When There Is Nothing to Imitate: Circular Business Models and the Limits of Mimetic Diffusion

Circular economy (CE) scholarship has documented in considerable detail how coercive pressures (regulation, landfill bans, subsidies) and normative pressures (certifications, professional standards) shape the adoption of circular business models (CBMs). Far less is known about why CBMs, once proven viable by frontrunners, so rarely diffuse across an industry through imitation. Drawing on recent institutional-theory research, this perspective argues that mimetic isomorphism, one of the most powerful mechanisms of organisational change, remains structurally weak in circular transitions, not because firms are unwilling to imitate, but because there is often little that is stable enough to imitate. Five obstacles to the mimetic diffusion of CBMs are identified: the absence of dominant archetypes, undisclosed cost structures, symbolic adoption that crowds out substantive practice, unsettled ownership of secondary materials, and the absence of independent verification for returned material. Underlying them is an inverted sequence of institutional diffusion: legitimacy arrived largely top-down and ahead of a proven practice base, leaving would-be imitators with permission but little proof. The result is a string of isolated pilots rather than a cumulative industry shift. The practical consequences of this missing pathway are discussed, including the vacuum it leaves for bad-faith appropriations of circular rhetoric. Levers to strengthen the pathway are outlined, and an open question for future research is flagged.