Ethical value co-creation in circular economy ecosystems: a case study of the textile industry

Purpose The purpose of this empirical study is to apply the industrial marketing and purchasing approach to explore ethical value co-creation and business ethics in the circular economy (CE) ecosystem (CEE) of the Finnish textile industry. A CEE involves a variety of business and institutional actors with shared business or societal targets. Ethical principles may become embedded in their first social interaction and can play an important supportive role in economic, environmental and social value co-creation, especially when the actors have sustainability goals. Design/methodology/approach This study uses a qualitative single-case study of a CEE in the Finnish textile industry where diverse actors seek to create value from circularity. The analysed data represent a set of interviews with business and institutional actors directly involved in managerial activities in the CEE of textile industry in Finland. Findings This study provides a conceptual framework of actors’ interactions and ethical value co-creation aimed at meeting CE and sustainability goals at the levels of actors, the network and the ecosystem. The findings emphasise the value of proactive collaboration among business and institutional actors seeking innovations, knowledge-sharing and business development in fostering more circular operations in the textile industry and thereby effecting the CE transition. Efficient interactions for value co-creation among actors can be grounded on ethical values such as trust, transparency, shared sustainability goals and the power to positively influence and motivate actors and even consumers to transition to CE principles. Originality/value An original research framework of ethical value co-creation is proposed in this study based on the combined concept of ethical embeddedness and ecosystem orchestration mechanisms to achieve sustainability and CE goals. This study contributes to the limited business ethics studies in circular business and CEE research and empirically examines business interactions among actors within a CE ecosystem. The managerial and policymaking implications of this study highlight the strategic importance of various actors’ interactions in implementing circularity in business processes.