Business model innovations for carbon reduction and circulation – Systematic literature review and a novel typology

With the increased understanding on the threats of climate change and the urgency of climate action, it has become evident that a truly sustainable global economy requires special attention to the reduction and circulation of carbon. Pushing emissions down has taken a high priority and attracted increasing funding on the tables of both governments and private companies. Despite the ongoing cross-industrial carbon transformation, the academic world has so far largely been unable to develop structured understanding of the business model innovations enabling these massive developments. Scientific literature is mostly tackling the issue of carbon reduction and circulation in an indirect manner, especially through research on circular economy and circular business model innovations, which we argue do not fully address the means for carbon reduction and circulation. To demonstrate the gaps in the current literature and explore the business model innovations for carbon reduction and circulation, we execute a systematic review of more than 140 scientific articles and public documents. We present a novel typology of business model innovations for carbon reduction and circulation, characterize the literature and its gaps, and conclude by proposing a research agenda.