Abstract Digital ecosystems are essential for enabling circular economy practices. Yet, little is known about how they emerge in segmented markets where voluntary coordination repeatedly fails, and no single actor can impose standards. This study examines the formation of a digital ecosystem through an in-depth case of the Battery Pass consortium, which developed a digital product passport in response to the European Union’s New Batteries Regulation. Based on 14 interviews across 17 organisations and an inductive case study design, we show that market-driven coordination challenges alone did not trigger ecosystem formation. Instead, regulatory enforcement created a shared imperative, while the consortium acted as an institutional facilitator by translating regulatory ambiguity into actionable standards, aligning heterogeneous actors, and fostering trust and interoperability. We identify a third pathway of ecosystem emergence, i.e. policy-catalysed, consortium-orchestrated formation, that arises when regulatory mandates intersect with fragmented markets lacking a focal orchestrator. The findings extend ecosystem emergence theory and offer guidance for policymakers and industry stakeholders in designing regulatory and collaborative structures that support transparent, trustworthy, and interoperable data-sharing infrastructures.
Böttcher et al. (Tue,) studied this question.