Organizational Network Capability for Circular Economy: The Case of Moroccan Manufacturing Firms

Abstract

Exchanges and interactions with stakeholders offer companies considerable opportunities to align their operations with sustainability challenges. However, many manufacturing companies lack the resources and capabilities to fully exploit these opportunities. Drawing on the relational perspective and the Natural-Resource-Based View, this study aims to explore the relationship between organizational network capability and its dimensions with firms’ circular economy capabilities. The results of regression analyses of data from 135 Moroccan manufacturing firms indicate that, respectively, coordination, relational skills, and internal communication network capabilities positively influence circular economy capabilities. Similarly, organizational network capability has a positive effect on circular economy capabilities. Furthermore, the study shows that the relational skills and coordination dimensions of network capability enhance internal communication capability. The results suggest that manufacturing firms can improve their circular economy capabilities by strengthening their network capability and aligning it with their sustainability strategy. These findings thus enrich the literature on network capabilities and their relationships with organizational capabilities in the context of companies’ green transition.