Title: Sustainable Business Model Innovation and Circular Economy Performance: The Dual Role of Green Marketing Orientation and Resource Use Efficiency
Authors: Ngo Anh Thu, Nguyen Manh Ha
Volume: 10
Issue: 7
Pages: 392-400
Publication Date: 2026/07/28
Abstract:
Firms are under increasing pressure to redesign their business models for circularity, yet the process by which sustainable business model innovation (SBMI) translates into circular economy performance (CEP) remains poorly understood. Drawing on the natural-resource-based view and dynamic capabilities theory, this study proposes that SBMI contributes to CEP through two paths: a market-facing path through green marketing orientation (GMO) and an operations-facing path through resource use efficiency (RUE). We test this parallel-mediation model with survey data from 300 manufacturing firms, using partial least squares structural equation modelling. To maintain conceptual separation, RUE is defined as efficiency in the use of inputs and CEP as the slowing and closing of material loops. SBMI is positively associated with both GMO (? = 0.487) and RUE (? = 0.405), and each mediator is in turn positively associated with CEP (? = 0.330 and ? = 0.234 respectively); a significant direct effect also remains (? = 0.250). Both indirect effects are significant and together account for roughly half of SBMI's total effect on CEP, which indicates partial and complementary mediation. The market-facing indirect effect is larger in magnitude, but a bootstrap test of the difference between the two paths does not reach significance, so the two capabilities are best described as jointly rather than differentially important. The results are robust to five firm-level controls and show satisfactory out-of-sample predictive relevance. The findings position green marketing and resource efficiency as a dual capability linking model innovation to circular outcomes, and carry implications for managers and policymakers seeking circular transitions that are both market-viable and resource-efficient.