüdeke-Freund, 



31 

2013). Bringing together operational practices (CE and GSCM), internal strengths (RBV), 

and external pressures (Institutional Theory), the framework supports a holistic investi-

gation of sustainable business model adaptation. 

 

 

Figure 2. Sustainable Business Model Adaptation Funnel. 

 

The sustainable business model adaptation framework includes five interconnected con-

structs: (1) Circular Economy Orientation, (2) Green Supply Chain Practices, (3) Sustain-

able Business Model Adaptation Strategy, (4) Internal Resources and Capabilities, and (5) 

Institutional Pressures. It recommends that MNEs with a solid CE orientation and deeper 

GSCM integration are more likely to adapt their business models to attain sustainability. 

However, this affiliation is legalized by adequate internal capabilities and moderated by 

the institutional circumstances of the markets in which they operate. 

 



32 

3.1 Sustainability through the Lens of Circular Economy 

The Circular Economy (CE) offers a persuasive approach for firms, principally multina-

tional enterprises (MNEs), to reexamine what sustainability means in practice. Rather 

than following the traditional model that ultimately leads to waste and environmental 

degradation, CE inspires organizations to hold materials in use for as long as possible, 

designing out waste from the beginning and supporting the transformation of natural 

systems (Geissdoerfer et al., 2017). This necessitates businesses to query long-held res-

olutions about value creation and to design products that are robust, repairable, and 

recyclable so that valuable materials are not rejected but repeatedly cycled back into 

production (Kirchherr, Reike, & Hekkert, 2017). 

 

For MNEs navigating complex global markets, CE signifies more than an environmental 

model, which is increasingly a strategic pathway for flexibility and revolution. By reducing 

dependence on freshly extracted resources, circular tactics can help firms defend them-

selves against price instability and supply risks, while also finding new revenue opportu-

nities embedded in reuse, refurbishment, and product-service systems (Ellen MacArthur 

Foundation, 2015). Rather than selling more products, companies can profit from longer-

lasting customer relationships and service-based offers, such as leasing or take-back 

models, that encompass product lifespans and capture residual value (Bocken et al., 

2014). These methods often catalyze innovation in areas such as materials engineering, 

digital tracking, and industrial symbiosis, fostering unique proficiencies and competitive 

advantages (Murray, Skene, & Haynes, 2017). 

 

Crucially, shifts towards CE are not occurring in a vacuum. They are fueled by growing 

external pressures from tighter environmental regulations in key markets to evolving ex-

pectations from consumers, investors, and civil society groups. These institutional forces 

encourage firms to take more responsibility for waste reduction, resource stewardship, 

and sustainable production and consumption goals, which are strongly echoed in Sus-

tainable Development Goal 12 (United Nations, 2015). For high-profile MNEs operating 

at the global forefront, failing to engage with CE can carry reputational and compliance 



33 

risks, while early adoption can reinforce leadership credentials and stakeholder trust (Di-

Maggio & Powell, 1983). At the same time, the ability to engage meaningfully with CE 

depends heavily on a firm’s internal set of capabilities. According to the resource-based 

view, it is not enough to simply respond to external pressure; firms must also possess 

distinctive, hard-to-replicate strengths such as circular design expertise, reverse logistics 

infrastructure, and sophisticated systems for managing material flows (Barney, 1991; 

Lewandowski, 2016). These capabilities take time to build and become sources of long-

term advantage for firms that can integrate circular thinking into their core operations, 

not just their communications. However, implementing CE across global value chains is 

rarely straightforward. MNEs must translate circular principles into action across very 

different institutional settings, adapting to diverse regulatory environments, stakeholder 

expectations, and infrastructure levels in each location (Xu & Shenkar, 2002). Those that 

succeed typically strike a careful balance, retaining a clear strategic vision for circularity 

at the global level while tailoring their business models locally to ensure feasibility and 

legitimacy (Zaheer, 1998). 

 

The circular economy offers companies an opportunity to reevaluate their growth strat-

egies and competitive approaches while tackling urgent environmental and social issues. 

