Current State and Barriers To The Circular Economy in The Building Sector

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Current state and barriers to the circular economy in the building sector: Towards a
mitigation framework
Muhammad Bilal, Khurram Iqbal Ahmad Khan, Muhammad Jamaluddin Thaheem,

Abdur Rehman Nasir
PII: S0959-6526(20)33295-9
DOI: https://doi.org/10.1016/j.jclepro.2020.123250
Reference: JCLP 123250
To appear in: Journal of Cleaner Production
Received Date: 24 November 2019

Revised Date: 13 June 2020
Accepted Date: 7 July 2020
Please cite this article as: Bilal M, Khan KIA, Thaheem MJ, Nasir AR, Current state and barriers to the
circular economy in the building sector: Towards a mitigation framework, Journal of Cleaner Production,
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Word Count: 12924
Current state and barriers to the circular economy in the building sector:
Towards a mitigation framework
Muhammad Bilal1, Khurram Iqbal Ahmad Khan1*, Muhammad Jamaluddin Thaheem2, Abdur
Rehman Nasir1
1
Department of Construction Engineering and Management, National University of Sciences
and Technology, Islamabad, Pakistan
2
School of Architecture and Built Environment, Deakin University, Geelong, Australia
*
Corresponding author: khurramiqbal@nit.nust.edu.pk
Abstract
The building sector is amongst the major resource consuming and waste generating sectors of
the economy. The paradigm of the circular economy has the potential to overcome the
problems resulted due to adoption of the linear economic model by the building sector. The
circular economy offers a new perspective for industrial ecosystems including materials and
products being fed back into the supply chain as resources, thereby resulting in reduced
consumption of primary resources and waste generation. The research on circular economy
increased rapidly during recent years; however, a research gap exists on the assessment of
current state and barriers to the circular economy in the building sector of developing
countries. This study has developed and used a circular economy assessment scale for the
building sector of developing countries. It is found that the current state of circular economy
implementation in the building sector is unsatisfactory. Out of the seven circular economy
dimensions used for analysis, the energy dimension showed the best performance and the
waste dimension showed the worst performance. Serious steps are required by all the
stakeholders of the building sector to improve the adoption of the circular economy.
Furthermore, interpretive structural modeling (ISM) and matrice d'Impacts croises-
multipication appliqué an classment (MICMAC) techniques are used to identify and classify
the key barriers to the circular economy. It is found that a lack of environmental regulations
and laws is driving the rest of the barriers to the circular economy. Equally critical is the lack
of public awareness and support from public institutions. Finally, a mitigation framework for
the building sector of developing countries is proposed, which is an addition to the circular
economy existing body of knowledge. The proposed framework could serve as a guideline
for decision and policymakers.
Keywords: Circular economy; Building sector; Interpretive structural modeling; Current

state; Mitigation
High costs Lack of
are related to standard
recycled systems for
Lack of materials in performance
Challenges of
adequate supply chain; indicators in
take-back
technology therefore, terms of
from other
they are often measurement
companies
more of circular
expensive economy in
than virgin supply chain
materials
Higher upfront Lack of an

investment information
costs in supply exchange Lack of circular
chain by system between economy skills
implementing different by employees in
circular stakeholders supply chain.
economy
Lack of proper training and development programs for

the members of supply chain
Inadequate financial resources
Lack of customer/public Lack of support/backing from

awareness public institutions
Lack of environmental regulations and laws
Figure 4-4 ISM model for CE barriers

Word count: 12924
Current state and barriers to the circular economy in the building sector:
Towards a mitigation framework
Muhammad Bilal1, Khurram Iqbal Ahmad Khan1*, Muhammad Jamaluddin Thaheem2, Abdur
Rehman Nasir1
1
Department of Construction Engineering and Management, National University of Sciences
and Technology, Islamabad, Pakistan
2
School of Architecture and Built Environment, Deakin University, Geelong, Australia
*
Corresponding author: khurramiqbal@nit.nust.edu.pk
Abstract
The building sector is amongst the major resource consuming and waste generating sectors of
the economy. The paradigm of the circular economy has the potential to overcome the
problems resulted due to adoption of the linear economic model by the building sector. The
circular economy offers a new perspective for industrial ecosystems including materials and
products being fed back into the supply chain as resources, thereby resulting in reduced
consumption of primary resources and waste generation. The research on circular economy
increased rapidly during recent years; however, a research gap exists on the assessment of
current state and barriers to the circular economy in the building sector of developing
countries. This study has developed and used a circular economy assessment scale for the
building sector of developing countries. It is found that the current state of circular economy
implementation in the building sector is unsatisfactory. Out of the seven circular economy
dimensions used for analysis, the energy dimension showed the best performance and the
waste dimension showed the worst performance. Serious steps are required by all the
stakeholders of the building sector to improve the adoption of the circular economy.
Furthermore, interpretive structural modeling (ISM) and matrice d'Impacts croises-
multipication appliqué an classment (MICMAC) techniques are used to identify and classify
1
the key barriers to the circular economy. It is found that a lack of environmental regulations
and laws is driving the rest of the barriers to the circular economy. Equally critical is the lack
of public awareness and support from public institutions. Finally, a mitigation framework for
the building sector of developing countries is proposed, which is an addition to the circular
economy existing body of knowledge. The proposed framework could serve as a guideline
for decision and policymakers.
Keywords: Circular economy; Building sector; Interpretive structural modeling; Current

