Measuring the Circular Economy: (de)coupling during strategic organisational transitions

Exacerbated and unprecedented global challenges demand the need for sustainable practice and effective governance. As organisations respond to these institutional pressures with systems-centric circular economic (CE) policy and practices, an observable gap exists between what they are enacting and their achievements. The research investigates performance measurement as a mechanism to couple or decouple CE from business strategy. It combines insight from CE and management and organisational literature, namely means-ends decoupling, material coupling and performance measurement and management. A qualitative, multi-method study was adopted, comprising a cross-sectoral analysis and multiple embedded case study. Data was collected via semi-structured interviews, supplemented by documentary evidence and research feedback sessions. Data was analysed using Gioia’s coding methodology and thematic analysis. The cross-sectoral study found evidence of means-ends decoupling in CE transitioning organisations, leading to the generation of a means-ends decoupling behaviours typology. Further, the case study investigation determined the factors that affect the coupling of CE to business strategy within organisations, resulting in the development of a material coupling tensions framework. This research delimits the confines of management theorisation by contextualising within the CE, providing a better theoretical understanding of the systems-centric approach to fostering successful CE transitions. It expands means-ends decoupling theory by identifying micro-organisational behaviours that attribute to the extrapolated macro consequences. It extends and adds nuance to material coupling theory in a CE transitioning organisational context by determining the perceived roles of performance measurement in helping or hindering the coupling of CE to business strategy. Finally, the research contributes to improving understanding of the relationship between means-ends decoupling and material coupling by addressing the micro level of operations. This research helps practitioners navigate complex CE transitions by adopting a systems-centric mindset, building knowledge of organisational behaviours that lead to means-ends decoupling, and harnessing measurement tensions to couple CE to business strategy.