Instead of following the traditional linear path of extracting resources, producing goods, 

and disposing of them after use, companies are increasingly adopting circular economy 

principles to shape their strategies. At the heart of this approach is the idea of designing 

products and systems that reduce waste, enhance material reuse, and ensure business 

activities help restore rather than harm natural systems (Ellen MacArthur Foundation, 

2025). In practice, this means implementing strategies like eco-design, modular manu-

facturing, remanufacturing, and service-based models that extend product lifespans and 

recover value that might otherwise be lost. Companies that use leasing, refurbishment 

programs, or product take-back schemes can lower their environmental impact while 

creating new revenue streams. Importantly, circular business models provide opportu-

nities for differentiation and innovation, helping companies strengthen stakeholder trust 

and position themselves as leaders in a global movement toward more regenerative and 



34 

low-carbon growth (Ellen MacArthur Foundation, 2015). In this way, circular economy 

thinking shifts sustainability from a mere compliance requirement into a strategic ad-

vantage and a path to long-term value generation. 

 

3.2 Sustainability through the Lens of GSCM 

Green Supply Chain Management (GSCM) has become one of the most practical and 

powerful ways for multinational enterprises (MNEs) to translate their sustainability com-

mitments into meaningful action across their global operations. Rather than focusing 

solely on what happens within the boundaries of the firm, GSCM encourages companies 

to integrate environmental thinking into every stage of the supply chain, from how raw 

materials are sourced and products are designed, to how they are manufactured, trans-

ported, used, and eventually recovered or disposed of (Srivastava, 2007). For MNEs, 

GSCM is progressively not just an environmental initiative but a strategic obligation. By 

reducing material and energy use, companies can lower costs, limit exposure to unpre-

dictable commodity markets, and guarantee compliance with tightening environmental 

regulations (Hervani, Helms, & Sarkis, 2005). At the same time, embracing GSCM can 

improve corporate status and strengthen relationships with environmentally sensitive 

consumers, investors, and policymakers, opening up opportunities in sustainability, fo-

cused markets, and strengthening competitive advantage (Green et al., 2012; Carter & 

Rogers, 2008). Notably, GSCM can also become a basis of innovation, enabling firms to 

develop cleaner processes, more resilient supplier networks, and greener products that 

better align with the sustainability priorities shaping global markets (Vachon & Klassen, 

2008). 

 

The growing thrust behind GSCM is powerfully linked to institutional pressures. MNEs 

now face regulatory demands to diminish emissions and waste, rising expectations from 

societies and industry bodies to function responsibly, and competitive pressures as sus-

tainability leaders set new standards in supply chain management (DiMaggio & Powell, 

1983). Yet, meaningful progress depends not only on responding to these external forces 

but on possessing the right internal capabilities. Firms with strong competencies in areas 



35 

such as supplier relationship building, environmental performance monitoring, logistics 

optimization, and integrating sustainability data into procurement systems are far better 

equipped to implement GSCM effectively (Barney, 1991; Sarkis, Zhu & Lai, 2011). These 

internal strengths are often built over time and become difficult for competitors to imi-

tate, providing the basis for lasting strategic advantage. From this perspective, GSCM is 

best understood not as a one-off program but as a dynamic capability that helps firms 

operate sustainably across widely differing regulatory, cultural, and infrastructural set-

tings (Xu & Shenkar, 2002). Ultimately, MNEs that embed GSCM into the heart of their 

business models are likely to be better positioned to navigate institutional complexity, 

meet growing stakeholder expectations, and create long-term value in line with the prin-

ciples of sustainable development (Pagell & Wu, 2009; Lee & Klassen, 2008). 

 

3.3 Business Model Innovation (BMI) through the Lens of Sustainability 

Business Model Innovation (BMI) is increasingly viewed as an essential pathway for firms 

seeking to integrate sustainability meaningfully into their strategic and operational core. 

Traditionally, business models explain how organizations create, deliver, and capture 

value (Teece, 2010). Under a sustainability perspective, this idea expands to include en-

vironmental integrity and social responsibility alongside financial outcomes. Sustainable 

BMI, therefore, requires firms to rethink how value is defined and constructed so that 

business success is linked to positive outcomes for society and the planet (Boons & Lü

deke‐Freund, 2013). Rather than making incremental process improvements, sustain-

able BMI often involves reimagining what the company offers, how it delivers those of-

ferings, and which stakeholders it needs to collaborate with. This might mean shifting 

from selling products to providing services, developing take‐back systems to recover 

materials, or working with partners outside the traditional business network to co‐de-

velop sustainable solutions (Bocken et al., 2014). Such changes usually unfold through 

experimentation and learning, where firms test new ideas, adjust systems, and cultivate 

organizational cultures that are open to transformation and long‐term thinking (Stubbs 

& Cocklin, 2008).  