state; Mitigation
1. Introduction
Globally, the use of material resources is increasing with an increase in population
and income (Behrens et al., 2007). If this scenario continues, many material resources will
become scarce and expensive, and may even vanish for the use of future generations (Defra,
2012). The release of a range of new durable and resilient materials in the twentieth century
has smitten the environmental impact of the construction industry (Shen and Qi, 2012). This
sector is known as one of the highest waste generating and the least sustainable sector of the
economy due to its environmental impacts (Núñez-Cacho et al., 2017). Many countries are
pushing this sector to find sustainable strategies to reduce environmental impacts (Lieder and
Rashid, 2016). The circular economy (CE) system offers an opportunity to reduce the usage
of primary materials, and their associated environmental impacts (EMF and MCK, 2014). It
is also envisaged that the adoption of CE may cause socio-economic benefits, including
increased gross domestic product and employment opportunities, and reduced use of virgin
materials and risk of material supply and price unpredictability (WRAP and Green Alliance,
2015).
The paradigm of CE has evolved from industrial ecology, which emphasizes the
advantages of recycling waste materials, and associated by-products (Jacobsen, 2006).
Furthermore, the intellectual roots of this concept consist of regenerative design, ecological
2
and environmental economics, the 3Rs principle (reduce, reuse and recycle), blue economy,
cradle to cradle approach, industrial symbiosis, performance economy, green growth, natural
capitalism and bio-mimicry concepts (Ghisellini et al., 2016; McDonough and Braungart,
2002). The progression of the CE notion and its implementation at the policy level has been
described in detail by different researchers (McDowall et al., 2017; Murray et al., 2017; Su et
al., 2013). Various definitions of CE exist in the literature. However, this paper is grounded
on the Geissdoerfer et al., (2017) definition; “a regenerative system in which resource input
and waste, emission, and energy leakage are minimized by slowing, closing, and narrowing
material and energy loops. This can be achieved through long-lasting design, maintenance,
repair, reuse, remanufacturing, refurbishing, and recycling”.
Experts from industry, academia, and society are rapidly recognizing the need for CE
(Merli et al., 2018). Consequently, this concept has been effectively applied to different
products like electronic goods and clothing (Ghisellini et al., 2016). The construction sector
has the maximum potential for CE adoption (Brambilla et al., 2019). But, we do not see this
practically happening (Minunno et al., 2018). This is when the building sector is causing a
large amount of waste, unsustainable material, and energy consumption, resulting in a
massive environmental impact (Conti et al., 2014; Viola, 2017; Zimmermann et al., 2005).
The statistics depict that globally the building sector consumes 30% of raw materials, 25% of
water resources, 12% of the land, and 40% of the energy (UNDP Buildings and Climate
Initiative, 2009). As the environmental impacts of building construction sector do not
conform with the sustainability level, statistics has identified this sector as a crucial target to
improve in terms of its sustainability (Buyle et al., 2018). Therefore, the building sector needs
to promote eco-efficient strategies to increase economic returns and decrease its
environmental impacts (Braungart et al., 2007). However, the current situation is different as
waste generation is rapidly increasing in different life cycle phases of buildings, and fewer
3
efforts are made to minimize the waste. There is a need to encourage the adoption of CE by
the building sector, in a way it has been adopted by other sectors.
The construction phase is among the major life cycle phases of a building, and it
accounts for a large amount of waste. The sustainability of global societal and economic
development is faced with the challenge of enormous construction waste (He and Yuan,
2020). For example, 820 million tons of construction waste is generated by the European
construction sector every year (Gálvez-Martos et al., 2018) and 131.2 million tons of waste
was generated by the UK construction sector in the year 2014 (Defra, 2018). The scenario for
developing countries is worse. For example, every year China generates 2.36 billion tons of
construction waste, which makes it the largest solid waste producer country of the world
(Zheng et al., 2017). Consequently, to overcome this challenge, several developed countries
like Japan and Germany have taken initiatives to treat such waste. But according to the
National Development and Reform Commission (NDRC) report for 2014, the developing
countries lag far behind in this regard (He and Yuan, 2020).
Based on this limitation, the current research discusses the state and barriers in terms
of CE implementation in the building sector of developing countries. The research is unique
to CE’s body of knowledge due to the presence of a research gap on the identification of the
current state of CE and barriers impeding CE adoption in developing countries. An online
survey was conducted to assess the current state of CE implementation in the building sector
of developing countries. Furthermore, interpretive structural modeling (ISM), matrice
d'Impacts croises-multipication appliqué an classment (MICMAC) and influence matrix
techniques were used to study the interaction among CE barriers, and influence of CE
barriers on CE indicators. It was followed by the development of a mitigation framework for
CE barriers. This paper consists of five sections. Section 1 comprises of the introduction part.
In section 2, existing literature on CE is discussed from the perspective of the building sector.
4
In section 3, methods used to answer research questions are described. Section 4 analyzes the
data gathered for this research. Finally, section 5 concludes the results and provides
directions for future research.
2. Theoretical perspective
2.1. Circular economy assessment
The famous proverb of management and economics “you can’t manage what you can’t
measure” is of great importance and is equally applicable in the case of CE assessment
(Nuñez-Cacho et al., 2018). An indicator system for CE assessment is essential for a
successful transition to CE. Using indicator system policy, decision-makers can monitor the
application of CE. Moreover, it can also help in policymaking. Consequently, scholars and
government organizations have made efforts to develop indicators for CE assessment (Su et
al., 2013). However, Beratan et al. (2004) stated that indicators are only a tool to measure the
transition towards CE; indicators alone cannot successfully achieve a transition to CE. Hence,
decision-making must be linked with indicators for a successful transition to CE. Indicators
focusing on the measurement of circularity are still evolving (Giurco et al., 2014). Banaité
(2016) reviewed indicators to measure CE at macro, meso, and micro levels and found a total
of 153 indicators at macro-level, 46 at meso-level, and 65 at micro-level. According to Geng
et al. (2013), the highest-profile of indicators comes from China where the government uses
well-known scales to measures the performance of CE policies. CE can be implemented at
the macro-level (city, province, region, and country), meso-level (symbiosis association and
industrial parks), and micro-level (single company, consumer, and product). For the
assessment of CE at all three levels, different indicators are required (Banaitė, 2016).
Different studies have been conducted on the development of indicators for the CE
assessment at the macro level. For example, Guo-gang et al. (2011) developed an evaluation
index system for the assessment of CE at the regional level. This evaluation index system
5
contained 16 indicators classified into 4 groups. It included indicators from ‘reduce’ and
‘recycle’ principles of CE and not from the ‘reuse’ principle (Banaitė, 2016). Additionally,
Wu et al. (2014) in their study for assessment of CE efficiency for 30 regions of China used
the DEA window analysis method. Furthermore, Geng et al. (2012) translated and explained
China’s national CE evaluation index system in English, and stated that the overall purpose
of this system is to provide credible and objective information to decision-makers on the
status of CE implementation. This system contained 22 indicators classified into 4 groups.
Although certain benefits can be gained using this evaluation index system, a revision is
required to incorporate social and business indicators for better assessment of CE.
Accordingly, various studies have been conducted on the development of meso-level
indicators. The number of indicators found in the literature for meso-level is comparatively
lesser than those for other levels (Banaitė, 2016). China has launched an evaluation index
system based on the material flow analysis (MFA) for the assessment of CE at the macro-
level and meso-level (Geng et al., 2012). For the meso-level, this evaluation index system
contained 12 indicators classified into 4 groups. However, this system was based on MFA
indicators that are most applicable to macro-level policy measures (Bringezu et al., 2003).
Moreover, this evaluation index system lacked absolute energy and material reduction
indicators (Geng et al., 2012). Li et al. (2012) proposed an indicator system for assessing the
CE performance of chemical industries. This system consisted of 18 indicators classified into
5 groups. They also evaluated the CE performance of a chemical enterprise in China. The
results showed that the enterprise was in the transitional stage from traditional mode to
circular mode. The proper CE assessment using this evaluation index system requires reliable
data and acquiring such data in a developing country is an uphill task.
The indicators at the micro-level are used for CE assessment of a single enterprise or
product. A generic indicator system for all enterprises may not fit for use. Therefore,
6
customized indicators are required for CE assessment at the micro-level (Su et al., 2013).
Franklin-Johnson et al. (2016) proposed an indicator system based on longevity for CE
assessment at the product design level. Although this is a simple and accessible method, this
indicator system partially addresses CE principles (Cayzer et al., 2017). A more exhaustive
approach has been proposed by the Ellen MacArthur Foundation (EMF) as a circular design
guide (EMF, 2016). This approach is simple, comprehensive, and speedy. However,
potentially misleading results, hiding complexity and reliance on context-specific
assumptions are some limitations of this approach principles (Cayzer et al., 2017). The
British standards institution has recently launched a standard BS 8001:2017 for CE. It
includes quantitative indicators based on MFA and life cycle analysis (LCA) for assessment
of CE in organizations. However, it does not explain the relation between CE monitoring and
already established quantitative tools LCA and MFA (Pauliuk, 2018).
The research on CE in the context of the built environment is in initial stages and it is
gaining momentum in the construction sector (Pomponi and Moncaster, 2017). In Europe, an
end-of-pipe solution to manage waste generation is focused (Yuan and Shen, 2011). There is
an improvement in waste management for construction and demolition waste (CDW) owing
to this approach (Defra, 2015), but most of this recovered waste is down-cycled which results
in lesser quality, value, and functionality (Wilson et al., 2012). These initiatives spread
awareness and promote the idea of CE but the studies on construction and demolition are
merely focused on the LCA perspective. Moreover, a mere focus on recycling, reuse,
resource efficiency, and consumption cannot bring circularity in the buildings (Pomponi and
Moncaster, 2017). Nuñez-Cacho et al. (2017) developed a scale using Monte Carlo
simulations for assessment of CE implementation in construction firms. The scale was based
on scores from three sections “organization section”, “process section” and “workgroup
section”. The scores for all three sections were integrated to get the overall status of
7
implementation of CE by a construction firm. Another CE assessment scale for the building
industry was developed by Nuñez-Cacho et al. (2018) which was based on seven diverse
weighted dimensions: one related to general CE indicators; four associated with resource
management indicators “3Rs”, “Efficient Management of Energy”, “Water” and
“Materials”; and two related to environmental impacts “Emissions” and “Wastes”.
A review of the existing literature highlights a lack of research specifically focusing on
the assessment of CE implementation for the building sector in the context of developing
countries. Consequently, this study fills this gap by identifying the current state of CE
implementation at the overall industry level for the building sector of developing countries.
2.2. Barriers to circular economy implementation
Efforts to identify the barriers to CE have been done by the research community since
the propagation of the CE concept by the European Union (Smol et al., 2015). The research
on barriers to CE has been conducted in different perspectives. Mangla et al. (2018) identified
16 barriers to circular supply chain (CSC) for developing countries (particularly, in the
context of India) through literature review and performed ISM and MICMAC analyses.
Among the identified barriers, “lack of environmental laws and regulations” and “lack of
preferential tax policies for promoting the circular models” were the major barriers. In
another study, through methodical literature review and content analysis, Govindan and
Hasanagic (2018) identified 39 barriers that impede the implementation of CE in the supply
chain context. The results showed that the government has a major role in the implementation
of CE in the supply chain because of the upfront cost required for the implementation of CE.
The barriers to CE in organizations' perspectives have been identified by Masi et al.
(2018) in their exploratory research. They identified 23 barriers to CE at a firm level. Among
the identified barriers, the major barriers were “lack of awareness and sense urgency”,
“limited attention to end-of-life phase in current product designs” and “higher costs for
8
management and planning”. According to their survey, 65.33% of firms were aware of the
concept of CE. However, they noted that CE practices are driven economically rather
environmentally, as firms prefer to adopt those practices of CE which offer an economic
return. Similarly, Liu, Y., and Bai (2014) identified barriers to CE in the organizations'
perspective. They identified contextual, structural, and cultural barriers and reported that
improvements in CE implementation can be made by giving incentives to firms. However,
firms should be penalized for noncompliance with regulations.
Additionally, the barriers to CE from the perspective of small and medium enterprises
(SMEs) are identified by various researchers in different contexts (Rizos et al., 2016; Tura et
al., 2019). Ormazabal et al. (2018) identified barriers to CE for SMEs in the Spanish context.
They noted that companies are more concerned about their profits. Thus, they do not consider
environmental impacts and are unwilling to pay upfront costs to close the loop. In their work,
two types of barriers, hard and soft, were identified. Their results show a “lack of support
from public institutions” as one of the main barriers to CE.
Several studies have been conducted to identify barriers to CE implementation at the
macro-level. Xue et al. (2010) used a questionnaire-based survey to evaluate the awareness of
CE in China at the country and municipal level. Although results indicated that overall
awareness of the CE concept is good, yet 16% of officials had just heard of word CE. They
stated that awareness of officials could be raised by conducting works shops, newsletters, and
media promotions. Furthermore, they indicated that “lack of public awareness” and “lack of
financial support” are the main barriers to CE. Besides, they highlighted that there is a gap
between CE policies and practical situations in China. In another study, Kirchherr et al (2018)
ranked cultural barriers as the major barriers to CE in the EU context. The most pressing
cultural barriers, which they identified, were “Lacking consumer interest and awareness”
and “Hesitant company culture”. According to them, these two barriers affect the CE
9
transition or even may derail it. They reported that none of the technological barriers is
amongst the critical barriers to CE. Most importantly, they stated that CE is still a niche
debate among professionals of sustainable development. Therefore, to maintain the
momentum of the CE concept, a serious effort is required.
The challenges to CE in the industrial perspective were identified by Oghazi and
Mostaghel (2018). They suggested four propositions to transform these challenges to circular
business model into opportunities. Furthermore, de Jesus and Mendonca (2018) used
academic and grey literature to identify both hard and soft barriers to CE development. They
indicated that academic literature calls for technological innovations for transformation
towards CE, while grey literature calls for systemic innovation. They concluded that an
innovation system’s view should always be considered for the transition towards CE.
There is minimal research work carried out on CE form the perspective of the building
sector. Mahpour (2018) identified 22 barriers that impede the CE adoption in the case of the
CDW sector. These barriers were ranked in three categories (legal, technical, and behavioral)
with the help of six experts having experience in behavioral, technical, and legal science.
Further, these barriers were prioritized using the fuzzy TOPSIS method. Nevertheless, this
work was just focused on the perspective of the CDW sector, which is just a subset of the
building sector. A study on barriers from the perspective of the UK construction sector was
conducted by Adams et al. (2017). They report that the implementation of the CE concept in
the construction perspective is still in its initial stages and little research on CE from a
system’s perspective is done. They studied the awareness and challenges to CE and
concluded that the awareness of the CE concept at the overall industry level is very low. The
barriers “lack of incentive to design for end-of-life issues”, “lack of market mechanisms to
aid greater recovery” and “an unclear financial case” were recognized as the most
significant barriers.
10
Briefly, it can be summarized that although the identification of CE barriers has been
done in different perspectives, yet minimal work is done from the perspective of the building
sector. Moreover, the previous work is mostly focused on CDW, which is just a single life
cycle stage of building, while the CE concept can be applied to all life cycle stages of the
building. There is a need for more research on barriers that impede the adoption of CE at the
overall industry level for the building sector from the viewpoint of developing countries.
Therefore, this study aims to bridge this gap by identifying the key barriers to CE at the
industry level for the building sector.
3. Research method
3.1. Methodology for circular economy assessment
The study comprised of two parts. In the first part, the current state of CE
implementation in the building sector of developing countries was assessed. After a detailed
literature review, 72 significant indicators for CE assessment were extracted from the
research published during the years 2010-2019. After eliminating the repetitions, 64
indicators were shortlisted. To screen out the least important indicators, their qualitative and
quantitative significance was assessed through content analysis (Hsieh and Shannon, 2005).
The qualitative score was assessed subjectively by authors, whereas the quantitate score was
based on the frequency of appearance in the literature (Ahmad et al., 2018). Further, experts
from developing countries were consulted to rate the indicators (Ullah et al., 2016). A total of
21 experts from 14 different countries were consulted for further shortlisting of the indicators.
The scores from literature and industry were combined to get a cumulative score for each
indicator. Accordingly, different weighting ratios were assigned to literature and industry
scores and were statistically tested using rank correlation and one-way analysis of variance
(ANOVA). As literature does not specify any specific weighting ratio (Ahmad et al., 2018),
therefore due to the novelty of the CE paradigm and to avoid any bias, an equal weighting to
11
industry and literature score was assigned. Based on the cumulative score, the 24 indicators
as shown in Table 1 were shortlisted for further analysis.
Table 1 CE Indicators extracted from the literature
Sr. Indicators for CE assessment Author reference

