Green Innovation and Circular Economy Practices in Small and Medium Enterprises: A Systematic Literature Review

Dian Puspitasari; Michael Tan

Abstract

Small and medium enterprises (SMEs) are central to many economies, yet their role in the circular economy is less studied than that of large firms. This systematic review maps green innovation and circular economy practices in SMEs, their drivers and their barriers. Following PRISMA 2020, Scopus and Web of Science were searched for studies published from 2015 to 2025. Of 536 records, 61 studies met the inclusion criteria. Practices were grouped into eco-design, resource efficiency, waste valorisation and product-service systems. Main drivers were cost savings, customer demand and supportive regulation, while the main barriers were limited finance, lack of technical skills and weak supply chain collaboration. The review proposes a research agenda on financing models and digital tools for circular SMEs in developing countries.

Keywords

circular economy
green innovation
SMEs
systematic review
sustainability

References

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