36 

Firms are prompted toward sustainable BMI by both external and internal forces. Exter-

nally, regulatory changes, competitive pressures, and rising expectations from customers, 

investors, and civil society have created a powerful push for business models that do 

more than generate profit (DiMaggio & Powell, 1983; Burritt et al., 2020). Internally, suc-

cessful BMI depends on the firm’s resources and capabilities, especially those that are 

difficult to copy, such as technological know‐how, partner networks, or specialized 

knowledge systems (Barney, 1991). This blend of institutional pressure and internal ca-

pability shapes whether and how a firm can create sustainable business models that are 

both innovative and commercially viable. The literature highlights several types of sus-

tainable business model innovations, including those focused on improving resource ef-

ficiency, closing material loops, providing access instead of ownership, and delivering 

social benefits (Bocken et al., 2014).  

 

In this context, the Business Model Canvas has appeared as a practical and broadly 

adopted means for guiding and constructing BMI for sustainability (Osterwalder & 

Pigneur, 2010). By breaking the business model into nine related components, key part-

ners, activities, resources, value propositions, customer relationships, channels, cus-

tomer segments, revenue streams, and cost structure, the canvas allows managers to 

scientifically assimilate sustainability into each part of the value logic (Joyce & Paquin, 

2016). In doing so, the Business Model Canvas supports multinational enterprises in de-

signing business models that are not only competitive but are also engines of sustainable 

development. 

 

3.4 Business Model Canvas: Sustainability Orientation in the Context of 

CE and GSCM 

The Business Model Canvas (BMC) is commonly familiar as a practical instrument for 

describing how organizations create, deliver, and capture value (Osterwalder & Pigneur, 

2010). However, as sustainability becomes central to strategic thinking, the traditional 

economic logic embedded in the BMC is progressively viewed as insufficient (Boons & 



37 

Lüdeke-Freund, 2013). Firms are now expected to develop business models that not only 

remain commercially feasible but also demonstrate responsible environmental steward-

ship and make positive social contributions. This segment offers an in-depth discussion 

of how each component of the BMC evolves when sustainability is at the center of its 

strategic intent. 

Figure 3. Business Model Canvas (Osterwalder et al., 2010). 

 

At the center of any business model lies the value proposition. Conventionally well-de-

fined in practical and economic terms, the value proposition in a sustainability-oriented 

model extends beyond these borders by also talking about environmental and social 

concerns. Under the CE logic, value is attained through products and services that are 

planned for longevity, reparability, reusability, and recyclability, thereby minimizing 

waste generation and reducing reliance on virgin resources (Kirchherr, Reike, & Hekkert, 

2017). Likewise, GSCM highlights minimizing pollution, conserving energy, and using en-

vironmentally friendly inputs throughout the supply chain (Srivastava, 2007). Firms thus 

slowly craft value propositions that highlight environmental identifications (e.g., low-car-

bon footprint, recycled materials) and broader societal assistances (Bocken et al., 2014), 

thereby tapping into a rising market of sustainability-conscious stakeholders. 

 



38 

The idea of customer segments is also ever-changing. Rather than aiming customers ex-

clusively by demographic traits, firms are increasingly considering behavioral and psy-

chographic variables, such as environmental awareness, willingness to contribute in cir-

cular structures, and preference for socially accountable brands (Peattie & Belz, 2010). 

Moreover, in sustainability-oriented models, stakeholders such as regulators, NGOs, and 

local communities also play a significant role. They may be conceptualized as indirect 

customer groups whose perspectives must be considered to maintain legitimacy (DiMag-

gio & Powell, 1983). In CE systems, customers are not merely end-users; they become 

collaborators in extending product lifespans through repair, return, and reuse behaviors 

(Lewandowski, 2016). 

 

Parallel changes occur in channels through which firms deliver and recover value. While 

traditional models emphasize outbound logistics, CE and GSCM frameworks highlight the 

importance of reverse logistics systems capable of retrieving products and materials af-

ter use so that they can be reused, remanufactured, or recycled (Carter & Rogers, 2008). 