No
1 Comprehensive utilization rate of industrial solid waste (Li and Su, 2012; Liu, 2014; Nuñez-Cacho et al., 2018; Zheng et al., 2012; Zhou et al.,
2013)
2 Recycling rate of reclaimed wastewater (Geng et al., 2012; Li and Su, 2012; Nuñez-Cacho et al., 2018; Zheng et al., 2012; Zhou et
al., 2013)
3 Total amount of SO2 emissions (Geng et al., 2012; Li and Su, 2012; Ma et al., 2014; Zheng et al., 2012; Zhou et al., 2013)
4 Total amount of COD emissions (Geng et al., 2012; Li and Su, 2012; Zheng et al., 2012; Zhou et al., 2013)
5 Rate of waste emissions (Li and Su, 2012; Liu, 2014; Zheng et al., 2012)
6 Design in accordance with CE principles (Nuñez-Cacho et al., 2018)
7 Total amount of wastewater discharge (Geng et al., 2012; Liu, 2014; Zhou et al., 2013)
8 Water consumption per unit product in key industrial sectors (Geng et al., 2012; Li and Su, 2012; Liu, 2014)
9 Environmental awareness in society (Nuñez-Cacho et al., 2018; Zheng et al., 2012)
10 Passing rate of used materials back into the supply chain (Cayzer et al., 2017; Nuñez-Cacho et al., 2018)
11 Comprehensive disposal rate of dangerous waste (Liu, 2014; Nuñez-Cacho et al., 2018)
12 Reusing rate of products/materials (Cayzer et al., 2017; Nuñez-Cacho et al., 2018)
13 Freshwater consumption (Ma et al., 2014; Zheng et al., 2012)
14 Willingness for transformation to a circular economy model (Nuñez-Cacho et al., 2018)
15 Percentage consumption of renewable or clean energy (Elia et al., 2017; Nuñez-Cacho et al., 2018)
16 Energy-saving amount (Nuñez-Cacho et al., 2018)
17 Redesign of products/services (Nuñez-Cacho et al., 2018)
18 Rate of carbon footprint (Nuñez-Cacho et al., 2018)
19 Availability of complete bill of materials and substances for the (Cayzer et al., 2017; Nuñez-Cacho et al., 2018)
product
20 Output of main mineral resource (Geng et al., 2012; Nuñez-Cacho et al., 2018)
21 Energy consumption (Geng et al., 2012; Zhou et al., 2013)
22 Total amount of industrial solid waste disposal (Geng et al., 2012; Zhou et al., 2013)
23 Availability of complete bill of solid waste for the manufacturing (Cayzer et al., 2017; Nuñez-Cacho et al., 2018)
process
24 Recycling rate of industrial solid waste (Geng et al., 2012)
Subsequently, the shortlisted 24 indicators were classified into different dimensions.
There is not any specific classification for CE in the literature (Nuñez-Cacho et al., 2018).
Moreover, integrative approaches for the implementation of CE strategies in lifecycle stages
lack in the case of the construction sector (López Ruiz et al., 2020). Most of the literature on
CE is comprised of topics like renewable energy, efficient resource management, promotion
of 3Rs principle for the care of materials and water (EMF, 2013; McDonough et al., 2003).
The other concepts in CE literature are classifiable into two groups: polluting emissions and
12
waste management (Nuñez-Cacho et al., 2018). Therefore, following the structure found in
the literature, experts were approached to classify these indicators into 7 CE dimensions
including material, energy, waste, 3Rs, water, emissions, and general CE indicators. In total
10 experts from developing countries provided feedback to classify the indicators. For every
indicator, experts specified the dimension in which it must be placed. Once responses from
all experts were gathered, frequency analysis was performed to classify the indicators using
majority rule.
The current state of CE implementation in the building sector of developing countries
was assessed using an online questionnaire survey. The questionnaire consisted of two parts:
(1) respondent’s demographics and (2) questions related to 24 CE indicators. Respondents
were asked for their level of agreement regarding the importance of shortlisted indictors a
five-point Likert scale (where 1= strongly disagree and 5= strongly agree). The sample for
this part of the study included engineers, architects, and facility managers randomly selected
from developing countries. A total of 300 invitations were sent against which 157 responses
were received, with a response rate of 52.3%. Out of them, 47 respondents declared to not
having any understanding of the circular economy. Thus, they were excluded and the
remaining 110 responses were included for further analysis. The sample size of 110 was
larger than the minimum sample size of 96 (Dillman, 2011). Microsoft® Excel® and IBM®
Statistical Package for Social Sciences v.23® (SPSS) were used for data analysis. Statistical
tests including Cronbach’s coefficient for reliability, and Shapiro–Wilk test for normality of
data were performed. Different sections of the questionnaire were analyzed through relative
importance index (RII) to consider every respondent’s feedback. The technique, RII, analyses
the responses to Likert scale using Equation 1 where w = weights assigned in Likert Scale
(for 5-point Likert Scale, w = {1, 2, 3, 4, 5}), A = highest weight assigned in the scale (for 5-
point Likert Scale, A = 5), and N = total number of respondents. The RII value ranges
13
between 0 and 1. For analyzing Likert scale-based data, RII has been used by different
researchers like Kometa et al. (1994) and Sambasivan and Soon (2007).
RII = Σ w / A*N Equation 1
In the second part of this research, the ISM technique was used to study the interaction
among CE barriers, and an influence matrix was developed to study the influence of CE
barriers on CE indicators.
3.2. Interpretive structural modeling
ISM is an interactive learning process and it comprehensively organizes various direct or
indirect components into a logical model (Warfield, 1974). ISM identifies relationships
among the specific items and portrays the patterns among items both graphically and
descriptively (Raj et al., 2008). It has been previously used by several researchers for
structuring barriers to various phenomena including CE from different perspectives
(Abuzeinab et al., 2017; Govindan et al., 2016; Kirchherr et al., 2018; Mangla et al., 2018).
The methodology for ISM is shown in Figure 1.
3.3. Influence matrix
To check the influence of CE barriers on the CE indicators, an influence matrix is
synthesized in this study (Averill, 2002). The shortlisted barriers of CE were put in rows
while indicators of CE were put in columns. Experts from the building sector were asked to
fill this matrix based upon the level of influence (1= low, 3= medium, and 5= high).
14
List of CE Literature
barriers review
Establishing contextual Building sector experts review of

