Life Cycle Assessment to Ensure Sustainability of Circular Business Models in Manufacturing

Circular business models (CBMs) represent a path for coordinating circular economy (CE) efforts. Life-cycle assessment (LCA) is a tool for quantifying environmental effects of a product or a service and can therefore evaluate the environmental sustainability of CBMs. This paper explores whether LCA can act as an enabler for manufacturing companies who want to implement a CBM. Following a case-study approach, we draw on the experiences of a specific manufacturing company during the time period 2014-2021. The paper presents key lessons on the interaction between LCA and CE. The study finds that LCA-by providing quantified results on the environmental impacts of circular strategies-limits the risk of problem shifting and challenges the normative rule of closing the loop by including a set of multiple impact categories. LCA offers a common platform and encourages communication with stakeholders. These characteristics make LCA a well-suited tool for CBM development. However, the holistic perspective on environmental problems that LCA provides can also complicate CE's clear message of 'closing the loop'. Lastly, LCA is a tool for environmental evaluation, and with the main emphasis of CE also on environmental issues, there is high risk of neglecting social and economic aspects of sustainable development.