Digital tools, such as QR-coded labeling, tracking technologies, and online platforms, be-

come crucial to enhancing transparency and traceability along supply chains (Tachizawa 

& Wong, 2014). Consequently, channels evolve to serve two-way flows of materials, in-

formation, and environmental performance data. Sustainability-oriented customer rela-

tionships rely less on transactional exchanges and more on ongoing interaction, mutual 

learning, and co-creation of environmental value (Evans et al., 2017). Firms engage con-

sumers through educational content that encourages environmentally conscious con-

sumption behavior, while incentive mechanisms encourage the return of end-of-life 

products or the use of reusable packaging. These efforts reinforce trust and strengthen 

the shared responsibility ethos underpinning both CE and GSCM approaches (Seuring & 

Müller, 2008). Shifts in value logic also trigger changes in revenue streams. In place of 

one-off product sales, firms are increasingly adopting circular business models, such as 

“product-as-a-service,” performance-based contracting, leasing, and pay-per-use mod-

els (Michelini et al., 2020). These mechanisms enable firms to retain ownership of prod-

ucts and recover them at the end of use, fostering incentives for durability and efficient 



39 

resource utilization. GSCM strengthens this longer-term orientation, as revenue be-

comes tied not only to sales but also to environmental performance and regulatory com-

pliance, bringing new forms of financial value derived from waste reduction and an im-

proved brand reputation (Bocken et al., 2014). 

 

From an operational standpoint, key resources increasingly include not only physical and 

financial assets but also knowledge-based capabilities, partnerships, and technological 

tools that support eco-design, life-cycle assessment, renewable energy integration, and 

environmental data analytics (Barney, 1991). Such resources underpin a firm’s ability to 

implement CE practices such as remanufacturing or material substitution and to ensure 

cleaner production in line with GSCM principles (Zhu, Sarkis, & Lai, 2013). Over time, 

firms may develop rare and inimitable sustainability resources, such as expertise in green 

innovation or robust reverse logistics networks, which form the basis of a lasting com-

petitive advantage. Under CE frameworks, firms engage in eco-design, repair services, 

refurbishment, recycling, disassembly, and product recovery alongside their traditional 

production and distribution functions (Ellen MacArthur Foundation, 2015). Under GSCM, 

attention shifts to running greener operations across the entire supply chain, including 

sourcing, manufacturing, warehousing, and distribution. This includes incorporating en-

ergy-saving technologies, cleaner production methods, and supply chain collaborations 

aimed at reducing environmental footprints (Srivastava, 2007). Robust information shar-

ing, monitoring, and reporting become core activities that enable continuous improve-

ment and compliance with environmental regulations (Hervani, Helms, & Sarkis, 2005). 

 

Sustainability also transforms the landscape of key partnerships. Firms must actively col-

laborate with a wide variety of factors, including suppliers with green capabilities, recov-

ery and recycling firms, government agencies, research institutions, and community or-

ganizations (Boons & Lüdeke-Freund, 2013). Such networks enable businesses to access 

specialized sustainability technologies and infrastructure, including closed-loop supply 

chain systems, renewable energy installations, and digital traceability platforms. Further-

more, through supplier development agendas and long-term strategic alliances, firms 



40 

can encourage upstream partners to adopt environmentally and socially responsible 

practices (Lee, 2008). Within the cost structure, sustainability initiatives often require 

investment in cleaner technologies, training plans, and infrastructure for waste recap-

ture and reverse logistics. Although these can increase short-term operational costs, 

they often translate into medium- to long-term gains through resource efficiency, re-

duced emissions penalties, waste diversion savings, and reputational advantages (Porter 

& van der Linde, 1995). Additionally, social investment in employee well-being, partner-

ships with local communities, and transparent reporting systems become essential ex-

penditures that support the broader legitimacy of sustainability-oriented business mod-

els. 

 

The recognition that sustainability should be embedded in each component of the busi-

ness model has led to extensions of the BMC. Among the most influential is the Triple 

Layered Business Model Canvas (TLBMC), which supplements the traditional economic 

layer with environmental and social layers (Joyce & Paquin, 2016). The environmental 

layer maps life-cycle influences of each BMC block, stressing the flow of materials, en-

ergy use, greenhouse gas emissions, and waste generation. The social layer highlights 

stakeholder relationships, including workers, consumers, suppliers, and local communi-

ties, assessing how each business choice impacts wellbeing, equity, and social justice 

(Elkington, 1997; Lüdeke-Freund et al., 2020). Examining both horizontal placement 

within each layer and vertical formation across layers allows organizations to classify 

where trade-offs happen, where collaborations can be reinforced, and how sustainability 

can be successfully combined into a strategic plan. 