relationships between CE CE barriers
barriers
Development of Development of
structural self- reachability matrix
interaction matrix
Partitioning of
reachability matrix
into different levels
Removal of Developing diagraph

transitivity from
diagraph
Yes
Replacement of
Is there any
variables nodes with
conceptual
relationship
inconsistency?
statements
No
Representing relationship statement into model for CE barriers
Figure 1 ISM methodology
4. Results and discussion
This section describes the result for both parts of this study.
4.1. The current state of the circular economy in the building sector
4.1.1. Level of awareness of circular economy

The results for the level of awareness of CE among the respondents showed diverse
results. A total of 157 responses were collected, 29.9% (47) respondents having ‘no
understanding’ of CE were excluded. The remaining 110 responses were considered for
further analysis. This low level of awareness reflects the novelty of the CE paradigm in the
15
building sector of developing countries. Out of 110 valid responses, 31% (34) respondents
had a slight understanding of CE, 22% (24) had a neutral understanding of CE and 40% (44)
had a moderate understanding of CE, whereas only 7% (8) had an advanced level of
understanding of CE.
4.1.2. Demographic profile of respondents

The demographics of respondents are shown in Table 2. Most of the respondents were
managers and engineers working at sites. Almost 55% of respondents had field experience of
more than 10 years.
4.1.3. Regional distribution of respondents

Figure 2 shows the location along with the frequencies of respondents. Respondents from
16 developing countries, representing six continents participated in this survey. Responses
were collected through emails and social and professional networking websites.
Mexico Fiji
2% 1%
Brazil
Albania Pakistan
7%
8% 19%
India
Serbia 9%
15%
Malaysia
6%
Nigeria
Egypt
7% Ghana
1%
12%
Turkey
Kenya 5%
2%
Bangldesh
South Africa 3%
2% China
2%
Figure 2 Regional distribution of respondents
16
Table 2 Demographic profile of respondents
Profile Frequency (%)
Total responses = 110
Job title
General Manager 2 1.81
Project Director 5 4.54
Project Manager 37 33.63
Facility Manager 6 5.45
Contract Manager 1 0.9
Planning Manager 1 0.9
Project Engineer/Site Engineer 38 34.54
Architect/ Designer 20 18.18
Years of experience
0-5 years 20 18.18

6-10 years 30 27.27
11-15 years 37 33.64
16-20 years 9 8.18
Above 20 years 14 12.73
Education
34 30.90
BEng/BSc
68 61.81
MS/MSc
8 7.29
Ph.D./Deng
4.1.4. Reliability and normality

