This paper builds on the available knowledge on what drives firms’ production choices towards circular economy practices to shed new light on a so far quite neglected dimension: the role of organizational settings. Being the transition to a more circular economy systemic in nature, it draws not only on technological but also on organizational changes and new set-ups. Coherently, the paper investigates how certain organizational settings (such as practices of communication to employees on critical aspects of the life of the company, the implementation of new performance evaluation mechanisms and incentive-based payment methods and the implementation of changes in recruitment and training of (new) employees affect the adoption of circular economy innovation. The work is empirical, and it draws on a newly collected dataset representative for Italian manufacturing firms in 2017-2018. Results show new light on the role of such organizational set-ups, which are found to be making the transition towards a circular economy more effective.

Suggested citation: D. Antonioli, C. Ghisetti, S. Pareglio, M. Quatrosi, (2022), ‘Innovation, Circular economy practices and organisational settings: empirical evidence from Italy’, Nota di Lavoro 07.2022, Milano, Italy: Fondazione Eni Enrico Mattei