 

Reframing the BMC through the Circular Economy and Green Supply Chain Management 

renovates it from a revenue-centered plotting tool into an all-inclusive mechanism for 

sustainable strategic innovation. Each component becomes a lever through which firms 

can nurture environmental integrity, social inclusiveness, and economic resilience. Far 

from serving as a standing explanation of existing operations, the sustainability-oriented 

canvas becomes a dynamic guide for accountable transformation, helping firms design 



41 

models capable of meeting stakeholder expectations, keeping pace with growing regu-

lations, and creating lasting value in a resource-constrained world. 

Table 6. Transformation of BMC Elements under CE and GSCM. 

BMC Element Traditional 
Interpretation 

CE/GSCM Sustainable Reframing 

Value 
Proposition 

Emphasis on 
performance, quality, 
price, and 
convenience 

Propositions emphasizing durability, reparability, 
recyclability, lower environmental footprint, ethical sourcing, 
social impact, and restorative or regenerative value 
(Kirchherr et al., 2017). 

Customer 
Segments 

Based on 
demographics, 
purchasing power, 
and market size 

Segments defined by sustainability consciousness, pro-
environmental attitudes, willingness to participate in 
reuse/return schemes, and inclusion of non-market 
stakeholders (Peattie & Belz, 2010). 

Channels Forward movement of 
goods through sales 
channels 

Addition of reverse logistics, take-back systems, repair 
centers, and digital platforms enabling material tracking and 
transparency across the lifecycle (Carter & Rogers, 2008; 
Tachizawa & Wong, 2014). 

Customer 
Relationships 

Transaction-focused, 
acquisition and 
retention-driven 

Relationship building through sustainability education, 
collaborative consumption models, loyalty based on 
environmental and ethical values, shared ownership or 
stewardship (Evans et al., 2017). 

Revenue 
Streams 

Revenue through 
product-ownership 
sales and service fees 

Circular revenues through leasing, renting, pay-per-use, 
product-service systems, and value capture from recovered 
materials, encouraging longevity and resource efficiency 
(Michelini et al., 2020). 

Key Resources Capital, intellectual 
property, physical 
assets 

Renewable and recyclable materials, eco-design expertise, 
reverse logistics infrastructure, environmental data systems, 
and stakeholder relationships as strategic assets (Barney, 
1991; Lewandowski, 2016). 

Key Activities Core operations such 
as manufacturing, 
marketing, and 
distribution 

CE activities such as design for disassembly, reuse, 
refurbishing, remanufacturing, waste valorization, closed-
loop sourcing, and GSCM practices like cleaner production 
(Srivastava, 2007; Geissdoerfer et al., 2018). 

Key 
Partnerships 

Traditional supply 
chain actors and 
service providers 

Inclusion of recyclers, sustainability certifiers, NGOs, local 
communities, knowledge institutions, technological 
collaborators, and regulators for eco-innovation (Boons & 
Lüdeke-Freund, 2013; Seuring & Müller, 2008). 

Cost Structure Operational and 
logistical costs; 
economies of scale 

Lifecycle-costing perspective including investments in eco-
technology, reverse logistics, supplier sustainability training, 
emissions mitigation measures, and local community 
engagement (Porter & van der Linde, 1995). 

 

 



42 

4 Methodology 

This research employs a qualitative approach guided by the interpretivist viewpoint, aim-

ing to explore how MNEs implement CE and GSCM practices within evolving MNE con-

texts. The selected methodology is informed by previous work in sustainability and in-

ternational business, making it fit for addressing a research question that is both multi-

faceted and context-driven. 

 

4.1 Research Philosophy and Rationale 

This study was guided by a critical realist worldview, which shaped both the design of 

the research and the interpretation of the findings. At its core, critical realism is based 

on the idea that an objective reality exists. However, our understanding of that reality is 

always shaped by our individual and collective experiences (Bhaskar, 1978). In other 

words, while there are real systems and structures in place, such as global supply chains 

or environmental policies, different individuals and organizations may interpret and re-

spond to them in their unique ways. 