To check the internal consistency of the developed scale, Cronbach's coefficient alpha
method was used. This method is most commonly used to check the reliability of Likert
scales. If the value of Cronbach's coefficient alpha is between 0.7-0.95, it indicates that the
data is acceptable for further analysis (Tavakol and Education, 2011). For the collected data,
the alpha value was calculated as 0.902 using SPSS. The higher value shows that data was
reliable and consistent for further analysis. Moreover, for the assessment of the normality of
data, the Shapiro-Wilk test was used. Significance values found for data were 0.000, which is
less than 0.05. This indicates that the collected data is not normally distributed.
17
4.1.5. Ranking of circular economy dimensions by mean and RII
The collected data was analyzed using Microsoft® Excel® and SPSS. RII, means,
percentages, and ranking of 7 CE dimensions were calculated as given in Table 3. The mean
value of CE implementation level in the building sector of developing countries is assessed to
be 2.936, which should ideally be closer to 5. Similarly, RII for the current implementation of
CE in the building sector of developing countries was calculated as 0.5873. Out of 7 CE
dimensions, the dimension of ‘Energy’ has the maximum RII (0.6533), whereas the
dimension of ‘Waste’ has the minimum value of RII (0.5114). It implies that ‘Waste
indicators’ are the most neglected aspect in the building sector of developing countries
followed by ‘3Rs indicators’ and ‘Emission indicators’.
Table 3 Ranking of CE dimensions

Mean of CE Percentage of CE RII of CE Overall ranking of
CE dimensions
dimensions dimensions dimensions CE dimensions
Energy indicators 3.2666 65.33 0.6533 1
General circular conomy indicators 3.1424 62.85 0.6285 2
Water indicators 3.0818 61.64 0.6164 3
Material indicators 2.9667 59.33 0.5933 4
Emission indicators 2.8045 56.09 0.5609 5
3Rs (Reduce, Recycle and Reuse)

2.7363 54.73 0.5473 6
indicators
Waste indicators 2.5571 51.14 0.5114 7
Average of the current state of CE

for building sector of developing 2.9365 58.73 0.5873
countries
Note: The ranking score is based on the level of implementation of each CE dimension.
4.1.6. Analysis of circular economy dimensions

The results for the material dimension showed that there is an availability of information
about materials and substances used for construction product manufacturing. Conversely, it is
worth mentioning that the environmental product declarations (EPD) strategy, which
provides the information regarding environmental impacts and embodied energy of building
18
material is yet to be developed for building materials produced in most of the developing
countries (Ortiz-Rodríguez et al., 2010). Further, the results of this study show that the output
of the main mineral resources is increasing. This increase in the extraction of construction
minerals can be associated with the increase in construction activity in the developing
countries (Giljum et al., 2015).
The level of implementation of CE for energy dimension in the building sector was
analyzed through three indicators. Overall, the energy dimension ranked at number 1, and the
top 2 indicators among 24 indicators were from this dimension. The results for the indicators
‘energy-saving amount’ and ‘percentage consumption of renewable or clean energy’ showed
good results. This is possibly due to increasing awareness for energy conservation among the
developing countries because the energy consumption of developing countries has increased
rapidly with the increase in urbanization (Allouhi et al., 2015). Several developing countries
have launched building codes for energy conservation. For example, India has launched its
first thermal code for buildings in 2007 (Tulsyan et al., 2013). Due to the increase in
construction activities, China was the pioneer in the region to launch its building codes
(Laustsen, 2008; Ye et al., 2013). From the results of this study, it is noteworthy to mention
that the energy-saving amount and percentage consumption of renewable or clean energy in
the building sector of developing countries is improved. Conversely, the results for indicator
‘overall energy consumption’ showed that overall energy consumption by the building sector
is still increasing. The reason for this increase is possibly due to an increase in urbanization
and construction activities (Zhang et al., 2015).
The results for CE current state assessment showed that the waste dimension ranked at the
lowest level for the building sector of developing countries. The results can be linked with the
fact that an overwhelming amount of solid waste is produced by burgeoning cities of
developing countries (T.Cecilia, 2012; Yousif and Scott, 2007). And a major portion of this
19
solid waste generated in cities is CDW waste (Kofoworola and Gheewala, 2009), whereas,
waste management practices of the developing countries have not improved, despite
increasing globalization (Marshall and Farahbakhsh, 2013). Moreover, the information
regarding construction waste and its composition, characteristics, and volume is unavailable
in the case of developing countries (Kofoworola and Gheewala, 2009). Thus, it makes
recycling of construction waste an uphill task.
The results for CE assessment of the building sector showed poor results for 3Rs
dimension, despite being the main component of the CE paradigm. Ferguson et al. (1995)
reported that approximately 50-80% of construction waste is recyclable or reusable but the
percentage of waste being recycled by the building sector of developing countries is much
lower (Ashford et al., 2000). A major obstacle to reuse or recycle CDW is the lack of on-site
sorting (Yuan et al., 2013) which has been reported for construction projects in developing
countries (Ghisellini et al., 2018). This affects the efficiency of reuse and recycle (Huang et
al., 2018; Lu et al., 2011).
The results for the current state assessment of the water dimension of CE showed better
results in comparison to other dimensions and ranked at number 3. Nevertheless, RII and
mean of this dimension depict that the results are not satisfactory. This is in line with the
assessment of Dong et al. (2013) where they claimed that the Chinese construction sector is
among the major water-consuming sectors, which is possibly due to increasing urbanization.
The level of implementation of CE for emission dimension in the building sector was
analyzed through four indicators. The current assessment of the CE of the building sector
showed poor results for the emission dimension. Similarly, it has been reported by other
researchers that the overall CO2 emissions of developing countries have increased rapidly
even exceeding the CO2 emissions of developed countries (Galeotti and Lanza, 1999;
20
Marshall and Farahbakhsh, 2013). Accordingly, environmental impacts associated with the
construction industry of developing countries are probably larger (UNEP-IETC, 2002).
Hence, poor results for CO2 emission by the building sector of developing countries can be
linked with the increasing construction activities and poor efforts to reduce the environmental
impacts due to building activities. The emissions of the building sector are mainly associated
with energy consumption (Li, 2008). Therefore, developing countries should promote cleaner
production strategies, and energy production by fossil fuels must be minimized (Khalili et al.,
2015; Wu et al., 2016).
The level of implementation of CE for the general CE dimension in the building sector
was analyzed through three indicators. The results for the indicator ‘environmental awareness
in society’ showed good results. This assessment is in line with the findings of Ofori (1992)
which stated that there is an improvement in the level of environmental awareness among the
public and governments in developing countries. Nonetheless, the indicator ‘design in
accordance with CE principles’ did not show good results, which is possibly due to the
novelty of the CE paradigm.
4.2. Model development for circular economy barriers using ISM
4.2.1. Identification of circular economy barriers

