Leveraging Closed-Loop Orientation to Enhance Digital Technology Impact on Circular Economy Practices: Evidence from Manufacturing Firms in Vietnam

Sustainable development is considered at the forefront of many countries around the world.The circular economy is seen as a precursor to achieving this objective.Therefore, research on the circular economy and its components is attracting the attention of scientists and businesses.However, to effectively develop activities in the circular economy, businesses need to develop self-contained strategies and apply digital technology achievements to these activities.This study analyzed the mediating role of closed-loop orientation on the relationship between digital technology and circular economy practices among 308 manufacturing firms in Vietnam using questionnaire data.Quantitative causal research and PLS-SEM analysis were applied.The results demonstrated that closed-loop orientation positively mediates the impact of digital technology on circular economy components like internal environmental management and eco-design.Closed-loop orientation also had a significant positive association with corporate asset management and recovery.The findings provide valuable insights into drivers of circular economy practices implementation in emerging economies.