 

This philosophical stance was well-suited to the topic of this research. The study focused 

on how multinational companies incorporate sustainability into their business models 

while operating across very different national and cultural environments. Critical realism 

provided a useful lens because it acknowledges both the influence of external conditions 

and the internal decision-making processes that occur within firms. It created space to 

explore not just what companies do, but also how they make sense of their actions and 

why they take them in a particular way (Easton, 2010). 

 

One of the key ways this study applied critical realism was through abductive reasoning. 

Unlike deduction, which tests existing theories, or induction, which builds theories from 

scratch, abduction moves between theory and data more dynamically and flexibly. It en-

ables one to start with initial ideas and refine them as new information becomes availa-



43 

ble (Dubois & Gadde, 2002). In this study, theoretical concepts such as institutional pres-

sure, sustainability adaptation, and business model innovation served as starting points, 

which were refined as real-world insights emerged during interviews and document 

analysis. This process of going back and forth helped the study avoid forcing the data to 

fit a predefined framework. Instead, it supported a more open and grounded under-

standing of the complex ways that sustainability practices unfold in different organiza-

tional and national contexts. Abductive reasoning was particularly valuable because it 

allowed space for unexpected patterns to emerge, especially when comparing firms 

across different industries and markets (Timmermans & Tavory, 2012). 

 

In addition, this reasoning approach aligns well with the nature of international business 

research, where the same issue may appear very different depending on the country, 

regulatory environment, or even the mindset of local managers. Abduction encourages 

the researcher to remain curious and responsive, constantly questioning whether the 

theory aligns with the observations and being willing to revise it when necessary (Ke-

tokivi & Mantere, 2010). Overall, the combination of a critical realist foundation and an 

abductive reasoning process enabled the research to remain grounded in real experi-

ences while engaging with academic theory. It made it possible to explore not just the 

surface-level actions that firms take in the name of sustainability, but also the deeper 

mechanisms. It is the thought processes that shape those actions in different parts of 

the world. 

 

4.2 Case Study Approach 

To gain a well-rounded understanding, this study employs a multiple-case study format. 

It examines five multinational firms operating in both developed and developing coun-

tries. This method enables the comparison of how sustainability efforts unfold in differ-

ent environments (Yin, 2018; Eisenhardt, 1989). Each company chosen has taken clear 

steps to integrate CE and GSCM into its operations. The cases were carefully selected to 



44 

provide meaningful, diverse, and information-rich examples. Case studies are particu-

larly useful for examining real-world situations where the context and subject matter are 

closely intertwined (Stake, 1995). 

 

4.3 Data Collection Techniques 

The data used in this thesis consists of qualitative methods, including detailed interviews 

and a comprehensive dataset focused on sustainability, CE, and GSCM. The primary data 

were collected through semi-structured interviews with professionals involved in sus-

tainability and supply chain management within the selected MNEs. This interview style 

is well-suited here because it encourages open conversations while maintaining a focus 

on key research areas (Kvale & Brinkmann, 2009). Five interviews were completed, each 

lasting between one and one and a half hours. An interview guide was used, featuring 

open questions that covered topics such as company strategies, drivers of sustainability, 

challenges, and how local pressures influence decisions. The following sections will pro-

vide a detailed review of the methods used for data collection and analysis in these stud-

ies, as shown in Table 7. 

Table 7. Research methods and design of the study. 

Research approach Abductive 

Research method Qualitative method 

Research design Explorative case studies 

Data collection Semi-structured interviews 

Sample size 5 MNEs from Bangladesh 

Data analysis Thematic content analysis  

 

In addition to conducting interviews, a variety of company documents were collected 

and studied to provide a more comprehensive framework and funding for the findings. 

These involved sustainability reports, corporate presentations, internal communications, 

and public disclosures. Including these documents helped cross-check interview infor-

mation and offered insights into how companies publicly communicated their sustaina-

bility efforts (Bowen, 2009). By mingling interviews and document analysis, the research 



45 

was able to triangulate data from multiple sources. This approach improved the trust-

worthiness of the findings and provided a more comprehensive understanding of how 

sustainability is addressed, communicated, and executed within multinational firms.  