After a detailed literature review, a list of 79 barriers to CE implementation was extracted
from the literature published during the period 2010-2019. To screen out the least important
barriers, qualitative and quantitative significance was assessed by performing the content
analysis as previously explained (Hsieh and Shannon, 2005). Further, experts from
developing countries were consulted to rate the barriers (Ullah et al., 2016). A total of 20
experts from 10 different countries were consulted for further screening of the barriers. The
scores from literature and industry were combined to get a cumulative score for each barrier,
21
following the same method as for indicators. Based on the cumulative score as previously
explained, a list of 25 barriers to CE implementation was identified.
Afterward, building sector experts having awareness of CE were contacted for developing
a contextual relationship among these barriers. A total of 15 experts were approached for this
survey. Of them, 10 experts from 4 developing countries took part in the survey. The experts
after reviewing the barriers suggested that the number of barriers needs to be reduced as
assigning relation to 25 barriers is a tedious job. Additionally, chances of error are greater
while assigning relation to 25 barriers. Therefore, experts were asked to rate these barriers for
further shortlisting. Accordingly, based on the RII score, the top 12 barriers were shortlisted
for ISM analysis.
4.2.2. Developing structural self-interaction matrix (SSIM) for circular economy barriers
The respondents were asked to identify pairwise relationships between CE barriers. To
identify the relationship amidst any two barriers (i and j) of CE, four symbols were used,
which are explained below:
1) V: barrier i influence barrier j;
2) A: barrier j influence barrier i;
3) X: barriers i and j will influence each other;
4) O: barrier i and j are not related.
Table 4 shows the SSIM matrix developed with the above-mentioned symbols.
22
Table 4 SSIM for CE barriers
Barriers 12 11 10 9 8 7 6 5 4 3 2
1 O O O O O X O A O O O
2 O A O O O A O O O A
3 O A O O O A A A A
4 A O O V O A X O
5 V O V O O O O
6 A A V V O A
7 V V V O O
8 O A O X
9 O O O
10 O O
11 V
4.2.3. Developing reachability matrix (RM) from structural self-interaction matrix (SSIM)
The SSIM was converted into RM by substitution of 1 and 0 in place of symbols V, A, X,
and O as per following rules:
1) For symbol V in the entry (i, j) in the SSIM, the entry (i, j) for the reachability matrix
is substituted as 1, and the entry (j, i) is substituted as 0.
2) For symbol A in the entry (i, j) in the SSIM, the entry (i, j) for the reachability matrix
3) For symbol X in the entry (i, j) in the SSIM, the entry (i, j) for the reachability matrix
4) For symbol O in the entry (i, j) in the SSIM, the entry (i, j) for the reachability matrix
Following the above-mentioned rules, the initial RM for the CE barriers is shown in
Table 5. After the transitivity check, RM was converted into the final RM by removal of
transitivity as given in Table 6.
23
Table 5 Initial RM for CE barriers
Barriers 1 2 3 4 5 6 7 8 9 10 11 12
1 1 0 O O 0 0 1 0 0 0 0 0
2 0 1 0 0 0 0 0 0 0 0 0 0
3 0 1 1 0 0 0 0 0 0 0 0 0
4 0 0 0 1 0 1 0 0 1 0 0 0
5 1 0 0 0 1 0 0 0 0 1 0 1
6 0 0 0 1 0 1 0 0 1 1 0 0
7 1 1 0 1 0 1 1 0 0 1 1 1
8 0 0 0 0 0 0 0 1 1 0 0 0
9 0 0 0 0 0 0 0 1 1 0 0 0
10 0 0 0 0 0 0 0 0 0 1 0 0
11 0 1 1 0 0 1 0 1 0 0 1 1
12 0 0 0 1 0 1 0 0 0 0 0 1
Table 6 Final RM for CE barriers

Barriers 1 2 3 4 5 6 7 8 9 10 11 12
1 1 1* 1* 1* 0 1* 1 1* 1* 1* 1* 1*
2 0 1 0 0 0 0 0 0 0 0 0 0
3 0 1 1 0 0 0 0 0 0 0 0 0
4 0 0 0 1 0 1 0 1* 1 1* 0 0
5 1 1* 1* 1* 1 1* 1* 1* 1* 1 1* 1
6 0 0 0 1 0 1 0 1* 1 1 0 0
7 1 1 1* 1 0 1 1 1* 1* 1 1 1
8 0 0 0 0 0 0 0 1 1 0 0 0
9 0 0 0 0 0 0 0 1 1 0 0 0
10 0 0 0 0 0 0 0 0 0 1 0 0
11 0 1 1 1* 0 1 0 1 1* 1* 1 1
12 0 0 0 1 0 1 0 1* 1* 1* 0 1
4.2.4. Partitioning the reachability matrix (RM) into different levels

The reachability and antecedent sets were derived for each barrier from the final RM, as
shown in Table 7. The level of barriers having the same reachability and intersection set was
decided in the first step. As barriers 2, 8, 9, and 10 had the same reachability and intersection,
these were placed at level 1. Once the level of any barrier was decided, it was discarded from
the list. The same process was reiterated until the level for each barrier was decided. The
24
iterations are given in subsequent Tables 7 to 12. These levels of barriers helped in the
formation of the final ISM model.
Table 7 Level partitioning iteration 1
Iteration-1
CE barriers Reachability set Antecedent set Intersection set Level
1 1,2,3,4,6,7,8,9,10,11,12 1,5,7 1,7
2 2 1,2,3,5,7,11 2 1
3 2,3 1,3,5,7,11 3
4 4,6,8,9,10 1,4,5,6,7,11,12 4,6
5 1,2,3,4,5,6,7,8,9,10,11,12 5 5
6 4,6,8,9,10 1,4,5,6,7,11,12 4,6
7 1,2,3,4,6,7,8,9,10,11,12 1,5,7 1,7
8 8,9 1,4,5,6,7,8,9,11,12 8,9 1
9 8,9 1,4,5,6,7,8,9,11,12 8,9 1
10 10 1,4,5,6,7,10,11,12 10 1
11 2,3,4,6,8,9,10,11,12 1,5,7,11 11
12 4,6,8,9,10,12 1,5,7,11,12 12
Iteration-2
1 1,3,4,6,7,11,12 1,5,7 1,7
3 3 1,3,5,7,11 3 2
4 4,6 1,4,5,6,7,11,12 4,6 2
5 1,3,4,5,6,7,11,12 5 5
6 4,6 1,4,5,6,7,11,12 4,6 2
7 1,3,4,6,7,11,12 1,5,7 1,7
11 3,4,6,11,12 1,5,7,11 11
12 4,6,12 1,5,7,11,12 12
Iteration-3
1 1,7,11,12 1,5,7 1,7
5 1,5,7,11,12 5 5
7 1,7,11,12 1,5,7 1,7
11 11,12 1,5,7,11 11
12 12 1,5,7,11,12 12 3
25
Iteration-4
1 1,7,11 1,5,7 1,7
5 1,5,7,11 5 5
7 1,7,11 1,5,7 1,7
11 11 1,5,7,11 11 4
Iteration-5
1 1,7 1,5,7 1,7 5
5 1,5,7 5 5
7 1,7 1,5,7 1,7 5
Iteration-6
5 5 5 5 6
4.2.5. Digraph for circular economy barriers

Based on the level partitioning, a digraph for CE barriers was developed, as shown in
Figure 3. As barriers 2, 8, 9, and 10 were at level 1 in level partitioning, these are placed at
the top of the digraph. This depicts that these barriers have less influence on other barriers,
while these barriers are more affected by other barriers. The arrows in the digraph show the
type of relationship between different barriers.
26
2 8 9 10
3 4 6
12
11
1 7
Figure 3 Diagraph for CE barriers
4.2.6. ISM model for circular economy barriers

The digraph was again checked for transitivity. As there was no transitivity, the digraph
was converted into the final ISM model as shown in Figure 4.
27
High costs are Lack of standard systems
related to recycled for performance
Lack of adequate materials in supply Challenges of take- indicators in terms of
technology chain; therefore, they back from other measurement of circular
are often more companies economy in supply chain
expensive than virgin
materials
Higher upfront investment costs in Lack of an information exchange Lack of circular economy skills by
supply chain by implementing system between different employees in supply chain.
circular economy stakeholders
Lack of proper training and development programs for the

members of supply chain
Inadequate financial resources
Lack of customer/public awareness Lack of support/backing from public

institutions
Lack of environmental regulations and laws
Figure 4 ISM model for CE barriers
4.2.7. Classifying circular economy barriers – MICMAC analysis

