Article
Sustainable Entrepreneurship in the Circular Economy: An Integrated Dynamic Capability Framework for Innovation, Organizational Resilience, and Long-Term Value Creation
Sustainability-driven transformation has increasingly become central to contemporary entrepreneurial and organizational discourse, particularly within the context of circular economy systems. However, existing research remains fragmented in explaining how sustainable entrepreneurial orientation translates into long-term organizational value. Most studies either emphasize innovation outcomes or environmental performance in isolation, leaving a conceptual gap in understanding the capability-based mechanisms underlying sustainability-driven value creation. This study addresses this gap by developing an integrated conceptual framework that explains how sustainable entrepreneurship contributes to long-term value creation through circular innovation capability and organizational resilience. Drawing upon Resource-Based View, Dynamic Capability Theory, Stakeholder Theory, and Institutional Theory, the paper conceptualizes sustainability not as a direct performance driver but as a multi-stage capability development process embedded within organizational and institutional contexts. The framework proposes that sustainable entrepreneurship strengthens circular innovation capability, which subsequently enhances organizational resilience, ultimately enabling sustained economic, environmental, and social value creation. Additionally, ESG governance and institutional support are identified as critical boundary conditions that shape the strength of these relationships. The study contributes to theory by shifting the focus from linear cause–effect relationships to a sequential capability-based understanding of sustainability transitions. Practically, it provides insights for managers and policymakers on how to design governance structures and institutional mechanisms that support circular economy transformation.