The Role of Organizational Climate when Implementing Circular Business Models : A multiple case study in the Swedish context

Abstract: Background: The circular economy has emerged as an alternative to linear approaches to consumption and has the potential to solve the most pressing sustainability issues society faces today. SMEs have a central role in the transition towards a circular economy, as they make up the majority of businesses in Europe. However, the adoption of circular practices has been slower than expected. Researching what is affecting the adoption of these practices could provide answers and insights into how to accelerate this transition.  Purpose: The purpose of this study is to explore the role of organizational climate as a moderator when implementing circular business practices, given its potential to lead to organizational change.  Method: This study follows an interpretive approach through a multiple exploratory case study using two companies. Qualitative semi-structured interviews and observations from the company visits were used as primary data. The empirical data is analyzed through a general coding procedure, where explanation building was used as the approach. The research adds to existing theory through an abductive approach.   Conclusion: By exploring the challenges people face in SMEs, we have found that the organizational climate of the company is a critical factor that can affect the implementation of circular practices. Therefore, we propose that by creating the right climate, organizations could potentially accelerate this transition.