The CE barriers were classified into four clusters based on their driving power and
dependence, as given in Table 13. The key findings of this classification, as shown in Figure
5, are as follows:
28
1) The barriers 2, 3, and 12 have weak driving power and dependence. Therefore, they fall
in the cluster of autonomous barriers. Autonomous barriers are comparatively detached
from the system.
2) The barriers 4, 6, 8, 9, and 10 have weak driving power but strong dependence.
Therefore, they are classified into the cluster of dependent variables. These barriers
require the removal of other driving barriers before their removal.
3) No barrier is classified as a linkage barrier. The barriers in this cluster have both strong
driving power and dependence. Therefore, barriers in this cluster are unstable.
4) The barriers 1, 5, 7, and 11 have strong driving power but less dependence. Therefore,
they are classified into the cluster of independent barriers. The barriers in this cluster are
key barriers, and their removal mitigates other barriers as well.
Table 13 CE barriers driving and dependence power

Barriers 1 2 3 4 5 6 7 8 9 10 11 12 Driving Rank
power
1 1 1 1 1 0 1 1 1 1 1 1 1 11 2
2 0 1 0 0 0 0 0 0 0 0 0 0 1 7
3 0 1 1 0 0 0 0 0 0 0 0 0 2 6
4 0 0 0 1 0 1 0 1 1 1 0 0 5 5
5 1 1 1 1 1 1 1 1 1 1 1 1 12 1
6 0 0 0 1 0 1 0 1 1 1 0 0 5 5
7 1 1 1 1 0 1 1 1 1 1 1 1 11 2
8 0 0 0 0 0 0 0 1 1 0 0 0 2 6
9 0 0 0 0 0 0 0 1 1 0 0 0 2 6
10 0 0 0 0 0 0 0 0 0 1 0 0 1 7
11 0 1 1 1 0 1 0 1 1 1 1 1 9 3
12 0 0 0 1 0 1 0 1 1 1 0 1 6 4
Dependence 3 6 5 7 1 7 3 9 9 8 4 5
Rank 7 4 5 3 8 3 7 1 1 2 6 5
29
Independent barriers Linkage barriers
12 5
11
1,7
10
9 11
8
Driving power
6 12
5 4,6
2 3 8,9
1 2 10
1 2 3 4 5 6 7 8 9 10 11 12
Dependence
Autonomous barriers Dependent barriers
Figure 5 MICMAC diagram for CE barriers
The MICMAC diagram shows that the barrier ‘lack of environmental regulations and
laws’ is driving the rest of the barriers to CE implementation in the building sector of
developing countries. Similarly, Mangla et al. (2018) identified barriers to CE in the supply
chain perspective and reported that the lack of environmental laws and regulations is among
the two major barriers driving other barriers. The barriers ‘lack of customer/public
awareness’ and ‘lack of support/backing from public institutions’ are identified as major
barriers after the ‘lack of environmental regulations and laws’. Interestingly, Sakr et al.
(2010) have also identified a lack of awareness as a major barrier that hinders the
30
sustainability of the construction sector in developing countries. Additionaly, Ormazabal et
al. (2018) identified barriers to CE for small and medium enterprises (SMEs) in the Spanish
context. They reported the lack of support from the public institutions as one of the main
barriers to CE. The MICMAC diagram shows that the fourth major influencing barrier is
‘inadequate financial resources’. Likewise, Xue et al. (2010), while studying the barriers to
CE in the Chinese context at municipal and country-level, have identified the lack of
awareness and lack of financial support as key impediments to CE. From this discussion, it is
evident that the results of this study are somehow aligned with the findings of previous
studies. However, it is important to mention that this research was undertaken in a new
perspective. Thus, the results cannot be completely compared with previously published work
which is mostly possible in terms of replication studies.
4.3. Circular economy barriers-indicators influence matrix
The experts who previously participated in the development of the interaction matrix for
CE barriers were asked to fill the influence matrix for CE barriers-indicators. The identified
12 CE barriers were kept in rows while 24 CE indicators were kept in columns, and experts
were asked to specify the number of CE indicators affected by each CE barrier. This matrix
consisted of 288 entries, which were to be filled by experts. There was a difference in the
opinion of experts. So, recognizing this difference, all entries of the matrix were filled based
on the maximum number of votes by experts for that particular entry. For the finalized
influence matrix, RII was calculated, and following the “80/20” Pareto rule, which states that
80 percent of results are affected by 20 percent of variables (Koch, 1997), most influencing
barriers of CE were identified. The barrier “lack of environmental regulations and laws”,
“lack of customer/public awareness” and “lack of support/backing from public institutions”
affect the maximum number of indicators. Therefore, following the “80/20” rule, it is
31
envisaged that the mitigation of these 20% key barriers can improve the overall
implementation level of CE.
4.4. Circular economy barriers mitigation framework
Based on the ISM model and CE barriers-indicators influence matrix, it was found that
the key barriers to CE were those shown in the dependent cluster of Figure 5 and the top 20%
barriers, as identified by the influence matrix. This means that these key barriers influence the
maximum number of barriers and indicators of CE. Thus, their mitigation will improve the
implementation level of CE in the building sector. To mitigate these key barriers, experts
from the building sector of developing countries were contacted to get proposals for
mitigation strategies. Based on the proposed strategies, the CE barriers-mitigation framework
for the building sector of developing countries is proposed. This framework was validated
through expert opinion. The CE barriers mitigation framework is shown in Figure 6.
32
Governments support
Amend environmental laws for building codes
Lack of environmental regulations Penalties for non-compliance and incentives for compliance
and laws Mitigation strategies
Tools to analyze the effectiveness of the CE rules and laws
Compliance with CE regulations
Formulate CE laws
Awareness through electronic media

Seminar and workshops for CE awareness
CE advantages to be highlighted for public awareness
Lack of customer/public awareness Mitigation strategies Incentives to those building sector organizations who
contribute for CE awareness
Public education on sustainable development
Advertiseent emphasizing need of CE
Key barriers to CE Funding for CE research

Subsidize technology for CE
Initiatives to improve public awareness
Governments should monitor CE implementation
Lack of support/backing from Governments support in tax and duty relaxation for green
public institutions Mitigation strategies products
Act as role model for CE implementation
Coordinating different CE initiatives
Support from local authorities
Public private partnerships
Platforms for CE Investment to be launched

