Can Supply Chain Integration Mitigate the Risks inherent in Circular Economy Transition?

ABSTRACT The Italian furniture industry increasingly adopts circular economy ( CE ) practices to address sustainability challenges. However, CE implementation introduces specific risks related to supply chain fragmentation, traceability issues and consumer resistance to sustainable materials. In this context, supply chain integration (SCI) emerges as a critical capability for managing complexity and uncertainty, yet its role in CE ‐related risk mitigation remains underexplored. While prior studies have examined CE and supply chain risk management (SCRM) separately, few have investigated how integration across supply chain actors enables firms to manage the specific risks of circular transitions. This study employs a multiple case study approach to address this gap, analysing five Italian furniture firms with varying CE maturity levels. Findings show that CE practices, such as the reuse of materials, the refurbishment of end‐of‐life products and digitalisation, are widespread, yet uneven in their impact. Companies with more advanced SCI systems, including shared data platforms and co‐sourcing agreements, are better positioned to mitigate operational and reputational risks. In contrast, firms with limited integration face obstacles in scaling CE due to inefficiencies and low coordination. The study highlights SCI not only as a strategic enabler for circular adoption under uncertainty, but also as relevant for mitigating the risks associated with CE implementation. The findings underscore the need for supportive policy frameworks that foster supply chain integration as a means to reduce risks related to circular transitions and promote their broader adoption.