Linking natural resource accounting to the circular economy: towards an integrated framework for sustainability measurement and governance

Purpose The purpose of this study is to examine how natural resource accounting (NRA) can operationalize circular economy (CE) principles to support responsible production, consumption and net-zero sustainability governance. This study explores how integrating physical and monetary resource information enhances measurement, accountability and decision-making at firm and national levels. Design/methodology/approach Using an integrative literature review, this study synthesizes research from accounting, environmental economics and sustainability science. A multi-level analytical lens links firm-level tools (MFCA and LCA) with economy-wide frameworks (MFA and SEEA). A conceptual framework is developed to explain how accounting structures, institutional forces and decision-making processes interact to enable circular and net-zero transitions. Findings The review finds that NRA provides the measurement infrastructure necessary to translate CE strategies into measurable and governable outcomes, including material efficiency, waste reduction and emissions mitigation. However, adoption remains uneven because of fragmented indicators, weak institutional capacity and limited integration between physical and monetary accounting systems. The findings of this study indicate that harmonized accounting standards and stronger institutional coordination are essential for linking micro-level circular practices with macro-level sustainability and net-zero objectives. Practical implications This study guides policymakers and organizations on aligning national accounting systems (SEEA-based MFA) with firm-level tools (MFCA and LCA) to advance circular business models, responsible production and evidence-based sustainability governance. Originality/value This paper positions NRA as a governance-enabling infrastructure rather than a complementary reporting tool. By integrating ecological modernization, institutional theory and stakeholder perspectives, the framework clarifies how accounting can support circularity and net-zero transitions across developed and developing economies.