Revenue through penalties for non-compliance
Inadequate financial resources Mitigation strategies Charity donations from public with logo “save our planet”
Governments should allocate sufficient budget
Promote financially sustainable projects
Figure 6 CE barriers mitigation framework
5. Conclusions, implications, limitations, and suggestions for future research
5.1. Conclusions
This study has assessed the current state of circular economy implementation in the
building sector of developing countries. Based on the 7 CE dimensions and 24 CE indicators,
a scale for CE assessment for the building sector was formulated. Responses from 16
developing countries were gathered to identify the current level of implementation of CE in
33
the building sector of developing countries. It has been found that the overall level of
implementation of CE in the building sector is 58%, which should ideally be closer to 100%.
Out of 7 CE dimensions, the energy dimension showed the best performance, whereas the
waste dimension has the worst performance. To improve the adoption of CE, serious steps are
required by all stakeholders of the building sector.
Furthermore, this study has bridged the literature gap by identification of key barriers to
CE from the perspective of the building sector of developing countries. Out of 25 barriers
identified from the literature, 12 barriers were shortlisted by building sector experts. ISM was
used to study the interaction among CE barriers. The MICMAC technique and CE barriers-
indicators influence matrix were used to identify key barriers to CE. The key barriers to CE
implementation as identified are ‘lack of environmental regulations and laws’, ‘lack of
customer/public awareness’, ‘lack of support/backing from public institutions’, and
‘inadequate financial resources’. These barriers are independent variables having high driving
power and less dependence. It is envisaged that CE adoption in the building sector of
developing countries can be improved by the mitigation of these barriers.
Finally, a CE barrier mitigation framework is proposed which provides the strategies to
overcome key barriers to CE implementation. This framework may serve as a reference for
policymakers to understand the challenges to CE implementation in the building sector of
developing countries and the possible mitigation strategies.
5.2. Implications for practice and research
Due to an increase in urbanization in developing countries, construction activity is
increasing (Zhang et al., 2015). Hence, there is great potential to implement CE in the
building sector (Brambilla et al., 2019). However, implementation of any phenomenon
requires a tool for its measurement (Nuñez-Cacho et al., 2018) so that performance can be
34
gauged and necessary actions can be taken by concerned stakeholders. In the case of the
building sector of developing countries, a CE assessment scale was missing. This research
has proposed a scale for CE assessment, which is an addition to the CE body of knowledge.
This scale can be used as a reference for further studies and modifications in the scale as per
local setting can be made in future research. Besides, a similar scale for CE assessment has
not been used previously. Thus, its limitations were not known. However, this study has used
the proposed scale for CE assessment and limitations have been discussed in detail using
which, future studies can be undertaken to overcome the limitations of this study.
A limited number of studies on barriers to CE implementation from the perspective of
the building sector were conducted previously. Moreover, a focused study on CE barriers for
the building sector of developing countries was missing. This study has not only identified
barriers to CE but also have mapped and structured the identified barriers. This provides an
exhaustive and richer view of impeding factors to the scholars and managers.
A unique approach has been adopted for the identification of the key barriers to CE
implementation in the building sector of developing countries. Key barriers identification was
based on the interaction among the CE barriers and the influence of CE barriers on CE
indicators. The proposed mitigation framework can be used as a reference.
5.3. Limitations and suggestions for future research
This work includes several limitations. Firstly, the indicators used for CE assessment
were shortlisted based on a single round of expert opinion. Preferably, several rounds for
shortlisting should have been conducted, which was not done in this study due to time and
resource constraints. Secondly, the inclusion of indicators into respective dimensions was
based upon the expert opinion only. This classification may be subjective to the expert’s
opinion. Moreover, due to the novelty of the CE paradigm, a consensus regarding the
35
dimensions of CE is lacked in the literature. Therefore, the dimensions used in this study
were extracted from the relevant studies. Nonetheless, there is a chance that the dimensions
used in this study may not completely describe all the aspects of CE. Thirdly, the assessment
of CE for the building sector is based upon the qualitative data collected from the
construction sector experts of different developing countries. Accordingly, the current state of
CE is assessed based on the mean for each indicator and dimension. Hence, results may
include outliers. For example, an indicator can show excellent results for some specific
country but due to poor results for the same indicator by the majority of the countries, the
mean for the indicators showed overall poor results. Furthermore, the assessment scale
collected qualitative data, and the results presented in the study were based on the collected
data. However, the actual state for CE may vary when assessed using the actual statistics
collected from different developing countries. Fourthly, the screening and mapping of the CE
barriers for this study were based upon expert opinions, which was prone to subjectivity.
Finally, the proposed framework is based upon the suggestions and recommendations from
the experts of the local building sector, as it was not possible to arrange interviews with
international experts. Also, the proposed mitigation strategies were based upon the consensus
of 5 experts only. Ideally, the number could have been more.
For future work, it is recommended to develop a CE assessment scale using multiple
rounds of expert opinion, and data may be collected using more robust methods. Moreover,
for better assessment of CE for the building sector, purely quantitative data can be collected
and used for analysis in future studies. Further, it is recommended to replicate this study in a
specific developing country for region-specific results as this study is generic for all surveyed
developing countries. Finally, studies can be undertaken to overcome the limitations as
specified in this research.
36
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Highlights
• The implementation of the circular economy in the building sector of developing
countries is analyzed.
• Major barriers to circular economy implementation in the building sector are
identified.
• ISM and MICMAC techniques are used to evaluate and classify the key barriers to the
circular economy
• A mitigation framework for barriers to the circular economy is proposed.
51
Credit Author Statement
Muhammad Bilal conceived the study and was responsible for data collection, analysis and
framework development along with drafting of the article. The study was supervised, reviewed
and approved by Khurram Iqbal Ahmad Khan. Muhammad Jamaluddin Thaheem reviewed and
provided guidance to the work. Abdur Rehman Nasir provided guidance to the work.
Declaration of interests
☒ The authors declare that they have no known competing financial interests or personal relationships
that could have appeared to influence the work reported in this paper.
☐The authors declare the following financial interests/personal relationships which may be considered
as potential competing interests:

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Current State and Barriers To The Circular Economy in The Building Sector

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Journal Pre-proof

Muhammad Bilal, Khurram Iqbal Ahmad Khan, Muhammad Jamaluddin Thaheem,

To appear in: Journal of Cleaner Production

Received Date: 24 November 2019

© 2020 Elsevier Ltd. All rights reserved.

Keywords: Circular economy; Building sector; Interpretive structural modeling; Current

Higher upfront Lack of an

Lack of proper training and development programs for

Inadequate financial resources

Lack of customer/public Lack of support/backing from

Lack of environmental regulations and laws

Figure 4-4 ISM model for CE barriers

Furthermore, interpretive structural modeling (ISM) and matrice d'Impacts croises-

for decision and policymakers.

Keywords: Circular economy; Building sector; Interpretive structural modeling; Current

Globally, the use of material resources is increasing with an increase in population

advantages of recycling waste materials, and associated by-products (Jacobsen, 2006).

repair, reuse, remanufacturing, refurbishing, and recycling”.

large amount of waste, unsustainable material, and energy consumption, resulting in a

Initiative, 2009). As the environmental impacts of building construction sector do not

to promote eco-efficient strategies to increase economic returns and decrease its

the building sector, in a way it has been adopted by other sectors.

of CE implementation in the building sector of developing countries. The research is unique

current state of CE and barriers impeding CE adoption in developing countries. An online

of developing countries. Furthermore, interpretive structural modeling (ISM), matrice

d'Impacts croises-multipication appliqué an classment (MICMAC) and influence matrix

barriers on CE indicators. It was followed by the development of a mitigation framework for

directions for future research.

2.1. Circular economy assessment

measure” is of great importance and is equally applicable in the case of CE assessment

(Nuñez-Cacho et al., 2018). An indicator system for CE assessment is essential for a

of 153 indicators at macro-level, 46 at meso-level, and 65 at micro-level. According to Geng

well-known scales to measures the performance of CE policies. CE can be implemented at

of this system is to provide credible and objective information to decision-makers on the

status of CE implementation. This system contained 22 indicators classified into 4 groups.

Accordingly, various studies have been conducted on the development of meso-level

CE performance of chemical industries. This system consisted of 18 indicators classified into

data and acquiring such data in a developing country is an uphill task.

Franklin-Johnson et al. (2016) proposed an indicator system based on longevity for CE

potentially misleading results, hiding complexity and reliance on context-specific

already established quantitative tools LCA and MFA (Pauliuk, 2018).

management indicators “3Rs”, “Efficient Management of Energy”, “Water” and

“Materials”; and two related to environmental impacts “Emissions” and “Wastes”.

A review of the existing literature highlights a lack of research specifically focusing on

2.2. Barriers to circular economy implementation

The barriers to CE in organizations' perspectives have been identified by Masi et al.

environmentally, as firms prefer to adopt those practices of CE which offer an economic

improvements in CE implementation can be made by giving incentives to firms. However,

firms should be penalized for noncompliance with regulations.

from public institutions” as one of the main barriers to CE.

Several studies have been conducted to identify barriers to CE implementation at the

debate among professionals of sustainable development. Therefore, to maintain the

momentum of the CE concept, a serious effort is required.

The challenges to CE in the industrial perspective were identified by Oghazi and

industry level for the building sector.

3.1. Methodology for circular economy assessment

as shown in Table 1 were shortlisted for further analysis.

Table 1 CE Indicators extracted from the literature