 

4.4 Participant Selection 

Participants and companies were chosen using purposive sampling, which targets indi-

viduals with specific expertise, in this case, sustainability. To be included, companies had 

to meet three conditions: they had to qualify as MNEs, be actively engaged in CE or 

GSCM efforts, and be open to participating in the study. Additional participants were 

found through snowball sampling, where initial contacts suggested others with relevant 

knowledge. In Table 8, additional background details of the interviewees and the sec-

ondary data sources used are presented. This table highlights the timeline of interviews, 

the format used, and the number of transcribed pages from each session. 

Table 8. Details of the Interviewees. 

 

 

Case Firms Person Inter-
viewed 

Inter-
view 
Time 

Covered 

Format of 
Interview 

Number of 
Transcribed 

Pages  
(1.5 spacing) 

Secondary Data Source 

Company A Director – Pro-
cess & Technol-
ogy 

80 mins Online 
(Microsoft 
Teams) 

38 Website, Corporate 
Presentations, internal 
documents. 

Company B Cluster Category 
Manager – 
Global Procure-
ment Service 

68 mins Online 
(Microsoft 
Teams) 

36 Website, sustainability 
reports, and Internal 
documents.  

Company C Procurement As-
sociate 

75 mins Online 
(Microsoft 
Teams) 

34 Company website, inter-
nal documents, sustain-
ability reports, and Cor-
porate Presentations. 

Company D Procurement As-
sociate 

70 mins Online 
(Microsoft 
Teams) 

32 Company website, inter-
nal documents, and sus-
tainability reports. 

Company E Manager – SCM 
Operation 

85 mins Online 
(Microsoft 
Teams) 

37 Company website, inter-
nal documents, and sus-
tainability reports. 



46 

4.5 How the data was analyzed 

After the interviews had been conducted and the supporting documents had been gath-

ered, the next step was to analyze and synthesize all the information. The study was then 

employed thematic analysis, a method that helps pinpoint key patterns or themes in 

qualitative data (Braun & Clarke, 2006). Thematic analysis was used because it is a flexi-

ble method that provides a clear structure for examining and interpreting the data. The 

analysis began with reading and re-reading all interview transcripts to ensure the re-

searcher is fully immersed in the material. This step helped to grasp the tone, context, 

and meaning of what the participants were sharing. Then, the process moved to coding, 

marking different pieces of text with labels that captured the main ideas being expressed, 

such as "adaptation to local regulations," "supply chain constraints," or "internal re-

sistance." 

 

Some of these codes were inspired by existing theories, particularly those related to in-

stitutional pressures, business model innovation, and sustainability strategy. At the same 

time, the analysis remained open to unexpected themes that emerged naturally from 

the data. This mix of theory-driven and data-driven coding enabled a more comprehen-

sive understanding of what was happening within the firms. After the initial coding, sim-

ilar codes were grouped to form broader themes. These themes reflected the larger 

story behind the data, for example, how firms adjusted their practices to fit new envi-

ronmental policies, or how internal departments collaborated (or clashed) when imple-

menting sustainability initiatives. 

 

To ensure consistency and manage the large amount of qualitative information, the soft-

ware tool NVivo was used to organize the data efficiently, making it easier to retrieve 

relevant segments when comparing across cases. The analysis followed two main stages. 

First, a within-case analysis was conducted for each company to build a narrative that 

describes the specific path each firm took in its sustainability journey, including what 

worked well and the challenges it faced. These case summaries helped highlight the 



47 

unique context and strategies of each firm. Next, a cross-case comparison was con-

ducted to look for similarities and differences between the firms. This step was especially 

valuable in identifying broader patterns, such as how companies in different industries 

respond to similar regulations or how corporate culture influences the framing and im-

plementation of sustainability. Throughout the process, the researcher stayed closely 

engaged with both the data and the theory, constantly moving between them to refine 

understanding. This iterative style of analysis enabled the development of more pro-

found insights that went beyond surface-level descriptions, helping to answer the central 

research questions in a meaningful way. 

 

4.6 Ensuring Quality and Reliability 

For the study to be reliable and trustworthy, the authors used some established qualita-

tive strategies (Lincoln & Guba, 1985). Credibility was supported through triangulation, 

using both interviews and documents, and by sharing summaries of findings with partic-

ipants to confirm accuracy. Dependability was ensured by keeping a detailed record of 

how data was collected and analyzed, which includes saving versions of interview guides, 

coding notes,